These small changes can help you reach long-term money goals.
Transcript:
CONWAY GITTENS: If you don’t have a concrete financial plan for the year, how do you create one and what needs to go in it?
LIZ MILLER: So everyone should have a plan. We say no matter what, how do if you’re on track for whatever you’re trying to achieve.
If you don’t have a plan of some kind, it’s great to work with an advisor who can help you build a plan, but there’s a lot of steps you can take yourself. So we say the very first step is an inventory, and that means make a list as tedious as that sounds of you’re checking accounts, your credit card balances, everything you have take in or owe and write it all down. And you’d be surprised how good it feels just to even see that in front of you. And that gives you that starting point to say, OK, here’s what’s coming in the door. Here’s what needs to go out the door, here’s my bucket of any savings or assets I have. And then here’s what I’m going to have to pay out. And it starts making it very clear where you’re going to start that planning.
CONWAY GITTENS: So we’re halfway through the year. What tweaks should people be making now?
LIZ MILLER: So the big tweak now is to see where have you been. Maybe your resolution in January was to get better control of your spending, but it was just too overwhelming. And you tried sort of keeping track of anything and nothing happened. So this is the time to see, am I spending a whole lot more than 30% on those choices. That’s the bucket. I always say to start with mid-year, how much are you spending on the things you have control over. And when you list them out, can you make some proactive decisions. I know someone who was a Starbucks addict and what they did was decide get that Keurig at home and they went to Starbucks once a week and the other days off to work, they took a mug with them of their own coffee. Well my gosh, that started it was like $100 over a month. It now got to go into savings. So little things that you really can live with. But when you make like anything like a workout goal, if it’s too big a goal, it’s not going to work. You really have to look, well, where am I spending all these things and what ones can I actually make a change to.
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