How to write a financial plan

If you are willing to achieve any kind of goal in your life, please, keep in mind that money rules the world. Today it’s not enough to know how to earn your living, or even how to save money, it’s essential to make your funds work. The big news is that this rule applies not to billionaires only, but to anyone who has gained a single dollar in his or her life. Key to success is a financial plan, which is a real means to make your earnings work in a way to make your best dream come true.

Note! It’s the financial plan that would make your dream come true!

Let’s get inside the idea of what a financial plan is. It really sounds so professional that you may think it can only be understood by high-level financials. In reality it’s absolutely not! In fact, it is a most creative and fascinating process. It may even become your hobby or a professional occupation, who knows!

Right now we are going to learn how to form a financial plan together, in just a few steps, and you will see it’s quite an easy matter if you know how to perform exactly.

1. Accumulate your assets

Make sure you are aware of all your current assets. Everything that comes in, e.g. rental or shareholder income, salary, donations, gratuity, gifts. All this comes in and forms your debit, as accountants say. This is your mighty side and you can base your calculation on it. Write down the figures.

2. Create a thorough plan

What would your life be in the next 10 years? In the next 20 years? You should know it for sure. If you don’t have a goal to move to, you are moving nowhere. Not only your personal needs should be included into the plan, but also the needs of your children, relatives and friends and, who knows! you may want to become a great philanthroper one day! Of course, nobody can be sure of his or her future, because everything doesn’t depend on ourselves. But anyway, if we are not thinking of the future, it will never become, isn’t it?

3. Set your goals

Almost everyone has a goal, but we do not always understand how to achieve it. Sometimes we wait for a happy occasion ignoring the fact that we can create this occasion by ourselves. The simple answer is finances, which often serves as a magic wand. Make the money work in accordance with your goals. Decide how much you would spend in accordance to your needs in the future and write down these figures. Set the time limit. When exactly are you going to enjoy the benefits of your successful financial plan in action. 

Note! The difference between your gains in the present and your spendings in the future makes the essence of your financial plan.

4. Safety comes first

On the way to achieving our goals, it is wise to consider whether we are safe enough.  Do we have enough resources to cover our everyday needs? Have we foreseen all troubles that may come in the future, all misfortunes, all needs of our family? It’s essential at this point to learn how to make a financial cushion. It doesn’t require a large amount of investment. But it’s good to have a certain sum for an emergency deposit, just in case that anything unexpected happens and you won’t be able to act as usual for a certain period of time.

5. Enjoy the results

Now you have successfully reached your goals. Do you need to stop and drop it out completely? It’s up to you to decide. Analyze your gains and losses. Think of your initial hopes and intentions. Did you get what you wanted? If yes, it’s time to set another prosperous goal. If not, maybe, it’s time to look back and hold on for a while, happy with up-to-date results, or willing to reach new heights. Now you are armed with knowledge and experience, so everything is in your hands!

Share
Copy link
Link copied
RELATED ARTICLES
5 min
10 mistakes that take away your money
3 min
How to change your attitude to money
5 min
When is the best time to buy stocks?
5 min
How to start online trading in India
4 min
How to choose the best online broker
5 min
Similarities and differences between crypto and stock trading