Reminder: Personal Financial Planning is Not Just for the Very Wealthy

March 4, 2021 | Louis Tully

personal financial planning

2020 was a wake-up call for a lot of people. While personal financial planning was already sort of a trend, especially among millennials, the Covid-19 pandemic showed everyone just how important it is to have good money-management skills.

Yet, while acknowledging its importance, some are still reluctant to try their hand at personal financial planning. Their argument? They live paycheck-to-paycheck, they don’t have money for it. Personal financial planning is for everyone. In fact, if you have little money to work with you need to start doing it more than the wealthy do.

5-Step Easy Guide To Personal Financial Planning

Personal Financial Planning Step 1: Determine Your Goals

What is it that you want to do with your money? And what is it that you need? And most importantly – what do you envision your money situation being in 10 years? Prioritizing your needs over your wants is important – not only during this first step but later on as well. That doesn’t mean you ignore your wants. You just need to come up with a step-by-step plan of where your money goes, and planning a vacation should go below the emergency fund in the list of goals.

But it should still be on the list.

Personal Financial Planning Step 2: Start Budgeting

The less money you have the more important it is to smartly divide it up between all of your expenses.

The first thing you must do is look at your bank transactions, determine what the unnecessary expenses are (subscription services you could do without, cable, takeout), what expenses could be mitigated, and what cannot be changed (rent, for example).

Budget for the “unskippables” first, then determine how much you’ll be saving, and only then start budgeting for the rest of the expenses.

Personal Financial Planning Step 3: Set Up An Emergency Fund

The first thing you should save money for is the emergency fund. That’s around 6 months’ worth of expenses fully covered.

(The easiest way to do this is to automate your savings – so that when your paycheck comes, the money you’ve allocated to savings in the budget is automatically transferred to your savings account). If there are large expenses you know you’ll have to tackle in the future (home or car repairs, doctor’s appointments, or above-mentioned vacations) – you can start saving money separately specifically for those. These are called sinking funds.

Personal Financial Planning Step 4: Start Planning For Retirement

After saving 6 months’ worth of money for emergencies, you can start saving for more long-term goals as well.

At the very least you should start putting money into your (Roth) IRA and max out any employer contributions available to you.

But a really smart step would be to determine what an optimal investment policy would be. Mutual funds are a popular option among those who don’t wish to take unnecessary risks, but you should pay a visit to a financial advisor to get a professional opinion.

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Personal Financial Planning Step 5: Learn How To Utilize Debt

Americans have an interesting relationship with debt. Some go all out and take all the “free money” they can get, and some are afraid of it to the point of panic.

Here’s the truth though: debt can be good if utilized correctly. Debt that puts you forward isn’t something to be afraid of. Getting a car, a home, or an emergency loan is a smart way to take on debt.

What you need to do though, is learn how not to abuse it. Before you take on any debt, you should plan how you’ll be paying it off.

For example, if you suddenly need to visit a doctor and you don’t have any money, acquiring an auto pawn could be good. As long as you’re smart about it.

What Makes An Auto Pawn A Good Emergency Choice?

For those who are strapped for cash and need it fast, an auto title pawn is a good choice due to its:

  • Accessibility – as long as you’re over 18, own a car, and that car’s title is in your name, you’re eligible for the pawn. Unlike with banks, you can apply even if your credit score is bad (or nonexistent altogether!) since Georgia Auto Pawns won’t be making a decision based on your credit history in the first place.
  • Simple procedure – you can start the auto pawn application process online, and the Georgia Auto Pawn representative walks you through the rest.
  • Swiftness – if you’re approved for the auto pawn, you’ll get the money the same day. The entire application-approval process typically lasts no more than an hour, on average around 30-40 minutes.

Here’s How You Apply For An Auto Pawn Online:

  1. Fill out the form on the website.
  2. Answer the phone when the store representative calls you to schedule a meeting.
  3. Take your car, your lien-free car title, and your government-issued ID to the meeting.
  4. Wait for the store representative to appraise everything and determine if you qualify for the pawn.
  5. Get approved and get the cash.

Follow these steps to move forward in your personal financial planning. It will make the process of dealing with your finances that much easier! If you get stuck, just ask Georgia Auto Pawn Inc. for speedy title pawn help.