A financial plan may seem overwhelming, especially when your financial goal seems so far away. It’s essentially a roadmap and allows you to clarify your objectives and the steps you need to take to get to your desired financial situation. With these principles, you can make changes now that will ensure your future financial security.
Where Do I Start?
When you begin, you need to assess where you are right now. This is accomplished through analyzing what you earn and what you spend. Take into account how much you’re earning through your employment and the total value of the items you own. As for what you spend, you need to account for taxes, bills, and entertainment. From this point, you’ll have a clearer idea as to how much you can save while being able to make necessary payments.
Calculating the difference between your assets (e.g. your home, artwork, and vehicles) and your liabilities (debts you owe) will give you your net income.
You need to determine what your short and long-term financial goals are. For instance, your short-term goal may be to save for the next few years in order to afford a month-long vacation, and your long-term goal may be to purchase a home.
What Do I Do With My Net Income?
Once you’ve figured this amount, the next challenge is deciding how to allocate what remains after you’ve met your financial obligations.
One way to build your income efficiently is to invest your money. This way, your funds increase as the market increases. To take it one step further, you can make automatic deposits in order to build your investment portfolio even more.
Your investments will build gradually, but you will have accumulated a substantial amount of wealth as the years go by.
How Can I Protect My Savings?
This is why it’s a good idea to have insurance. When you have insurance, a devastating event such as a car crash will not cause a financial strain on you. An insurance company will be able to reimburse what you’ve lost so that you don’t have to start from square one.
Another good rule is to put a portion of your income into a retirement account, such as a Tax-Free Savings Account (TFSA) or a Registered Retirement Savings Plan (RRSP).
We’ll Help You Build The Wealth You Need
At FiduSure Financial, we are dedicated to keeping you informed about what you can do to stay out of debt and accomplish your long-term goals. We will help you craft a financial plan so that your financial freedom is only a matter of time. Call us today at (647) 567 4702.