Skip to main content

If you want to have financial security, having a good plan is the only way to achieve it. The good news is that financial planning doesn’t have to be complicated. These 6 simple steps will help you start saving more and put you on the path to living comfortably!

6 Steps to Financial Planning

1. Find Out Where Your Money Goes

The first and most important step for financial planning is to create a budget detailing where your money goes now.

To do this, keep a notebook with you or log your purchases with an app on your phone. Every time you spend money, make a note detailing what you bought and how much it cost. There are also a number of personal finance apps and websites that can help you keep track of your spending for you. Everydollar, Fudget and BillGuard are all free apps that help keep tabs on your budget.*

At the end of each week, go over your notes and categorize them. How much did you spend on food, transportation, housing, clothing, entertainment, healthcare, rent/mortgage, bills and utilities? At the end of a month, consolidate your notes. Repeat the process for 3-4 months, then add everything up and devote some time to go over the results.

Remember, the job is only to figure out where your money is going now, not to begin cutting pastimes and pleasures.

You want to capture a good idea of all expenditure you make, including those you don’t make every month, such as car repairs.

2. Set Financial Goals

Next, think of where you want to be 20 years from now. Avoid generic answers such as, “I want to be rich” and answer with more specificity: “I want to own a house that is half paid off and an investment portfolio of $500,000.” Be realistic and specific when setting your goals.

3. Know Your Credit Score

Your credit score is very important. Once a year, check your score. Some credit card providers now offer a report of your credit score, but you can get a free report once per year at

4. Start Saving

The key to a good savings plan is to focus not only on your income, but also your expenses. Even if you earn a high wage, you can outspend your income. However, if you control your spending, you will be able to grow your savings easily.

After reviewing your list of expenses, determine where you might be spending too much or where you can cut back. Look for ways to save here and there, but don’t be too hard on yourself. Your goal is not to eliminate all pleasures, but to control them so you can free up more of your income. An extra 10% is a good starting place.

Comparison shopping is also a great way to start saving on your current expenses without cutting necessities. When it comes to your insurance, we can do the comparing for you and get you the best price on coverage that fits you, not a one size fits most policy. Bundling your home and auto can save you up to $500 a year. Save today by calling us at 724-929-2300.

Put this money aside and add to it until you have at least three months’ worth of income in a separate savings account. This will be your emergency fund, should a surprise expense, such as a car repair, come up. Just make it your first priority to replace this fund as soon as possible should you need to use it. This will keep you from dipping into your savings for emergencies.

5. Build a Portfolio

After saving enough for an emergency fund, you should begin to look toward investing extra cash. Many people enroll in their company’s 401k, if offered. Another easy way to start building a portfolio is with mutual funds.

6. Keep Track of Your Plan

Track your financial plan with an annual checkup to ensure that it still meets your personal situation. Have your goals changed? What about your income, debt, family needs, or health? How have your investments performed? More importantly, have they performed as you expected?

Depending on your circumstance, it may make sense to review your plan semi-annually or even quarterly. If you do, however, don’t confuse your long-term goals with short-term ups and downs in your personal situation and don’t be too quick to change your plans.

Financial planning is an important part of assuring your future stability. By taking these steps early, you will better understand your spending and will begin to grow your savings to create a safety net for your future. For more ways to add to your savings, just call us at 724-929-2300. We’ll save you time and money by comparing insurance costs for you to get you the lowest price on the right coverage for you.


* CSC is not sponsored or endorsed by any apps mentioned in this article. This is simply a reference for our readers to begin researching financial planning options.