Even the Best Laid Plans Often Go Astray

Real Life Example: I’m stuck away from home during the Covid-19 pandemic, states are starting to lockdown and air travel is iffy at best. If I don’t fly home, I’ll blow my budget for a month or more on hotel and other costs. If I do fly home, I could get sick or make others sick.

How do we balance our personal financial goals and plans when life gets in the way? The tradeoff in the example is stark, but the general situation happens all the time.

Disruptions come in many forms, our current pandemic example is (hopefully) the biggest one any of us will experience in our lifetime. More common ones are job loss, unexpected home or auto repair, a big market swing at the wrong time, or an unexpected family event (hundreds of possibilities, there, don’t you think?).

Let them come. Let them smash the short-term progress on your goals.

Do not let the tail (your plan to reach that goal) wag the dog (your life).

Sometimes we need to accept disruption – or make choices – that thrash or delay the goal we knew and loved. And that’s ok. A disruption comes along and we need to be flexible. A lot will change across the span of a financial goal or a full plan. Many things will go right, some things will go astray. Take a breath, put your life first, then return and make adjustments as needed. Ideally your plan informs your choices and increases your confidence.

Things I Wish I’d Done When I was 18-24

Real Life Example: I wish I’d known about the most important things I could do in my twenties when I had no money and wasn’t likely to get some. What practical things could I have been doing?

I love this question because most of us (well, me anyway) just weren’t that smart in the early adult years. I might have spent more on compact discs than I did on rent for a couple years. I loved music and still do, but that choice didn’t help me start smoothly.

Here are three buckets you can start with:

Start Learning What it Costs to be You

You don’t need to torture yourself with budgeting. Rather, build your own awareness of what you’re spending and why. Just the awareness and the occasional review will have a powerful positive impact on your entire financial life.

Manage Your Debt

If you’re between 18 and 24, there’s a strong chance you have debt or are building some up. As of this writing, student loans in America are generally associated with the word, “crisis”. Consumer debt and student loan debt need attention as early as possible in your life. You want your money to grow, not your debt.

Your First Jobs and Saving

Saving at this age can be tough and sometimes impossible. Here’s why you should make it possible: the more you can save, the more options you’ll have when your life presents choices. In the early years, that might mean enough savings to cover a $400 emergency (12% of Americans can’t). In your late twenties or thirties, that might mean enough money to comfortably change jobs or buy your own place to live. The more you save, the more you build circumstantial freedom of choice.

If you can get those three things started in a good direction, your momentum will build steadily. If those three feel like too much, just do the first one. That single thing – the awareness of what it costs to be you – produces great results.