Having a financial backup plan gives extra finances, as well as genuinely necessary significant serenity in the event that the bottom falls out.
Can you see yourself assembling your very own business? Manufacture your own financial backup plan by supplementing your pay, making a financial cushion, or perhaps eventually freeing yourself totally of financial stress by utilizing your insight, gifts, and ability to step up.
The following are tips on what you ought to do.
Make a list of things to anticipate
On the off chance that you have a profession or are an entrepreneur, you need to clearly understand your financial picture and prepare a plan for your future self. This means creating a list of things to plan for and start working on asap.
Things you need to work on include:
- Creating monthly budgets to help you keep your expenses below your income
- Paying off debt and creating a spending plan (using your budget)
- Understanding all your bills and their due dates
- Funding your emergency account
- Saving for retirement
- Building a diversified portfolio of investments
- Creating multiple streams of income and
- Putting aside money for the other things you want (e.g. your short, mid-term and long goals)
- Making sure you have the right type of insurance coverage (Life, health, disability, home etc)
- Including your dependents (e..g children) as part of your overall plan
Plan for yourself
If you are single, it’s important that establish your a financial plan that not only helps you meet your immediate goals but that ensures your future self will be taken care of and this means doing all of the things mentioned above without making any assumptions that things will somehow work themselves out or that you’ll meet someone who will deal with the finances in your relationship. If you relationship status changes or you get married, you’ll be well equipped to plan your finances together since you’d already have things in place for yourself. See below.
Make arrangements with your loved one
On the off chance that you are or have a significant other, then you need to participate in your finances as a team. Discuss your budget and money goals and make financial decisions together. Understand where your money is going and how much money you have in savings and in investments.
If you are a stay at home mom, which in itself is a full time job, you need to be the CFO of the establishment that is your home. Be involved in all of your family financial decisions and make sure you clearly understand your family’s financial picture. You can even take it upon yourself to manage your family’s savings and investments or plan your household budget.
Have your own account
Having joint accounts is great but I also believe in having your own personal savings accounts as well because as women, it is important for us to build our own sense of security and have “our own” that we bring to the table. That being said, your personal accounts should not be secret. Remember, marriage and committed relationships thrive on openness and honesty.
Not everyone will agree with me on this and that’s ok but look at it this way: In the event that something serious happens or your significant other makes a poor financial decision that causes serious losses to your money portfolio – wouldn’t it be great if you could be the backup plan instead of there being no plan?
Also, lack of cash ought not be the reason you remain in an awful relationship that you know you have to escape. Having cash in your own personal accounts can make all the difference.
Being your own backup plan is taking your financial future (and that of your family) into your own hands and not sitting around waiting for anyone to improve your financial situation for you. It’s all about planning accordingly and taking the necessary action to ensure your finances are in order.