Sapphire Wealth Advisory Group > Blog > Financial Planning > Fundamentals of Financial Planning
Financial Planner New York NY

It comes down to the basics.

The fundamentals of financial planning are quite easy – save more than you spend in the earlier stage of your career so that when you get older, ultimately retire you can enjoy and relax. This may sound so simple, but living in a fast-moving society where the daily grind has an expensive price tag this may not be as easy as it seems.

We should stop and ask ourselves, “how much did I spend on things that I did not need to purchase”? If you admit to yourself that you did, you can begin to figure out how you can direct the money you would have spent on something frivolous towards something more productive.

As a society we want to live comfortably – some want more – while for some reason people are beginning to realize they are falling short of not being able to enjoy certain luxuries.

How many times have you or a friend ever said, “when I retire or get older, I want to buy a special car or a house on some island”? Accomplishing those goals is not too difficult when you quantify how much you need to save to achieve that milestone. A supplemental variable in the planning equation, aside from money, is discipline.

This goes back to the earlier point. Fundamentally, saving for the future is not difficult. Many people in our generations or those that have preceded, found ways of living with a lot less than what we have today, while that may not be enough. While there are societal pressures to go to bars, restaurants with friends, going to the movies, which nobody should deprive themselves of, but there should be an element of discipline behind these choices. The more often one goes out with friends, and spends money, the less they will have to save for that future goal.

Nonetheless, if one reduced the number of times they went out and unnecessarily spent money, the more those experiences will also become something of luxury, not necessity. Therefore, that goal of buying something in the future or living a lifestyle your friends may have spoken about years earlier will be something that only you can enjoy.

 

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