Begin Saving and Investing Through Intelligent Financial Planning

Begin Saving and Investing Through Intelligent Financial Planning

The manner in which a person manages their personal finances defines them. Many people express the will to save and invest but never do because of frivolous spending or lack of commitment. These individuals should take note that it is not the unexpected windfall or promotion at work that should initiate responsible financial planning, but rather the intelligent distribution and wise saving of current income revenue streams.

There are many ways of remedying one’s financial woes through astute financial planning that can even reverse a worsening financial downward spiral. Here are five recommendations from Efficient Wealth to recover and even enhance your financial situation:

  1. Close Unnecessary Accounts

Credit cards, accounts and interest-bearing loans are becoming easier to access for the average salary earner, driving them further into debt. Do not be tempted by intelligent marketing campaigns harping on our need for instant gratification. Pay up and close all unnecessary accounts – even if it means paying extra every month. Make the short-term sacrifice and avoid additional interest payments. Once they are closed, do not replace them.

  1. Control Excessive Spending

Stopping frivolous spending does not mean living miserly. But not being able to account for where money has gone means that there are opportunities to improve one’s financial management. Intelligent financial planning means minimising non-essential spending like those convenient fast-food dinners or even that daily cappuccino. These are quick and easy ways to limit spending and will have a noticeable effect once minimised.

  1. Learn to Budget

One’s net monthly income minus the payment of necessary expenses such as rent, utilities and groceries leaves an amount for controlled spending. Budget to live comfortably but not excessively. Be realistic but within reason. Initial budgeting may appear restrictive as unnecessary debt may need to be settled but do not set unrealistic goals that might not be met. Creating areas of frugality within pockets of flexibility is the first step toward responsible financial planning.

  1. Pay Bills and Cut Back on Subscriptions

Settle essential spending before due dates like rent, utilities, school fees, etcetera. It avoids late penalty fees and inflated interest rates, and it may improve one’s credit ratings. Additionally, cancel recurring charges that can be done without, like subscribed streaming channels and phone apps that are less frequently used, for example.

  1. Save and Invest

Once the excess debt is settled and responsible spending has been implemented, begin saving the resultant expendable income. These savings may be used for necessary debt such as a sizable deposit on a car or property. It’s important to be protective of one’s nest egg and only access it in case of emergencies. Begin an investment strategy. Small investments into unit trusts or a retirement annuity, for example, may be a good start. As finances improve, a more elaborate investment portfolio can be put in place where the invested funds begin to make more sizeable returns. This creates new and previously untapped revenue streams.

It is never easy to begin the journey to financial freedom but start by rectifying bad spending and poor financial habits. At Efficient Wealth, we’re not about promise; we’re about effective, efficient performance. We have been assisting individuals to effectively plan their finances since 2003.

Allow us to evaluate, assess and implement an effective financial plan for you. You can redefine the manner in which you manage your personal finances. We can assist you by initiating an immediate and future needs plan. We will plan your future efficiently. It’s what we do! Contact us to find out more.