Financial Planning - Getting Started Stage

Hey Fellow Knowledge Seekers!

It's me again, your friendly Unfussy Scholar!

In my last post, I discussed the 4 different life stages in financial planning. For the next four posts, I'll be discussing these stages in more detail.

I want to make sure you get the proper information you need to help you in your financial journey. And we'll begin with the Getting Started stage.

As mentioned in the previous post, the getting started stage is the first stage in financial planning. It's the stage where you just graduated from college and are starting your career.

This is considered the first stage of financial planning because it is the stage where most of you will start to make your own money and handle your finances.

You are also likely worrying only about yourself at this point. And in this instance, there will be certain aspects of personal finance that you need to focus on first. 

Of course, this could be different for others, especially those who are breadwinners or are starting a family early. But for most, the focus will be on yourselves.

So, what should you be focusing on at this stage? Here are the important ones.

1. Start Investing

One of the first things that you can focus on during this stage is investing. You can spend a portion of your income and put it in investment vehicles like stocks, mutual funds, bonds, etc.

It's a good idea to start investing since you will have more funds to allocate at this stage. It's also worth noting that the earlier you start investing, the more time you're giving it to grow.

Put one of your financial focus on investing while you still have fewer responsibilities to deal with. This will allow you to get a good head start in growing your money and wealth.

2. Getting Insurance

This might sound too early to do, but it isn't. It's much easier to get insurance when you're young and healthier. Premiums are also cheaper, which will make it easier to pay.

Getting insurance early is a good idea if you plan to start a family eventually or if you expect to support your parents in their old age or your siblings.

By protecting yourself, you're ensuring that they will be covered regardless of what happens to you. Insurance can also be good to cover any debt that you might incur later on.

Just make sure you're clear on the beneficiaries and I suggest getting a revocable beneficiary. This will allow you to change beneficiaries whenever you need to do so.

Also, consider getting health insurance to make sure your health is covered.

3. Saving for Milestones

You can also start saving up for milestones. This can be for a new car, condo, capital for a business, or even funds for prolonged travel.

It's the perfect stage for you to try and accomplish some of the things you want since you don't have any responsibilities yet, except for yourself.

You can set aside a portion of your money and then use it later on for some of the milestones once you have enough.

4. Enjoy Your Life

Finally, you want to make sure that you're also enjoying your life. Yes, it's important to plan accordingly in how you use your finances.

But also make sure you leave enough for you to enjoy yourself. Don't deprive yourself of doing fun things like eating out, buying things you want, traveling with friends, and so on.

This is the stage where your focus is on yourself. So don't just focus on being financially responsible, have some fun as well.

Just make sure you're not compromising your financial goals when you're trying to have fun. Put your financial obligations first, then entertainment second.

You must focus first on building yourself up during the Getting Started stage. Take advantage of having fewer responsibilities and use your money to build up your finances, while also enjoying life a bit.

"Do not save what is left after spending but spend what is left after saving" - Warren Buffet

Keep on Learning

The Unfussy Scholar

P.S. Please share this post with a friend if you enjoyed what you learned here :-)