The One- Page Financial Plan- Book Summary
The one-page financial plan is about getting clear on what you want so that you won’t be swayed away by ads or by what other people are buying.
Your one- page plan represents things that are important to you. You can’t fit a lot on one page you’ve to focus on what’s really important. The One- Page Financial Plan,the author suggest you do this using Sharpie marker it is thicker and will constraint you to focus on what is really important- you’re creating a one-page plan.
Creating a financial plan is a process; ergo your one page is not permanent.
Most of our money decisions are driven by a desire to feel happy, safe, and secure and all of us have different varieties, ergo, our financial plan can’t be identical with our neighbors’.
Identify your starting point.
The first step to creating the one-page financial plan is to know where you’re financially.
Before you plan you need to know WHY you’re planning.
The most important question to ask is “Why is money important to you?” This helps in uncovering why you need financial planning in the first place and the values most important to you. This will guide all your financial decisions from how much to save for retirement to customizing a unique portfolio.
You can’t solve what you don’t know, financial solutions are only better when you’ve identified the problem.
Using doctor’s and patient analogy the discovery process will look like this;
- You’re noting your symptoms (your financial life feels out of balance)
- You’re identifying what health looks like (you’re asking yourself why money is important)
- You’re discovering a solution (you’re using the values you’ve identified to drive your financial planning decisions)
You can’t start with No. 3 but that is where many people start.
Keep asking yourself, WHY?
- Why I am saving?
- Why did spend so much on X?
- Why do I invest a lot in Y?
Asking “WHY?” helps us to reveal the reason why we have certain goals and gives us the power to say No to things that distract us from what is important.
The amount of time we spend and the money we spent tells us what we really value.