Smart Financial Planning

This is where this website starts to get very interesting because our goal is to be financially safe, and we are not going to achieve that only by saving money, we can use the money we save to make small secure investments that will help us do things such as consolidating debt and paying for our bills. A good financial plan is a plan that helps you achieve the financial goals that you want, so that you can live the life that you want, without being stressed because you owe money or because you don’t know how are you going to buy the things that you need. So, today we start talking about making money through secure investing.

I Savings Bonds

I mentioned that we want to make small investments that are secure. Because we don’t want to make big mistakes that will cost us greatly, we want to make a small Return on the Investment (ROI) even if its low. I Bonds are low risk and if you buy them you will earn interest while you own them, they will also protect you from inflation. For example people who have purchased Series I Savings Bonds in November will make a 3.36% by April 30th.

Ever since the I savings bonds program was launched back in September 1st, 1998, people owning them have been protected from inflation. You can learn what is going to be the I Savings Bonds rate every November 1st and May 1st. These bonds have a final maturity, meaning that they stop earning interest 30 years after the bond has been issued. The final interest rate is issued on the first day of the final maturity month.

You must own  a Series I Savings Bond for at least a year before cashing in. You will be penalized if you redeem your bonds within the first five years, so you will lose the last 3 months of interest as a penalty. If you redeem a 36 month old bond you will receive your investment and 33 months worth of interest. After 5 years you won’t be penalized and you will cash in all of your money.

You can also buy Paper I Bonds, they can  be acquired online, you have to open an internet processing account with the U.S treasury department at treasurydirect.gov, if you do that then you can even buy EE savings bonds online, and you can even set up automatic purchases for as little as $25 dollars. If you don’t you simply have to go to a local bank to buy them, but you have to check if your bank does have them, because some don’t.

You can open an account at http://www.treasurydirect.gov/indiv/myaccount/myaccount_treasurydirect.htm

This information you can find it more Complete on the Treasury Direct Website found at:

www.treasurydirect.gov

You can buy I Bonds through Treasurydirect.gov in the following ways:

- At face value, you pay $50 for a $50 dollar bond.

- They can be purchased in amounts of $25 dollars or more, to the penny.

- You can buy at most $5000 dollars worth of bonds in one year.

- They are issued electronically to your designated account.

How to Buy Paper I Bonds

- They are also sold at face value, you pay $100 for a $100 dollar bond.

- They can be purchased at demonitations of $50, $75, $100, $200, $500, $1000, and $5000 dollars.

- $5000 is the maximum amount you can purchase in one calendar year as well.

- They are issued as paper bond certificates.

I Bonds can be used for many things like financing education, as a supplement retirement income, or for making more investments after you receive your interests worth.

So, a quick Recap:

Current Rate 3.36% through april 30,2010
Face Value, $50 for a $50 dollar bond when purchasing bond certificates.
$25 for a $25 dollar bond when purchasing through treasurydirect.gov.
Maximum purchase in one year $5000 in treasurydirect.gov and $5000 in paper bonds.
Denominations For Paper Bonds $50, $75, $100, $200, $500, $1,000, and $5,000. Electronic bonds through treasurydirect can be purchased to the penny for $25 or more.
They are issued in Paper Bond Certificates or electronic issue in treasurydirect.gov accounts.

Just wanted to make things clear, so you don’t get confused about what you can or can’t do. If you want more information on things like taxes, rates, terms, redemption information and stuff like that, visit the following web page at treasurydirect, just copy and paste it in your browser, http://www.treasurydirect.gov/indiv/products/prod_ibonds_glance.htm.

Before you leave.

Where to Buy Bonds?

Treasury Direct.

Banks and other financial institutions.

Internet Banking Systems.

This is why I like so much the President of the United States Mr. Barack Obama, he’s different, he can be a very inspiring individual. He is actually trying to help the American citizens have a better life, he wants his people to have more coverage, he wants to improve the financial situation of every single American, he wants everyone to be safe and secure, and that includes healthcare as well. If you did not get to see the inspiring speech about the health insurance plan that he has created, then check it out in this website, as I will be posting it on the next article.

Basically what he is trying to achieve with the health insurance reform is to provide all U.S citizens with more security and stability. He wants to provide a more secure enviroment for the people that already have health insurance, he wants to lower the cost of health care for everyone and he wants to provide coverage for the people that don’t have it. Now this is something great for people that practice financial planning, because they will be able to save money.

I know that the President of the United States Mr. Barack Obama is a very ambitious person, but in a good way, hey, that’s what made him the first Afro American President. So, even as ambitious as his health care plan sounds, it is very possible that he will succeed. Now why did I mention that you will save more money, because the new health care reform plans to save the average american family overy $2,500 U.S dollars a year. His plan also includes to get health insurance for everyone.

How Does the Obama Plan Work ?

The plan is very simple actually:

• He wants to provide every person with high quality affordable health care.

• He wants to lower costs in the U.S health care system. He wants to strengthen  public health.

How will the Health Insurance Plan Save Money ?

Obama said: “If you lose your job, change your job, or start a new business, you’ll still be able to find quality health insurance you can afford”.

This is how it’s going to happen:

• He wants to increase competition levels in the health insurance industry.
• He wants to reduce costs in the health insurance industry.
• He wants to improve the management and prevention of diseases in America.
• He wants to reduce spending in uncompensated care.
• He wants to reduce insurance premiums.

By making all of these things work he plans to save the average American family about $2.500 U.S dollars on annual fees, and through these action plan he wants to provide everyone with affordable high quality health care.

That’s not all he plans to promote a healthy lifestyle for everyone, he wants to create wellness programs to reduce illness everywhere in the U.S by encouraging better eating habits in the workplace and at schools. So, he is not doing this just to help people save money, he is doing this because he wants welfare for his country in general.

Without a doubt Mr. Barack Obama is a great man and I hope he succeeds with his Healt Insurance Reform Plan, because it will help the U.S become a better place. The reform is ambitious but it can be done, it has been created to provide U.S citizens with better health care as well as easier access to health care, by providing people with high quality affordable health insurance.

We all know that saving money can be one of the hardest things to do, that is why this article is one of the most important lessons on this website, we all have a little bit of trouble when it comes to avoid overspending, most of the time we become our own victims because having money right there at our disposal makes it easy for us to fall for the tempation of spending every last penny that we have, even if we know that it is not right and that we can’t spend that money because we might need it for stuff that is really important, like paying off debt. Truth is that human nature is complex and almost impossible to control, so we must find a way to avoid overspending, or simply avoid spending money in things that are not important or necessary for us.

This is a very important post because I will teach you how to do just that. Let’s say that maybe we want to put some money away for college, a new car, or even retirement, so we start saving and the money is right there where we can easily take it and spend it, so when something comes up we do exactly what we were not supposed to do, spend it. We think to ourselves there’s no problem, “I will just take a small portion of my saved money and I will put it right back as soon as I can”, but what happens is that we don’t put the money back and we just keep coming back for more until our plans become a part of the past, so you forget about your goals and about what you really wanted, and you start thinking that what you dreamed for is not as important as you thought it was, when it really is important, because being happy, reaching your goals, your objectives and living life the way we want to is part of good financial planning.

What we want to do to have success in our money saving campaign is place our money where we can’t touch it, and if all the management of our savings account can be done without us being a part of it, then things will be a lot easier as we are less likely to fall into the tempation of spending it. Saving money automatically has been discussed in many books, guides, and websites that talk about personal finance. In this article you will learn the most effective way on how to do it.

How to Save Money Automatically

You need to create two savings accounts, I believe that you must have one saving account by now, if you don’t then you should probably want to get one to make this work. The account that you already have won’t be for saving, it will be for spending. You will use this one to pay for bills, groceries, clothes, going out, and for any other need that you might have.

The second savings account that you are going to open is to really save money, you will put in this account the money that you are going to use in the future for retirement, a new car, education, vacations, etc. This is the account that you are going to use to set up an automatic savings plan.

There are two ways to approach automatic money saving, you can do it directly through your brick and mortar bank or you can do it through an online bank. Anyway you choose it will work, all you have to do is simply set the percentage that you want to save everytime you make a deposit in your spending account. For example if you got paid today, you deposit your money in your spending account, the percentage that you set to save will be automatically taken out from that account and it will be automatically sent or placed in your real savings account. You won’t have to worry about saving money again in your life because it will happen even without thinking about it. The money that you save should be placed in a high interest savings account, this way your money will grow exponentially as you save it.

How to Split up the Money in Different Accounts

This one is easy, all you have to do is go to the HR department and pick up a direct deposit enrollment form. Direct deposits can be split up between several savings accounts, after knowing how much you want to save and how much you need to spend, decide what percentage are you going to place in your savings account and what percentage you are going to leave in your spending account. The money that is saved shall be deposited directly in a high yield online savings or money market account.

The Process

Open a special high interest savings account. As you must know by now online banks usually offer their customers higher savings rates than almost any other brick and mortar traditional bank, because they don’t have expensive teller interactions and expensive paper handling they are able to offer their clients better deals and opportunities. You should check out my article about online banking so you understand the true benefits of using one of these financial entities.

If you are interested then you should set up an online savings account right now. There are several online banks that you could use, in the next article I will review the best online banks, but right now I will give you a quick introduction of my personal favorites:

• ING Direct : You can use it as a savings account and as a checking account, you can also have access to your money at any time in case that you need it for something, you also get some great benefits as free online bill payments, free debit card for purchases, and you can withdraw up to $35.000 from ATM’s.

• HSBC Direct : You can get a special CD for saving that pays a 2.5% interest rate. You can make up to 5 times the national average.

• Money Aisle : They will automatically analyze and compare the online savings accounts rates from almost all the other banks that are online, and they will choose the highest interest savings account rate for your own account. You can make up to 10 times the national average.

Conlusion

After reading this article saving money should no longer be a problem, what you have to do is get started right now, this way you will strengthen your financial plan. You won’t have to worry anymore about saving because you won’t have to think about it, it will just happen automatically. Saving money is something that you have to do, so to avoid falling for the tempation of spending your saved money, simply do it automatically.

What Is Online Banking ?

Most people understand what Online Banking is, it is very self explanatory, a bank online. You probably have heard a lot about online banks and about the benefits of using one, but most people are scared to trust a bank without bricks.

It is a system that allows people like you and me, individuals, to stay at home, use their computer and perform banking activities through the internet. Isn’t that nice? No more waiting in line, no more dealing with the long faces and bad attitude of bank tellers, and these examples are just the tip of the iceberg, keep reading and you will learn the real benefits of using a Virtual Bank.

When I got interested for the first time in opening my first online bank account I performed a lot of research, soon I discovered that I had the wrong idea about how the whole thing worked. I found out that this type of banking isn’t out to change your money habits, they are just using computers and technology to make your life easier, by getting rid of some aspects of traditional banking to make your finances more effective and a lot faster, they are just getting rid of all the paper based features and all of the time consuming characteristics that are involved in traditional banking.

Some traditional banks have noticed that people are starting to trust online banks, so a lot of physical banks have gone into the online banking system as well, some “real banks” are now online. There are many banks that are online only and have no physical existence.

Banks going online was something that was expected as soon as this whole internet thing got started, it just made sense, and since banking entities already had unbelievable computer networks that automated millions of transactions each day, it was just a matter of time for them to connect that same internal electronic process with their clients at home, of course the process had to be adapted, but through these adaptations a lot of value was added. Cost reduction also played an important role since paper handling and expensive teller interactions could be reduced or even eliminated for good.

After opening my first online bank account I soon discovered the great perks of having one, the best feature probably was saving a lot of time, paying my bills through one single click sure made my life easier, then I realized that I could do a lot more things than just paying my bills through one click or the automated payment option, I could also transfer money to other banks, transfer money to other brokerage firms, receiving email alerts for different things for example if my balance was running low, viewing images of cancelled checks online, better interest rates on interest bearing savings accounts, etc.

You can choose an online bank, traditional banks online allow customers to perform all the typical routine transactions like, balance inquiries, stop payment requests, bill payments, account transfers, some will even offer you credit card applications and online loans.

Most large banks, regional banks, and even smaller banks offer some form of online banking, it is also known as  home banking, internet banking, electronic banking or PC banking. The challenge for banks online is to get customers to learn how to use the system as well as making them trust the system. Even though most large banks offer online banking for free or for a small fee some have limited functionality, for example you can take a look at your balance but you can’t make any online transactions.

Hurdles to Overcome

Online banking security is the primary issue, banks are trying to convince people that through the online system their financial security will improve. You can check your statement at any time, you can find about unsual activities in your bank account much sooner as well, you can be alerted by e-mail alerts when large sums have been withdrawn from your account. So through online banking safety is actually strengthened they just have to reach more people with detailed information on how things can be better through one of these accounts and how safety is no longer an issue.

Benefits of Opening an Online Bank Account

Earn More Interest

This is probably the most appealing factor and this is where they have an edge over brick and mortar banks, online bank accounts have succeeded primarily for their ability to earn you more interest on your money. This means that you will make more money on your savings account rather than if you used your traditional brick and mortar banking entity for a high yield savings account. Online banks offer interest rates as high as 5% each year while traditional banks will earn less than 1% per year, although rates constantly change, so you have to keep checking up on them, go to moneyrates.com to find out the current online high yield savings accounts so you can get an idea of what you can get right now.

24/7 Support

You can access your bank at anytime anywhere. You can access  your account and manage it at any moment, you don’t have to re-schedule or anything for your other appointments, you can don anything or everything that you have to do throughout the day and after your day is over, you get home, you turn on your computer and manage your account.

You Can Save Money Automatically

There are online banks which I will address on future posts so I don’t give out free advertising before they pay me. Anyway there are virtual banks that will automate the whole savings process, all you have to do is hit “enter”, you tell them how much you want to save and they will automatically throw exactly that amount into your savings account each month, then they will make the other payments that you requested. Yes they automatically make all payments for your bills as well, so you don’t have to worry about a thing, this will help you a lot because you will be very responsible about your savings and you will have a lot of extra time, just think about how much time you waste at traditional brick and mortar banks.

Lower Fees

The only fee you usually have to worry about is the fee that you have to pay for withdrawing cash money from ATM’s if you have an ATM card. The rest is usually free, because as you know since they are online they don’t have the same operational costs as a physical bank. Usually there is no fee to join an online bank, it’s free, no transfering fees of money between accounts, and no fees to manage or access your account.

Easy and Fast Access

You not only have 24/7 support, you can also get to your bank fast, you are as far from your bank as your are from your computer, if you are reading this right now then you are a click away from your bank, so this is very convenient since usually banks are very far from where you live or work.

Transactions Are Faster

They are faster than traditional banks to execute and confirm transactions.

More Efficient

You can access and manage all your bank accounts, CDs, IRAs and even securities.

Disadvantages

- Delays in the process of transactions. It can take up to two weeks before payments are due.

- Setting up an online bank account can take some time.

- Getting used and learn how to manage your account can take some time as well.

- Some banks don’t give full online support.

- You have to mail in deposits instead of making direct deposits as traditional banks. (this is for online only banks)

- No traveler’s check, no cahsier’s check.

What to Look for When Choosing an Online Bank

- Good Tools : It should be easy to use, it should provide features such as showing you images of your checks, scanned images from the front and backside, archiving of your check images and your account statements. Also tools that allow to create budgets, they must show your latest transaction reports such as payments, transfers, and deposits. They must provide you with security alert systems such as emails, alerts from possible e-mail phising and things like that.

- No Fees

- High Interest Rates for Your Savings Account.

- Transfering funds has to be easy, so you can set up automatic payment features.

- Account Aggregation, so you can manages all your bank accounts from your online bank account.

Basically they must have everything I talked about in this page, after comparing your online option with the things that I talked about here, and if you make a green checkmark for each one of the things that are on the list, then you have a winner.

Note: There are more advantages than disadavantages when using online banks compared to brick and mortar, I hope you get the picture and that this webpage helps you out create better financial planning strategies.

There are many ways to save money and as you know saving money is a fundamental part of good financial planning. But to do it right you don’t have to go crazy about every little detail within the expenses that you have. You can effectively create a money saving  if you change  your mind-set and start seeing things in a different way, in a way that will help you identify which of you expenses are necessary and which aren’t, and also you have to identify which necessary expenses can be trimmed or cut down. There are thousands of ways to do this right, but if you stick to some of the basic principles that will be on this article you will do it right.

How to Save Money:

1. Get Out of Debt : You must be debt free to really start saving money.

2. Make a Budget : You have to make a budget.

3. Cutt off Expenses : Don’t overspend.

4. Create an Interest Beared Savings Account.

5. Stop using your credit card to pay for everything.

6. Get Better Deals for your expenses.

This is a simple guide to start saving money, this guide will give your financial plan more power. Saving money is one of the most important aspects of financial planning, basically because it is where a financial plan starts. These are just a few tips to open your mind so that you can easily come up with new plans and ideas of your own to save a bit more.

1. Get Out of Debt

If you really want to start saving money then you have to get rid of your debt. If you don’t you will always have bills to pay and your saving plans can be affected a lot. If you create a plan and set yourself saving goals you can easily get out of debt to start saving for your real plans and your financial future. If you already have debt and you know that you won’t be able to pay it off by saving some money, then you will probably have to get a debt consolidation loan. Through this type of loan you will only have to pay one bill and the interest rates will be lower, and maybe you will be able to save some money as you get out of debt for good. Debt Consolidation Loans will help you save money through lower interest rates, it will help you save thousands of dollars if you already owe money.

2. Cut off Unnecessary Expenses: Don’t Overspend

Don’t spend more money on things that are not absolutely necessary, sure we all like things and we want to spend money on the things we like but there are many things that are not really important that make us throw our money away, small changes can make a big difference, like changing our transporation method to go to the office, for example if you go to work everyday on a cab swicth to a bus (do the math and find out how much you will save every month just by making that little change), if you go to work in a car figure out a route that will help save more money on gas, if you spend $200 dollars a week eating at restaurants try to spend just $100 or $50 if you can, small changes like this can really add up to your saving campaigns.  These are just some examples of a few things that can be done, be creative. What you have to do is take a really good look at all of your spending habits, your bills, everything that makes you spend and try to reduce them a little bit.

- You can consolidate your debts to pay less interest on them.

- You can spend less money on gas, or use cheaper ways of transportation.

- You can move from where you live to a cheaper place.

- You can refinance mortgage.

- You can spend less water to lower your bills.

- You can spend less electricity to lower your bills.

- You can spend less money on other activities, like eating on restaurants, night clubs, cigars, etc.

There are thosusands of ways to cutt off expenses on a lot of different things to improve your saving campaign and strengthen your financial plan. As I’ve said before, be creative!

3. Learn How to Make a Budget

If you know how then make a budget, if you don’t then learn, It is very easy everyone knows how to make a budget and everyone has made one before. Making a budget is basically done by writing down how much you earn, how much you spend, how much you save, and making a balance between them to know how much do you need to get by every month or day. Do this to know exactly what you have to pay for every month so that you don’t exceed your spending capacity in order to reach your saving goals for each month. Make a budget based on what you are spending right now and then figure out a way to trimm it down to %50.

4. Create an Interest Bearing Savings Account or An Online  Interest Bearing Savings Account

Create an Interest Bearing Savings Account to place every dollar that you save there! This is a very important step because it will allow you to make money while you save some. Make this a totally separate account from your primary savings/spending account, the money that you place in this account can’t be touched, this way your money will keep growing every month as you keep adding your saved money and interest do their thing. You can also consider higher interest options like CD’s or Money Market Accounts. A very good option to make this point even more effective is by creating the same type of savings account but through an online bank, the will pay higher interest rates, and that’s always better for the person that’s trying to save money and make money at the same time. On the next article I will tell you which are the best online banks, the most secure, trusted banks and the ones that have the highest interest rates available on the internet.

5. Stop Using Your Credit Card to Pay for Everything

If you can pay with cash then do it. People get  relaxed about spending with credit cards, people get tempted a lot and it is very easy to overspend if you have one right next to you. If you can quit your credit card then do it. If you have to have one for certain expenses then leave it at home always and only use it for the expenses that are required. Make notes do something that prevents you from falling into temptation of making an unnecessary payment with your credit card. If you restrict the use of your credit card harshly you will save a lot of money.

6. Get Better Deals For Your Spending

Use discount coupons to buy stuff, bargain, buy food in bulk, shop retail and outlets, etc. Once more be creative, saving money is about being creative and frugal.

I didn’t write these tips in order, I just wrote them down as I created this article, with tips 5 and 6 what you have to do is take that saved money and place it in the secondary account that I talked about to make your money grow.  These steps can be applied in any order, just make sure that you use them. Now you know how to make your financial plan a little bit better by saving a lot of money if you just make small changes that will make a big difference in your life.

Apparently Financial crisis is coming to an end, things are getting better. And apparently Obama’s government has a plan, the Obama administration is going to put forward a budget on Feb. 1 containing significant deficit reduction measures. Many expert economists believe that it is too quick a move, it is premature to implement deficit reduction. In fact they believe that to avoid a double dip recession they must create additional fiscal stimulus. According to the experts this is necessary to prevent the government from making the same mistakes that  Franklin Roosevelt made in 1937, which caused a second recession which began in May 1937 until June 1938. So after only four short years of apparently overcoming the crisis that began in 1929 and ended in 1933, the economy was threatened a second time because of what experts believe was a wrong move by Roosevelt’s administration, a very bad government policy.

This is the reason why Obama’s economic advisers have been saying that stimulus must continue until full employment has returned. If you take a real good close look at the things that happened in those days back in the 30’s you will notice that the fiscal tightening that Roosevelt pressed in that period caused a great setback in the economy, producing consequences such as the rise of unemployment and the falling of GDP. So Obama and his administration must take a look at the past so they do not make the same mistakes that others have already made, this administration has to be cautious and they must remember what happened back in 1937. Remeber that the economists are calling the 2007-2010 the worst financial crisis since the Great Depression, so a similar scenario with similar reactions by the Government could lead to a similar history.

Another issue regarding the financial crisis is war. I must say that war is wrong, it is not supposed to be like this, not after what history has shown us. The world has suffered enough, there has been enough chaos, a lot of innocent blood has been spilled. I don’t want to make this a history class because this article is about the financial enviroment. But what I want to say is that it is a shame that after everything that the world has been through there is still such a terrible series of events being held overseas.

If all this madness should ever stop, then i’m sure that economy would rise up beyond all expectations in every country of the world. All countries should stop fighting and we should all act as humans in a world that needs brotherhood, friendship and love. Instead of fighting we should all work as a unit to see how can we improve the standard of living for people around the world through really good relations and collaboration between every country, especially between the primary international players.

What does this have to do with Financial Planning? Well I’d have to say a lot! Because if you have a great financial plan you will be able to get through any financial crisis without even worrying about it. A good financial plan is set to secure your financial future even if the worst things happen. That is why you should always come back to this website to create great plans for your future.

Welcome back to the Financial Planning Guide! If you read the last article on this site about making small changes that make a big difference and you did the exercise I recommended on that article, then you are on your way of creating a good financial plan. Anyway you should keep in mind that financial planning is not just about saving money, it is about spending money as well, it is about living your life the way you always wanted, it is about making your own decisions, about controlling your time and every little aspect of your life. A good financial plan is not just about planning well your retirement, it is about getting through all the experiences in your life without having your own financial crisis.

Everyone has different goals and objectives, that is why some people make a plan that involves working forever but without stressing out about financial challenges, other people make a plan that involves becoming wealthy, other people make plans that do not require working that much or even saving money they are just ok with their current situation and they already have a plan to mantain that lifestyle. Almost everyone has a financial plan even if they did not plan it. If people take the time to learn a few things through some great resources like this website, books and any other source of financial planning information, then they can make some changes that will have a great impact in their financial situation,  very positive changes for their financial future. Just by sitting and writing down a few things, creating a few rules to abide will make a huge difference, of course it is not just about writing down some stuff, it is about taking action.

So as I just said a financial plan is way more than just about the money, it is about living your life they you want to live it, and I can’t stop stressing about this issue, because many people do not do it even if they are financially safe because they rely on their paycheck. A good financial plan is basically about being free, about not being scared of any change that might come up, like losing a job and a paycheck, it is about not being worried even if you do lose your job and your paycheck. If you do not feel like that right now then your financial plan is not complete yet! But don’t worry we will get there soon enough!

In the last article I talked about how to begin your own plan, I gave you some ideas on how to make some small changes that would have great impact on your own economy in no time. If you did that right then you must be saving some good money by now, or you are on your way of doing so. But remember it is not just about saving money, it is also about doing something with that money that you are saving to make your financial future even better, not just in the long term, we want to make positive changes for our short term plans as well. What’s the point of saving all that money for retirement if you did not live your life how you wanted to? Soon you will be in a retirement home where money is not the issue, and you will have saved a lot of money that is not going to be enjoyed the way it should have been enjoyed.

So remember good financial planning is not just about long term objectives but also about short term positive changes that will allow you to enjoy your life even more. The idea of performing the exercise I talked about in the first article is to start saving money, savings that you will then use to make investments. Remember that investments are part of a good solid financial plan. Some of you may think, ah those measly dollars that i’m saving won’t allow me to invest on any business venture. Hold it right there, because you are wrong! There are tons of ways to make investments that do not require a lot of money and that can make you a lot of money. Just take a look at Alex Tew whom in desperate need of securing his education came up with an idea of creating a website to sell pixels for $1 dollar, and his idea was to sell one million ad spaces, and he did! Alex Tew created the million dollar homepage at 21. So the next time that you think that saving money won’t allow you to make money because the amount of money that you will be able to save is not enough to make any kind of investment, then stop right there and think about the $1 million dollar homepage that only required a small investment of $100 dollars.

That was just one example of thousands of examples that can be exposed. Just by performing the exercise on the first article for a year, believe me that you will have money to invest, if you do it for three years or five, well sky’s the limit. My last article talked about making small changes, simple adjustments to improve your financial situation, in the next article on saving money we will think about more sources from which you can take some money and put it on the side on your savings account.

Financial Planning is not just about saving money, but it is the first door that must be opened if you want secure your financial future in the long and short term. As I told you before it is about saving money, making money and living your life how you want to!

As you already know Financial Planning is about your needs, your lifestyle, your dreams, it is your present and your future. Through a good financial plan you will be more secure, more confident, better prepared and it will also allow you to acquire the things that you need the most, you can live the lifestyle that you want to live, you can buy the things you want, you can travel, you can do whatever you want that you had planned for your life. If you do this right, you know create a good financial plan, if you concentrate and you are very responsible with the things you do about your financial future, then your dreams will become your reality. Remember financial planning is about everything that involves your financial and also your personal situation, saving money, making money, getting rid of debt, banking, credit reports, planning your retirement, etc.

Small Changes Make a Big Difference

Since this is the first article written on this website I don’t want to start right off the bat with the heavy artillery, you know, the meat and potatoes of financial planning, because as you know you always have to save the best for last, it’s just the rule of good stuff. You will not see that pattern only in this site and other websites or blogs; you can also notice the same trend on great books, novels, movies, TV series, etc. Anyway let’s start with the first of many strategies to start creating a financial plan, or at least an activity that’s about you achieving your financial security and that through this and many other activities hopefully your financial situation will soon become a wealth management issue.

“Small Changes Make a Big Difference!”  That was what my first accounting teacher told me when I began my college education, he said: “the money is in the cents, and most people don’t even notice, but companies do!” Well without a doubt most companies have a solid financial plan.

I quote him because those words stayed with me forever; I started looking at things from another perspective. I want you to take this article as a mind opening article that will help you think about your current financial situation and about how you can immediately make it better. Probably not immediately right now in the next ten minutes, but maybe even then depending on what plans you have for the next few hours.

What I want you to do is perform a little brainstorming exercise for a few minutes and I want you to think about your expenses, about the things that you like to do that require spending some money, I want you to even think about your transportation, I want you to think about everything that you do on a daily basis that requires you to spend some money.

After you do that I want you to think about how you can save money at least a little bit on each one of those things, remember “the money is in the cents”. Then I want you to think about which of those expenses are necessary and which are unnecessary, if you have unnecessary expenses, if you spend money on things that you don’t really need and you don’t even know why you do it then just cut them off.

That little exercise will take only minutes; it is a very simple and easy analysis that will make a big difference in your finances. What you want to do after this exercise is open a secondary bank account, an account where you are going to place that extra money that was being wasted in the past, it is going to be an account to save money, your very own untouchable savings account.

This is the first step to change your financial future and the easiest step to begin your financial plan, if you do this right, if you are responsible and diligent enough to do this exercise every month, soon your savings account will begin to grow greatly without you even noticing it and when you do notice it you will start to feel more secure and more confident about your life, and about your future because you know that you have “Money in the Bank”.

This is just the beginning of a complete guide of real financial planning, for real people, with real dreams, and real needs. I will lay out information that will help you guarantee your financial freedom and your financial future; I hope that I can even help you manage your wealth after you have secured your long term financial situation. See you on the next one, and do the brainstorming exercise, open your account, and just let your money grow.