Financial plans are underrated. This makes sense because life is chaotic and the last thing people think of when it comes to spending money is planning how to spend money. Creating a financial plan sounds like too much work, but that is actually a myth. Besides, compared to the benefits of a financial plan, you might find yourself better off taking time to make one. However, this can be difficult when you are in bankruptcy. Talk to a Tennessee bankruptcy lawyer if this is you.
BENEFITS OF A PERSONAL FINANCIAL PLAN
A personal financial plan is an organized outline of your current financial situation, financial goals, and alternatives in case your plan backfires. While this is an oversimplification, if you follow these three basic steps, you might just find yourself reaching your financial goals. First, you have to decide if this is worth it to you.
The main benefits of taking time to create a financial plan include using your money effectively, achieving your financial goals, finally having financial security, and avoiding debt. Doing this will decrease your financial anxiety. For the first time, you might start feeling like you have control over your finances.
When you compare these benefits to the costs, the only cost of financial planning is time. The more time you put into your financial plan, the stronger your plan will be. One of the coolest things about a financial plan is how usable this plan can be for almost anything.
You can use your financial planning to help you with budgeting your spending, managing your debit or credit, building your savings account, and maintaining a healthy credit score. Yes, you can even use financial planning to pay off your student loans faster.
BEST WAY TO CREATE A PERSONAL FINANCIAL PLAN
It is one thing to talk about a financial plan, but creating a financial plan is a whole other story. Six basic steps are recommended. The first step is being fully aware of your current financial situation. Add up all your monthly expenses:
- House bills
- Electric bill estimates
- Insurance bills
- Entertainment monthly subscription fees
- Any other monthly expenses
Now subtract these all from your average monthly income. What you have left is the money you have to work with at the end of each month. The second step involves writing out your long-term and short-term financial goals. Be as detailed and practical as possible. Third, list out alternative plans for when goals or steps in your goals do not work out.
The fourth and fifth steps simply involve weighing your options and implementing your plan. Last, revise your plan when anything fails or changes.
BANKRUPTCY ATTORNEY IN KINGSPORT, TN
The last thing you want to do is file for bankruptcy, but sometimes life leaves you no other escape. When you are in a tricky situation like this, you may need help. Consider calling us at Tom Bible Law today at (423) 690-7712 to explore your financial options. Our team of Tennessee bankruptcy attorneys might be able to help you escape bankruptcy or bad credit. Look for us in your local Tennessee cities of Chattanooga, Kingsport, and Tullahoma.