10 Financial Planning Dos and Don’ts for Building a Secure Financial Future
To many, the term “financial planning” can feel overwhelming - evoking a sense of uncertainty and fear that can paralyze them into inaction. The good news: it doesn’t have to feel that way! Whether you’re just starting out, or refining your current strategy, having a solid plan in place is they key to setting yourself up for long-term success.
Remember: small, consistent actions that build momentum over time.
In this guide, we’ll break down 10 financial planning dos and don’ts - helping you avoid common pitfalls while focusing on smart money habits that can lead to lasting financial confidence.
Let’s start with the Dos!
✅ 10 Financial Planning Dos
These essential steps will keep you on track toward a secure and thriving financial future:
1. Set Clear Financial Goals
Before making any financial decisions, outline your short-term, medium-term, and long-term goals. Whether it’s building an emergency fund, buying a home, paying for college, or planning for retirement, clear goals provide a roadmap for success.
2. Create a Budget That Works for You
Budgeting isn’t about restriction - it’s about awareness. Track your income and expenses to ensure you’re living within your means while still making progress toward your financial goals. There are lots of great budgeting tools available online, or you can use a spreadsheet. The right budgeting tool is the one that works for you.
3. Build an Emergency Fund
Unexpected expenses can derail your financial plan. Aim to save at least three to six months’ worth of essential expenses in a readily accessible account. This is an absolute must!
4. Invest Early and Consistently
The power of compound interest means the sooner you start investing, the better. Even small, consistent contributions to a retirement or brokerage account can grow significantly over time.
To illustrate that, let’s look at this powerful example:
Person 1 (Early Saver): Saves $5,000 per year from age 20 to 30 (10 years, total savings: $50,000). Then, they stop contributing and let their money grow at 8% annual return until age 65.
Total at 65: $1,070,944
Person 2 (Late Saver): Starts saving $5,000 per year at age 30 and continues saving every year until age 65 (35 years, total savings: $175,000).
Total at 65: $861,584
The early saver ends up with $1,070,944, while the late saver has $861,584.
Difference in final amount: The early saver has $209,360 more at age 65, despite saving $125,000 less overall!
5. Pay Yourself First
Treat your savings like a must-pay bill. Automate contributions to your savings and investment accounts before spending on discretionary purchases. Think of this as paying “future you.” (You’ll thank yourself later!)
6. Regularly Review and Adjust Your Financial Plan
Just like a yearly health check-up, your finances need regular check-ins. Life changes, so your financial plan should evolve with it.
7. Prioritize Paying Off High-Interest Debt
Debt with high interest (like credit cards) can drain your financial progress. Prioritize paying these off quickly to avoid excessive interest payments.
8. Protect Yourself with the Right Insurance
People have mixed feelings on insurance, but life is unpredictable. Make sure you have the right insurance coverage. Whether it’s health, disability, life, or auto, or homeowners insurance - the right protection safeguards your assets and loved ones.
9. Continue Educating Yourself About Money
Financial literacy is a lifelong journey. Stay informed about financial strategies, investment opportunities, and tax-saving options to make informed decisions.
10. Celebrate Your Progress
Every step forward - whether it's paying off a debt, hitting a savings milestone, or investing consistently - is a victory. Acknowledge your progress to stay motivated!
🚫 10 Financial Planning Don’ts
Avoiding the wrong decisions is just as important as making the right ones. Here’s what to look out for on your financial journey:
1. Ignoring Your Credit Score
A low credit score can mean higher interest rates on loans and credit cards, costing you more money in the long run. Regularly check your credit report and take steps to improve your score.
2. Living Beyond Your Means
Spending more than you earn leads to financial stress. Stick to a budget and be intentional about where your money goes. Avoid using that credit card, unless you know you have the funds to pay it off (notice I said have, not will have!)
3. Skipping Retirement Contributions
The longer you delay saving for retirement, the harder it will be to catch up. Even small contributions to a 401(k) or IRA can make a big difference over time.
4. Forgetting About Taxes
Tax planning isn’t just for accountants. Understanding how taxes impact your income, investments, and withdrawals can help you keep more of your hard-earned money.
5. Being Afraid to Ask for Help
Whether it’s hiring a financial advisor or seeking budgeting advice, don’t hesitate to reach out for guidance. Financial planning is complex - professional insights can make a big difference.
6. Procrastinating on Financial Decisions
The best time to start planning was yesterday, and the second-best time is today. Don’t let fear or uncertainty delay important financial actions.
7. Making Emotional Money Decisions
Impulse decisions, especially during market fluctuations, can cost you. Stick to your long-term strategy instead of reacting emotionally.
8. Neglecting Estate Planning
Wills, trusts, and beneficiary designations aren’t just for the wealthy. Ensuring your assets are distributed according to your wishes is essential for financial peace of mind.
9. Forgetting to Update Your Beneficiaries
Life changes, and your financial documents should, too. Review and update your beneficiaries regularly to avoid unintended consequences.
10. Thinking You Have to Do It Alone
You don’t have to figure everything out on your own. A financial planner can help create a strategy tailored to your unique situation and goals.
Take the First Step Toward Financial Confidence
Which of these financial dos and don’ts resonate with you? What small step can you take today toward a stronger financial future?
Financial planning isn’t about perfection - it’s about progress. If you’re looking for guidance or support in creating a plan that fits your goals, reach out today. We’re here to help you build the most wonderful life you can dream up!
Let’s make financial confidence your new normal.
About the Authors
Scot Whiskeyman and Lindsey Ciarrocca are a husband-and-wife financial planning team and co-owners of Providers & Families Wealth Management, based in Carlisle, Pennsylvania. They help busy professionals and families navigate the complexities of financial planning, from investing and retirement to budgeting and building long-term wealth.
Scot is an avid runner who enjoys pushing himself on the roads (and occasional trails) while Lindsey has a passion for budgeting and quoting Friends. Together, they share their home with their beloved cats.
Providers & Families Wealth Management is a registered investment advisory firm. This blog post is for informational purposes only and should not be considered financial, tax, or legal advice. Investing involves risk, including the potential loss of principal. Past performance does not guarantee future results. Always consult with a qualified financial professional before making any financial decisions.