Financial Planning Tips To Get You On The Right Track

3 Oct

Financial Planning image - Dollar SignThe following ideas are intended to give you ideas to begin your financial planning journey. When you make the decision to make financial planning part of your daily routine, it will not appear so tough. Starting your financial journey could be the hardest thing. These suggestions will certainly assist encourage you to make financial planning one of your primary objectives.

Financial Planning Tip # 1 Repay Debt

One of the most significant aspects battling against financial planning is personal debt, particularly credit card personal debt. If something begins as a little personal debt it could develop into a larger debt due to the fact that you were not reducing the debt regularly!

Financial planning implies you have a plan and paying personal debt must be the very first objective of your plan.
The main benefit of reducing and repaying your debts is that you then have more money to invest for your future. In addition, your living costs become lower because you no longer have debt repayments to make.

Financial Planning Tip # 2 Start Investing

An important principal is to start investing. Financial planning implies that you are saving and planning  for the future, so you will certainly wish to take cash you make today and buy investments for the long term.  Areas you can invest into include the stock exchange, in bonds, IRAs, 4019k) or a blend of all of the above. Saving your cash with the aid of financial management and good discipline will certainly help your nest egg to grow.

Financial Planning Tip #3 – Have Goals

In my experience, the number 1 reason people don’t save is because they have no goals for the future. Without goals, there is nothing to motivate you to defer spending today in exchange for a greater benefit in the future.

Take some time to set out some concrete goals – things that are important for you. It could be a holiday, new car, maybe even a career change!

Financial Planning Tip # 4 Spend Less Than You Earn!

This is easy to understand but not as easy to put into practice! This is due to the fact that many people prefer to buy new things and want the latest and greatest TV, Phone etc without thinking about the long term consequences.

Regardless, you can’t get ahead financially if you’re spending more than you earn. It doesn’t make sense, does it!

I’ve met some people who spend more than they earn, and fund this by increasing personal debt. This isn’t sustainable and will only end in a bad way. Which brings me on to my next tip…

Financial Planning Tip # 5 Know where Your Money Goes

Budgeting is another financial concept that many people struggle with. You will not have the ability to save unless you’re aware of where your money is going and you are in a position to influence your spending.

You must make a record of all the money that comes into, and out of your household. This may be difficult to do initially, but once you start it, it gets easier over time. It’s not until you know where your money is going that you can begin to take steps to re-prioritise your spending so that an adequate amount of money is being saved for your future.

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