I’m good; I don’t need a financial plan! How many of us think and / or say this on a regular basis? How many of us actually believe this? Believe it or not, I used to be one of these people. I used to think creating a plan was just creating a dream / wish list. Then once created it may or may not just magically happen. This was before I educated myself on this process. Now I completely understand the purpose of a plan and the role it plays in helping us achieve our financial and life goals. Let’s start debunking this “I don’t need a plan” mindset:
- Why set a goal when I can barely pay my own bills? Having this mindset tells us we are ok with allowing all the money that comes in to flow out without us even knowing where it went. We go about our daily activities without a worry in the world. Never thinking about how or when our purchases we make today will be paid. A study done by the Washington Post in Aug 2020 states that between 50 – 78% of Americans live paycheck to paycheck. I’m not sure about you, but I find this very alarming! Coasting through life without a plan keeps us broke and in debt.
- Plans always change, so why create one? Plans are designed to be fluid & ever changing. Life happens and we need to be able to adjust along the way. Having a plan allows us to adjust while staying focused on our long term goals. Plans allow US to determine where our money where it is best allocated! Telling our money where it is going instead of our money dictating where it goes is very empowering. As we gain control in this area we will find that our life in general will start improve. We will start looking at life situations as just a small speed bump instead of a huge crater as our plan will allow us to make modifications. This may feel strange at first, but after a while it will become second nature.
- Why worry about tomorrow when there are lots of other things I want to do with that money today? I feel a lot of us find ourselves in this bucket. We always want the latest and greatest widget. Our dream house for our first home purchase. The latest model car because we need to drive in style. This list could go on and on. Don’t get me wrong here; I’m not saying you shouldn’t have nice things. What I’m saying is don’t let your nice things have you! Planning and saving for these purchases will provide you a sense of peace when the time comes to make the purchase. Planning for these purchases will also allow you to not jeopardize your future financial well-being because you are spending it all today! Ever hear of the words compound interest? These 2 words are your best friend when it comes to investing in your future. These 2 words alone will allow you to buy many new widgets, cars, or (insert your desire here) in the future. Delaying our instant gratification way of thinking for one of contentment goes completely against what society drives into us on a daily basis. This is probably one of the hardest obstacles we have to face, but if we can conquer this one, our financial and life goals are well within reach!
Having a plan allows us to have something to aim for. Without having something to aim for we achieve nothing. Feeling like we achieve / accomplish nothing will keep us broke, depressed, stressed, etc. Let’s change the way we look at life & finances and start creating your plan today!
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Crossroads Financial Coaching LLC