You're closer than ever to getting a handle on your personal financial statements. Like the head honchos of corporate America, you've subjected your finances to some serious scrutiny. Let's review:
First you reviewed your balance sheet
Then you spent a day (or more, if you're an over-achiever) tracking your spending,
With that spending list, in hand, you questioned whether your cash flow was consistent with your goals.
These exercises reveal what you've done with your money in the past.
Now it's time to look to the future -- what you can do now to improve your situation and attain your goals years down the road.
Here's a simple solution: Make savings mindless. That's right; take the guesswork and busywork out of budgeting by putting your savings plan on autopilot.
If you're contributing to your retirement plan at work via withdrawals from your paycheck, congratulations -- you already have an automatic savings plan! You are regularly socking away money for an important goal. Since the money is transferred to your plan automatically, you don't have to worry about forgetting or accidentally spending your retirement plan contribution. It's such a no-brainer, and it makes great financial sense.
But such a smart plan is not limited to saving for retirement. Many banks, brokerages, dividend reinvestment plans, and mutual fund companies will automatically transfer money from your checking account to the investment of your choice. Will you need the down payment for a house in three years? Have $100 to $500 sent to a money market account every month. Want to send your kids to college? Sign up for a 529 plan and make hassle-free contributions over the years. Don't have a particular goal in mind, but you want to increase your net worth? Figure out how much you can save, and have it automatically invested. Over the years, it'll really pay off.