Many people have heard of earn a dollar and save fifty cents. Then it became more of a joke to hearearn a dollar and save a quarter. Nowadays you do not hear much about saving, it is all about spending, even if you do not it to spend. Financial planning has always been a smart decision, however, in today’s economy it is almost a matter of survival.
When some people think of financial planning, they think of wealthy people. The truth is, everyone can benefit from a little plan. Financial planning does not take a college degree or the services of a financial professional. All it really takes is a little common sense and a frugal lifestyle. This article is going to give examples of how financial planning makes a difference.
*Budget. This is probably one of the hardest things to make and stick with. To put everything down on paper is the easy part. Everything looks good on paper, the trick is making it really work. When you actually follow your budget, you see exactly where your hard earned money is going and where you might be able to cut some corners to save some money.
*Savings account. Open a savings account and feed it every time you get paid. If you can only add five dollars, then add five dollars. A savings account is a very wise thing to have and maintain. You never know when an emergency will come up, therefore it is best to be prepared.
*Plan ahead. College, retirement, maintenance and death are all things that can and do happen. It is wise to plan for the future by setting up funds for these things. Many parents, for example, begin a college fund for their kid(s) before the child can even walk. Plan for retirement before it happens. Many young people do not bother thinking about what can happen when they are aged and cannot work anymore. Many companies do not offer retirement benefits, therefore, you need to plan for it yourself.
With these three things in place, you are on your way to a solid financial plan. Be smart, do not leave anything to chance. Do not assume your company will take care of you when you retire, do not foolishly assume you will never end up in the hospital. Life happens and it helps to be as prepared as possible when it does.
The true difference financial planning makes is peace of mind for you and your family.