LET'S BE SMART for your financial planning!

Hey guys, I think you have a plan for what you want to do next year. Before planning what to do next year, it helps you evaluate what you have done this year. With your financial situation too. By looking at your financial situation over the past year, you can review your income consumption habits and your actions to achieve your financial goals. Not only that, it also helps improve financial plans for next year.

How has your finances progressed over the past year? Follow the steps below to analyze.

1. Income VS Expenses

Record your total expenses and then divide by your full year's income. Expenditures here are expenses related to the consumption of transportation, food, clothing, gadgets, recreation, etc., excluding expenses related to the purchase of investment facilities such as investment trusts, shares, and real estate. Calculate total expenditure per total income and convert it to a percentage If the percentage of expenditure is still high (usually above 60%), it means that last year's spending behavior is still there.

2. Assets vs. Obligation

This year, give us a quick assessment of your financial situation. Next, check whether the liabilities exceed the assets. To pursue the ideal financial ratios, you need to immediately develop a strict financial plan for the following year.

3. Reanalyze your debt.

When used for some productive purpose, debt can generate more income, for example to buy assets (real estate, transportation, etc.). Check the following points.

1. Is the value of all your assets still able to cover all your liabilities? If not, manage your expenses better next year.
2. Calculate the balance owed and the amount of interest you will incur over the next few years. If the interest on your debt is too high, plan for additional sources of income besides your monthly salary.

4. Review the list of financial plans for the year.

Have you achieved all the financial plans you made earlier this year? If something still hasn't been accomplished, or most of the plans haven't been accomplished, it means that you haven't promised to carry out your plans. One of the main reasons why financial goals are not achieved is poor planning. Build and improve your consumption habits and apply the following tips:

1. Selective shopping. Be wise in deciding expenses. Shopping without planning, and other impulsive behaviors that cost you money, is one of the main causes of financial planning failure. Remember to always put your wants above your wants. Remember the difference, Unmet need hinders your daily activities, but unmet need does not hinder the continuity of your productive activities.
2. Watch the debt. Debt is a type of expense that has a significant impact on your financial situation, especially consumer debt. If you feel you have unpaid debt, plan your debt repayment well. If you have extra cash, feel free to monetize it right away. Don't stay in debt or take on new debt, especially if you have a lot of debt. This is what you have to do