Do you break out in a cold sweat when you it time to evaluate your finances and balance your budget? At that point in time, it seems like dyslexia is the order of the day and panic sets in. You don’t need to hire a professional to get your financial life in order especially if there are some delicate expenses you’re not willing to show. Putting together a detailed yet simple and understandable financial plan isn’t like building a rocket or spaceship and is pretty simple. You need a clear head and time to do this. Think of your financial plan as a DIY (Do It Yourself) project – like painting your room, changing your floorboard, making potpourri and so on. The only difference is that this DIY project has to do with your finances.
Here are some basic steps to help you in your personal finance project:
- Set a plan: This might be a long or short term plan but writing down a goal plan will give you a clearer idea of how you want to spend, save and invest your money in the coming days.
- Give yourself a reality check: In order for you to have a successful financial plan, you need to have a clear understanding of where you are right now with your finances. Doing that will help you plan better and make you avoid costly mistakes.
- Get rid of debt: or debts. You need a clear slate to make a successful financial plan. Getting rid of previous financial baggage helps a lot and if you can’t do that, make a sustainable plan on how to clear off your debts while working towards your goals.
- Protect yourself: Putting aside money for a rainy day or what we call a plan C for your plan B will help you manage certain unforeseen circumstances such as job loss, economic recession and much more. Have an emergency fund that will last you till things get better during the down times of your life.
- Start planning. If you’re still confused as to how to go about it, seek the help of a professional.
Have a lovely day ahead.