You need to not only know how to save, but how to use your savings properly and spend well. Savings are important, but so is financial planning. Among the many reasons financial planning is a good idea are:
Security is found in knowing that there is something there when you need it. Security lessens stress, and less stress means less risk of heart-related diseases. You want to make sure that you have security in knowing that if you were to have a financial emergency you would be prepared.
Security
Security is found in knowing that there is something there when you need it. Security lessens stress, and less stress means less risk of heart-related diseases. You want to make sure that you have security in knowing that if you were to have a financial emergency you would be prepared.
Stability
Stability is found in building assets that grow. This includes a home, rental property, a 401(k), and passive income from bonds or dividends. This can allow you to grow a lot financially in many ways other than through savings.
Wealth
Wealth is grown over time by having a stable asset base to provide a secure income. You want to make sure that you start planning well financially now so that you can build up your income and have more secure and stable finances in the future.
Access to funds
By seeing increase in all of these other areas you can also see increased access to funds, be it from a fast lender like Payday Express, or a different bank such as Capital One. Increased access to funds is essential to being able to stay on top of your money and stay financially secure.
Beyond these reasons there are two areas of financial planning we want to touch on. One is when to start planning; the other how to do it properly.
When to Begin Financial Planning
The truth is that you have already begun planning financially. It begins each time you get a paycheck and decide what to do with it.
If you're in line for the latest iPhone, then you've financially planned to spend that money, and the monthly charges. Since you have already been doing this the question is how to do it in a fashion that will help you make some serious money.
Have you ever heard the phrase pay yourself first? This is the process where you plan for retirement by having money taken directly from your check so that you never miss it. You can do this with $25 per month or $2,500.
How to Plan for the Future
Have you ever heard the phrase pay yourself first? This is the process where you plan for retirement by having money taken directly from your check so that you never miss it. You can do this with $25 per month or $2,500.
The key is to set aside an amount of cash that you can reasonably part with, and then you watch it grow. For more info on how much you can make if you started today you can use a savings calculator.
By plugging in the numbers you'll see that by saving just $100 per month over 30 years at 8% interest your $36,000 contribution will more than quadruple to $149,000!
There are many good reasons to do financial planning. The key is to recognize you're already doing it, and then to make the choice to pay yourself first.
There are many good reasons to do financial planning. The key is to recognize you're already doing it, and then to make the choice to pay yourself first.
After that be sure to set money aside for savings and properly plan out how to spend your paycheck. It really is amazing how much of a difference a little planning can make.
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