4 Steps for Personal Financial Plan

The goal of personal financial planning is to enhance your financial situation and in turn, enhance your standard of living. If you plan your finances properly you will not only be able to provide for the basic necessities of life but also be able to afford the comforts and luxuries that you wish.

Personal financial planning entails setting financial goals to satisfy your needs – the goals that will ensure you attain your choice of lifestyle and standard of living. You need to manage your money in order to maximize the benefits.

To plan for your financial future carry out the following 4 steps:

  1. Establish your current financial position
    Record what you income you have coming in, calculate how much is spent on your living costs, how much you think you can save and what debts you have.

  2. Establish your financial goals
    Where do you see yourself in 5, 10, 20 years? What assets do you hope to have acquired? What is the lifestyle that you want? Note down your future goals and categorise them into needs and wants. Remember needs are items of necessity whereas wants are items that while unnecessary, are on the wish list. ...

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