Three Important Financial Planning Stages

Any time you want to get the most out of your finances, it pays to take a three pronged approach. For one, you'll need to get your current finances under control, so that you're able to budget and save money. Next, you'll want to make your money work for you through investments. Finally, you'll need to think big picture and plan for your retirement. To learn about these three stages and hire the help of a financial advisor, read on. 

#1: Get your current finances under control

One of the first things that you can do is put away the plastic. Charging to credit cards is a big no-no and a sure-fire way to develop bad spending habits. Credit cards aside, make sure that you're using cash when possible, since it lets you know exactly how much money you have and will let you avoid impulsive spending. You'll also want to start paying yourself first by stashing a percentage of your income aside before you do anything with it. Talk to a financial advisor who can help you assess your income and expenditures, so that you can put together a budget that suits your needs and lifestyle. 

#2: Grow your money through investments

It's crucial that you grow your money by finding sound investments. One of the best things you can do is put your money into an interest bearing account -- such as a mutual fund or index fund. This is definitely a time where a financial advisor will come in handy, because they'll discuss your financial goals with you and find prime investments for this stage in your life. Your financial advisor will assess your risk tolerance and help you find the right stocks and bonds to invest in for the long term, so that your money is spread out wisely. 

#3: Set aside that retirement nest egg

The big goal is to retire on your terms, debt free and with plenty of money to carry you. This only happens when you aggressively save through retirement funds and long term investments. The most important thing that you can do in this regard is start early. Interest will compound greatly over time, so don't cheat yourself of interest by waiting too late. You'll also want to diversify, so that you don't make a bad investment that sucks away your entire nest egg. 

Consider these three tips and contact a financial advisor that can look out for you.