Breaking financial planning into life phases

You might find financial planning is easier once you break it into phases that are applicable to your life.

08:03 09 September 2013

When doing your financial planning, you might find it most effective to break your planning into stages. Everyone is different, so this method might not work for you, but it’s worth considering. Here are some of the ways you could develop your financial planning around certain specific phases tailored to your own goals.

• Short-term goals—it’s easy to separate short-term goals from long-term goals in our minds, but if we write it out or create a file, it doesn’t need to be mentally sorted all the time. This is something to keep in mind when doing your financial planning because you might find yourself breaking phases into categories of short-term or long-term goals.

 

• Save enough money so you can attend the university you want

 

• Set aside money for your children to attend university or participate in extra-curricular activities

 

• Take lessons to acquire a particular set of skills such as playing a musical instrument, horseback riding, or anything else

 

• Save enough to pay off, purchase, or put a partial payment on a vehicle

 

 

• Long-term goals—since everyone has unique needs from their financial planning, some of the things listed in short-term goals may actually be your long-term goals. The benefit of doing your own planning is that it allows flexibility. Here are examples of long-term planning phases.

 

• Enough money to put a large initial payment on a mortgage

 

• Money to use for investments for the purpose of enhancing wealth or leaving an inheritance for your family

 

• Financial planning specifically geared towards retirement years and the costs involved with that including increased medical needs, and the possibility of higher inflation rates and perhaps higher interest rates for regular payments

 

• Generate enough money to manage and eliminate debt, including the possibility of paying off a mortgage