Financial Plan | Working Towards Achieving your Financial Goals

Financial goals are the basis for creating and achieving your overall financial plan .

When setting up your financial goals, you will realise that you are at the same time working on step 3, 4, 5 & 6 of the 6 steps to creating a financial plan.

For example,

  • If you set a goal to create an emergency fund, you will be working on step 3.
  • If you set a goal to take a life cover, you will be working on step 4.
  • If you set a goal to retire comfortable, you will be working on step 5.
  • If you set a goal to achieve financial freedom, you will be working on step 6.

These financial goals will produce a number of subset financial plans that will bring about achieving your overall financial plan.

For example,

  • Your goal to get out of debt will produce a Debt Repayment Plan.
  • Your goal to educate yourself or children will produce an Education Plan.
  • Your goal to live comfortable in retirement will produce a Retirement Plan.
  • Your goal to acquire small/medium ticket items will produce a Savings Plan.
  • Your goal to acquire big ticket items will produce an Investment Plan.

All the above plans will require money. Therefore, you will need to allocate funds for them. The only way to do that is by putting up a Spending Plan.

The spending plan will include money for:

  • Your daily and monthly upkeep
  • Building a financial reserve (Risk Management Plan )
  • Buying basic insurance covers (Risk Management Plan)
  • Debt repayment if you have debts (Debt Repayment plan)
  • Building your nest-egg (Retirement plan)
  • Personal & children’s education (Education plan)
  • Small ticket items (Savings Plan)
  • Big ticket items (Investment Plan)
  • Holiday & Recreational activities (Leisure Plan)
  • Tithe & charitable giving (‘Giving Back’ Plan)
  • E.t.c

As you can see, your spending plan combines together all the other subset plans. Therefore, achieving your financial goals will require you to set up a spending plan that will include each subset plan that you will come up with.

Is a spending plan the same as a budget? That’s right!

Your budget will include all of the above items and not just your daily and monthly upkeep.

Now, preparing and achieving your financial goals will require you to have good money management habits. Click here to learn what money management is all about.


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