Some people don’t think they need a financial plan.
Some people don’t think they make enough money for a financial plan.
Some people think that it’s ok to go to Walmart without pants on.
Some people are wrong.
Whether you plan on living as a grizzly man in the woods or as a high rollin’, hob nobber in the city, a financial plan will not only set you apart from the pants-less, but will set you on a path to actually realizing your goals.
The good news is that financial freedom is easy… well, at least it’s easier than you think. Chances are that if you haven’t yet begun mastering your your finances, it’s because you’re scared poop-less. Or worse, you think you’ve got everything under control, but you don’t.
Either way, we’ve selected a great list of articles to help you start and/or hone in your financial plan.
“Begin with the end in mind.” Steven Covey, 7 Habits of Highly Effective People
Teach yourself how to tell the difference between wishing wishes and setting goals. It may surprise you just how important SMART goals are to the whole financial domination process. Make one of these goals for everything and anything that is important to you.
- Debt Destruction
- Emergency Fund (4-6 months of expenses is a MUST)
Dreamers, stop here.
Doers, you keep right on going.
If a financial plan is the map to your goals, you’d better know where you’re starting. Take the time to fill out a net worth statement, you might even be closer than you think.
A well maintained budget will bring your from your starting point to the finish line in the fastest time possible.
- Here’s our free, simple budget printable to help get you started. And remember these basic rules while you’re filling it out:
- Crush debt first. Crush it.
- Keep 4-6 months of expenses in a emergency fund to be used only for, duh, emergencies.
- Save at least 10-20% of your income towards your retirement.
- When you do buy a home, make sure your mortgage payment is <25% of your monthly income (don’t forget to save for a 20% down payment too).
- After you’ve been at it a while, fine tune your budget so it sings like Eric Clapton.
You’ll find that we like to save money around here. We are just bananas about saving money.
Start by getting back to basics. Sometimes we can all use a common sense reminder.
Cook at home. You’ll find you can save the most in the areas where you spend the most – like food.
Sweat the small stuff because little purchases are where things can escalate quickly.
See that little “Saving” tab at the top? We’ve got just oodles of ideas for where you can save a buck or two, roll up your sleeves and check ’em out!
If your money isn’t growing then it might actually be shrinking due to factors like inflation.
Not to mention that when you put your money to work for you through smart investments, you have to work less hard for your money. Who doesn’t want to work less hard?
Now, if you have no idea whatsoever how, what or where to invest, don’t sweat it. All you need to do is contact a Registered Investment Adviser and they can help you match your goals and needs with some appropriate investments. Chances are that you already have one of these guys available to you for free through your banking institution (like USAA) or through your company’s retirement program.
Bone up on a few of the basics before you make the call, they’ll love it when you talk dividend reinvestment to them:
- Compounding Explained in a Not Boring Way
- How to Accumulate a Million Bucks
- How the Stock Market Works
Once you have your big boat, or your state-of-the-art camera, or your authentic Neil Diamond jumpsuit (we aren’t here to judge), what are you going to do if it sinks, or falls off the counter, or has grape juice spill on it?
Protecting the things you’ve worked so hard for is crucial. And protection comes in many forms: property insurance, life insurance, tax planning (to make sure you keep more of what you’ve earned), estate planning, etc.
A great place to start making sure your covered is making a detailed household inventory. Include pictures, measurements and original costs if you have them available. This can be quite tedious, but it’s worth it. It will also be very helpful when you’re filling out your statement of net worth (*cough* scroll up).
You don’t have to do this all alone, we are always here to help. We just hope this list helps you get started kicking financial butt. Be sure to check-in or subscribe so you may continue to sharpen your mad money skills.
Lauren & Alex