How to Live for Today, Plan for Tomorrow| North Loop Official Blog
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North Loop
27 Nov 2020

How to Live for Today, Plan for Tomorrow

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Introduction -

We understand how striking a balance between short-term goals and long-term ones can become a struggle. From paying bills, dining out, insurance and transportation to saving for travel or a down payment on a house, there are just so many things that take up a significant chunk of your monthly income. Not to forget putting money away for retirement and financial or medical emergencies.

In other words, there are innumerable plans you may have for your money and a lot of confusion on how to manage them. With a little help, you can strike a balance between your expenses and savings without sacrificing your financial future or giving up on enjoying life. In this article, we will guide you through the steps you can take to do that.

Create a financial plan -

So have you given a thought to what’s your plan for tomorrow? If you haven’t already, fret not. Here we will help you in understanding how to plan for tomorrow and strike that perfect balance. First, you should start with your goals.

If you haven’t already spared much thought about what’s your plan for tomorrow, it is likely that you have not created a list of your goals either. So, the first thing you should do is to work on creating a list of all your short-term and long-term financial and life goals.

Once you have done that, you will know what you want to work on. That may include paying off debt immediately or beginning to save more for a house, your child’s higher education or even your retirement. It is vital to complete this step before you start to plan for tomorrow. Without a complete list of things you want to achieve or goals that you want to meet, it can get difficult to move ahead with future financial planning.

Since the first step can get a little tricky, you can think of your finances in sections to make the process more manageable. Segregating your finances can aid you in setting small goals for each of them. For example, your finances can get divided into different tiers like budgeting, debt management, saving or investing, and protecting what you already have.

Setting small goals for each of these tiers can not only help you to plan for tomorrow, but it can also strengthen your long-term motivation and finances. Most experts suggest that one of the most critical aspects of future financial planning is to ensure that all of your different finance divisions remain equally strong. The ultimate goal when creating a plan for tomorrow’s finance is to keep all your finance tiers as strong as possible.

That is because each of them remains interconnected, and if one segment becomes unsteady, your entire financial plan can go haywire. So, let us say, if you are focussing on one aspect like budgeting but not giving enough attention to managing your debts, your financial plan can be unstable and unreliable in the long run.

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Implement -

We know that all of this is easier said than done. Life has a funny way to throw surprises, and some of those can throw us off balance. Also, not all of us are born savers, and for many, it can be a challenge to manage everyday expenses or pay off debt. However, one way around this problem is to create specific strategies that help you put your plan into action.

While it may take time, it can help you to free more money to save for tomorrow’s finance and pay credit card dues and other loans. You can also keep increasing the amount you save, if possible, by as little as 1% to create a slow but significant impact on your future financial planning efforts.

If you make adequate efforts, you can develop a strong foundation of budgeting, debt management, saving, and insurance to eventually, achieve big, long-term saving goals. Moreover, a discussion on how to plan for tomorrow is incomplete without the mention of investing. Investing is a crucial component in a long-term plan, and creating a well-diversified portfolio with a mix of stocks, bonds, and short-term investments can help you grow and reach your goals faster.

However, finding the right asset mix, reviewing it annually and rebalancing it when necessary can become a time-consuming process. Therefore, when thinking about how to plan your financial future, you should get invested as soon as possible. An investment mix that gets tailored to your goals and investment horizon, financial needs as well as risk profile can help you find the balance between risk and reward that is best suited to you.

While investing is one of the crucial steps for long-term growth and future financial planning, it is also important to note that to see real results you need to be able to stick with it for a long time. Therefore, creating a well-rounded plan built for the long run that can sustain the market’s ups and downs relatively well and gets customized to your needs and preferences is an important factor.

Monitor and manage -

No guide on how to plan your financial future is complete without a mention of the importance of monitoring and managing your financial plans. After putting all your plans into action, it is essential to check them at regular intervals.

As life moves on, several new developments can take place such as marriage, change of employment, the birth of your children etc. These changes warrant that you take a look at your existing plan, gauge where you stand relative to your goals and also make updates to your current one as and when required.

Investment monitoring and rebalancing should get done in the same way. The generally accepted rule is to review your asset mix and investments annually to make adjustments wherever needed.

Plan for the future and live in the moment -

Even though planning and strategizing for your financial future may seem overwhelming when you begin, the results you get later make it all worth it.

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This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended be advice. You must obtain professional advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax, investment or other professional advice from North Loop or its affiliates. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date. All opinions expressed do not reflect the views of North Loop nor are endorsed by North Loop.