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When you start out in your adult life, you might not have a plan for yourself. Creating a plan will give you a road map for your future and ensure your financial wellbeing is protected. When a financial emergency does emerge, you’ll have the resources in place to handle that unexpected challenge.

Start With a Budget
Every personal financial plan should start with an actionable budget, which is a budget that you can realistically follow. Your budget should allow you to pay your monthly bills, save at least 10% of your earnings, and leave something left over for entertainment and daily living.

Pay Off Your Debts
If you have personal loans or credit card debt, your disposable income, or that which you would deposit in a savings account, should go towards paying off your debts. You can either pay off your debts from smallest to largest or in order of interest rate size. Follow one method consistently until your debts are paid off in full.

Start Saving for Your Future
Once you’re debt free, cancel all but one of your credit card accounts. The remaining card should be locked away and only used in a rare emergency. Your disposable income can now be deposited in savings accounts. Open a high-interest savings account and deposit half of your disposable income into it from each pay period. This account should be reserved for financial emergencies, such as auto repairs or replacing a hot water heater.

Invest in Your Retirement
The remaining half of your disposable income should be deposited into an IRA account. If your employer offers a 401k plan, join as soon as you’re eligible. The 401k will allow you to double your savings and maximize your contributions. Working with a financial advisor will help you ensure you’ll be able to meet your retirement goals on time.

Once you have these basic elements of a financial plan in place, you should start thinking about protecting your family and assets. Life insurance is one tool that will be useful in protecting your family. You should also create a comprehensive estate plan to make sure your assets will be dispersed according to your final wishes.