So… what is a financial plan anyway?
This might be one of those questions where you feel like you should know the answer, but you also feel a little silly for not actually knowing the answer, so you never ask.
I know I was afraid to ask when first started in the industry. It seems like it should be obvious right? It’s, um, a plan… for your finances…. whatever that means. Whatever it is, it sounds important, and grown up, and slightly boring (usually comes with the territory of things sounding important and grown up, too).
So, what is it?
In the most basic terms, a full, comprehensive financial plan looks at all aspects of your financial life and gives you a guide for what you need to do next – what to change, what to add, how to move forward, what to prioritize.
It takes into account your income, spending, debt, savings, investments, insurance, estate planning (the legal stuff) and gives you a path for how to reach your goals.
Still sounds important, grown up, and boring, right?
Here’s the secret – it totally is! Planning is ALWAYS the boring part, but it’s also always the important part. That’s why it feels hard, that’s why it’s hard to be objective about it, and that’s why it helps to have someone there to help you.
But once you finish planning and start actually implementing it, there’s no better feeling in the world than knowing exactly what you have to do next, what you need to take care of now, and what you can wait to think about later.
This is what freedom feels like.
All of January on Bondfire Radio, we are going into serious detail about the guts that go into making a financial plan. It’s definitely a pen and paper kind of month because we’ll be going over tons of info.
Changing your money habits takes time. Real time. Time to have set backs and bounce back from them. Time to let new ideas sink in. Time to experiment and see what sticks.
Time to be an important, boring, grown up, so you finally have time to feel free.
Please feel free to share it with someone who you know is ready to tackle their finances and wants some guidance and support. It’s going to be one awesome year!