July 08, 2009
Life is a journey full of twists and turns, and so is the road to financial fitness. As with any trip, it takes planning, calculations and tune-ups along the way.
The first part of any journey is to understand where you are today and then plan for where you want to go. How can we know where we're headed if we don't know where we want to be? Financial fitness is attainable, but it takes time, commitment, determination, and making some tough decisions.
The term "financial planning" seems daunting, but it's merely a road map to help us along the way - a step-by-step process as easy as counting to 5. So what are we waiting for, let's get started!
For some this may be early retirement, vacation, a child's education or a new home. It may simply be to start a savings account. Each person's goals will be different and that's OK.Step 2: What will it take to achieve those goals?
Each person will have a different answer here - maybe the amount to take that vacation, the amount for a down payment on a new car or the amount to retire at a certain age.Step 3: What will you have?
Based on your current plan what will you have saved next year for that vacation? What will you have saved in five years for the down payment on that first home?Step 4: Is there a gap
This is no time to be unrealistic; we have to be brutally honest with ourselves. Are we putting enough away today to get where we want to be tomorrow?Step 5: What should you do?
Based on the outcome of the first 4 steps, your path may take a turn here. Maybe we realize that we can't start saving yet because we're living paycheck to paycheck with credit cards and other debt. This would be the time to closely examine spending, make a family budget and start asking yourself what you can do without.
Depending where you are on the road to financial fitness, the plan may be different. Thinking about your plan for the future and how to manage your money the right way can be overwhelming. People are making changes - Americans are saving more, spending less, and rebalancing expectations about what's important in life. You can do it, just get going! Start with one piece and go from there. Becoming financially fit can provide peace of mind in all aspects of life, freeing up your attention for friends, family, and hobbies.
The possibilities are endless. What's there to lose?
Jamie Turner is a consultant in Humana's Human Capital Performance Group. Jamie joined Humana in 2008 to lead the development of the "My Money, My Health a guide to financial fitness" program. Jamie has a BBA from Marshall University and a MBA from Point Park University.
Note: The information available in this article is for informational purposes only and not for the purpose of providing financial advice. Financial recommendations are provided for illustrative purposes only. You’re responsible for verifying the accuracy and suitability of all assumptions and calculations. Please seek the advice of licensed or competent individuals before making any investment or financial planning decisions. Don’t rely solely on financial or retirement information found in e-PlanProfessor.