The main reason most people fail to achieve lifetime financial security is lack of organisation.
Building a plan is simple, first develop a financial profile for yourself then use strategies that meet your needs. It basically a three-step process:
1. Now – What do you have?
2. Future – What do you want? Where do you want to be financially?
3. Intermediate – How are you going to reach your goals?
The last two steps will vary significantly depending on the first step more specifically your age and financial situation. A young single person has very different goals and priorities then a middle aged parent or someone about to retire.
Stages of your life can be categorised by decade
- Twenties – begin a career and maybe a family
- Thirties – raising children and advancing career
- Forties – paying for children’s education, earning more
- Fifties – reach career and earning plateau, start thinking seriously and planning for retirement
- Sixties – start retiring and start thinking about estate planning
- Seventies – retired
Of course everybody’s case is a little different. There are a few other important factors to look at:
- How much do you earn?
- What are your financial responsibilities?
- How much risk can you tolerate?
Most people in their early twenties do not earn a six figure income, but neither do they have to worry about paying a mortgage or a car loan.
After checking where you are now the next step is to ask yourself were do you want to be. Seek the advice of a Financial Planning Advisor, they have experience with dealing and advising in these situations and may help you formalize your plan and lay down some mile stones to help you reach your ultimate financial security.
- Boyd Scott