The only way for you to reach your money goals is the to have a solid plan for your personal finances. The good news is, you still have time to get on track with you money, this year. Here are the three steps absolutely need to take, right now.
Step 1: Identify Your Core Values and Develop Your Goals
You already know that you need to do better with your money, but where exactly should you start? First thing’s first is to identify your core values. Ask yourself, what is most important to you in your life? It may be to travel, have a more flexible work schedule, or pursuing continuing education. There’s no wrong answer, dig deep and write them down.
Developing the main goals that you want to achieve, is another important part of this first step. What are those non-negotiable goals that you want to achieve? Do you want to finally get your passport and travel to two international destinations this year, or do you still need to set up a college fund for your child? Remember to make sure that you establish S.M.A.R.T. goals that you can realistically achieve.
Step 2: Track Your Spending
Once you have identified you core values and your S.M.A.R.T. goals, it’s time to determine whether the way you currently handle your finances are in alignment. Track your spending for at least a month’s time or grab last month’s account statements to review what your spending and where you are doing that spending. This will give you valuable insight into how you need to readjust your spending and savings.
If travel is one of your core values, for example, have you set up a travel fund and are you building savings, specifically to fund the trips you desire to take? If not, then the next step will be to set up that travel fund and direct savings there.
3. Make A Plan For Your Money
Making a plan for your money is critical to reaching your goals. Not only do you need a budget to plan your savings, investing and spending, but you also need to have a plan for windfalls, bonuses, raises and your tax returns. Set up those savings buckets so that you can direct the extra cash when in shows up, without a second thought.
When you set up Your Money Plan, it represents a blueprint for keeping your money in alignment with your core values and stated goals. It will document how you will allocate your savings and spending. To boost your travel fund, or pay off debt with extra debt payments, for instance.
Need help getting your money on track? Download these free Your Money Plan Worksheets.
How are you doing with your Money Goals going this year? Are you on track? Let me know in the comments below!