Get a more successful financial plan.
Use these tips to help set yourself up for financial planning success.
Everybody – and every business – knows the importance of financial planning. Finding the right financial planning model for your business isn’t as simple a process as making sure the checkbook is balanced every month – planning isn’t so much just accounting for every dime that was spent, but also for planning for future purchases, saving for goals and emergencies, and creating and overall financial strategy. Here are some of the key components of successful financial planning:
For effective financial planning, you need to make sure you have all your records together. This includes rounding up all your bills (personal or professional, depending on what kind of planning you’re doing) as well as any documentation of streams of income you or your business makes. You’ll also want to make sure that you have statements related to any debt you have and factor that into your plan – you don’t want to get to a point where your debt is greater than your income (or sales) as that will mean you’re in the red or unprofitable.
Know Your Goals – and Your Limits
It’s very important to have goals, whether it’s to save for a vacation or to have your business sell its first million units. Whatever your goals are, make sure they’re reasonable and achievable and not just hopes. Goals are something that you could realistically accomplish in a certain amount of time. Having goals is an important step in your financial planning, because it helps lead to the next step.
Leave Room for the Future
Whether the future is saving for retirement or being able to sell your business, planning for the future is a key component of financial planning. How you handle your finances now – from debt, to savings, to investments – will affect your financial future. A good financial plan means not just following a daily budget but understanding how that budget and your financial habits might help you create wealth down the line.
Use the Right Tools
Finding and investing in the right financial planning tools is a key step to assuring a successful financial plan. For some, this just means a good broker, investor, or accountant that they can trust. For others, it means a full suite of financial software. Here are some ideas about what financial tools can help you with.
Mint: This is a great app that can be used by individuals who want to track their spending and be better at budgets.
Albert: This is an iOS app that helps people understand their personal finances and can make recommendations based on your spending to help you save and pay down debt. This is a great tool for individuals who are looking to become entrepreneurs or small business owners down the line to better understand the full scope of financial planning.
CreditKarma: This is another online tool that users can sign up with for free. It helps them not only get their credit score but also helps them understand what loans and credit cards they might be approved for based on their score – both essential for anyone looking to start a business or create a business-level financial plan down the line.
Do you think these tools and tips could help you get your finances into shape? What are the elements you always make sure to pay attention to when working on your financial planning?