Why do I struggle with financial planning
Tags: Struggle, Money, Financial Planning

Lets begin with the basics of fin planning and behaviors.

What is fin planning

In simpler terms, ensuring that in future you shall have certain amount for certain things!

Suppose you want to buy a bigger house and would require to have a specific amount for that. So you define a need to have X amount in Y years. Then you split up how much you need to save each month. To archive the target you utilize a helper.

E.g. Equity is a type of helper that gives you most returns (equally risky). Equity investments are not guaranteed, it so happens that markets crash around the moment you want your money back.

Another example would be of a Debt helper which guarantees your returns. But its like lazy worker, it will not offer significant help.

You choose the helper based on your comfort levels of volatility and the amount you could save.

Once you know with how much to save each month/year using which helper, your plan is ready for one goal.

Do this for every goal be it house, vacations, retirement… and your financial planning is done.

What is behavior

It is you as a person, the choices you make, the things you do, the food you eat, etc…

Each individual has different level of control over themselves. Some are very strict with their rules. Some are absolutely lazy. Some are crazy committed. In general most people do struggle with sticking to plans. Just look the amount of books available for self help.

So do not get demotivated if you are struggling with sticking to financial plan. Its normal thing and you will overcome the failures once you are willing to understand how to overcome the

Now the basics are done, lets dive into specifics on being successful.

Success through behaviors

Understanding the triggers that cause failures.

Behaviors is a free spirit and it takes mighty commitment to bend it. Equally they are also our guiding force. Everyone of us has tried to change our behaviors multiple times in our life, you can recall how many times you have succeeded.

Now I will be relying on the behaviors for achieving financial success. Lets take example of shopping.

We absolutely love shopping and the dopamine kicks ensure we keep on doing it again and again.

Individual or family man the shopping is done in varied categories. Buying different products, different services. Some we use a lot, some rarely and some very average consumption.

Lets look at your shopping list and figure out what you really enjoy or liked.

This approach will tell you in all things on which you spend money what is giving you the most fulfillment. It the list of things that give you highest return on investment (RoI).

E.g. If you enjoy most of the shows from Netflix, you can skip the subscription for other streaming services. Since majority of time is spent on this streaming service, so you would not notice much if the other services are not there.

You would manage to overcome easily the missing things/services, as significant behavior change is not required.

Analyze your spending list of last one year. Concentrate you spending into a particular thing. Avoid the spread.

And please FOMO (fear of missing out) is not something very useful and real. Be logical.

Conclusion

Your behaviors tell a story, listening to them will save you money and stay guided on your financial plan.