written by AJ Balois No one could have really prepared for the disaster that was 2020. The pandemic has given people time to rethink and refocus, asking themselves the hard questions. Among them is how financially capable they are to withstand a crisis and their ability to thrive way beyond its duration.
Creating a solid financial strategy that works for your income, lifestyle, and overall habits will ensure that your growth is at a steady incline for years to come. How exactly do you go about the process? The right questions to ask before creating a tailor-made financial growth strategy The first step in creating a plan that works for your financial priorities starts with asking the right questions. How do you sort out your financial goals at this stage in your life? Ask yourself the following and arrive at a thesis statement worth clinging to on your road to realizing your earning and investing potential.
Your recent purchases would likely reflect on your credit card statement. What about those products or services you bought using cash, checks or, perhaps, a debit card? Will you have the proof of purchase with you? Tracking your overall cash flow requires you to keep a meticulous record of money that comes in and out of your personal accounts. Knowing what you earn and how you spend it will teach you how to save money in such a way that will allow you to live comfortably. Many applications and software will give you the ability to recalibrate financial goals at any point. Having some basic knowledge of Microsoft Excel or any similar open software will also enable you to maintain a worksheet of all your active and inactive cash transactions. The most important thing to remember to make it work lies in your discipline to keep it updated and correct at all times. 1. Do you have debts to pay? Your financial power lies in knowing how to control your spending. Buying things or services with money you do not have yet is a sure way to drown in debt, and many people do not realize this. Check for any credit card debt, loans, and other arrears to ensure that interests are kept at a minimum. The key to having a balanced approach is not accumulating debt and always paying on time. This way, you won't have to slave away for years paying off loans, and you will get to save up for both short- and long-term goals. 2. Are your current lifestyle choices aligned with your actual income? Living within your means takes on a different sense when you are bombarded with content especially engineered to internalize the "add-to-cart" mindset. You probably will be subjected to the pressure of buying an air fryer, for example, because you saw your friend frying dumplings with it on socials. The question you have to ask yourself every time you think you WANT something is: Do I NEED this? More often than not, the answer is unequivocal and resounding: "No, I do not." Of course, you should always strike a balance between enjoyment and pragmatism, allowing yourself to experience the world a little better, even the finer things, on some days—but only when you could truly afford them. Living large with a small income is a surefire way to kill your chances of making it big. Be wise and save for the future, too. 3. What are my short-term, intermediate, and long-term financial goals? We generally start with the end in mind. That's always a good thing to keep one going. But we often forget to space out goals and tasks into chunks, and we feel discouraged with the tiniest mishaps. Therefore, as not to get overwhelmed, you must be able to identify your financial goals first:
2. Do you have insurance and, if you do, is it enough to cover your needs? We all know that accidents and disasters could strike at any time. Are you prepared to spend for any health, property, or other asset casualties that may impair your potential for financial growth? Having dependents could make it even more challenging. If you are head of the family, a parent, or legal guardian, you know that creating a budget plan is one of the biggest headaches of living in the modern world. Most insurance firms will have life insurance calculators. Before you purchase one, you may try their sample calculations and then inquire from any of their trusted representatives. Your goals are within reach Growth begins when we start asking the right questions. Creating a plan without knowing the whole situation never ends well. That is why, before you can truly sanitize your spending habits, you first answer the hard, financials-related questions that will open your eyes to the truth about your cash flow. Once you have mastered the holes that need plugging or things you could do without, you will realize that you have more control over your finances than you previously thought. What you needed all along was a real reason to start discovering your dream of long-term financial independence.
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