How did you do about figuring out your financial goals? Good thing about this plan is that there is no set time you need to start. People generally choose January since it’s resolution month but best would be to choose the time that works best for you where you are focused and free of distractions. When you break it down, it’s not as huge a mountain as you think but it still takes contemplation and time to get things done.
After you have completed the Transcendental remedies to help your Financial Qi, you can move on to the mundane nitty gritty details to keep moving things forward.
Figure out your current financial health. Do the basics – claim your free credit score and figure out your net worth. Get your free credit score from the right place – the Federal Trade Commission. It will give you an idea of where you are right now. For your Net Worth, it’s a simple equation: Your Assets – Your Liabilites = Your Net Worth. In even simpler terms it’s what you have/own minus what you owe others. To find out more details, here’s a link to a great website that explains it more in depth. Be sure to download their simple excel spreadsheet that can help you figure this out. I loved it and it gave me a very clear picture of where I stood and what I needed to do next.
Come up with a feasible plan. An old fashioned budget works best for me. I do this by figuring out how much my monthly income is and from that I subtract my monthly expenses. The big mistake that people make when doing their monthly expenses is they forget the big expenses that come up throughout the year such as vacation and baby shower gifts. So plan ahead. If you know are taking a vacation in June, budget how much you will have to spend for the total trip (yup) and divide that by 12. That number gets added to your monthly expenses. Be sure to stick to that budget in June too!
Revisit, adjust and reward. It’s rare that I get things right the first time. Because of that, I often revisit and make adjustments where I need to. Feeling the pinch because you are contributing too much to your 401k? No need to feel guilty, just scale it back a bit. Realize that you have more money left in your bank account at the end of each month? Think about increasing your contribution to your rainy day fund or debt repayment. You revisited and everything was spot on? Congrats! Just always keep mentally referring back to that goal you set in the beginning and remember to feel the joy your hard work and success brings you. Then reward yourself. It doesn’t have to take money but it should definitely bring a smile to your face.
There’s tons more information out there but I just wanted to get you started. If you feel that this part is over your head, don’t fret, there are professionals who do this for a living and can help. You can tap into my favorite person, Suze Orman who has a wealth of knowledge (pun intended) on her site. You can also sign up for great services like Mint.com or DailyWorth.com who gear their message specifically to women.
Just be sure to enjoy the process. Why not recruit some of your family and friends to join you? Until then, here’s to building your nest egg and making the rest of your life feel lighter. Because as my mentor Suze says, People first, then money, than things. Spot on Suze, spot on.
