The financial plan will help keep the budget under control, gradually and painlessly raise funds for high expenses and realize life plans.
1. Make a list of goals and desires. Any planning begins with an analysis of what is now. Analyze whether you are satisfied with the current situation with personal finances, what is still missing, what you would like to improve.
Decide on goals. A financial goal isn't just about 50% more revenue or buying a new laptop. Any goals for the year are somehow connected with money, even if they are intangible.
2. Determine their cost. Once your big wishlist is complete, determine which ones you need money for and how much they cost. For convenience, create a 4-column sign. In the first — the goal, the second — the cost, the third — the deadline, and the fourth — the amount that must be saved monthly. So you need to write down each goal and calculate how much money you need for everything each month.
3. Analyze whether you need all this. The fact is that we often want to do or buy something in order to impress someone or meet a certain status, and not because we need it. It plays a cruel joke on us, makes us buy more, and drives us into credits, but it does not make us happier. And an honest analysis of your goals allows you to identify actual value for yourself and weed out unnecessary ones.
4. Don't forget about the airbag and invest.com/investing-in-ukraine/business-opportunities/long-term-business/" rel="dofollow">long-term savings. If you don't have a reserve fund or airbag yet, it's time to put it together. The minimum amount is 3 months of your expenses, but still, it is better to have a supply for 6 months of life without income.
It is also essential to add long-term goals, such as buying a home, to your annual planning if you have such plans for the future.
5. Keep track of income and expenses. This should be done to understand how much you can save monthly for your goals. Income minus expenses = your resource. Financial literacy books advise saving 10-20% on revenue. Of course, you can start with saving 5% of your income, but gradually you need to increase the percentage.
6. Be flexible and change your plan. Check the plan once a month and see if you have postponed the planned amounts. If not, analyze what went wrong, how you can fix it.