A practical guide to building your own financial plan
Tags: Business, Finance, Freelance Writing, Personal Finance

A practical guide to building your own financial plan Marillynbagenda Jul 15·3 min read

Financial planning is not just for the rich but it’s for everyone including college graduates, singles, professionals, married, mid-career, single parents, senior corporates, and entrepreneurs.

With this, money is spent wisely and as a result, you will have an improved lifestyle.

So, if you’re willing to know what you need financially, and how to get there, then financial planning will give you an advantage over one who merely reacts to financial events as they occur.

Think about, the Covid 19 virus, which has caused a lot of financial crises. Do you think that planning for your finances would have helped you survive through this economic storm?

In this post, I’ve assembled a practical guide on how to plan for your finances. Let’s dig in.

Drawing your financial goals

What are financial goals? These are the results that you want to achieve. Such as buying/building a home, achieving financial independence, saving up for business capital, or investments. So, what are your financial aspirations? Have you spelled them out?

If so, then we need to know where we are heading financially, so that we can manage the major monetary events in our lives. And activities such as saving, investing, and retirement planning should be key to your financial life

We have three types of financial goals. Short term, intermediate and long term goals

Short-term goals are usually for 12 months. And with these goals, one has to make solid, regular contributions to savings accounts to accumulate a desired net worth.

Establishing an emergency fund with 3 to 6 months of your income should be part of your short-term goals. These special funds serve as a safety reserve in case of financial emergencies.

And unless you attain your short-term targets, you probably won’t achieve any of your intermediate and long-term goals.

Your goals should also be specific. An example of this can be “I want to save 40$ at the end of every month to spend on what I want” put as;

What is the goal?

How much money do you need for it?

When to achieve this goal.

Develop a financial action plan and keep it simple

How will you achieve the financial goals you set for yourself? Of course, you will need a plan.

The process of financial planning is dynamic because as you move through the different stages of your life, your needs and goals change.

But with careful planning, you can get through tough times and prosper in good times. For example, setting up an emergency fund or reducing monthly expenses will protect you and your family financially if setbacks occur.

How great is that?



A financial action plan directs you on how to manage your finances and achieve your goals. This plan should include specific goals and clear actions to monitor.

Your plan can be as simple as writing down three to five goals and the steps to achieve them. As this simple plan succeeds over time, you can then update and redefine it to include more complex goals like making an investment or retirement plan.

And for these added goals, the services of a professional planner can be desirable. These planners not only get you onto a sold path, but they can also save you a lot of money over what you might spend on.

Now, not two financial action plans are the same. They differ based on how complex your needs are and how much of your life plans you want to cover.

These plans can be as simple as listing each goal and then the means of achieving each one. For example:

Setting goals: Write down the things you want to achieve.

Developing the plan: Set a simple task list to attain the goal.

Carrying out the plan: Do the tasks and mark them as done when they are finished.

Monitoring your actions: Set a reminder on a calendar or an app to see how you are doing.

In brief,

Goal: Save 40$ at the end of every month to spend on what I want.

Make a budget.

Look for less expensive alternatives to reduce expenses. For example, eat out a few times per week.

Have this money saved in a different place.

Now that you have learned how to create a financial plan, remember to monitor it every end of the month to make sure you’re on track. Then redefine and revise your actions and strategies as personal circumstances change.

What’s your take on this? Let me know in the comment section. Good luck!