This week is about looking at the bigger picture. For a lot of people at the moment, it might just be a case of living from week to week and getting by, trying to pay the bills and put food on the table but there is also a need to consider planning for the future goals. We want to put some money aside for our future goals and general expenses.
In terms of future goals, we have short term goals, medium term goals, and long term goals. Short term is usually in the next 6 to 12 months. Medium is in the next usually two to three years. And the longer term is five years or more.
The hierarchy of roles as shown in a triangle below shows your priorities and starts from having living for today, then income protection like insurances, and then pension, savings and investment.
In terms of priorities pensions come first, before we’re planning for the nice hot holidays, the bigger car, the extravagances and maybe moving house and getting a bigger garden, we actually should be planning for our retirement first, because the small incremental amounts that you can put aside now will benefit you long term. And because of the compound effect of small amounts over a long period of time, it actually means that it doesn’t become that big of a deal.
I want to encourage people to think of the bigger picture. Think about what actually lights you up and what really makes you happy. Is it something that you wanted to do this year and you haven’t yet or you just feel like you’d really love to do and haven’t had a chance? This will allow you to think beyond reactive needs. Then think about the bigger picture, what do you want things to look and feel like in the sense of incremental upgrades?
That is not necessarily really extravagant or expensive, but could really light you up and make you feel really good about yourself. Because it’s all about those higher vibes. Take a step back and start to prioritize where you might see some of your annual spending. So if you look back over the last six months, what things did you pay out for that you didn’t plan for? What things did you pay out which you wish you’d never did? And what things did you pay out for that you would do again?
Look at your finances much more holistically, and think about how you’re spending from a bigger picture.
Feel free to join my Facebook Community and watch out for the final week of our financial Detox. You will also find inside all replays from the previous weeks of our 4-week Financial Detox.
I would love to encourage you to come and please leave a review of my podcast. We are doing a monthly draw for everyone who leaves a review with the chance to win a copy of my book and my wealth planner which is available on Amazon. All you have to do is leave a review, take a screenshot and email me a copy at firstname.lastname@example.org
We’ll be in touch if you are our lucky winner!