Budgeting and Saving
Financial planning is the process of developing a plan to achieve financial success. It involves the steps of defining and setting goals, analyzing information, developing a plan to achieve them, putting that plan into action, and monitoring and modifying that plan. It includes all aspects of handling your money: spending, credit, saving and investing.
- To aid in making wise decisions, financial planning involves distinguishing between our needs and wants and use that understanding when making important decisions and choices.
- Food, clothing, shelter, these are essential to our lives, therefore classified as needs. Anything that increases the quality of our living is classified as a want, such as dining out, entertainment, and vacations. Most individuals take care of their needs first since money is such a limited resource.
- Taking into full consideration ones needs and wants, which of course are influenced by ones values, the financial planning process begins with the first step of Defining and Setting Goals.
- The next step in financial planning is analyzing information. Since goals are directly impacted by your sources of money and where that money goes.
- The third step in financial planning is to actually setup your budget! After you have analyzed your cash flow, money coming in versus money going out, you will be able to determine if you have any money left over at the end of the week or month.
- The fourth step in the financial planning process is to implement the plan. Remember, financial planning is a learned skill! Knowing what you should do and actually doing it takes discipline and practice. Put the plan into operation.
- The final step is to monitor and modify your plan. Your plan most likely will need to be altered over time as you run into challenges and obstacles. You may even change your goals along the way.
Use our Cost Calculator to start planning your budget!
If you need help with any of the above, visit the financial education office in SVC 2054 or contact us to schedule an in person budgeting appointment.