Financial planning today provides major benefits tomorrow, and for the remainder of your life.
Regardless of your current income level or personal situation, learn why you must be committed to the following personal finance strategies in order to secure your financial success.
Planning now for your financial future is, quite simply, a smart thing to do. The tools and process detailed here will pave the way for anyone who is serious about conquering their debt and taking control over their financial existence.
Financial planning is how you get from point A to point B, as well as points C, D and E. Depending on where you are financially today, you no doubt have multiple goals that you wish to accomplish. “Hoping” for your luck to finally change, or “waiting” for your ship to come in, is NOT a financial plan – it’s simply a dream.
Most people get into a set routine with their finances. The longer you allow yourself to continue down the same financial road without a clear map in hand, the more you lessen your chances of realizing your financial goals.
Let’s face it, most people are not known for their patience or their planning skills, and even less people are admired for their ability to save money. No one should be surprised to learn this given how the mass media is constantly teaching people in our society to “buy it now- pay later!”
To ensure financial success, people must break away from this destructive, and weak, mind-set.
Do not make the common mistake that financial planning is only for the wealthy, or that you must already have a good sized nest egg before meeting with a financial advisor. Nothing could be farther from the truth.
However, you don’t need to pay out your hard earned money for a professional. The most effective financial planning occurs in the home at the dining room table or home office.
Common tools include the household checkbook, a pen, calculator and a piece of paper with a line down the middle. One column is titled, “Cash Coming In”, and the other column reads “Cash Going Out”.
The main goal to keep in mind is that you want to spend every dollar of your monthly income ON PAPER, before you actually spend it. This way you will plan your expenditures for the month, knowing you have set aside adequate money to cover all the fixed expenses. In addition, you will have thoughtfully allocated the remaining funds to the areas of your life that are most important to you.
Examples of important financial goals might include:
Buying a new car Saving for a down payment on a house Future college saving Dream family vacation Purchase of investment property Planning for retirement years Regardless of what your financial goals are, your chances of realizing those goals are highly dependant upon your decision to plan ahead and your willingness to take action – right here and right now.
There is a great tool available to anyone who is not comfortable with sitting down and creating a household budget on their own. This important tool is called a Personal Financial Statement.
If you’ve ever applied for a loan or credit card, you have filled out the majority of what is found on a personal financial statement. Starting immediately, you can begin using the same process that a lender uses to account for all monies coming in and going out.
Once you have completed filling out a personal financial statement, you will have all the information you need to take the financial planning process to the level – that is, creating a budget that works!
“Budgeting” gets a bum wrap. No one likes to hear the word “budget”; however, it is the process of budgeting (aka. financial planning) that will ultimately set you free and secure your financial future. Too often, people make the mistake of assuming “only broke people have to budget”. The reality is that most rich folks are rich because they budget.
The decisions you’ve made up until now are the reason you are where you are today. The decisions you make today going forward will shape your destiny. The only real question is, “Where are you going?”. Decide well.
By: Richard Gorham
Posts Tagged ‘Hard Earned Money’
How to Begin Planning Your Financial Future
February 4th, 2010A Career in Financial Planning
December 26th, 2009
Personal financial advisors are often referred to as financial planners or financial consultants. They provide individual clients with information and advice on their personal investments. Some further specialize in areas such as college planning, estate planning, and retirement planning. Personal financial advisors work to reach the long term and short-term financial goals of their clients.
What They Do:
Personal financial advisors sit down with their clients to discuss their needs, current financial situation and their expectations for their financial advisor. They will create a plan and discuss the investment ideas with their client to come up with the right plan of action for them. They tend to meet with their clients on a yearly basis – sometimes more often – to recommend investment opportunities of change the course of their financial plan.
Training:
Would you trust your hard earned money to someone with out a college degree? Financial planners should have at least a bachelor’s degree in a major area such as economics, accounting, law, or business. In you studies you will probably take courses in estate planning, tax law, and risk management. A love of mathematics and finance is necessary for financial planners. To work as a successful financial planner, you will need to have top-notch computer skills, analytical and problem solving skills, as well as good people skills. A good understanding of the economy, money markets, and tax laws are almost a prerequisite for employment in this field. Being able to forecast trends in the market and economic changes will give you client the best possible results.
Outlook:
Personal financial advisors work in industries such as finance and insurance. This can include working for commodity brokers, investment firms and banks. Personal financial advisors with many years of experience make from $52,000 to over $100,000 annually.
About forty percent of all personal financial advisors are self-employed.
By: Mary Hart