YOUR FINANCIAL PLAN: WHERE IT ALL BEGINS

“Most people don’t plan to fail… They simply fail to plan!”

THE FIVE-STEP FINANCIAL PLANNING PROCESS

SAMPLE WANTS AND NEEDS NEEDSWANTS Food for breakfast An iPod Clothes for school DVD Player Transportation to school or work Cell Phone ______________ Hot Car ____________________________ ____________________________

VALUES Getting a good education Getting a good education Religious faith or beliefs Religious faith or beliefs Social causes Social causes Handling money responsibly Handling money responsibly Friendships / The people I hang out with Friendships / The people I hang out with ____________________________ ____________________________

TERM GOALS SHORT-TERM GOALS  Within three months INTERMEDIATE-TERM GOALS  Three months to a year LONG-TERM GOALS  More than a year

DELAYED GRATIFICATION Saving money over time to make a major purchase. Saving money over time to make a major purchase. Waiting to buy a new product until the price goes down. Waiting to buy a new product until the price goes down. Waiting to see the latest movie until the crowds get smaller and the lines shorter. Waiting to see the latest movie until the crowds get smaller and the lines shorter. ______________________________________ ______________________________ ______________________________________ ______________________________

S-M-A-R-T GOAL CRITERIA S pecific M easurable T ime-Limited R ealistic A ttainable

SMART Goals Examples S pecific…….. M easurable… T ime-Limited.. R ealistic……. A ttainable….. “ Pay for lodging, transportation, and meals for a 5-day trip to Washington, D.C. ” “I will get $300 through fundraising, $50 from birthday money, and save $25 a week. ” “ If I stick to my plan, I will have the money when I need it. ” “ I still have enough money to live on while I work toward this goal. ” “ I need to have all of the money within six months from now. ”

SPENDING RECORD $35.00 $5.00 $15.00 $6.00 $4.00 $7.00 $8.00 $15.00 $40.00 $55.00 $15.00

What about you? FACTORS THAT AFFECT DECISION MAKING Wants Family Values Time Money Needs Habits Motivation Education Age Attitudes Society Culture

Evaluate Results DECISION-MAKING PROCESS Make a Decision Identify Your Goal Weigh Pros and Cons EstablishCriteria

EvaluateResults Make a Decision Identify Your Goal Weigh Pros and Cons EstablishCriteria Monitor & Modify the Plan Implement Set Goals Create a Plan AnalyzeInformation Financial Planning Decision-Making and Financial Planning Processes Decision-Making

KNOW WHAT YOU WANT Identify Your Goal EstablishCriteria Decide where to eat

REALITY RESPONSIBILITY RESTRAINT

Your Financial Plan: Where It All Begins