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Importance of Financial Trajectory

“Planning is bringing the future into the present so you can do something about it now.”-Alan Lakein

The most important actions are never comfortable.

According to the United States Census Bureau, the average American will earn around $1.2 million with a high school diploma, $2.1 million with a bachelors degree, and $4.4 million with a higher degree. However, statistics say that only 5% of their income gets saved. The average American finds it hard to shell out $400 without selling or getting credit. These statistics show a problem with the lack of savings of a typical American.

Financial planning or trajectory helps you create short term and long term goals to help save and invest in getting financial freedom when the individual gets older. An individual doesn’t have to rich to do financial planning.

How to do financial trajectory:
1.Identify your financial or asset goals first. Whether you want to buy a house or fund the education of your kids, it is good to have dreams that you can look forward.
2. Look at the past, present, and future financials. Try to compute what you earned and spent in the past year, what you have right now and how much you owe the bank or other financial institutions in the future.
3. Develop small-term goals. Start by focusing on paying back what you own as the interests overtime can bite you in the back. Then continue with saving money either through banks or government bonds that can add interests for when you retire.
4. Be consistent. Slow and steady wins the race. You don’t have to start big on to fall short in the end. Instead, start saving little by little.



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