Welcome to 2024!
Here is some advice to plan your finances and investments to start 2024.
1. Set Goals: A goal without a plan is called a dream. Financial goals vary depending on your needs, desires and objectives. Your objectives might include information such as how you want to raise funds to acquire property or buy a care. Goals are also important because they give you something to strive towards, helping you stick to your budget.
2. Do: Budget: A budget is something that most people are familiar with. Setting a budget helps you plan your spending. It doesn’t matter if you earn much or little. One of my wisest clients always lived below his level of wealth to ensure a prosperous future. Nowadays, it’s much easier to establish a budget through various budgeting applications. Ask us for one.
3. Do: Increase Investments: Your financial plan should outline how you want to invest your money. Several factors will determine your investment portfolio. But one is risk appetite. Building a portfolio that reflects your risk tolerance is always critical. Speaking with a financial expert is beneficial because we can advise you on which investments to include in your portfolio. A systematic and regular investment contribution is wise and we can assist you setting it up.
4. Do: Set Up An Emergency Fund: Extra cash is always an excellent idea if an emergency pops up. A medical emergency might necessitate more funds to cover medical expenses, or supplemental income. Put money into an emergency fund and utilize it when you need it right away.
5. Don’t: Prioritize Wants Over Needs: There should be a clear distinction between what you need and what you want. Needs are necessities, while wants aren’t. To reach your financial goals, you must prioritize your needs and investing for a retirement is quite often forgotten. That implies you might have to cancel your vacation to meet your savings goals. It might also mean that instead of buying coffee, you prepare it at home. Doing the little things that might seem insignificant helps you keep your spending under control and moves you closer to your goals.
6. Don’t: Spend Beyond Your Means: How much you income is, it makes no difference when you go over budget. Going over your budget can happen, considering the available credit options, effectively allowing you to buy with the money you don’t have. While there’s nothing wrong with using a credit facility, how you use it is crucial. Exercising extreme caution regarding your spending can help your finances. Your credit record suffers if you consistently exceed your credit limit and fail to repay it. Not spending beyond your means keeps you from going into debt. I had a client once with the highest documented income I had ever seen. And yet he had a hard time paying his monthly bills because he continually spent beyond his means.
7. Don’t: Invest Using Emotions : When investing, experts always advise following your mind rather than your heart. Most of the best investments are boring. For our financial planning thesis, our professor told us that if anyone used a long term rate higher than 6% he would fail them because historically that was hard to achieve. Any yet many people get carried away chasing a high stock return from a friend’s tip. Usually that tip, if followed, leads to regret.
8. Don’t: Forget To Revisit Your Plan: Your financial plan won’t remain the same for the rest of your life. Your current situation doesn’t necessarily reflect the future since things change. The future is unpredictable too. You might have to modify your financial plan to reflect current economic circumstances and your needs, goals, and values. Review your goals with us at least once a year to see what you must adjust.
January is a good time to review your personal finances including investments and goals. If you would like me to assist you with an objective review of your finances and investments, please call the office to make an appointment. Appointments can be in person or by video conference meeting.
Sincerely,
Norm Holmes | Vice President