Lifestyle Planning
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Lifestyle Planning
As society becomes more aware of each individual’s special needs, techniques used in sociology and psychology are being applied to personal finance as well. Lifestyle financial planning considers a person’s desires, dreams, strengths, needs, and goals and fashions them into the overall financial equation in order to bring those goals within reach.
Things To Know
- The lifestyle financial plan will help you acquire the money necessary for each of your goals.
- Lifestyle financial planning focuses on maximizing your happiness.
Lifestyle planning is about more than just money
Heretofore, planning has focused on maximizing the accumulation of wealth. Lifestyle financial planning, however, focuses on maximizing the individual’s happiness. It de-emphasizes greed and embraces frugality. It also helps individuals focus on realistic goals based on their desires, dreams, strengths, and needs.
Many colleges, universities, and professional schools are implementing lifestyle planning counseling programs to help their students focus on what is important in both their personal lives and careers. Lifestyle planning counselors help students make an inventory of those things in life that are important to them, such as where they want to live, the types of cars they want to drive, and the income they think they will need to support their lifestyles.
The types of things people typically save money for haven’t changed, but the way they look at them has. For example, people still need to save for the down payment on a house, but perhaps a smaller house. Buying a car? Consider a previously owned luxury car or a lower-quality, brand-new one. Or, when planning for college, it may make sense to go to community college for two years and then finish the degree program in a more prestigious school—it will cost a lot less.
Other things to think about
Very often life throws us curves. How many people do you know who wish they were in a different occupation or profession? What if your personal relationship doesn’t work out? How will a breakup, separation, or divorce affect your lifestyle? Can you be financially prepared for it? You should be. Lifestyle planning can help you reevaluate your personal choices and make decisions that will help you be happier and more productive. What about retirement? When planning for retirement, you need to consider what you really want to do. This will determine how much you need to save and how frugal you will need to be in order to plan for your retirement.