What your financial plan should cover

Financial planning includes every aspect of your finances. Your financial planFinancial plan Your financial plan should cover every aspect of your finances: saving and investing, paying down debt, insurance, taxes, retirement planning and estate planning.+ read full definition should cover:

 5 reasons to have a plan

  1. Prioritize your financial goals – For example, if you buy a new car now, will you have enough savings later to buy a house or go back to school? Which of these goals is most important to you?
  2. Save money to reach your goals – You may find it easier to save when you know what you’re saving for.
  3. Focus on the bigger picture – Your financial plan considers everything from watching your spending to managing your investments to minimizing your taxes.
  4. Organize your finances – A financial plan can help you balance spending and saving, keep track of expenses and manage debtDebt Money that you have borrowed. You must repay the loan, with interest, by a set date.+ read full definition.
  5. Worry less about money – With a plan, you’ll know where you are today and how to get to where you want to go.

Prioritize your goals

Use this Prioritizer Calculator from CNN Money to help you rank your goals in order of importance to you.

5 key points

A financial plan can help you:

  1. Prioritize your goals
  2. Save money
  3. Focus on the bigger picture
  4. Organize your finances
  5. Worry less about money
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