Today we’re discussing the role of financial planning, managing debt, and realizing your goals, both in the short and long term.  

Wealth accumulation is a complex process. It requires foresight, realistic expectations, and an open mind. You won’t hit all your financial targets overnight, so it’s important to establish a reasonable timeline that is within your comfort level. It’s also important to strike a balance of paying down debt and living a full life (your quality of life could potentially suffer by devoting all your efforts to debt management, only to neglect the basics that make for a comfortable, liveable day-to-day). The bottom line is that it is very possible to find a middle ground and ensure you’re always moving in the direction of your fiscal goals – this is financial planning.   

Most of us have at some point faced financial or debt overload, it is a universal experience that we can all relate to. There are various ways to address debt without sacrificing happiness and quality of life – it just requires you to be creative and perhaps restructure your future plans, your daily expenditure and your attitude towards money and finances.  

Living Within Your Means 

We live in an ever-inflated economy with daily spending increasing all the time. This ranges from essentials like food and gas, to non-essentials like high-end clothing, alcohol, and your favourite morning latte.  

If your monthly spending does not fit within your budget, it’s time to take a closer look at where you can potentially cut back. Of course, this is nobody’s favourite part – but it’s a necessary first step if you realize that you have been living beyond your means. This is also the time to exercise your creativity. Maybe you can allow for one day a week where you enjoy a café-made latte and commit to a homemade brew for the other 6 days. This one small change can have a noticeable impact on your monthly spending, and that might be all you need.  

Create monthly allowances for things that you truly enjoy, but don’t necessarily need. You might also discover in this stage of budget planning that there are several things you can easily live without. If possible, try not to cut down on items like healthy foods and gas – this kind of spending is mostly unavoidable, and you don’t want to be stuck in a situation where you have an unreasonable gas allowance and therefore can only really travel to and from work. This scenario would have a profoundly negative effect on your quality of life. And often, it is not worth the sacrifice except as a short-term plan to achieve an immediate financial goal, such as a vacation with friends or family.  

Once you’ve determined where spending cuts and adjustments can realistically be made, you can begin to assess whether debt consolidation would be beneficial. This is where a certified financial planner can guide you through additional options for debt management.  

Debt is a normal part of the human experience, and not something to be afraid of. Lean on those you trust and ask for support when you need it. Understand that everyone’s timeline looks a little different and that’s okay. Lastly, be your own biggest cheerleader, always remind yourself why you’re focusing on your debt – and know that the end goal is so worth it. 

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