A Myth-Buster on Financial Planning

Imagine days where you won’t have to second guess on your future. Imagine being able to enjoy more of life because you were able to optimize your earning potential. Imagine of not having to worry so much about bills because you already got it covered. Well, you may want to stop imagining and act on that “imagination” right now.

Financial planning is one aspect which a number of people – mostly from the middle-class, lack. One sees it as a thing for the rich because, let’s face it, your hard-earned money is just about enough to cover your bills and daily necessities. There is barely anything left that needs planning.

There are firms that give an effective financial planning in San Diego and you will see that you do not need to be rich enough to be able avail yourself of financial planners to properly manage your hard-earned money. If you want to take control with your finances, you have to start to act now. But before you dive in, you must first be able get a grasp on the concept of what is financial planning, how does is work, and how will it help you get the most of your money and with your life.

The concept of financial planning revolves more on budgeting, retirement planning, saving, insurances and being able to minimize if not get out of your debts.

If you are not that equipped with the know-how of financial planning, you can seek advice from experts, but first, below are some points in evaluating on how you can plan your finances:

  • Evaluate your cash flow and establish a budget

The basic contemplation you must do when you want to be more in control of your finances is to   know how much is your earning capacity along with the things you spend your money on. With that, you can start to segregate the essential and non-essential expenses.

Then, you start listing down the expenses ranking them from most to least essential. From that list, you create a budget or a spending plan which should dictate what you should do with your money from a certain period.

You should try to create a detailed and​ ​written budget because this will also allow you to make smarter decisions with your finances. A budget will then require you to stop and think first whenever your impulsiveness in buying something new arises. This will make you realize certain areas which can actually help you save more from your money.

With this tool, you can see that you really do have excess money that you can use it to save for retirement, build up your emergency fund, pay down debt or apply to other financial goals.

The simplest method in creating a budget is by writing it down on paper, or you may use a spreadsheet or budgeting apps whichever is more convenient for you. If this is going to be your first time, try to test out different approaches each month so you can know which one best fits your needs and style.

  • Reduce Expenses and Pay off Debts

Now that you have established a budget, reducing unnecessary expenses should be easier. You must be able to sacrifice a few luxuries that you know you can still be able to avail of sometime in the future where your financial status has improved. With the extra money, you can start paying off your debts, especially those which are of big amounts and interests. This way, not only will this improve your credit scores, you will also be facing lesser burdens in the future.

  • Save. Save. Save.

Now that your money is being fairly allocated, you can now start stashing your cash and start thinking of investments and of course consider of planning your own retirement. Not all companies offer the best pensions plans, and you do not want to live by just relying on your Social Security pension fund.

You can start small with your investments, with this, you can evaluate which one works well for you – be it on stocks, foreign currency trade, insurances, and retirement plans. You have to consider how you want to live your life as you age. And being able to save up early will be very helpful, because when things will get tough, you know you are prepared enough, not just emotionally but also financially because you were already able to put up funds for the rainy days.

Building your financial status, especially if you are just starting out is not going to be easy. There will even come a time where you will ask yourself why you are restraining yourself to enjoy and live your life “now”.
You must not wither, you must be able to vividly paint that bright future not just for yourself but for your family as well. There are even books which offer financial literacy, inspiration for financial growth, and life coaches which is going to be of a big help as you build your own path.

So when you think that financial planning in San Diego is just for the rich and not for you because you are too busy catching up with life, then no, you will never have that financial breakthrough that you keep on praying for. You must change your mindset when you think about financial planning because, truth is, financial planning in San Diego are not all costly. You just have the will to start, and be diligent enough in finding the right tools for you. You can hire a good financial planner at a reasonable price, or you can choose to do it yourself. Waiting for your life to settle down before starting to think about financial planning will not be of help either, because before you know it, your hair had already turned gray and you may not even be halfway of settling your life down. So better do it now.

There will always be risks that come along with changes. But how will you be able to change your life if you do not want to take that first step. Right? Get that breakthrough that you have long been waiting for.