What is a financial plan?

Just like you go to a doctor to get a checkup, or you go to the mechanic for a scheduled oil change, you must consciously be aware of your financial condition. You don’t have to be wealthy to be concerned about your financial situation. In fact, if you’re not wealthy it’s more important for you to be aware of where you stand financially. Being financially aware means knowing your past, present and future financial state. Knowing your past financial state means understanding what assets and liabilities you have generated during your lifespan. Knowing your present financial state means knowing the plan you have in place to manage your assets and liabilities. Knowing your future financial state allows you to better know what you will need to sustain a desirable lifestyle.   All of these are interconnected and  constantly have to be monitored and reassessed.  Like most things in life, if you don’t have a plan, you may have to rely on external forces to control your destiny. The same holds true for your financial state.