Courtney Myers Blog | Five Steps to a Solid Personal Finance Plan | Talkmarkets

Five Steps to a Solid Personal Finance Plan

Date: Tuesday, August 28, 2018 8:06 PM EDT

Whether you’re setting out to implement a new diet, take up a new hobby or start a new career, there are some goals that you can only reach once you develop a detailed and regimented plan. Think about it. You didn’t get to where you are today by simply making on-a-whim decisions all of the time. Rather, you likely had a long-term goal in mind, then put into action specific steps that allowed you to ultimately reach it.

The same method should hold true in how you approach your personal financial planning. While you can make off-the-cuff decisions when you’re young, chances are these will come back to affect you later in life, and you might not like the aftermath. To set yourself down a successful road and ensure that your golden retirement years really are golden, it’s important to strategize now. Unsure how to get started? Here are five steps to take to polish your personal finance plan and stick with it.

1. Write down your major goals.

For a moment, close your eyes and envision your perfect life when you’re retired. Are you on a boat, docked just outside of your vacation home? Are you in the backyard playing with your grandchildren? Are you still working a part-time hobby job that allows you to be creative?

Regardless of the scenario your imagination paints, the reality is that to achieve those goals, you need to understand them first. Put simply, why do you want to be smart with your money? Is it so you have plenty left over when you stop working? Do you want to acquire assets you can eventually pass down to your heirs? Do you want to travel the world? Send your children to college?

Any answer is correct, so long as it’s coming from the heart. Start your personal finance plan by writing down a comprehensive statement that covers your major investing goals.

2. Determine your risk level.

You’ve heard it said that while you’re young, it’s smart to take on a higher level of risk with your investments. The logic behind this reasoning is that you’ll have enough time to recover any short-term losses you incur if the market temporarily downswings. However, if you’re closer to retirement age, it’s in your best interest to take a risk-averse approach to investing, as you might not have enough time to bounce back in the event of an upset.

1 2 3
View single page >> |
Disclaimer: This and other personal blog posts are not reviewed, monitored or endorsed by TalkMarkets. The content is solely the view of the author and TalkMarkets is not responsible for the content of this post in any way. Our curated content which is handpicked by our editorial team may be viewed here.


Leave a comment to automatically be entered into our contest to win a free Echo Show.

Following (5)

Followers (1)

Stocks I follow

General Stats

Article Comments

Received: 2
Created: 0