August 27, 2009

The Financial Review

Posted in 4 Steps to Financial Freedom at 3:18 am by kimsan23

It’s been almost 2 years since I’ve started trying to make my first million.  It’s been a tough journey and it’s not getting any easier!  So far I am at 40% of my goal.  I had originally planned to be at at least 60%, but my journey took lots of twists and turns –so here we are.

Right now, my monetary assets are divided into 5 accounts –  only 2 of which have my permanent savings.  The others are for car payments, car maintenance and other miscellaneous expenses.

One thing I realized in the course of my mission is that one needs to review their plans every now and then.  I mean, goals adjust according to need.  Originally, I thought I’d start buying a house by 2010, well at the rate things are going, it looks like I’ll have to push back another 2 years.  I’m a bit disappointed but I guess this is still how the natural course of things goes.

Like any business, making or saving money must be examined with utmost detail and precision.  Here is my personal assessment of how I should have (and will do, moving forward) monitored my goal.

1. Revisit your goals to determine feasibility every 6 months. — I didn’t do anything like that till today!  I’m sure it will be useful in the sense that you keep everything real.

2. Make a list of your monetary assets and determine what could be reassigned to other functions depending on immediate need.  Try not to touch your personal savings, use the movable income!

3. Ensure that you still keep to your main goals, try your best not to sacrifice any goals unless there are monumental changes that have happened in your life that will clearly impact your spending/saving.

4. If any extra income comes your way, you can even add new goals or adjust time lines in case you are able to acquire money faster.

The key is to always plan ahead without suffering through the process.  Remember to reward yourself within the right margins.  Remind yourself that it is you who will benefit from all the planning and saving you are doing as early as now.

The fourth step in financial freedom is the allocation of monetary assets.  This should be in your planning and must be implemented once you have reached your financial goal.  I will definitely discuss this further in my next post.

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