How Should I Create A Personalized Financial Plan?

Have you set some financial goals that you want to achieve?

Have you made a budget for your monthly and quarterly expenditure?

Do you have an emergency fund?

Do you have some way of managing your debt?

Do you have a good insurance plan?

It’s always good to have a clear idea of why you’re saving your hard-earned money. You should always set goals that you want to achieve in a short term or a long term and why do you want to achieve that goal as it the reason will act as a pushing power to achieve your goal.

Consider this your monthly cash flow and savings/investing plan. Give yourself permission to decide where and how to send your money with. The budget will help you deciding how much money is set aside for fun, saving and daily expenses etc. This will also let you know how much money you will save on a monthly basis and you can refine the budget on a monthly basis if possible.

All the planning in the world won’t help if life throws you an unexpected situation and you’re not prepared financially. That’s where an emergency fund comes in handy. Keep a certain amount of your monthly income aside in-case of an emergency and after a few months, it will be a substantial amount.

Understanding and managing debt is a key part of creating a financial plan. This will also help in allowing you to manage the amount you want to set aside for your monthly payments from your budget. This will also allow you to actively decrease your debt, in small payments it may be, letting you feel accomplished.

Life can change in an instant. People with a good financial plan hope for the best, but plan for the unexpected. Insurance helps with that. This is another type of emergency fund that is kept aside for some specific occasions so that during that scenario, you don't have to go about looking for money.

The financial plan is also another way to plan for your retirement. Even if it’s a long way off, think about what you want your money to do for you when you retire, and create a plan to make it happen as this might allow you an early retirement.