Think life, not numbers

Financial planning, like so many things in life, can be more stressful to think about than actually do something about.  Once you get to it, though, it’s actually quite intuitive: Before you ever add or subtract a number, it begins with laying out a few of your long – and short-term goals.

Some of the things you thought really mattered 10 years ago are perhaps less important to you now, in light of a few of life’s inevitable twists and turns. All the more reason for reviewing an existing financial plan with current and future goals in mind. A few adjustments today can translate to tens of thousands of extra dollars in another 10 years’ time.

Lots of new things can factor in to your financial plan at this point in your life. As your career progresses, changes in income and employee benefits should be reflected in how you save and invest your money. A growing salary may be subject to higher taxes, which may prompt you to work more taxeffective savings and investments into your plan. The needs of a growing family may dictate holding larger cash reserves to easily cover unpredictable expenses.

The life stage list

• What’s the monthly cost to maintain my standard of living?
• What lifestyle do I see for myself in the future?
• What will I need financially to achieve each of my goals?
• When do I plan to retire?
• How much income do I have available to invest? Can I do it automatically?
• What investments are in my portfolio today? What’s my overall net worth?
• Do I have enough set aside or available immediately in case of an emergency?