Most Americans don’t have a financial plan, but should


Do you have a financial plan? A real, written plan with goals, targets, and timelines, not just “I plan to stay out of debt this year”? If you have no such plan, you have plenty of company.

According to Charles Schwab, only 25% of Americans have a written financial plan. The good news: Schwab's 2018 Modern Wealth Index survey shows that investors with a written plan tend to have greater fiscal discipline and better money habits.

A written financial plan is the monetary equivalent of an exercise buddy who works out with you, motivates you to stay on track, and occasionally swats Oreos out of your hand. It serves as a template to remind you of your financial goals and keeps you from frivolous spending (the monetary equivalent of Oreos).

The Schwab poll finds that, compared to non-planners, planners are far more likely to pay bills while still saving money every month (75% to 33%). They are also more likely to have an emergency fund (65% to 24%), life insurance (62% to 39%), and an overall feeling of financial stability (62% to 32%). Conversely, only 38% of planners live paycheck-to-paycheck, as opposed to 68% of non-planners.

Unfortunately, financial planning is perceived to be a rich person's tool. Approximately 45% of non-planning respondents believe they don't earn enough money to warrant a financial plan. Given that respondents define financial comfort as $1.4 million on average and wealth as $2.4 million, many Americans look at their accounts and conclude that financial planning is not for them.

That premise couldn't be more wrong. If you have less money, isn't it even more important that you plan and use your money wisely?

Financial planning doesn't have to be complicated and it doesn't even require professional services. While it's best to consult with financial professionals, and low-cost options are available, just under half of survey respondents created their financial plan without professional financial assistance.

Other survey roadblocks to financial planning include a lack of financial understanding or lack of confidence. It never occurred to 20% of non-planners to make a financial plan, and another 20% claimed to not know how to make one.

If you've read this far, you know the importance of a written financial plan and if you don't have one, we can provide a simple guide to starting one.

Start by defining your goals. Are you saving for a home? Planning to send kids to college? How about retirement and emergency funds? Do you plan to pay down debt? Once these goals are written down and quantified, you can prioritize your goals and start funding them. If you want to reduce your interest payments and lower your debt, try the free Debt Optimizer by MoneyTips.

To allocate money to any goals, you need a budget that provides a surplus. Lay out your monthly income and regular expenses. Don't forget to include annual expenses, such as property taxes. If you don't have enough of a surplus to meet your goals or you don't have a surplus at all look for places you can trim your spending and ways to increase your income. Reconsider your goals if they don't seem realistic.

Now comes the tricky part executing your plan. It takes willpower and financial discipline to avoid overspending and create savings. Use your written plan to remind you that you have greater goals. Plenty of online resources are available to help you adjust budgets and plans.

If you need more help with financial planning or executing your plan, seek the assistance of a qualified financial professional. They aren't just for millionaires.

Do you know your credit score? You can check your credit score and read your credit report for free within minutes using Credit Manager by MoneyTips.


Advertising Disclosure

Originally Posted at:

The Secret To Financial Security? Have A Plan

Prioritize Saving From The Start Of The Year

Baby Boomers Not Ready For Retirement

Information contained on this page is provided by an independent third-party content provider. Frankly and this Site make no warranties or representations in connection therewith. If you are affiliated with this page and would like it removed please contact



More News

Rice Lake
New Richmond
Black River Falls
River Falls
Green Bay
La Crosse
Twin Cities
Weather Outlook: Occasional flurries this afternoon, then chilly tonight!

Weather Outlook: Occasional flurries this afternoon, then chilly tonight!

An the flip-side, the snow will be easy to scrape off the driveway and sidewalk.

Connect With WQOW
Top Stories

UPDATE: 4 from Loyal, including 3 kids, killed in Apostle Island kayak incident

Sheriff Michael Brennan said Erik Fryman, 39, and his kids 3, 6 and 9-years-old died. The mom, Cari Mews, 29,

NEW: Missing Mondovi man found dead Wednesday afternoon

According to Mondovi Police Chief Colin Severson, the department is looking or Nathan D. Kummer who was reported missing by

UPDATE: Gas leak contained in Boyd

Boyd's fire chief told News 18 crews were digging up a leaking water line at Double D's Saloon and workers

Sex offender faces new charges in Eau Claire

A convicted sex offender living in Eau Claire is charged with two counts of first degree sexual assault of a

UPDATE: Middleton shooter was employee of business where he opened fire

The Middlelton Police department sent a phone message to residents about an active shooter.

Scroll to top
Skip to content