Happy National Financial Planning Week! I promise it’s more exciting than it sounds. If you’re anything like me, a little organization can make you feel a whole lot better. Take this as an opportunity to motivate yourself to do the financial planning you’ve been putting off. It could be as easy as balancing your checkbook or as lofty as setting up a college savings account for your child. I’ll help get you started with a few ideas.
Eye on the Prize
There’s a saying in my industry: “The eighth wonder of the world is compound interest.” Clever quips aside, what that saying means is you should have started creating your financial plan yesterday. The sooner you start crafting a plan and putting money into the right accounts, the better off you’ll be in the long run.
The first step is to put together an honest overview of your current finances. Gather as much information about your accounts as you can – everything from loans to last year’s tax return. Once you have those numbers in front of you, start setting goals. Decide what you or your family need to approach first and foremost, be it existing student loan debts, a new home, or even something as simple as starting a fund for a dream vacation.
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Consult the Experts
If you need help setting up a strategy, you may consider working with a good financial planner. He or she will ask you great questions to determine the depth of your goals and then help you set up a plan to achieve them. After your initial meeting, I advocate meeting with your financial planner yearly, even if what you have set up with them is automatic. As we all know, the market can change and a planner can help you rebalance, see if your goals have changed, or provide information about new products that could help you get to a more comfortable situation, financially.
When my spouse and I meet with our planner, we also take our 401k information in for review to see if either of us needs to make any changes to our allocations. He may not manage those funds, but he does manage our family’s long-term financial goals and will work with us to help us achieve them. Figure out what kind of assistance will work best for your situation and be upfront about your goals. A good planner is like a good physician – be honest (and communicate often) with them about your saving abilities and goals, and you’re more likely to reach them.
Part of the reason National Financial Planning Week is celebrated is to remind and encourage people from all across the monetary spectrum to take time out to review their spending and saving habits. Whether you have been a saver since your first paycheck or you need to completely overhaul your approach to finances, consider this week an opportunity.
Kat's Money Corner is posted on Dollars & Sense every Tuesday. Kat Hnatyshyn, when not blogging or caring for her little ones, is a manager with CommunityAmerica Credit Union. For more financial chatter, click http://twitter.com/savinmavens or visit http://communityamerica.com