Important To Everyone
Addressing financial planning correctly goes a long way in achieving success. The financial planning journey is constant.
You create a plan and take the necessary action to implement it. You constantly look for holes in your plan and you plug them as quickly as is possible.
You are accountable for every bit of the success of your money plan as well as every failure. Success is a never ending journey and not a destination.
You stop working your plan and you will find that your progress will cease, you begin to go backwards.
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Beginning The Journey
Sit down and take some time to evaluate what kind of financial situation you are in at the present time. Ask yourself these questions and write down the answers. Remember that financial planning is about your future and of more importance the future of your family so take the time to really think about the answers.
- What are my financial assets? Enumerate them.
- What are my liabilities? How much money do you owe? Include loan balances, taxes etc. What financial commitments do you have?
Once you have a fairly accurate picture of where you stand you now need to decide where you want to be financially 5 years down the line, 10 years hence and 20 years from now. We are talking about financial planning here so you should try to be realistic. Don’t make your initial goals too big, but don’t make them too small either. It has been cleverly put this way. “Goals should be within your reach but outside of your grasp.”
The following are just examples of how some people plan for the future…financial planning; your desires may include a lot more than mentioned below.
- Decide how much money you would like to have in the bank in 5 years, 10 years and so on.
- Decide how much income you want to be earning down the line.
- Decide what kind of house you would like to share with your family. Decide how soon you would like to have it.
- If you have children, decide how much you need to put aside for college education.
- Decide when you would like to retire and how much income you will need.
- Now prioritize your goals.
I bet you thought that was rough, well, you ain’t seen rough yet. Now you have to decide how these goals are going to be achieved.
- Decide on an investment plan. Research it thoroughly. Think of 401(k) plans, mutual funds, buying stocks and so on.
- What about real estate? Is this a good thing to invest in? Where would you invest? Would this be in income producing properties. Do you prefer to buy and repair inexpensive properties and then sell them at a profit.
- Are you an expert in some area where you could start a business and make it profitable? Consider that and go at it with all the enthusiasm you can muster.
Make planning an annual habit. Constantly evaluate and reevaluate your progress. Make changes and adjustments where necessary.
Consider these things and anything else that you may think of and then take action. People who succeed know before hand whether or not they will achieve their goals. Don’t approach this exercise with a wish, rather have a sound financial plan. If in doubt call in an expert. You can find them…Here: Financial Planning Association
Remember that your goals are for yourself and your family, you therefore may need some life insurance which will guarantee that if you should die while working toward your dreams they will be OK financially. It doesn’t matter how comprehensive your financial planning if you don’t consider the possibility of untimely death. Think about estate taxes and how it can devastate your estate. It is recommended that you start off with term insurance