Starting to create a financial plan can be daunting. For those of you who are just starting out planning for your financial future, it can feel overwhelming. Knowing where to start and what to prioritise is only the tip of the iceberg when planning for your financial future. 

Don’t worry or stress too much, here at Schofield we believe that starting to plan for your financial future in your 20’s is the best place to start. Our easy tips and tricks will help you understand your finances, as well as enable you to plan effectively for your financial future. 

Create a financial checklist 

The first step in planning for your financial future is to create a financial checklist. This will be a simple checklist that details the tasks you need to complete. Tasks such as:

• Setting a budget
• Organising your finances
• Tracking your expenses
• Setting financial goals

Anything related to your finances will be included in your financial checklist. Writing each step out in a clear and easy to understand way will help you see what it is you need to do. Planning for your financial future might take a little bit of legwork to get started; but once you have begun implementing your plans it’s easy to continue. 

Set your financial goals

Once you have created your checklist you can begin to set your financial goals. Consider using the SMART goal setting method with your financial goals 

Specific
Measurable
Achievable
Relevant
Time-bound

This way of setting goals allows you to set a financial goal that you can easily track as well as achieve. One of the most common reasons why people struggle with saving for the financial future is because they don’t know why they are saving. 

Read our blog about where to start your financial planning journey. 

Create your financial budget 

Once you have set your financial goals you need to create your financial budget. You can do this by writing down a list of expenses. This will include your essential bills, such as rent/mortgage repayments, utilities, food and fuel etc. Below that list of essential bills you will have an additional layer, these will be the other expenses such as subscriptions, gym memberships etc. Having your budget split into essential and additional expenses will help you when it comes to prioritising your funds.

Once you have assessed your outgoing expenses, you can then compare that to your income. The difference between the two figures will give you an idea of how much “disposable income” you have available at the end of each month. 

Use this disposable income and split it across your savings goals. Have several different accounts which you can use for each goal that way you are able to easily track your progress for each goal. 

Our final top tip to planning for your financial future is to speak with a financial planner. Working with a financial planner who is able to understand your financial goals and your current financial situation will ultimately help you make the most of your budgets. Your financial planner will be able to assist you in reaching your goals and helping you set up your financial security for your future. 

Contact our team of independent financial planners at Schofield today.