How to Begin Financial Planning

Video Transcript

"Hi my name is Bill Rae. I'm with Alumni Financial Services out of Seminole, Florida. I've been in the business in the finance world for well over 30 years. We have an excellent question to cover today, how to begin financial planning. Financial planning obviously needs to begin right where you are right now and it may sound silly, but the first thing you need to understand in financial planning is what is my income, in other words how much am I making? And then we're going to move to how much am I spending? Might seem simple at first when you say how much am I spending, well I get paid 400 dollars a week, that's my income. What we need to talk about is what do you bring home, OK? That's where reality hits. So you also want to perhaps do this over a month or perhaps even 2 month period, what you bring home and then average it. That'll be your beginning base or your income. While you're doing this, simply take a sheet of paper such as this and or a notebook or anyway you want to record and every time you spend something, record it. If you can, save the receipts and bring them home. Once you know you're income and what you're spending, now we can begin financial planning. That's called budgeting. We can use simple envelopes, you can use the accordion. You can use simple files. You can use an expansive file, little guy. And then of course if you're high tech you can use computer programs and spend some money. Once you have a budget underway, run it for three or four months and continue to monitor it and then begin to look further into your financial planning. All financial planning begins with where am I here today and where do I want to end up. If you have those two ideas very clear in your mind, the rest is simple process of putting it together in such a manner that you can sit down and quickly see in black and white where am I. Am I under budget meaning I'm putting more money in the bank then I'm spending, am I over budget, am I spending more then I'm bringing in? If you see those two things, it's just simply a matter of fixing it. My name is Bill Rae, I'm with Alumni Financial Services, hope that help, we're here to help you build true wealth."