I hope your August is going well and your summer is rounding out to be great!  I want to talk about planning this month.  Planning can come up in every instance of your life: planning for your day or week, a trip, a new job, or my favorite, for your taxes and finances. 

In honor of a month of planning, I have included below some of the best steps you can take to be successful in your planning – not only from a financial and tax perspective, but for life in general.

Enjoy! And as always, if you have any questions or if something strikes you that you’d like more information on, please let me know.  

5 Steps to Successful Planning

1. List your Goals

Before you can begin planning, you need to first figure out what you are planning for.  Take some time to write down everything you want to accomplish.  These items can be long-term or short-term, big or small.  There is no limit to what this list can hold for you.

From a financial standpoint, I like to start with some basics and then expand from there.  Some areas to consider are retirement, home or property purchase, college savings, debt payoff and estate set-up. 

It’s important to make sure your goals are written down, so you have something to go back to as we go through the next steps, and more importantly, to track your success. 


2. Set a Timeline

Goals should be specific and measurable.  Now that you know what your goals are, it’s time to give each a timeframe.  For longer term goals, this can be in years, while for shorter term goals, months and even weeks can help you to be more successful.  By giving your goals a timeline, it is easier to start to plan the steps that you need to take to get there. 

Financially speaking, timelines are even more important so that you can give your current income and assets direction.  A timeline can help you not only to assign and allocate the use of each of your accounts and the money coming in, but also to prioritize the use of these assets based on their target date or importance to you.


3. Work Backwards

You know your starting point and now have set your end goals.  All that’s left is to figure out the middle.  Instead of working towards your goals as you will be doing once you put your plan into action, start off by working backwards.  If you know 5 years from now you want $50,000 in a bank account and you are starting at $0, what should monthly targets look like for moving money into the account? 

This can also be the time when you determine guideposts you want to achieve on the way to completing your goals.  For example, having $50,000 in a bank account 5 years from now may mean setting a guidepost to have contributed $25,000 2.5 years from now.  However, if you are putting that money into an investment account, you may only need to have a guidepost of contributing $20,000 2.5 years from now, as the investments should help to make up the difference.  

Taking steps to work with someone becomes increasingly important as you move through the planning stages. As an example, working with a financial professional, such as myself, can help you to determine your goals and get an outside and unemotional opinion on best options for working towards these goals.  It also helps to have someone cheering you on along the way.


4. Figure out their Impact

Planning isn’t limited to just putting together steps to follow.  It should also involve a review of what the impact of your plan will have on your life.  What does it mean for your time commitment or maybe your spending habits?  Will you start to structure your day differently to ensure you make time for the guideposts you set while working backwards?

Financially, it is important to figure out what your plan means not only from a spending and account structure standpoint, but also from a tax standpoint.  Working with a CPA and / or a financial professional can help you here as well.  It could be that your goal is to save more for retirement, which could benefit your current tax return.  However, if your goal is to make your retirement more tax-free, then this could cause a higher tax impact today with a tax savings result in the future.  Even simple steps such as saving or investing the money you previously spent can result in dividends, interest and / or capital gains / losses on your taxes. 

A quick analysis both before you begin, and as you work towards your goals, can help to alleviate any surprises coming up along the way. 


5. Take Action

All that’s left to do now is start!  This should be easy now that you’ve gone through steps 1-4.  Your goals are closer to being achieved than you know.  There’s never been a better time to start than today.


If you want more information or guidance on planning and achieving your goals, please let me know!  I am happy to schedule a complimentary consultation to discuss any questions or concerns you may have. 


Thank you, as always, for your time.