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Effective Financial Planning for Singles
Financial planning is what every independent and working (read earning) person must do. Even if not earning, the habit of financial planning must be inculcated right from the childhood. Financial planning helps create an organized way of handling money and cutting down on useless expenses while saving wherever possible.
Married couples find it relatively easier to plan their expenditures and savings as they have the support and encouragement of each other. But when it comes to singles, it becomes comparatively harder to sustain the habit. Nevertheless, financial planning for singles is a must too, and if you are single, you must plan differently from the couples, as financial planning requires you to adjust to your unique circumstances for squeezing the best value out of your money. Singles generally feel a bit more pressure for creating a financial security for themselves. There might be times when a person goes from being in a relationship to being single again and at such times, they need to reassess their finances.
Anyway, if you are single, you should do your financial planning really well and obviously, on your own. So here are some tips to make financial planning for singles smoother.
Set Targets for Saving Money
Most of the singles have the habit of waiting till the time they are in a relationship to start creating goals for saving money. But you must reassess the situation and realize that there is really no reason why you should not do this right now when you are on your own. If you don’t start saving for future goals now, you will feel a lot of pressure on you to start saving for specific purposes once you go into a relationship and there is another person sharing your life with you.
So to avoid any kind of such pressure which could stress you out and spoil your relationship, set important savings targets right now and work for them. Your goals can be anything, from buying your dream home or taking a year off from work to travel the world. Being single gives you the control of your own hard-earned money; so start securing your future now.
Pay Off All Your Debts
Loans come with interest rates and holding on to a loan for long can take up a huge chunk of savings in interest. This way, you will be losing a lot of money in outstanding loans even before you start creating your savings goals.
So get rid of all your loans first. Whether you have graduated out of university with debt or are into debt due to a broken marriage, the first step to any financial planning for singles is to get rid of debt. Once you are on your own and don’t owe a penny to anyone, you can start thinking and saving for your future.
Create a Timeline
Financial planning for singles requires a lot of focus for realizing those saving goals. To make the task easier, you need to place those long-term targets along milestones that are time-specific. You can also break down the targets into monthly aims, as this will make it easier to accomplish targets and will make the process more organized.
You are completely in control of your finances when you are single and complications like joint accounts or shared expenses do not arise, thus providing you undivided focus. So take advantage of this and cultivate a good habit of financial planning and saving to figure out how to reach your milestones and ultimate goals.
Have a Foresight
It can be difficult as a single person to look very deep and farther into the future, but you really need to have a foresight for successful financial planning. What it means that you should set your goals according to the money flow that you might gain in the coming future, like pensions or investment returns. In case you do not have any disposable income yet and have a lot of debts and monthly obligations to be met with, then you must research the future options that are more likely to come up. Such an insight fill motivate you while preparing you for the time when you do have that future money.
Save, Don’t Waste
As a single person, you can save a lot and still live a pleasant life without compromising. For example, you can get a discount on the council tax if you are living alone. Try to minimize the waste of electricity by using less heat when you can and switching off electrical appliances when not in use. Try to get discounts on shopping and look for the cheapest deals on insurance, utilities, broadband, groceries, etc.