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Financial Check Up
May 25, 2018
At the start of a new year, many people make New Year’s resolutions. More often than not by February, those resolutions are long forgotten. Not you though, not this time. You committed yourself to becoming debt free or saving more or putting more in retirement. You committed to your financial well-being in 2018. Now, nearly halfway thru the year, it’s time to check in. How are you doing? Are you still on track with your goals? Let’s check!
The first step in the process is the assumption that you wrote your goals down. “A dream written down with a date becomes a goal. A goal broken down into steps becomes a plan. A plan backed by action makes your dreams come true,” Greg Reid.
It also assumes you have a plan to reach that goal. Pull it out. Review each step you intended to take and think carefully about how you have done in completing each step. What did you want to accomplish? Evaluate how it’s going. Have you taken the necessary steps to achieve your goal by the desired date? If the answer is yes, evaluate your progress and ... keep up the good work! If the answer is no, further analysis is essential.
For this scenario, we are going to assume you wanted to begin the process of becoming debt free. If so, you should be consistently working to pay down your debt without adding any new debt. Are you? This can be determined thru simple math. Compare your total debt now to the debt you had, when you started your plan. Is the number less? Yes? Great job! No? Call a Mulligan and get back on track.
Now, look at the money you have spent, since you first started. Are you still spending? Debt free will happen faster if the answer is no. If it is yes, can you cut some of your expenditures even more? No? Then you are slowing down how fast you can become debt free. You may still be whittling away at your total debt, but it could go even faster.
Lastly, if you have done everything in your plan, but you are still coming up short you need to make some probably tough decisions. You can look for additional ways to cut expenses out of your budget or you can look for extra income. When it comes to cutting expenses, do you really need the NFL package as part of your tv service? Can you have coffee at the office rather than a Starbucks every day? If you want extra income, have you considered a part-time job or freelance work? Can you get a roommate?
All of these are viable options. They may not be ideal, but remember they are only temporary. They are simply a short-term solution to meet a goal. The prize at the end of the goal . . . financial independence. Few prizes are better than that.
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