6 Steps For Planning Your Wealth Management and Financial Security

Posted by Jarrod Musick, CFP® | February 13, 2017

Wealth management sounds like a fairly straightforward term, and in many respects, it is. For one thing, the phrase is all about managing your wealth. However, this type of management requires you to consider many factors. As an example, wealth management typically begins with planning around your income, incorporating smart credit usage and long-range planning and investing. Below, you will find money management tips and personal financial insights to help you get started.


Step 1: Plan Your Income and Expenditures
Assessing your income and expenditures is the starting point for managing your wealth. Focusing on your monthly earnings and necessary expenses allows you to make sure you are in-balance and not overspending, if you are you can make some necessary spending cuts.


Step 2: Use Credit Wisely
Perhaps the most important piece of financial advice is to use credit only when you are sure you can pay it back on time. For instance, a credit history showing on-time payments helps you build a good financial track record. In fact, these on-time payments apply to far more than credit cards and mortgages. Take utility bills; if you pay them late or do not pay them, they may end up in collections. That is a mark you want to avoid on your credit history.

Experian, one of the three major credit bureaus, points out the many considerations that go into wise credit usage. In a marriage, for example, both parties’ credit scores take a hit when a missed payment occurs on a jointly held credit card account. With this in mind, you may prefer that you and your spouse divide the payments according to whose name is on what bill, or set up automated payments so that nothing is missed.

Likewise, many companies use credit checks to determine whether a potential employee may be worth hiring. Using your credit wisely could help you land a better job.


Step 3: Remember Your Savings
There are so many blogs, articles and Youtube videos on various personal financial strategies out there that it can be quite confusing. One piece may say to start saving for retirement at all costs, while another may promote the advantages of paying extra for health insurance at the expense of other needs. That said, many guides do get the main thing right — you need to focus on your savings before you can direct your attention to other things.

One of your early, primary financial goals should be building a cushion of savings that constitutes at least three to six months of your living expenses, including your mortgage payments, car payments, gas, credit card bills, student loan payments, eating out money and so on. Everything should be accounted for, so you need to track your spending for at least three months. (One month typically is not enough, as some expenses occur every few months.) Once you have a budget in place, calculate how much you want to put away each month. The final step is to create a separate account for this purpose and to automate your payments into the account.


Step 4: Ensure Your Goals Are Achievable
Dreams are important, being able to work toward them is one of the great parts of life. That said, it is important that your financial goals are achievable. The more financial security you enjoy, the stronger a foundation you have to fall back on as you set out on a journey to bigger and better things.

Take managing your wealth one step at a time, and create small and achievable goals that lead to your ultimate goal of financial stability. Being in charge of your future ensures that you have an actionable plan for your financial goals and that they are realistic and within your control. The time frame, who is involved and the assets you have are just three possible factors.


Step 5: Make a Retirement Plan
Planning for retirement is critical on several fronts. People are living longer, meaning that their retirement dollars must stretch further. The earlier you start, the more money you should have throughout retirement. Financial moves you might consider include establishing avenues for passive income, investing in real estate and setting up IRAs. You want to enter retirement as financially sound as possible.


Step 6: Create a Long-Term Wealth Management Strategy
Even if you start planning for retirement relatively late in the game, it is still a long-term goal. In fact, it is just one of the several approaches to financial security and prosperity you should have going on as you create a long-term strategy for handling your wealth. These approaches can include investing in property and the stock market, as well as in interest-bearing savings accounts. Let us help you find where your interests lie.

Allow us to help you with your wealth management and with achieving your desired financial freedom and security.



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