The Three Essentials of Financial Planning

We’re less than a month away from bidding the year adieu. And once you’re probably through with all your Christmas preparations, you’ll be coming up with a new set of resolutions to welcome 2022 with. Whether it’s dropping a bad habit or developing a routine, the start of a new year is always the perfect time to start anew.

A lot of people usually use this as an opportunity to finally start taking better control of their finances if they haven’t yet. We tell ourselves, “I’ll start saving this year” or “I’ll start investing”. These are good goals to set for yourself – there’s no question about that – but you have to realize that a goal is just a goal unless you see it through. And let’s face it, we usually lose all motivation to tick our list of resolutions a few months into the new year.

So for this year why not try a different approach? Instead of the traditional resolution, how about trying to shift your perspective in financial planning for a change? Perhaps this might make it easier to get you on track with your finances and everything will likely follow from there.

Here it goes: There are three essentials to financial planning, and they are money, knowledge, and time. We’ll talk about the three individually, but know that they’re interconnected parts of a whole – each one adds to the bigger picture.

Money is yours. By that, we mean you have full control of it. It’s fairly straightforward if you think about it: You receive an income from your work, which you can spend, save, or invest – choices you make for yourself. Say, you want to earn more, you can demand a raise or find side hustles. In short, how much money you make or won’t make is largely on you.

Knowledge is what you gain. Now more than ever, information is readily accessible. It’s out there for you to obtain. You can learn about basic financial planning, for example, with a quick Google search. You can also get advice from people you know, who are financial advisors themselves or may know one. You just have to make sure that your information is reliable.

Time, on the other hand, is not yours. There are 24 hours in a day, 60 minutes in an hour, and 60 seconds in a minute, no more, no less. We’re all bound to time – we have no control over it.

You can’t go back to the past, nor can you jump to the future. The only time you own is now. Right this very moment. This is why they say time is the most precious commodity in the world. You just can’t put a price on it.

What you can do, however, as you probably may have heard before, is make the most out of the now that you have. Do not concern yourself with the past or the future, you have no control over those. Take control of the now.

You might be thinking, “that’s easy for us to say”,” and we understand how you might feel, especially if you have a lot going on day-to-day. But hear us out for a bit. Once again, if you try changing your perspective, you might realize what you’re missing out on all along.

This same philosophy should apply to how you think about financial planning: With the money you have and the knowledge you’ve gained, do something about your finances now. Not tomorrow. Not next week. Now. From there everything else will follow.