GMA Quick Tip from Wendy Bounds: Creating a Financial Plan
Creating a written financial plan is key to managing your finances.
Oct. 26, 2010— -- Wendy Bounds, from The Wall Street Journal, says that creating a written financial plan is key to managing your finances. Here's how you can get started:
1.Know Your Goals
Sit down with your significant other and write down your short and long term financial goals. Consider things like:
How much you want to save monthly
Any major purchases you want to make
How much money to set aside for leisure activities
How to pay down any debt
Saving for retirement
2. Create a Budget
Bounds recommends the website Mint.com, which lets you link all your various bank, loan and investment accounts. It will also help you determine your annual expenses, track your income and project your savings.
Stick to It
It sounds simple, but Bounds says this is the most important part of making your plan a success.
Your plan should be detailed, and should have cushion for unforeseen events. And you should revisit your plan at least once annually, or whenever you have a significant life event such as getting laid off or having a child.
More Tips on Saving and Investing
CLICK HERE for tips on how to make the most of your 401(k).
CLICK HERE for advice on what to do if you and your spouse have different philosophies about saving.
CLICK HERE for tips on how to raise money-savvy kids.