Jump-Start Your Financial Plan For 2019!

By Lisa Strohm

What are your goals for 2019? Eat healthier and exercise more? Strengthen your relationships? Advance your career? These are all worthy goals, but I urge you to consider one more: setting up your financial plan. It’s one of those things you know you should do but keep putting off. Why not make 2019 the year you finally cross it off your to-do list? After all, having a solid plan in place is the first (and most important) step toward achieving your financial goals. Here’s how you can get started.

1. Create Your Budget

Do you have a budget? The foundation of any financial plan is knowing exactly how much you earn, how much you spend, and what you spend it on. So your first task is to record everything you spend for at least three months (the longer, the better). This can be done by carrying around a small notebook, entering your expenses into a budgeting app on your phone, or automating the process with a service like Mint. At the end of three months, calculate your average monthly spending for various categories (food, entertainment, utilities, clothes, gas, recurring bills, etc.). If you’ve never done this before, I bet the results will surprise you.

2. Set Financial Goals

Now that you have a clearer picture of where you are now, it’s time to define where you want to be in the future. When would you like to retire? What quality of life do you want? How much will you need in your retirement account to afford this quality of life? Retirement is a big part of financial planning, but don’t forget to include all your short-term and long-term goals. Want to move into a new lake house in 10 years? Pay for your children’s education? Donate to charities? Write it all down.

3. Design A Savings Road Map

So far you’ve defined where you are now and where you’d like to be. Now it’s time to make a plan to bridge the gap. Assuming an average return on your investments, how much do you need to put away each month to reach your goals on time? Does your budget allow for this? If not, what steps can you take to either reduce your monthly spending or increase your monthly income?

4. Put Together Your Portfolio

Unfortunately, stockpiling your savings under your mattress won’t get you very far. The key to achieving your financial goals is creating an investment portfolio strategically diversified to meet your personal needs. The earlier you get this started, the more you’ll benefit from the exponential power of compound interest.

5. Define Your Exit Plan

The last part of your plan is creating exit strategies for each goal. You need to be able to access your money when you need it. If you skip this step and just dump all your savings into retirement accounts, you’ll be in for an unpleasant tax surprise when you want to pay for the aforementioned lake house or college education. So keep in mind when you’ll need to access your money and how to set up your portfolio accordingly.

6. Schedule Check-Ins

At this point, you’ve set up your plan, but your work’s still not quite finished. Now it’s time to maintain. You’re bound to experience many life changes between now and retirement, and you must adjust your plan accordingly. Check-ins are easily forgotten, so it’s best to schedule it into your calendar. Aim to review your progress every six months or whenever your life situation changes (income change, change in expenses, change in goals, etc.).

Next Steps

That’s all there is to it! Not so complicated, right? From a bird’s-eye view, it seems like a straightforward process. But it’s easy to get stuck in the details and feel overwhelmed. Fortunately, our team members at The Athena Network are experts in designing personalized financial road maps to help people achieve their goals. If you’d like to learn more about how we can help you set up your financial plan, email me at lisa.strohm@the-athena-network.com, call 484.224.3439, or click here to schedule your free introductory meeting.

About Lisa

Lisa Strohm, CFP®, MBA is the founder and CEO of The Athena Network and Good Life Advisors of the Lehigh Valley, fee-based wealth management firms. She specializes in providing financial planning, investment management, and life management services for women and their families across the U.S. With more than 18 years of industry experience, she sets her firms apart from traditional wealth management companies by focusing on providing clients with an educational, collaborative, supportive experience that inspires her clients to engage in their financial lives. If you have a question, please click this link to schedule a phone call today. To learn more, visit https://the-athena-network.com/ or connect with Lisa on LinkedIn and Facebook.

Investment advice and financial planning offered through Good Life Advisors, LLC, a registered investment advisor. Good Life and The Athena Network are separate entities.