There’s an old adage that educators, such as myself swear by:
“Those who fail to plan, plan to fail.”
This applies to most aspects of life, particularly to your finances. And at the start this new year, lots of us are busy making resolutions, especially of the financial variety. But if you’re not sure what goal setting or financial planning entails, or even what that means, who do you turn to?
Most of us turn to our parents, spouses, mentors; pretty much any person we trust or admire. The problem is that these people rarely have financial credentials.
Let’s say for argument’s sake, you’ve found a friend or family member that displays the signs you perceive to signal financial success. Do you know for a fact that this person you are trusting for financial advice is actually financially savvy? Maybe this person drives a luxury car and lives in a fancy neighborhood. How do you know that this person doesn’t have heavy credit card debt? Or multiple mortgages on their home? Maybe this person has a lot of stuff, but is struggling to pay the bills each month.
Make sure that whoever you consult for financial advice actually knows a thing or two about how to successfully handle money. Consider talking to a professional financial planner or consultant instead of a friend or family member. Just like your friends and family, your planner should have your best financial interests at heart – that is part of what you will be paying him/her to do. But a planner has something that your family might not; financial expertise. A good planner should be able to help you set up an effective plan for your individual situation based on your income, debt, assets, and so on. You should be able to work with your planner to set specific short and long term financial goals that are realistic and attainable. Ultimately, the time you dedicate to planning your financial life should empower you to live the life you want to live instead of the life you have to live in the future.