When you prepared to buy a home, you made a plan. You plotted out an ideal time frame, considered when to list your own house and with whom, and determined what types of properties you wanted to purchase. You determined the right neighborhoods, the right price and the right size. By the time you took action, you were ready for anything and capable of handling any unforeseen (or foreseen) bumps along the way. It was a beautiful thing. So why wouldn't you do the same for your finances?
A financial plan will help you determine what investments you should make, how much money you should save and how much you can spend. It will ensure that you are able to finance your new home, and that down the line, you are set for retirement. It's one of the smartest things you can do and one of the easiest, considering the first step is the hardest: calling a financial consultant and finding a time to schedule the appointment. Once you do however, there are only a few simple steps you'll have to take before you've mapped out your financial future.
The first step will be an introductory meeting. You'll sit down with your consultant to discuss what your goals are and how your finances are right now - what is already in order, what is in complete disarray. You'll go over retirement plans, college planning, tax liability, disability, death, career plans and estate. You'll lay out the framework for the remainder of your plan.
Once you've established your goals, you'll have to gather some data. You want to put together a packet of information detailing what you owe and own, your most recent 1040, your bank statements, retirement policies, life insurance plan and other similar documents. With this information, your consultant will be able to determine the best course of action. He'll analyze and figure out, with a little bit of time, where you can manage tax deductions, what you should be investing, and what, exactly, you should be doing in the upcoming months and years, to secure your future. It should be a fairly in depth and complex (if your assets are many and varied) plan.
The next step, then, is to implement that plan. Do what he tells you. If your consultant provides tips for improvement, you should follow through. Don't think that the formation of a plan is the end of the road. A plan is only as good as the action that follows. And remember to monitor your finances throughout the process and beyond. Every few years (three to five) reexamine the plan to see if any new laws or assets have affected its efficacy or can make it more effective. You may find that nothing has changed, or you may discover that a completely new plan is in order.
Your finances are what keep you afloat. They are what pay for the clothes on your back, the food in the fridge and the home you have so recently bought. Planning how best to keep them healthy is not only a wise decision; it is the only decision you can make. Call a consultant today and make an appointment. In a short time, when you are resting calmly and comfortably, you'll be glad you did.
Joe Cline is a professional real estate broker, investor, and REALTOR with RE/MAX Capital City Austin, Texas.
Find out more about Austin Texas real estate and new homes in lakeway Texas.
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