Many people in today’s economy have found that it is more important than ever to take their financial matters into their own hand. Again and again, I see people hand over their extra cash or their savings over to financial experts only to be burned, again and again. If you are looking for a solid, no-nonsense financial planning guide, look no further. Here is so of my tips and advice to creating your own financial planning guide and take control of your investment and savings.

First, the key to any financial planning guide is understanding exactly what your budget looks like. If you do not understand the money coming in (income) and the money going out (expenditures), you should not be concerned about investing. First things are first, after all. No investments should be made unless you are dealing with a monthly surplus; in other words, no investments should be made unless you are making more money than you are spending. If you have a monthly deficit, you need to either cut spending or increase your income. Take a second job or cut back on extraneous spending like dining out or cable.

Now, just having a monthly surplus is not enough to start investing, not with my financial planning guide. Do you have debt? I mean beyond home loans like mortgages or car loans. If you are not paying off your entire credit card balance every month, you should also not be investing. You will spend more money on the interest you incur on your credit card than you will make with even the most lucrative investments. Pay of your debts before you invest.

Finally, you must have a substantial amount of savings before you invest. This is the cornerstone of my financial planning guide. Investments are never, never one hundred percent safe. If you cannot afford to lose your particular investment, whether it is for retirement or your children, investments are only for additional income. Having savings will protect you from the fluctuations in the marketplace and ensure that you can meet your financial goals. Spend and save as aggressively towards your savings account as you would your market investments.

A sound financial planning guide incorporates all of these strategies and ideas. Living within your means, without credit card debt and with a security blanket in the form of a savings account are all crucial for your foundation in any wise financial planning guide. Only after you do these three things should you invest your money on the market.

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