What is personal financial planning?

send money to Senegal

Do you send money to Senegal? In this article, we will throw light on personal financial planning and understand what it actually is.

People go to other countries for better opportunities to earn handsome and based on those earnings they make their personal financial plans. Take, for example, Senegal. From there, people travel to other countries and send their remittances back home to their families either through banks or some of the globally recognized online money transfer companies such as ACE. These companies not only have the option to transfer money online but also enable recipients to pick up cash from Senegal. With these remittances, they carry out personal financial plans to secure their future.

Let’s take a look at the steps involving personal financial planning.

Personal financial plan:- As an expatriate or local resident, it is a plan which helps you manage your money transfer to Senegal, savings, expenses and investment.

Budgeting:- The first step is to budget your income and break it down in 50/30/20. In this 50/30/20 budgeting method, you can divide your income and allocate 50% to essential living expenses; 30% can be allocated for general expenses such as dine outs, etc., and 20% is allocated for future-oriented savings and clearing of debts, if any. Keep in mind that this division is made in the net income that you have after paying taxes.

Emergency fund:- Be prepared financially for unexpected expenses such as accidents and emergencies and create an emergency fund for it. Keep pouring money into this fund each month. Financial experts say that a three to six months safety net is ideal, but we recommend filling money into this fund even after you have established the said safety net.

Cap debt:- Try not to spend more than you earn; because if you do, you are bound to borrow money to meet the expenses beyond your earning. This will help you cap your debts, and with that, you will be able to clear your already existing debts more efficiently and quickly. As an expatriate, you save money to send money to Senegal online through proper monthly budgeting.

Use a credit card with caution:- Usage of credit cards, if not with care, can lead you into trouble. These can create traps for you. So, beware of their use because they will help you with your credit ratings and keep track of your expenses.

Monitor credit score:- Keeping an eye on your credit card score helps you keep your income and expenses aligned with your financial plan, and a good credit report makes it easy for you to apply for leases and bank loans etc. if there is a need.

Consider family:- Do not shy away from discussing your financial plan with your family and involve them in the process. Keep advising your children when they are young on how to save and invest money and teach them its value.

Pay student loans:- There are a lot of plans available for the repayments of student loans. If you are stuck with a high-interest loan, you are advised to pay off the principal amount quickly to unburden yourself from the loan. Apart from that, you can look into other plans and apply for one which suits you best.

Retirement plan:- Normally, retirement seems distant, but it arrives sooner. Therefore, plan for retirement well in advance and keep saving money. A point to consider preparing for retirement is to start early. Earning from a young age will help you save more at a younger age.

Maximize tax saving:- Paying taxes is tricky. Many people end up paying more taxes than required because they do not have the basic knowledge of how tax mechanism works. Therefore, it is important to understand it deeply and increase your savings from taxes.

Plan refreshments:- Creating a personal financial plan can be exhausting, and it can deprive you of the breaks you need for refreshments. Give yourself some time. Plan a tour and go for a vacation. Invest in yourself because the healthier you are, the better you can manage your plan.

Conclusion:- This article has thrown light on the importance of personal financial plans to secure a financial present and future. There are many people who earned handsomely in the prime years of their lives, but because they did not have a plan to manage their finances, they saw financial troubles in the later years of their lives. Therefore, a financial plan is as important as earning itself if one is to have a financially stable and secured future.   Your online money transfer to Senegal can make your life after retirement much easier.