Managing Your Money: It all starts with a plan

“If you don’t know where you’re going, you’ll end up someplace else.” ~Yogi Berra.

Want to win with money? It’s not rocket science. In fact, we often make it harder than it is.

Ya gotta have a plan. It doesn’t need to be elaborate, and you don’t need special apps or even a multi-sheet Excel workbook. You can do it on the back of a napkin or certainly in a small notebook. Having a plan in place will bring you peace of mind and hope.

Here are some helpful steps to initiate your plan.

  • Put it on paper. Believe me, it’s a game-changer to actually see the numbers written out in front of you.
  • Set goals. Where do you want to be financially by the end of this year? In the next 2 years?
    • Do you want to buy a house, start school, pay off the car, save for retirement?
    • Write down your goals, then prioritize them.
    • Again, if you don’t know where you’re going, you’ll end up somewhere else.
  • Track your spending for two weeks. Every single nickel and dime. You will have a-ha moments. Guaranteed.
  • How much is coming in (net income)? How much is going out (expenses)?
  • Start at the beginning.
    • Establish your $1,000 emergency fund. This is non-negotiable and will give you a cushion in the case of a true emergency.
    • What fires are burning? In other words, what must be handled today (e.g. creditors calling, payments behind etc.).
    • Prioritize debt by the lowest overall amount.
  • Find an accountability partner. Someone who you can tell about your plans and will help to keep you on track.

If you are like most people, something has to change. If you want to win with your money, you’ll need to make adjustments. Sometimes, those are small steps, but other challenges may require an overhaul of how you handle your finances.

Now that you know where you want to go and have a plan in place, take another step every day. Here are a few important questions you can ask yourself as you review your finances and the plan you will put together.

  • What one thing can you do today to get you one step closer to your goals?
  • If you say “yes” to ______________ (buy a car, travel, go out to eat), what will you have to say “no” to (pay off debt, save for retirement, put money aside for child’s college)?
  • What’s holding you back from making the plan? Your success is on the other side of fear.
  • What would change about your life if you had a clear plan in front of you and then acted on that plan?
  • What habits do you need to change to help you become a winner with your finances?

Remember: Now that you have a plan, it won’t happen by accident. Put feet to it. Having the plan and knowing what you need to do is only 20% of the game. The remaining 80% is behavior, habits and walking it out.

There’s nothing better than having a plan in place except living out the plan.

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