How Much Cash Should Your Business Have on Hand?

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Business revenue and available cash are not the same thing. Your company may have strong sales and still struggle to cover payroll, rent, or an urgent repair. A dedicated cash reserve can help your business continue meeting essential obligations when money comes in later than expected or an unplanned expense arises.

How Much Should You Keep in Reserve?

A common starting point is enough cash to cover three to six months of essential operating expenses. That range is a guideline, not a universal rule. The right amount depends on your business model, revenue patterns, payment cycles, staffing, and fixed costs.

A business with reliable monthly revenue and quick customer payments may need a different reserve than a seasonal company that regularly waits 60 or 90 days for invoices to be paid. Your goal should reflect how money moves through your business, not an arbitrary number.

Which Expenses Should Your Reserve Cover?

Start by identifying the costs your business must pay to keep operating. These may include:

  • Employee payroll and benefits
  • Rent or mortgage payments
  • Utilities, insurance, and required licenses
  • Essential inventory, supplies, and vendor payments
  • Required loan or business credit card payments
  • Software, technology, and professional services
  • Equipment maintenance and repair
  • The business owner’s regular compensation

Separate essential expenses from costs you could pause or reduce. That distinction gives you a more realistic estimate of the minimum your business needs each month.

How to Calculate a Starting Goal

  1. Review a Full Year of Expenses

Look at the previous 12 months to capture costs that do not occur every month, such as annual insurance premiums, licensing fees, tax payments, or seasonal inventory purchases.

  1. Calculate Average Essential Monthly Costs

Add your essential operating expenses for the year and divide the total by 12. For example, if essential expenses total $240,000, your average monthly operating cost is $20,000.

  1. Select a Coverage Target

Multiply that monthly amount by the number of months you want the reserve to cover. Using the example above, a three month reserve would be $60,000 and a six month reserve would be $120,000.

Factors That May Change Your Target

Revenue Consistency: Seasonal sales, project-based work or large month-to-month changes can create longer gaps between income and expenses. Reviewing prior cash flow patterns can help you prepare for slower periods.

Customer Payment Timing: If customers routinely pay on longer terms, your reserve may need to cover several weeks of operating costs while invoices remain outstanding. Track how long it actually takes to collect payments, not just the terms shown on your invoices.

Payroll and Fixed Overhead: Businesses with employees, leased space, or other significant fixed costs may use cash more quickly than businesses with flexible overhead. You’ll also want to include any owner compensation so the estimate reflects the true cost of operating the company.

Essential Equipment and Concentrated Revenue: Consider what it would cost to repair equipment your business cannot operate without. You may also need a larger cushion if one customer provides a significant portion of your revenue.

Practical Ways to Build Your Reserve

  • Create a specific reserve goal and include contributions in your monthly budget.
  • Transfer a set dollar amount or percentage of revenue on a consistent schedule.
  • Send invoices promptly and follow up on overdue balances.
  • Review recurring expenses and redirect unnecessary costs into savings.
  • Keep reserve funds separate from the account used for everyday purchases.
  • Set guidelines for when the reserve can be used and how it will be replenished.

Review as Your Business Changes

Revisit your reserve goal when you hire employees, add equipment, or experience changes in customer payment timing. A reserve that worked two years ago, may not reflect today’s operating costs.

A separate deposit account can make your reserve easier to track while keeping the funds accessible. If your business is local to Monmouth or Ocean Counties, learn more about First Financial Business Savings Accounts, call 732-312-1500 to speak with a member of our team, or visit a local branch.

*A First Financial membership is available to anyone who lives, works, worships, volunteers or attends school in Monmouth or Ocean Counties. A $5 deposit in a base savings account is required for credit union membership prior to opening any other account. Other terms & conditions may apply, see credit union for details.

Article Sources: Capital One | PNC

Where Will Your Retirement Money Come From?

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What workers anticipate in terms of retirement income sources may differ considerably from what retirees actually experience. For many people, retirement income may come from a variety of sources. Here’s a quick review of the six main sources:

Social Security

Social Security is the government-administered retirement income program. Workers become eligible after paying Social Security taxes for 10 years. Benefits are based on each worker’s 35 highest earning years. If there are fewer than 35 years of earnings, non-earning years are averaged in as zero. For 2026, the average monthly benefit is estimated at $2,071.1,2

Personal Savings and Investments

Personal savings and investments outside of retirement plans can provide income during retirement. Retirees often prefer to go for investments that offer monthly guaranteed income over potential returns.

Individual Retirement Account

Traditional IRAs have been around since 1974. Contributions you make to a traditional IRA may be fully or partially deductible, depending on your individual circumstances. In most circumstances, once you reach age 73, you must begin taking required minimum distributions from a Traditional Individual Retirement Account (IRA). Withdrawals from Traditional IRAs are taxed as ordinary income, and if taken before age 59½ – may be subject to a 10% federal income tax penalty. You may continue to contribute to a Traditional IRA past age 70½ as long as you meet the earned-income requirement.

Roth IRAs were created in 1997. Roth IRA contributions cannot be made by taxpayers with high incomes. To qualify for the tax-free and penalty-free withdrawal of earnings, Roth IRA distributions must meet a five-year holding requirement and occur after age 59½. Tax-free and penalty-free withdrawals also can be taken under certain other circumstances, including as a result of the owner’s death. The original Roth IRA owner is not required to take minimum annual withdrawals.

Defined Contribution Plans

Many workers are eligible to participate in a defined-contribution plan such as a 401(k), 403(b), or 457 plan. Eligible workers can set aside a portion of their pre-tax income into an account, which then accumulates, tax-deferred.

In most circumstances, you must begin taking required minimum distributions from your 401(k) or other defined contribution plan in the year you turn 73. Withdrawals from your 401(k) or other defined contribution plans are taxed as ordinary income, and if taken before age 59½, may be subject to a 10% federal income tax penalty.

Defined Benefit Plans

Defined benefit plans are “traditional” pensions, or employer–sponsored plans under which benefits rather than contributions, are defined. Benefits are normally based on factors such as salary history and duration of employment. The number of traditional pension plans has dropped dramatically during the past 30 years.3

Continued Employment

In a recent survey, 73% of workers stated that they planned to keep working in retirement. In contrast, only 25% of retirees reported that continued employment was a major or minor source of retirement income.4

Expected vs. Actual Sources of Income in Retirement

What workers anticipate in terms of retirement income sources may differ considerably from what retirees actually experience.

Questions about this topic or interested in setting up a time to talk? Contact First Financial’s Investment & Retirement Center by calling 732.312.1534.  You can also email maureen.mcgreevy@lpl.com

Securities and advisory services are offered through LPL Financial (LPL), a registered investment advisor and broker/dealer (member FINRA/SIPC). Insurance products are offered through LPL or its licensed affiliates. First Financial Federal Credit Union (FFFCU) and First Financial Investment & Retirement Center are not registered as a broker/dealer or investment advisor. Registered representatives of LPL offer products and services using First Financial Investment & Retirement Center, and may also be employees of FFFCU. These products and services are being offered through LPL or its affiliates, which are separate entities from and not affiliates of FFFCU or First Financial Investment & Retirement Center.

Securities and insurance offered through LPL or its affiliates are:

  1. & 2. SSA.gov, 2025
  2. Investopedia.com, December August 16, 2025
  3. EBRI.org, 2024

The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG, LLC, is not affiliated with the named broker-dealer, state or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security. Copyright FMG Suite.

Five Lessons for Your Teen’s First Job

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A teenager’s first job gives them a chance to take on responsibility, learn time management skills, and collaborate with new people. It’s also a chance to discover important lessons in personal finance, such as how to manage money and develop financial goals. These lessons build the skills and habits that will shape teens’ financial futures for years to come – and early exposure can help them avoid financial pitfalls. Here are five lessons you can teach your teen when they get their first paycheck.

Understanding Gross vs. Take Home Pay

Your teenager might be surprised when the amount of their first paycheck is less than expected. Let’s say your teen is earning $15 per hour and working 15 hours per week. Mental math might have told them they would earn $225 a week and $900 a month – though is the amount before deductions are taken out (their gross pay).

This is a great opportunity to explain the difference between gross pay and take home, or net pay. Without realizing it, your teen might know that gross pay is the hours they worked multiplied by their hourly wage. Their net pay will be less due to deductions such as federal and state income taxes, and Social Security and Medicare (FICA). The difference between your teen’s gross and net pay might be noticeable enough to give them a reality check – this is the money they really have left to spend. If your teen has their pay stub, you can help them understand each deduction.

Understanding the difference between gross and net pay is important, because their net pay will shape their spending decisions.

Setting Financial Goals

Encouraging your teenager to set financial goals will lay the foundation for lifelong success. Start by helping your teen come up with financial goals that are achievable and personal. Maybe your teen wants to buy tickets to their favorite artist’s concert or buy a gaming console. You can also help them determine if their goals are short, medium, or long-term, depending on the money and time needed. You can also assist them in calculating how much money they should save each month to reach their goal. If your teen’s goal is to save $1,000 to buy a laptop in a year – they would need to save about $84 per month. This will motivate them to make consistent progress toward their goal, since it will give them a realistic number to achieve on a monthly basis.

The Importance of Paying Yourself First

Another way to get your teen in the habit of consistently saving is by encouraging them to “pay themselves first,” and set aside a portion of their income for the future. You can explain that they might not need the funds now, but they’ll be thankful they have them on a “rainy day.” You can illustrate this point with an example. Let’s say your teen saves $20 a month – they’ll have $240 saved in one year that they may have otherwise spent. You can take it one step further by explaining that if someone needed this $240 for an emergency car repair and didn’t have it – they might need to use a credit card instead and potentially pay interest if that balance isn’t paid off right away.

Distinguishing Between Needs and Wants

When a teen is earning their own money, it’s a great time to give a hands-on lesson about distinguishing between needs and wants. Learning the difference will help them build discipline and make wise spending choices. At this stage, your teen might be deciding if items like video games, the newest Stanley tumbler, or the latest sneakers are needs or wants. But one day, they will be asking if an expensive handbag or new car is a need – and if making the purchase would prevent them from reaching more important goals, or falling deeper into debt.

Learn How to Budget

Now that your teen knows where their money comes from, you can help them understand how to manage it with a budget. An effective way to teach budgeting is by using your teen’s monthly income and spending as an example. You can begin with an easy budgeting method, like the 50/30/20 method – where 50% of their income goes to needs, 30% goes to wants, and 20% goes to saving. Let’s return to the example of the teen who makes roughly $900 a month, and assume they take home around $700 after deductions.

They should:

  • Spend $350 per month on needs (gas or car payment).
  • Spend $210 per month on wants like activities with friends or video games.
  • Save $140 for financial goals.

This example might not be exact, but should illustrate how your teen can use a budget as a guide. This will help your teen see where their money is going and build an awareness of their spending habits.

First Financial is dedicated to helping your family build strong financial foundations. If your teen recently got their first job and is local to Monmouth or Ocean Counties, you may be interested in getting them started with a First Financial Student Checking Account. By helping to manage their own account with your guidance, they can understand how banking works and the different tools and resources available to them to build smart money habits for their financial future.

A $5 deposit in a base savings account is required for credit union membership prior to opening any other account. All personal memberships are part of the Rewards First program and a $5 per month non-participation fee is charged to the base savings account for memberships not meeting the minimum requirements of the program. View full Rewards First program details.

Don’t Get Scammed by Fake Airline Customer Service

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A canceled flight or last-minute schedule change can leave you scrambling for help. Scammers know travelers are stressed and looking for a fast solution, so they have been known to create fake airline customer service numbers that appear in online searches, advertisements and deceptive websites.

The person who answers may sound professional, use the airline’s name and ask for details that seem connected to your reservation. Before you share personal information or make a payment, take a moment to confirm that you have reached the airline through an official channel.

How the Scam Works

The scam often begins when a traveler searches online for an airline’s phone number after a delay, cancellation or booking problem. A fraudulent number may appear near the top of the results, including in a sponsored listing. The traveler calls and reaches someone pretending to represent the airline.

The scammer may ask for your booking confirmation, credit or debit card number, passport details or other personal information. They might claim you need to pay a fee immediately to rebook your flight, protect your seat or receive a refund. Some scammers also direct travelers to a fake website or ask them to download software that gives the scammer remote access to a phone or computer.

Watch for These Warning Signs

  • The representative may pressure you to pay immediately or tells you that your reservation will be lost if you don’t.
  • You are asked to pay by gift card, wire transfer, cryptocurrency or a peer-to-peer payment app.
  • The caller requests your online banking password, PIN or one-time security code.
  • You are told to download an app or remote-access software, so the representative can “help.”
  • The person cannot confirm basic reservation details, but continues asking you for sensitive information.
  • The website address is misspelled, contains extra words or does not match the airline’s official domain.

A legitimate airline may need information to confirm your reservation and may charge a valid fare difference or service fee. The key is to verify that you are communicating with the airline before sharing information or approving a payment.

How to Contact an Airline Safely

Use the Airline’s Official App or Website: Open the airline’s mobile app or type its known website address directly into your browser. Avoid clicking a search advertisement simply because it appears first.

Check Your Travel Documents: Your confirmation email, boarding pass or original booking receipt will typically include verified contact details. Be cautious with messages that arrive unexpectedly and direct you to a new phone number or link.

Ask for Help at the Airport: When you are already at the airport, visit the airline’s customer service desk or ask a uniformed employee where to get assistance.

Be Careful on Social Media: Scammers also create fake airline profiles and contact travelers who post publicly about delays or cancellations. Do not move the conversation to a private message or share reservation details until you verify the account through the airline’s official website.

What to Do if You Shared Information

End the conversation and contact the airline through a verified channel. If you provided financial information or approved a suspicious payment, act quickly.

  1. Contact your financial institution or card issuer and explain what happened.
  2. Lock or turn off the affected card and review recent transactions.
  3. Change compromised passwords from a trusted device and enable multifactor authentication.
  4. Report unauthorized activity and keep copies of related messages, receipts and call details.
  5. Consider a fraud alert or credit freeze if you exposed sensitive information.

First Financial members can use First Financial Wallet to lock eligible First Financial cards, set transaction controls, and dispute transactions.* You can also review our fraud prevention guide and additional identity theft information in our online resources, or visit the Important Alerts & Scams section of our First Scoop blog to stay up to date on the latest scams.

If you notice suspicious activity involving a First Financial account, call 732-312-1500 or visit your local branch. A few minutes spent verifying contact information can help keep a frustrating travel problem from becoming a financial one.

*Data rates may apply. Check with your mobile phone carrier for details. First Financial Wallet is available through the First Financial Mobile App and Online Banking.

Article Sources: Consumer Affairs | Federal Trade Commission 

How to Save on Maintenance and Repairs as a Homeowner

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Owning a home brings many rewarding moments, but it also involves a steady commitment. From regular seasonal maintenance to unexpected repairs, homeowners can benefit from having a thoughtful plan to keep their property in great condition without overburdening their budget.

The great news is that with a bit of planning, you can make home maintenance much easier. When you know what to expect, save a little money regularly, and stay on top of small problems – it becomes much more manageable.

1. Build home maintenance into your budget

A common rule of thumb is to set aside about 1% of your home’s value each year for maintenance and repairs. For example, if your home is valued at $350,000, that means plan to save around $3,500 annually, or about $292 per month.

That number won’t be perfect for every homeowner, but it provides a helpful starting point. Actual costs will depend on your home’s age, size, location, and condition. Older homes may often need more repairs, and coastal or harsh-weather areas may need extra exterior maintenance.

Instead of waiting for something to break, treat home maintenance like any other regular expense. Consider opening a dedicated savings account for home repairs so the money is there when you need it. A First Financial Special Savings Account is designed for exactly this kind of goal-based saving, separate from your everyday spending.*

2. Focus on preventive maintenance first

Preventive maintenance helps you avoid more expensive repairs later. Small tasks such as cleaning gutters, replacing air filters, checking for leaks, and trimming branches away from your roof protect your home’s major systems.

A simple seasonal checklist can help you stay on track:

  • Spring: Check your roof, gutters, siding, windows, outdoor faucets, and air conditioning system.
  • Summer: Inspect decks, patios, landscaping, sprinkler systems, and exterior paint or sealant.
  • Fall: Clean gutters, service your heating system, test smoke detectors, and seal gaps around doors or windows.
  • Winter: Watch for frozen pipes, check insulation, monitor your roof after storms, and keep walkways clear.

You do not have to tackle everything at once. Start with the areas that protect your home from water, weather, and safety issues first.

3. Know which repairs need attention right away

Not every repair is urgent, but some issues should not wait. Water leaks, electrical problems, roof damage, plumbing issues, and heating or cooling failures often become more expensive if ignored.

When deciding what to fix first, ask yourself:

  • Could this create a safety issue?
  • Could this lead to water damage or mold?
  • Could waiting make the repair more expensive?
  • Could this affect the value or livability of my home?

If the answer is yes, prioritize that repair. Cosmetic updates, such as new paint, upgraded fixtures, or decorative landscaping, can usually wait until your budget allows.

4. Get multiple estimates for larger projects

For major repairs or improvements, get more than one estimate before you move forward. Comparing quotes helps you understand the fair price range, evaluate materials and avoid rushing into a costly decision.

When reviewing estimates, consider more than just the total price. Ask what’s included, if permits are needed, the duration of work, and if labor or materials are guaranteed. A lower estimate might not save money if it omits key details.

Check reviews, ask for references and confirm that the contractor is licensed and insured when required. A little research upfront can help you avoid bigger headaches later.

5. Learn which repairs you can handle yourself

Some home maintenance tasks are simple enough for many homeowners to manage on their own. You can often replace air filters, tighten hardware, seal small gaps and change smoke detector batteries without hiring a professional.

However, DIY has limits. Electrical work, major plumbing, roofing, structural repairs, and HVAC issues usually need trained professionals. Attempting to save money on unmanageable repairs can cause safety risks or costlier damage later.

A good approach is to handle simple maintenance yourself and call a professional when the repair involves safety, permits, or specialized equipment.

6. Plan ahead for big ticket replacements

Every home has major systems and appliances that will eventually require replacement, such as your roof, water heater, HVAC system, washer, dryer, refrigerator, and windows – all of which have a limited useful lifespan.

Start with a list of your home’s major systems and their ages, then research replacement costs to estimate upcoming expenses.

If your water heater is near the end of its life or your roof shows wear, start saving now. Planning ahead offers more control and helps you avoid high-interest credit in emergencies.

7. Use financing carefully when savings are not enough

Even with a solid savings plan, some repairs are too large or urgent to cover out of pocket. In those cases, review your financing options carefully before you make a decision.

Review the total borrowing cost, including the monthly payment, interest rate, repayment period, and whether your home secures the loan. Compare these financing options with your savings, emergency fund, and overall household budget.

For planned renovations or larger home projects, a First Financial Home Improvement Loan may be worth considering, with terms up to 10 years and no pre-payment penalties.**

8. Keep an emergency fund for surprise repairs

Your home maintenance fund can cover expected costs, but a separate emergency fund for surprises like a broken furnace, burst pipe, or storm damage, which can occur at the worst moment.

Even a small goal, such as $500 – can make a difference. From there, you can continue to build over time. Setting up automatic transfers can help you stay consistent, even if you start with a modest amount each paycheck.

Take care of your home and your financial peace of mind

Home maintenance isn’t always exciting, but it protects your big investment. Budgeting for repairs and seasonal upkeep helps you make informed decisions, reducing stress and costly surprises.

Start small. Create a maintenance checklist, set up dedicated savings and review upcoming repairs before they become emergencies. A proactive plan helps keep your home safe, comfortable and ready for the years ahead.

*A First Financial membership is available to anyone who lives, works, worships, volunteers or attends school in Monmouth or Ocean Counties.  A $5 deposit in a base savings account is required for credit union membership prior to opening any other account. All personal memberships are part of the Rewards First program and a $5 per month non-participation fee is charged to the base savings account for memberships not meeting the minimum requirements of the program. View full Rewards First program details. Some restrictions apply, contact the Credit Union for more information.

**Available on primary residence only. A First Financial membership is required to obtain a Home Improvement Loan and is open to anyone who lives, works, worships, volunteers, or attends school in Monmouth of Ocean Counties. See credit union for details. Rate will vary based off of applicant’s credit rating. Not all applicants who apply will be approved, subject to underwriting guidelines and credit approval. Lien position and appraisal valuation may affect the maximum loan amount. Not all applicants will qualify for maximum Loan to Value (LTV) ratio. It will be based off of creditworthiness, property type, occupancy, lien position, and loan amount. Rates will be affected by LTV or combined LTV if there is another lien on the property. Loan amounts over $7,500.00 will be required to give First Financial FCU a security interest in their property. Rates will vary based off of lien position and whether the loan is mortgage secured or unsecured. For mortgage secured Home Improvement Loans, First Financial FCU will waive closing costs at inception of loan. If loan is terminated within the first 2 years of opening, closing cost waiver is revoked and are required to be paid back by member to FFFCU.

Affordable Summer Activities Kids Will Love

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Summer is the perfect time for kids to get outdoors and make memories, but coming up with new, exciting activities to keep them busy all season long can be a challenge – or quickly become costly. Luckily, making memories doesn’t have to come with a hefty price tag. With a little creativity, you can turn ordinary things into activities that kids (and your wallet) will love. Here are some affordable activities to keep the kids in your life busy this summer.

Camping in the Backyard

Who said you have to pack up a car and leave home to go camping? If you have a backyard, you can turn it into a campsite with just a few items!

What you’ll need:

  • A tent
  • Sleeping bags or blankets
  • Pillows
  • Flashlights or lanterns

Get the whole family involved in setting up the tent so it feels like a real camping trip. For an added bonus, also grab the ingredients to make s’mores so you can sit around a campfire telling stories with a gooey, chocolatey treat.

Stargazing

Stargazing is a great activity because it’s educational and free. Just head outside after sunset and look up to the night sky! You can print star charts or download a free stargazing app to help you identify stars, constellations, and planets too. You can also leave the star charts and phone inside if you just want to see what you can find with your own eyes. This can be especially fun if you have younger kiddos – who will probably be thrilled at the chance to stay up past their bedtime and gaze up at the starry sky.

Photo Scavenger Hunt

This activity is a great way to keep kids entertained, especially if they are usually reluctant to spend time away from electronic devices. Using a smartphone or other electronic device, this photo scavenger hunt will challenge kids to find and take pictures of items on a predetermined checklist before time runs out.

Here’s how to organize a photo scavenger hunt for your family:

  1. Decide if you’d like the scavenger hunt to take place indoors, outdoors, or a mix of both. This will determine the types of items you’ll include on the scavenger hunt.
  2. Create the list of items participants will set out to find. If your scavenger hunt will send kids into the great outdoors, a few ideas include searching and photographing signs, footprints, animal prints, an American flag, and a lawn mower.
  3. Decide if they’ll set out on their own or in teams – or even as a family.
  4. Give each person or team their list of scavenger hunt items to photograph and a pen. Make sure every person or team has at least one device to take pictures.
  5. Set a time limit for when each person or team should be back. Remind them that they must take pictures of each item on the list. Before they set off, make sure to share how the winner will be determined. For example, the winning team can either be the first team back or the team with the most items checked off their list.
  6. Off you go!

The best part of this activity is that it can be anything you would like it to be! Whether you’re searching for something to fill a 30-minute break or looking for an all-day activity – this photo scavenger hunt can be customized to your liking.  

Family Olympics

Does your family enjoy a little friendly competition? Host your own Family Olympics. Whether you want to compete for a sought-after prize or simply for “bragging rights” – this activity is sure to get your family active and engaged. Decide on activities that your family will compete in, such as athletic, skill-based, silly, or a mix of all three – and let the games begin!

Here are a few ideas to include in your Family Olympics:

  • Two-legged races
  • Potato sack races
  • Throwing water balloons at targets
  • Obstacle course

Don’t forget the winning prizes, either! You can either purchase some medals online, or fill jars with gold, silver and bronze wrapped candy. No matter what your budget is, there are plenty of ways to be creative with the winnings.

Check out our First Scoop blog for more family tips and financial resources like these. You can also find our monthly Things to Do on a Budget in Monmouth & Ocean Counties posts – packed with family and budget-friendly activities for the month ahead. Be sure to comment and let us know if you try any of these affordable summer activities with your children!