Financial Health Planning
Financial Health Planning
Understanding the status of our financial situation is critical in making sure that we make the right decisions when it comes to our overall financial health. This, however, is not always as straightforward as it may seem.
Financial health is the decision to make the right decisions concerning our finances.
Let's look at a few steps to financial health planning
1. Understanding your current financial situation The very first step to take in the journey to financial health is one of introspection. How do you manage your finances? Have you planned for unforeseen circumstances? Are you investing your money? Have you set realistic goals? Answering these questions will give perspective on how to better plan for the coming year.
The next step to take when it comes to ensuring your financial health is financial planning. As the saying goes, “if you fail to plan, then you plan to fail”. This saying applies directly to your personal finances. Planning your finances for the coming year is one of the most important ways to groom your finances. Planning encompasses all the considerations you make before spending. This includes drawing up a realistic budget, cutting out unnecessary expenditures but most importantly planning financially for the future by starting to invest some of your income. The sooner you can start investing, the better prepared you can be.
In securing financial health, discipline is very important. Have the determination to hold to what you NEED; a discipline founded upon the realisation that what you WANT may not always be what you NEED. Financial health requires prioritising needs over wants.
Viable financial health involves ensuring that your future is not only intact, but also filled with potential possibilities. Investing makes it possible. Investments give you the room to diversify your income and add a healthy cash flow to supplement your revenue sources.
However, it is important to understand that growth from investments take time and patience, but ultimately, the rewards are immense for you and your financial health.
5. Setting Milestones
A fundamental step to take on the quest to financial health lies in the act of setting goals. Take some time off to write down what financial freedom means to you, why you want to work towards it, and the steps you would take to pull it all off. Whatever reason you choose, make sure said reason is dear to your heart. Setting goals will give you a sense of purpose and motivation when times are tough.
The importance of keeping financially healthy cannot be over-stated.
The Key? Plan, save, invest, budget, and smile.
Here’s to a healthy financial health status in 2021.