Building your financial future can take a long time. From opening your first chequing account and getting your first car, to mortgages, loans and planning for retirement — that’s a lifetime of financial planning. And if that sounds intimidating, well, it can be. That’s why it’s a good idea to break things down into more manageable chunks. That brings us to our 5-Week Fitness Challenge!
Think of these 35-or-so days as a overview of your financial life. By breaking it into chunks, you can focus on what you want to accomplish further down the road.
This is the big picture. Include everything you want to achieve, experience and enjoy. Vacations, that great house in the better neighborhood. Investments and paying for your child’s education. Write it all down. Try to be as specific as possible.
Try taking the goals you set in WEEK 1 and breaking them down into three parts. For part one, include more immediate goals like getting a car, saving a modest amount of money, etc. Next, it’s on to the things you want to accomplish in the next three-to-five years. This might include saving for a vacation, getting that house you’ve always wanted or having children. Finally, part three is where you’ll forecast the remainder of your financial goals — saving up for a post-secondary education (or educations), saving for your retirement, etc.
Now, it’s time to prioritize. Take each of the three parts you established in WEEK 2 and focus on your number one goal for each part. Planning your financial future can be daunting, so breaking it down to one achievement at a time can make matters much easier.
With the use of the Internet, information has never been more accessible. For instance, if you want to remodel your bathroom, go online and compare prices. Thinking of getting a new car? Search what type you want, is new or used the best option, should you finance, lease or buy, etc.
Financial planning needs to be adaptable. Your circumstances can change as time goes on, and so your financial needs may change. Having a solid plan is still important, but so is being able to recognize when it needs to be changed to better meet your immediate and future needs. So, if something unexpected does come up, revisit your plan and tweak accordingly.