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The Economy – Your Personal Financial Plan

People responding to my survey about the area of greatest importance to them listed Personal Finances 38% of the time . That was the number one area of immediate concern.  Take a deep breath, hold and let it out. Do it again now more times and make a loud sighing sound as you do. OK, feel more relaxed now?  Better?  Good.

Money makes us nervous or the lack of it does.  One fellow I listened to a few times, used to say stress is the result of trying to put a 5 dollar bill where a 50 needed to go.  I couldn’t argue that finances are often stressful, but his solution was to have you join his multi-level marketing organization and subscribe to training tapes.  I later found out that most of his income came from the tapes and not the products.

If you don’t have a budget – a plan for making your money work for you – then you need to make one.  You don’t need anything more than a spiral bound note book for one dollar and a decent pen and a calculator.  Later, if you decide to get more sophisticated, you can get a computer program. Right now, you need to know the principles you need to apply.  If you know the principles, you don’t really need anything fancy to acheive your financial goals.

Goals!  Yeah, YOUR financial GOALS.  Do you really want to be financially independent? Do the following:

• Create a vision of how you would like to live financially – see it, smell it, feel it, hear it

• Make a list of all the things you have done well with money  – if there are a lot list the principles you always follow

• Now set a goal – what is your next objective along the financial path – look down the road 3-6 months – what is your objective?

• What are the things that might keep you from getting to where you want to go in 6 months financially

• Brain-storm a list of actions that could get you there – make a list of 10-20

• Pick the best 5 and prioritize them, and give them a due date

• Now, write a statement(affirmation) in the present tense describing the emotion you feel from doing this – it could say something like “I am at peace and satisfied when i follow my financial plan every hour of every day.”

• Choose a mind/body practice like those 3 deep breaths we did at the start here and maybe a swallow of water- take 3 deep breaths and a swallow of water each hour and in your mind repeat your affirmation

Read a few good books on the subject of personal financial plans.  Start with Andrew Tobias.  The thing I like about his book “The Only Investment Guide You’ll Ever Need” is that he shows you what the rate of return is on using a coupon, buying in bulk, not financing anything, and other practices you will likely say – I can’t do that!  You can do what you can do and as you get more disciplined – you will be able to pay cash for a car, not have credit card debt and be building a nest egg.  One of the most important pieces of advice he gives you in the book is “to trust no one with your money.”  This means the bank – review your mortgage statements, a broker (want to lose money,just pay the fees associated with this kind of transaction), your brother-in-law, your professor in business school or anyone else.  No one will watch over your money like you will, so get in the habit and get educated about it.

If you were out of debt, had a years income in savings and 60-90 days of food in your pantry and freezer, would you feel less stressed?  Probably. Why not take actions that will reduce your stress and improve your financial position. I have added Ramit’s blog “I will Teach You to be Rich” to my Info from other authors page on the bottom left of the home page.  He has some great practical advice aimed at younger people but anyone can learn to do what he has learned. Check out that page and leave me a comment.  Is this all just junk to you or am I right on these recommendations?