Yusra3
VIP Contributor
A 5-year plan for financial success is a great way to keep your money on track and make sure you're not losing money in interest over the long term.
The first thing to do is create a budget that takes into account both your income and expenses. Then, set aside money in a savings account or retirement account. these are things you can't touch until after five years, so they won't have any negative impact on your spending habits during that time.
Next, think about what you'd like to spend money on during this time period. Consider things like vacations or home renovations, but don't forget about other important things like education and health care costs. The key is having a plan with all of these things accounted for so that you aren't spending more than your income allows!
For example, if your monthly rent is $1,000, then $1,000 has to go into savings every month for five years. Now that you know how much money needs to be saved each year, let's move onto how much debt you'll need to pay off in order to reach your goal.
You'll need at least $2 million saved up in order to make this work that's the amount of money it would take for all six years of college for one child (plus room and board). Now that we know how much money we need to save each year and how much debt we'll have after we've paid off all of our loans.
Finally, make sure that all of these plans are written down somewhere that is easy to access when needed. your phone or computer are great options! If something changes in the future (like another job opportunity).
The first thing to do is create a budget that takes into account both your income and expenses. Then, set aside money in a savings account or retirement account. these are things you can't touch until after five years, so they won't have any negative impact on your spending habits during that time.
Next, think about what you'd like to spend money on during this time period. Consider things like vacations or home renovations, but don't forget about other important things like education and health care costs. The key is having a plan with all of these things accounted for so that you aren't spending more than your income allows!
For example, if your monthly rent is $1,000, then $1,000 has to go into savings every month for five years. Now that you know how much money needs to be saved each year, let's move onto how much debt you'll need to pay off in order to reach your goal.
You'll need at least $2 million saved up in order to make this work that's the amount of money it would take for all six years of college for one child (plus room and board). Now that we know how much money we need to save each year and how much debt we'll have after we've paid off all of our loans.
Finally, make sure that all of these plans are written down somewhere that is easy to access when needed. your phone or computer are great options! If something changes in the future (like another job opportunity).
