Financial Planning 101: Why Make A Personal Financial Plan?

Financial Planning 101: Why Make A Personal FInancial Plan?

6/8/2019

Plan today for a better tomorrow. Preparation is the key to success.

A Personal Financial Plan is an organized written strategy on how you handle your money for your financial health, dreams, and goals in life.

The Bible reminds us in Proverbs 6:6-8, God tells us we can learn from the ant. What can ants teach us?

6 Go to the ant, you sluggard;
consider its ways and be wise!
7 It has no commander,
no overseer or ruler,
8 yet it stores its provisions in summer
and gathers its food at harvest.

Like the ants, we must consider its ways and be wise. It is important to be realistic. Think ahead! Yes, live for the now but we must plan our future.

So why is it important to make a personal financial plan? Here are some of the reasons why you must!

Control

A financial plan lets you know your financial situation and enables you to control your spending.

Security

A financial plan enables you to build-up your emergency fund to cope with unforeseen expenses such as sickness or sudden job loss.

Freedom From Worry

You get a sense of financial certainty because you are preparing for the future.

Sustainability

A financial plan allows you to prepare for retirement. A retirement fund will help you live comfortably even when you no longer earn income.

Freedom From Debt

A financial plan will enable you to avoid unnecessary debt due to unnecessary wants.

Realizing Dreams

A financial plan motivates you to save a portion of your income to help achieve your life goals.

6 Comments

Mia Evans link

10/11/2021 09:28:53 pm

Thanks for pointing out that a personal financial planning service will be able to provide you with a way to control your spending that will help you handle your money well. I hope that I can find a professional to hire and teach me good strategies. It's because I wanted to start saving for my retirement since I want to retire by the age of 40.

Ralph link

10/11/2021 10:43:59 pm

Hi Mia, thanks for visit.

Tip: Look for a Registered Financial Planner (RFP) or a Licensed Financial Advisor. They are willing to help you with your Personal Finances including retirement.

Millie Hue link

4/22/2023 03:37:04 am

It got me when you said that financial advisors would be able to help us control our spending habits by letting us know the financial situation we have. I think I need their help if I want to achieve a goal regarding my savings this year. My dream is to reach a certain amount of money which will only be used for emergency purposes as well as continuing the practice in the years to come.

4/22/2023 06:14:44 am

Hi Millie, yes a Registered Financial Planner (RFP) or a Licensed Financial Advisor will help your Personal Finances.

Victoria Addington link

6/27/2023 10:18:16 am

It was interesting to know that a financial plan enables you to cope with unforeseen expenses. My friend wants to better manage her wealth. I should advise her to seek guidance from an expert in wealth management planning.