Personal Financial Planning

According to chapter 1 of our textbook, personal financial planning can be described as a process of “making deliberate decisions that allow [an individual] to get closer to their goals” (Siegel & Yacht, 2009, p.9). Also, it is worth mentioning that personal financial planning is about asking yourself every important question pertaining to your future, with the end game of sticking to the goals mapped for yourself. But, this process is a lifelong, and recursive one, and it is important to define the steps that will help you take a big picture at your finances. These following steps are primordial in achieving your life goals:
Defining measurable goals: it is is the first step that allows to set specific targets and establish a timeframe to carry out those goals you want to achieve.
Assessing the current situation: this process begins with a review of your current financial situation, anticipated changes,

On a personal level, factors such as family structure, career choices, and age can be critical in the planning process. Providing for a spouse and dependents can affect the way you spend your money. Indeed, at this stage people are often more willing to preserve their assets than indulge in reckless spending. The other factor to consider is career choices. As the matter of fact, the career one chooses can be primordial in determining your salary, risk factors, and advancement throughout your career. Even, the educational path you choose should be the first step of the planning. The last element to consider as far as micro factors are concerned is age. Taking a closer look at an individual’s life stages is an important part of financial planning since we know that the age of a person can determine his needs and priorities in life. What a young adult needs, is different from what a middle aged or older person wants, so it is important to plan it according to each individual’s