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Get Your Life ‘In Financial Planning’ (Step 3)

It is time to analyze and evaluate your financial status.


Now that you have gathered all your relevant data, let us talk about analyzing it. The data you have gathered can help you arrive at some basic assumptions. You can now use your data to determine your needed levels of investment. Your analysis will determine your starting point, ending point, and all the steps in between to get there.


If you completed your financial worksheet, you should have the following.

• Your current net income

• Your total expenses

• Your credit liability

• Your total available credit

• Your total discretionary funds


With these in mind, our analysis will be simple. We can use retirement as an example. Let us assume you have 30 years until retirement, you have already saved $50,000, you expect an 8.00% return on your investments, and you can save $250 per month going forward.


With all variables consistent, you will arrive at approximately $920,000 at the proposed retirement date of 30 years from now.


Given your current family situation and life style, do you think this is a sufficient amount for you to retire? Often, the initial assumptions are not quite enough to obtain the goal. This where you begin devising alternative solutions.


It is time to dig deep and make some adjustments. From the analysis of your finances and family status, determine where you can make changes.

• Will your current income allow you to set aside more than $250 per month?

• Are you willing to be more aggressive with your investments?

• Can you expand your timeframe?


Do not be befuddled by the calculations. There are many online calculators and tools that you can use. For instance, Kiplinger's Retirement Savings Calculator, plug in the numbers and see if your retirement nest egg will be just right for you.


Whether it is for retirement or for that big vacation, the same concept can be applied. Just fill in the blanks.

• I want to _________. (i.e. retire, go on vacation, buy a new house, purchase a car, etc.)

• I currently have $__________ (current amount saved). If you are like me, this may be at $0, but that is ok. It is still a starting point.

• I can currently afford to set aside $_________ each month. (Be sure to use your analysis too accurately determine this amount.)

• I need $___________ to achieve my goal. (what amount will be needed in the end)

Nov. 2, 2018

• I have _________ months/years to save the amount needed.



You are now half way through the financial planning process. Time “falls back” this weekend, but you do not have to. Stay the course! The fact that you are even thinking about your finances is a good start. Keep on keeping on and Get Your Financial Life!

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