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Financial planning means having a plan

Financial planning means having a plan

Are you planning ahead for your finances? 

I just read an article that promoted “Money Advice for Your 30s,” and it got me wondering, “Why would anyone need to wait until they’re 30 to do these things?” Things like getting life insurance, paying off debt, and saving for retirement or homeownership are good advice at any age!

Don’t get me wrong, it was a great article and I’d recommend it to anyone who’s looking for a few quick money tips. It just got me thinking, “Why are we teaching people there’s a ‘right time’ to start planning for their financial future?” The right time is always now, no matter your age!

Financial planning evolves, but it has to start sometime

When some people hear the term “financial planning,” they think it means meeting with a stock broker, a financial advisor, or a trip to the bank, but of itself, it’s none of those things.

Anytime you sit down and make goals about your money, you’re doing financial planning. If you’ve never have, now is the time to start! All you need to do is sit down with a pen, paper, a general understanding of your current finances, and ideas!

Taking the first step with your finances

I think there are two big obstacles that prevent people from making a financial plan, and they’re both mental: 1) The myth that you need help from “a professional” to start the process, and 2) inertia.

Study after study has shown that big life decisions (like which retirement plan to choose, or even what salad dressing to buy!) leave us paralyzed when presented with too many options. Maybe that’s why people tend to want an expert to tell them what to do with their finances. So, I think most of us need some “training wheels” to get things rolling.

Being SMART with your finances

The acronym “SMART” started in management theory, but has been incorporated into a number of disciplines; it’s a useful tool to get you thinking in bite-sized chunks. The letters stand for:


Under these criteria, saving $500 a week is a great starting goal. Saving $2,000 might work for some high earners, but for many, it would fail the “achievable” standard. Saving $50,000 a year (20% of a $250,000 salary) would be another good place to start, but it probably doesn’t meet the “timely” requirement. Setting a weekly or monthly goal that is achievable for you is an excellent way to get started with a financial plan.

Remember, not all plans are going to be the same and not every plan is going to work for every person. The most important thing is to have one that works for you.