We’re often told that plans are important, to ensure we get what we want from life and such. Break it down into five years might be something a career advisor told you once when you were leaving college but they are important – particularly in terms of finance.
Like we saw with the housing crisis, things can change in an instant and you need to be flexible with the change. India has broken down its economics into five year plans since 1951 and simple maths tells us we are now on number 12, and in the majority of these they have come close to growth targets. If this is a possibility for a whole country then it must be achievable for us all? You don’t want to be living paycheck to paycheck forever. Here’s how to do it.
Goals
Just like anything in life, to achieve something big you need both targets and achievable goals. Think about how you would like your life to be in one, three and five years and outline them. This should include: intellectual, occupational, lifestyle, residential or retirement goals so that you cover everything.
Financial records
Keeping up-to-date with any tax returns, loan payments, contacts, investment plans, benefits and so forth will mean that you can fully assess your situation. A failure to do this can mean an unexpected expense at any time which nobody needs to be going through.
Preliminary budget
Without saying “stop that morning Starbucks”, this is where you can identify habits and determine what you can do to make this cheaper. Put expenses next to income and see what you should be spending in order to give yourself the best chance of bringing home more than what’s going out.
Projected income
It is, of course, important not to read too much into things like this but as time changes you would expect your income to – for the better, hopefully. With this in mind forecast anything from investment to inheritance to a home business to your career and see how you expect things to grow.
Commit
Once you have devised what you think is a doable plan, given it a timeframe and understood your strategy it is time to start. Be focused, be willing to reframe the plan when needed and be sure to give it all you have. Give yourself a head start by selling things online with services like musicMagpie.com and remember that without a personal financial plan, the health of your finances is at the discretion of both consumerism and the economy.
Often times, going back to school to earn a university degree is part of this commitment to your financial well-being. The more education you have, the easier it is to make money. Start by requesting more information from various universities about the programs that they have to offer. That way, you can be certain that your new education matches your financial goals. Online schools are an option if you do not have the time to return to school in the traditional sense, as they allow you to complete your assignments from home.
