How to Make a Financial Plan

financial planning
June 29th, 2023 0 Comments

Growing your wealth over the course of a lifetime begins with a smart financial plan. However, financial planning is not a one-size-fits-all process. There are a few initial steps that can help anyone plant the seeds for long-term financial success.  

An exceptional wealth management and financial planning service provider like Saddock Wealth can help create a tailored financial plan based on your unique situation and ambitions. Our financial experts prioritize creating a financial plan that will maximize your earnings over time.  

In the meantime, however, you can get started on financial planning by following these initial guidelines. These steps will help set the stage for strategic budgeting and savings in the future.  

Set Your Financial Goals 

Your financial goals will likely change throughout your lifetime. However, creating a list of your short-term and long-term financial goals is helpful.  

Short-term goals can include items like: 

  • paying off debt. 
  • saving for a down payment on a home. 
  • starting an investment account. 

 On the other hand, long-term goals may include an early retirement with a hefty nest egg. Consider what ambitions you’d like to accomplish in 5 years, 10 years, and 20 or more years. Then, you can use that as your map for the financial road ahead. 

Track How You Currently Spend Your Money 

You can’t possibly know what adjustments you’ll need to make until you comprehensively understand your financial situation. So, the first step in creating a financial plan is tracking your incoming and outgoing funds. Create a simple spreadsheet or enlist another tracking system to keep tabs on how you spend your money and where. Additionally, track the income you receive over a set timeframe (like a month.) This will help reveal areas that need improvement, as well as identify routine expenses that may be able to be reduced.  

Create an Emergency Fund 

An emergency fund is a financial safety net that can be a lifesaver if unexpected expenses threaten to break your budget. If available funds are an issue, you can put away as little as $500 in an interest-bearing account (without early withdrawal penalties) and increase that amount as needed. A general rule of thumb is to have at least a month’s worth of basic living expenses tucked away. That’s a minimum requirement so that an emergency doesn’t bring your finances and life into turmoil. 

Tackle Your Debt First 

Before you can start investing or a savings plan, it’s important to get rid of outstanding debt with high interest rates. Payday loans, credit card debt, rent-to-own loans, and title loans have steep interest rates that typically outweigh investment returns. So, one of the simplest ways to save money is to pay off all of these loans before making any additional financial moves. 

Create a Budget 

Once you understand your expenses and income and have paid down any outstanding debt as needed, it’s time to develop a game plan that includes long-term savings. A good place to start is a 50/30/20 budget. That means that 50% of your take-home income goes towards regular needs (like housing and utilities), 30% goes towards wants (like dining out or entertainment), and 20% goes towards savings.  

Start to Plan for Retirement and Long-term Investments 

When it comes to long-term investing and saving, there are tons of options. A good first resource for retirement planning is your own employer. Check with your company if they offer a 401(k) plan. If they provide matching contributions, you should sign up with the maximum contribution you can make if you haven’t already. Besides 401(s) plans, numerous additional options exist, such as stocks, bonds, real estate, saving accounts and CDs, and many other opportunities. Your financial advisor will be able to identify the best financial solutions for your unique situation, depending on your long-term aims. 

Establish a Secure Wealth Management Partnership with our Experts at Saddock Wealth  

 Whether you need a hand managing an extensive investment portfolio or are just starting in your financial planning, your smartest move is to partner with an expert who can help guide the way. 

At Saddock Wealth we have ample experience helping clients at all stages of the financial planning process, and we work with you to identify your goals and the clearest way to reach them.  

From annual taxes to discovering investment opportunities, we’re standing by to ensure that every step of the financial planning process is covered while maximizing your eventual returns on investment. 

Let’s work together to create a financial plan that will benefit your budget now and decades into the future.  

Contact us today. 

Financial Planning