FINANCIAL PLANNING






Planning


Financial Planning is required by every business and every family. 
It is the foundation to keep debt at bay and to improve your savings and investment strategy. The following are the steps for financial planning:

  1.  Budget: To take control of your monthly cash flow. Calculate all your expenses including your non-recurring and gifts along with festivals. 
         INCOME - EXPENSES= 0 
        
         If you have any surplus that must be kept away for savings etc. 

         Track your expenses throughout the month. Check your progress. 

 CREATE AN EXCEL SHEET GIVING IT THE NAME BUDGET AND CHECK YOUR PROGRESS. 

       2.    Pay off Debt: Follow a payment system that starts with the smallest and ends with  
            the largest amount of debt. This does not include your mortgage debt. 


CREATE AN EXCEL SHEET CALLED DEBT PAYMENT AND DIVIDE IT WITH DEBT, TOTAL PAYMENT AND MINIMUM PAYMENT = NEW PAYMENT IN PERCENTAGE. Adding to it from any surplus amount left. 

     3.   Build an emergency fund: Have a Cash savings account to avoid further credit card debt in 
           case of emergencies. Save up for your holiday, festivals and any non-recurring expenses. 

     4.  Build Wealth: Invest in S&P 500 Index 10% per year thereby, have an average 10% return. It  
          will grow overtime. 
          
         How to Invest in various stocks, bonds or mutual funds. If you are a beginner go for  
         Mutual funds as it involves less risk. 

NEXT POST WILL BRIEFLY EXPLAIN EACH INVESTMENT OPTIONS. 
TIP: Download Monefy app to keep a track of your expenses. 

Invest in buying this Income & Expenses log book, it will help you control your financial situation.

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