Many may think financial planning is only needed for wealthy investors with complex needs, but the reality is a financial plan is something that can help everyone — not just the wealthy. And your workplace may be able to help you get started.
The fact is, if you have any source of income, you’re always deciding what you’re going to do with it: — what you’ll spend it on (groceries, rent or mortgage, clothes), how much you’ll save. Financial planning simply means having a well-thought-out strategy that helps you achieve longer-term goals while meeting near-term needs. Many employers offer benefits that can help individuals connect with financial coaches, advisers or tools to create a personalized financial plan.
Recent events have highlighted the importance of staying on track financially and preparing for the unexpected, and the stress that can result when we don’t. Lending Tree’s Pandemic Money Survey found that 42% of Americans said they cried over their financial situation during the COVID-19 outbreak, but only 18% made a plan to tackle the problem.
Just as it’s impossible to build a skyscraper without a blueprint, we all need a detailed plan to construct a financial framework that takes care of not just our day-to-day needs, but also to lay the groundwork for the future we envision. Creating a practical and actionable financial plan is your first step.
If you can imagine it, you can do it
Morgan Stanley research has found that most investors are concerned with ensuring they can cover their financial needs during their entire lifetime, maintaining or improving their standard of living, and being able to cover unexpected medical costs. But everyone also has unique priorities. What matters most to you: caring for your loved ones, buying a home, preparing for retirement? Maybe it’s all of the above, and more. Regardless of your current financial circumstances, a financial plan can help you see new possibilities and take charge of your future by implementing new tools and behaviors.
This is why many companies now offer financial-planning support to their employees. This may take the form of financial coaching, strategizing or advice to help you identify and move toward your financial goals. Find out if your employer offers access to a financial-planning app or website, education on investment basics, matching contributions on emergency savings, or student debt repayment programs. Together, these workplace benefits can help open the door to a more solid financial future.
Laying the groundwork
Research from the Brookings Institution shows that just one-third of Americans are truly financially healthy. Half are just coping, while nearly one in five are financially vulnerable — meaning, they’re struggling with nearly …….