So far, we are in agreement that we have to be financially successful. But how do we go about that? What are the steps to success? Well, one thing for sure is that it is not easy to plan and stick to a financial roadmap. For evidence just look at how faithfully we stick to our new year resolutions! How faithful are you at keeping your well intentioned New Year resolutions? Most of us don’t do so well.
Let us acknowledge that the hardest part of change is taking the first step. Having a financial plan of achieving financial success and understanding your idea of what financial success actually looks like is critical.
We know planning doesn’t come naturally to most people. Right now, most people have no idea what they shall have for dinner tomorrow let alone how their life will be in the next 10 years. How do you envision your life to be in the next few years? What about retirement? Can you picture yourself retired? How does it look like?
After creating this vision, we now find ways of how to get there? Your road map or financial plan should be a reflection of what you plan to achieve…. financial success. Let’s take the example of Simon. Simon is a 35 year old long distance runner who is fast approaching the sunset years of his athletic career. He has a young family and envisions himself running his tea farm and managing his dairy cattle upon retirement. He believes that these two ventures will sustain his family into the future. Simon needs to evaluate whether these ventures are truly sustaining for his family in the long run and what it entails to invest in these. He may need to undergo training in dairy and tea farming and confirm whether this is truly what he wants.
As you come up with a financial plan, ensure there is room for flexibility. After all, nothing is cast in stone. Remember life does have the habit of throwing in curve balls along the way. Make your financial plan as adaptable as possible to many scenarios. Remember, the best plan is not the one perfectly written down on paper but rather the plan that you can stick with. Having a flexible plan will help make sure you stick to it as much as possible.
Finally, you may need to reassess your financial plan and check whether with time, it still reflects your goals as a person and as a family. This is because life is not linear and changes do happen. Ask yourself these questions: Does this goal still take priority over other things in your life? Is the timeframe still correct, or is there a different end date? Are we on track? If your goal becomes secondary to another or is scrapped altogether, review why it changed and the financial implications, if any, of that change.
Remember, a goal without a plan or roadmap is just a wish – Anonymous.
Next time we look into ‘Make your money count’.
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Financial Expert and Trainer