TomorrowMakers ™

Financial planning for dummies: a 7 step guide

11 September 2015
Regardless of your age, gender, income or location- you need to financially plan for retirement. To take the complexity out of the process, we’re giving you a 7 step guide to a secure future.
 
 

Your education in financial planning begins with your first piggy bank. Every time your relatives give you a little something, you gingerly put it away for a rainy day.

When you’re all grown up and earning a regular income, the need to save is never more pronounced. But a piggy bank just doesn’t make the cut.

So how do you start planning for your financial future? Here are the 7 steps you need to follow:

1. Start now

Ask anyone; it’s never too early to start planning your finances.If you start saving now and continue for 10 years, you will have more money at 65 than someone who starts 10 years later and invests for 30 years! That's the power of compounding.

2. Save

Usually, your saving is the money that remains after your monthly expenditure is deducted from your income. Instead, your monthly expenditure should be the amount left over after you’ve put aside your monthly savings. It’s a little tweak, but it makes all the difference.

Related:10 hacks to save money in day to day life

3. Make a budget

A budget is a necessity and can also be a lot of fun to make. Talk to your friends and family, monitor your expenses using phone apps or a notepad, and challenge yourself to find creative ways to stick to your budget no matter what!

make-a-budget.jpg

4. Control debt

Once you start earning and banks become more willing to lend you money- in the form of loans or credit cards- it’s easy to feel like you have more money to spend than you actually do. While borrowing is not a bad thing, it’s important to keep it in check so you don’t have to sacrifice your investments to pay off your debt.

5. Buy insurance

Be it accidental, health, car or life insurance, this is a layer of protection nobody can do without. Buying insurance is a great way to begin financial planning, as it secures the very future you are planning for.  Insurers these days offer a variety of customized plans for all sorts of customers, so do you research and start paying for protection!

insurance-planning.jpg

6. Ask an advisor

It’s important you do research before you make anything official. Whether you hire a financial advisor to help you in the initial stages, or ask for help from a friend who’s good with money, or even just Google your way to enlightenment, make sure you clarify all doubts and ask all the questions!

7. Make a will

Making a will is the best thing you can do for the future of your loved ones. It ensures that they don’t have to struggle to use the money you wanted to leave them. Plan and write a will detailing your financial investments and assets as well as whomsoever you want it to benefit at the end of your financial lifecycle.

make-a-will.jpg

Financial planning ensures you can cut the cake and eat it too. Save money now, be prepared for life’s uncertainties,avoid cash crunches and at the same, reach all your goals- financial or otherwise. Now that’s a sweet thought!

 
Market Quotes by TradingView

Quotes of The Day

POLL

 

MOST VIEWED CONTENT

5 situations where you should never use a credit card

5 situations where you should never use a credit card

While credit cards come with a host of benefits, they must be used carefully, and never in these situations!

7th Pay Commission: What you must know about it?

7th Pay Commission: What you must know about it?

The 7th Pay Commission is on the verge of being finalised. Here’s what you should know about it.

Understanding your savings account

Understanding your savings account

You savings account is more than just a place to park your money. Here’s what you should know about it.

Investor's guide to managing money [eBook]

Investor's guide to managing money [eBook]

Money management is something that is very unfamiliar to the majority of us. Download the eBook to know more.

What do to do if you find yourself with fake cash

What do to do if you find yourself with fake cash

What if you end up with a fake currency note either from an ATM or during a cash transaction? Well we tell you how you can handle the situation.

10 hacks that can save money in day to day life

10 hacks that can save money in day to day life

One of the major costs all families incur is excursions-movies, vacations, eating out, theme parks, etc.

Life stages and Investment [Infographic]

Life stages and Investment [Infographic]

Your income, priorities and spending habits change depending on which life stage you’re in. These changes can be better navigated if your investments change with you.

boy

We would love to hear from you!

Question, comment or concern? Our contact form is the best way to get in touch. We will respond to you within 5 working days.

NEWSLETTER