Nearly 40% of all households in the United States experienced severe financial problems in 2021, including having difficulty affording medical care and food.
Having troubles with your finances is always stressful, but it is even more so in these uncertain times. If you’re looking for a way to take control of your money situation, consider learning how to create a financial plan.
Even if you are facing difficulties, knowing your next step can make everything seem a little easier.
Set Your Financial Goals
Setting goals for your future is the key to financial success.
What are your priorities? How much do you have in your savings?
This can help you determine how much you need to change and save to get where you want to be.
Create Your Budget
The number one rule of managing your finances is setting a budget that you actually stick to. Address your current financial situation as it is, not where you want it to be.
What is your current cash out-flow? What is your current cash in-flow?
Total up your monthly bills, and add a bit more for unexpected expenses. This should include your housing, healthcare, transportation, debt, childcare, food, entertainment, personal, and anything else that costs you money.
You get to decide what you spend your money on, but it’s essential that you are living within your means if you want to have the best money management practices.
Build Your Emergency Fund
The best financial plan has a section saved away for emergencies. Planning for the unexpected will keep you prepared and help keep your savings intact if an emergency were ever to occur.
Set aside a little bit of each paycheck until you reach your goal.
Plan For Taxes
When tax time comes around, it can either be rewarding or devastating. If you don’t want to have to pay a chunk of money every April, ensure you are planning throughout the rest of the year.
Have the proper amount taken out of each paycheck if you are considered an employed person, or take the money out yourself and put it in a separate bank account if you are self-employed.
If you aren’t comfortable doing your taxes yourself, hire a professional to handle them. You want to ensure you are doing them correctly and getting every deduction possible.
If you’d like the professionals to handle your finances altogether, consider contacting Moneta Dunston Financial Team.
The Basics of How to Create a Financial Plan
Learning how to create a financial plan can help you take back control of your life and get you where you want to be. While it may take a bit of discipline and hard work, if you stick with it, you’ll be amazed at how far you can go in just a few months.
We have many more financial-related articles on our website, so browse through them today!