Everyday Money

Financial Plans: 3 Reasons You Shouldn’t Be Without One

April 22, 2016

Everyone has dreams, and some of you may even have long-term goals mapped out. Whether your dreams involve a new house, an early retirement, or just living debt-free, having sufficient financial resources plays a key role in achieving these goals. 

So, why is it that so many of us don’t have a financial plan? Maybe it’s because we don’t feel like we have enough money to even justify one. Or, maybe we put it off because we don’t know how or where to begin the process. Whatever the reasons, before completely dismissing the idea of developing one, consider the following three things a solid financial plan can do for you.

 1. Financial Strategy

If for no other reason, give yourself a good night’s sleep. A solid financial plan will help provide you the confidence you need to sleep well and worry less. It puts you in control of your finances and helps to ease your mind when short-term financial issues arise, such as a dip in the stock market. Because a solid plan is long-term, those hiccups will seem less like a tornado, and more like a rainstorm.

 2. Better Decision-Making

Writing down your goals, and the steps you’re going to take to get there, will help you make better financial decisions simply because you’ll be more aware of the things you do on a daily basis that affect your finances. For example, let’s say part of your plan is to pay an extra $200 per month for one year to achieve the goal of eliminating a high-interest credit card debt. Because you have a plan, you also know you’re currently spending $400 per month eating take-out. It isn’t hard to deduce that by eating at home a few extra nights per month, you can accomplish one of your goals with little effect on your day-to-day life. No matter how big or small your goals, it’s always easier to make better decisions when you have all the information.

 3. Staying on Track

We all get off track now and then, but getting back on track and staying there is much easier if you can simply make a small adjustment on your road map and keep on going. In addition, the times you encounter bumps in the road may very well be the best time to reevaluate your plan, and reconfirm that you’re still headed in the right direction.

 The best financial plans are written out and specific. If you aren’t comfortable doing it yourself, consider turning to an expert to help you develop a plan that covers every aspect of your financial life. We turn to experts for our body’s health, why not turn to them for our financial health if we can. Not only can they provide expert advice on everything from insurance and daily spending, to retirement and estate planning, they take an objective and unemotional look at your situation and apply solutions that fit your own unique circumstances.

So, if you don’t have a financial plan, consider getting started today. There is so much to gain, and so little to lose by doing so. 

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