Financial planning for a better life

Watching all these magical formulae at work in Hollywood life, we sometimes think how nice it will be if we also can wave a piece of wood and money or gold will appear to ease us of all the financial threats we face? How about a genie who will come out when the lamp is rubbed and bring you whatever you want, whenever!

Managing your finances

Well, we live in the real life where none of that is happening anytime soon. That sort of says that we have to manage our own finances, balance the earnings and costs and save some for the future. it actually does not take a genie to give you that knowledge; and even though a genie is there to gibe you whatever you want at whatever the time, it will never be enough. So managing your finances, what you have to remember is what your limits are. Going for gold when you can be satisfied with silver, so to speak, is a way to waste money. In addition, going for unrealistic things that you do not in fact need, is a sure way to increase your debts and get you more stuck-up.

How to go about it?

First, list down your earnings. Is it only the day job you do? Do you have a part time work? Rented out premises, vehicles and so on? How far are you aware of your expenses? After clearing out these, write down your goals for financials; building or buying a house, exchanging the vehicle to a better one, taking a month long trip etc. These expenses will give you an idea of how much to save and how well to do it. Once all the goals are jotted down, make sure you list them down in an order. Perhaps use a timeline to mention it so that you will get an idea of how much you need and when.

Tips on setting goals

If you are already in debt, make getting out of debt one of the major goals. If you are already indebted to organisations such as banks or persons, more goals will make you borrow more and there won’t be an end to it. Separate long term goals and short term goals; building or buying a house like ones are long term goals. So is getting out of debt. Short term goals are setting up a new budget for household expenses, paying down or stopping using credit cards etc. When you borrow debts like payday loans, make sure they are repaid as soon as possible.

A proper financial plan is undeniably important to help one reach their goals in life. The plan must include several milestones and ultimately show the pathway to a successful lifestyle.