Back-to-Basics Financial Plan

Start your month off right with these tips on a back to basics financial plan

Financial planning plays an important part in helping you achieve your life goals by organizing your finances, so you stress less about money. It isn’t always easy. The best laid plans don’t always work out the way we want. But planning will put you on the right track and keep you on it, even when there are some bumps in the road. Here are some back-to-basics financial plan tips.

What Should I Plan for?

Step one for your back to basics financial plan is determining what you want to save for, like your wedding.

Your life will be filled with big dreams and lofty goals. But unless you luck into a huge inheritance or win the lottery, the only way to ensure you obtain those life experiences is by planning for them. Everyone’s goals are different, but here are some that you might want to consider:

  • Marrying your love
  • Buying a car
  • Buying a home
  • Having children (we recommend you take a look at our piece specifically dedicated to how to financial plan for a new baby!)
  • Paying off your student loans and other debt
  • Traveling around the world
  • Retiring in comfort
  • Helping your kids go to college
  • Ensuring your family is taken care of when you die
  • Passing your assets on to your loved ones

How Do I Make a Financial Plan?

back-to-basics financial planning tip: find out how much your a spending to determine how much you will save.

A good financial plan assesses your finances, breaks down what you’ll need to do to meet your goals, and helps you determine how long it will take to meet those goals comfortably. Here are some steps you should consider:

  • Find out what you are spending your money on

You need to get a sense for your monthly cash flow. An accurate picture of your income and expenses is key to creating a financial plan.

  • Determine how much money you need for emergencies

Your financial plan must include putting cash away for emergency expenses. You can start small and build on the amount you save.

  • Figure out a way to pay down your debt

This is a critical step in any financial plan. You want to zero out high-interest debt, like credit card balances or student loans. Interest rates on these may be so high that you could end up paying three times what you borrowed.

  • Determine how much money to put toward your retirement

Retirement is the ultimate goal for many people. Start saving early if you want to live comfortably in your golden years!

  • Determine how much to save for big goals

If you want to buy a house, for example, you’ll need to have a plan for the down payment, mortgage and other costs. Any large goal like this requires changes to the way you are allocating your money.

  • Seek advice on savings and investment options  

Investing can help you reach your goals faster. Get help with opening a portfolio that suits your needs.

  • Determine ways to protect your assets, your family and any future needs

Insurance, insurance, insurance. Research policies like life insurance to protect your financial stability now and in the future.

  • Create an estate plan

Make sure you ensure the wishes for your family and assets are carried out after your death.

Will My Financial Plan Change?

A good thing to remember for any financial plan, whether basic or complex, is that things can change. You should try not to avoid the change so much as try to plan for it in mind.

Yes! A financial plan isn’t set in stone. It should evolve your as life evolves. You can create and adjust a financial plan on your own or seek help from a professional financial planner. Financial planners will help you get your finances organized, figure out a path to obtaining your goals, and assist you with any adjustments to your plan over time.

It’s easy to let your future road map fall the to wayside. Things happen, life changes rapidly and all of this may take your focus away. When that happens, it’s good to go back to the beginning – try out some of these tips for back-to-basics financial plan.

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