Manage Financial Plan
The most important and hardest stage in the financial planning it is time to start planning. Wrong planning could cause un achieved goals or target. The financial plan itself could be more difficult if you have family or might be starting a new family, especially if you used to be alone.
There are a few fundamental questions before embarking on the preparation of financial plans. Some of these questions, among others, what should you prepare? How do I recognize the needs of families so that no one in preparing the financial plan? Beyond that, of course there are many more.
When you’re starting to plan the family finances, honesty and good communication with your partner is essential and most fundamental thing. Discuss openly what you planned, do not hide anything.
The first stage is setting family financial goals, you have to describe it in detail the intended use of your money. For example, your goal is to finance the education of children, own a home, car, vacation undergo, and so on.
In setting financial goals, you should be able to distinguish between needs and wants. The need is if you do not have it, then your life will always be disturbed. On the contrary, the desire or wants arose spontaneously.
The second stage is to establish the amount of income and expenditure. In other words you must know the cash inflows and outflows. The one classified as cash inflows (revenues) are the salary, allowances, bonuses and other income from other resources such as side or part time jobs.
Basic principles of finance, the revenue must be greater than expenditures. When determining the types of expenses, you need to adjust to the needs of each partner based on its activity. For example if your husband profession is a marketing officer, he might need to buy a car.
The next stage is deciding expenditure according to needs. In order to do it, you should prepare emergency funds, that the amount are 6 or 12 time of your monthly revenue. The purpose is when you’re in emergency situation such as accident, or sick, then you’ll have money for that.
The other things are buying insurance, and do some investment. Insurance to prevent those emergency funds, while investment is to add your future income. Routine family costs such as paying electricity, water, cable tv, etc. should be well prepare as your monthly expenditure. And the last thing is evaluation. You should evaluate all your expenditure based on your income, with that you’ll be able to manage your own financial plan.
The next question is what if you’re in position of unable to manage your financial, or in other word expenditure are higher then your income. Its time for you to start and says repair my credit now, if you do got loans, then the ways are a bit similar as I mention above, but in the next few month your expenditures would still be high, but the important thing is to reduce it every month.