Would you take a road trip without checking out the route and destination first? Probably not. To get the best out of the trip, you would plan accordingly. Perhaps you would include a few exciting stops along the way and make the most of your time.
Neglecting the planning stage where your financial future is concerned is the same as jumping in your car and driving until you drop off the coastline into the sea!
Planning gives you the time you need to get clear on your goals and intentions. Without a goal, you have nothing to strive for.
What are your financial goals?
Let’s look at a few ideas:
- Pay off the mortgage
- Buy a car
- Be debt free
- Retire early
- Start a trust fund for the kids
There are, of course, many unique goals that will suit your circumstances and dreams. Planning allows you to explore the ones that will be most beneficial to you and your family and then create an action plan to achieve it.
Financial goals differ from a financial plan. A goal is specific and measurable and, when actioned correctly, will get you closer to your dream. The financial plan is the prompt necessary to recognise what goals are important.
What is a financial plan?
At its core, a financial plan is a step-by-step journey you take with a series of actionable stages guiding you along the way. It’s a powerful way to put you back in control of your finances, including income, expenses, and any savings or investments you have.
Without this step, you will struggle to understand how to achieve financial stability, security, and independence.
There are many benefits to financial planning, ranging from emotional to economic, but we’re going to concentrate on three specific reasons why financial planning is important.
- Planning improves your financial outcome
Your financial future can be successful in the same way as your planned road trip. By beginning with a goal, you already know the outcome you desire. This allows you to plan for every possible challenge or emergency.
Understanding your short, medium, and long-term goals gives you the proper perspective and balance to save for the future and spend in the now.
Try starting at the beginning and writing down your assets and liabilities. Create a list of everything you can think of so you can see your net worth at a glance. Planning requires clarity and honesty.
Some elements of your plan may be more challenging than others. Spending your hard-earned money is more fun than saving it, after all! However, the plan you create will help you manifest and allow you the freedom to live your life to the fullest.
- Planning supports your mental health
The Money and Mental Health Policy Institute discovered that a percentage of people with problem debt are significantly more likely to experience mental health issues. That figure was as high as 46%; that’s one in five people with mental health problems in debt.
Financial difficulty causes stress and anxiety. Developing a financial plan allows you to see at a glance the state of your finances and create action steps to turn things around. Sticking your head in the sand where your financial future is concerned will only increase the discomfort and add more pressure to your mental health.
It’s often the case that people who don’t plan their financial future become more heavily entrenched in debt because they are too afraid to face reality. The possibility of correcting mistakes would be easily spotted with a financial plan to follow.
Ridding yourself of any uncertainty will reflect positively on your mental health. My Life Without Limits programme was designed with this in mind and includes mentoring so my clients never feel alone on this journey.
- Planning motivates you to stay accountable
Goals and accountability go hand in hand. It’s understood that having an accountability partner who understands your goals improves your chance of success by 95%.
Clarity and focus when working towards your end goal boosts your confidence where financial planning is concerned. Having a clear plan with action steps and a dedicated mentor is a positive way of working that doesn’t allow for stress or overwhelm.
Finding out what matters to you is the best starting place, and this is where I begin in my DREAM programme. It’s where you discover your priorities – what motivates you – and gives you a clear focus on your future. By asking the right questions, you can dig deeper into the hopes and dreams your harbour and bring them to the forefront.
With the advantage of working with an accountability partner, your financial planning will reap the benefits you are working towards.
If you’re ready to start planning for your financial future, our holistic approach is the right fit for you. It includes mentoring to bring together your financial and life plans and guide you on your journey to financial independence. We are with you every step of the way.
We aim to inspire people through a mix of financial planning and coaching to make positive changes in your life. Using our DREAM methodology, we look at your finances from your values, dreams, and objectives.
Our Life Without Limits programme was designed to help you understand more about your financial goals.
Discover – Where are you today, and where do you want to be in the future?
Realise – Identify your priorities and visualise your goals
Everest –There will be challenges, but we help you overcome them
Action – Agree and implement the financial plan to get you to where you want to be
Mentorship – Bringing together the financial and life plans of you and your family
If you’re ready to create financial independence and live the DREAM, get in touch for a chat
Create your own ‘Life Without Limits’ with Rory, a Certified Financial Planner CPF®, and Ireland’s first RLP® Financial Life Planner, to discuss how his DREAM programme can shape your future and allow you to create financial independence.
Financial Life Planning sessions are conducted face to face or over Zoom/Skype/Teams. Book your call today HERE.