
3 Financial Planning Steps
Organization, efficiency and discipline can be considered as three primary steps of financial planning. Organization is knowing where your money comes and goes. An efficient portfolio means working towards a better chance of profits, and discipline can help keep you on the right track. Statistics tell us that the average credit card debt per person – including all people who pay off their cards each month – is over $5,500. Many folks struggle to handle the big picture of their personal financial world. If you are one of these folks, you can learn what the steps of financial planning are and even get started today, either on your own, using resources on the Internet, or by hiring a financial professional. An important first step of financial planning is organization. You can work towards your financial goals in life by organizing your finances and understanding money flows, both inflows (like your paycheck) and outflows (bills). If your financial life isn’t terribly complicated, an Excel spreadsheet may suit your needs perfectly. However, using something a little more sophisticated, such as Mint, Quicken or other online budgeting tools may become necessary, as you and your financial life continue to evolve. There are a million ways to approach organization, but the “how?” may be nowhere near as important as “when?” In some cases, the answer to when you should start organizing is now. Whatever method you choose, once you set up the system you can enter historic information as far back as 12 months (if you have it). This may require digging out the old bank, investment and credit card statements. It may not be as intimidating as it sounds. In today’s connected world,