Plan Your Work and Work Your Plan
|Plan Your Work and Work Your Plan|
|By Ashish Kumar|
Vince Lombardi, legendary coach of the NFL Green Bay Packers once said, “Plan your work and work your plan.”
It is very true that in order to accomplish anything in life, be it good grades in school, financial freedom, or a successful career, you must have a plan. But a recently published research report by Charles Schwab shows that three in five Americans live paycheck to paycheck and that only one in four has a written financial plan. Further, 45 percent of men and women who do not have written financial plan think they do not have enough money to start planning, while 20 percent say they never thought of having a financial plan, and another 20 percent say they wouldn’t know how to start planning.
Millennial versus older generations
According to the same research report, millennials are in many cases more focused on saving, investing and financial planning than older generations:
Men versus Women
In another similar survey, Schwab found that young women are more driven to reach financial independence than young males (67% vs. 58%). They are more likely to take on extra work to make ends meet (28% vs. 23%) and see more value than men in creating a plan to achieve their financial goals (76% vs. 64%). Yet, despite all these good ‘first’ measures, they are investing and saving less than young men.
Overall, women surveyed show greater awareness of day-to-day finances, budgeting and spending. More young women than men understand the value of making a financial plan, and higher percentages of women say they want to pay their own bills, remain debt-free and live independently. For example:
While the women surveyed report spending 36% less than men, they have far less savings than men ($1,267 vs. $2,000) – a nearly 60% difference. In addition, twice as many young men as women say they would invest spare cash, and almost twice as many young men as women report having investment accounts (though most young adults do not invest at all). Finally, women surveyed were slightly more likely to carry a balance on a credit card, miss a bill payment and ask their parents for money to cover necessities.
Benefits of Financial Plan
The research and the following table reveals that having a written financial plan can lead to better daily money behaviors.
When it comes to investing behavior, these planners are more likely to stay engaged with their investments, be aware of the fees they are paying, and have confidence about reaching their goals:
Parents Know Best
According to the report, below is some advice parents should start giving children at a young age: