Steps to Creating a Strong Financial Foundation

Are you the master of your wealth? You have to!

To build a strong structure, you need to start with a heavy financial duty to keep you going now while solidifying your future goals. What do you need to do to put the structure in place? It’s strangely clear cut. Bottom line tactics can help to boost your financial self -confidence and position yourself for financial success.

Organize

Before you can move on, you need to be clear on where you stand financially right now. You can start by developing a personal balance sheet. Make a list of each of your assets (what you own) and responsibilities (what you owe). If you have already gathered all your statistics that will give you a sense of your net worth.

Next, find out your monthly cash flow and check your credit. You can use a budgeting template like this to help simplify the process.

Improving Your Net Worth

– Analyze your home acquisition fee

– Make sure you spend less than you earn. Track your own finances with a tool like Moneydesktop, which can empower you to take control of your finances and simplify your life.

– Manage your debt responsibly by making your payments on time and paying more of all your consumer debt.

– Save money for your long -term purposes. Open a job promotion 401 (k) and make sure you take advantage of any employer-compatible programs.

Protect Yourself

Now that you are organized and following a growth plan you need to make sure you are financially secure. Try implementing these options.

– Create an emergency fund because life will happen. You need to be able to continue to survive financially – as opposed to going into debt if you face unexpected expenses or other financial crises.

– Check your insurance protections. These types of policies can help to limit your out -of -pocket expenses when unexpected expenses arrive.

– Make sure you have built or updated your land plan. This may include updating your will, creating a living trust and creating a power of attorney and a healthcare directive.

Prioritize Your Debt Reduction

Beware of excessive additions by paying excess interest on the money you borrow. This will prevent you from putting money into your other financial purposes. Debt settlement is a perfect way to start building your financial foundation. If you are interested in implementing a quick to track debt repayment strategy try the debt snowball method or other financial strategy to lower your interest rate.

Define your financial goals

Now that you’ve put together all the pieces for your financial foundation it’s time to ask yourself what you want for the short and long term. Remember, your goals need to be SMART: Specific, Unmeasurable, Reachable, Reasonable and Timely. Below are some concepts to help you get started.

– Save for a down payment for a house

– Create retirement funds

– Save for college kids

– Set up an emergency fund

– Save for the holidays on the bucket list

– Become financially free

Now It Happened

– Discipline: Stick to the plan

– Maintain a balanced budget. You can’t be financially healthy if you spend more than you earn.

– Automate your finances (regularly transfer money from checking to savings, and pay bills online)

As you can see, building a financial foundation requires a lot of focus and determination. If you follow your step by step you will inevitably see consequences. More importantly you start to trust your ability to create and maintain your new financial health.