By Oyinlola Oresanya (@oyinnlola)

Making a Financial Plan

  • Create a vision statement.

In the book, the Smart Money Woman, Arese Ugwu talks about creating a vision statement.

“We get so bogged down with the reality of our everyday lives, bills, bills and more bills that we forget to focus on the vision. For most people the vision is foggy, which is why their limited resources are allocated inappropriately and their money gets pulled in every direction except their goals! To begin the journey to financial fitness you need to get clear on what your vision is.


Your vision statement helps you create a summary of your life’s narrative. It is a way of articulating who you are, who you want to become, the value you want to create and the impact you would like to have”


  • What are the things you want to save and invest for?

This should be clear from your vision statement. Think about the goals that are most important to you and make a list starting with the most important e.g. home, car, an education, comfortable retirement, children, medical or other emergencies, periods of unemployment etc.

  • Decide how many years you have to meet each specific goal.

Each goal has a time frame and you need a savings or investment option to meet your time frames. You’ll find a wealth of information and tools to help put your financial plan together online.

  • Know your Current Financial Situation.

You should know where you are starting from when taking a journey. Take an honest look at your entire financial situation and on paper, figure out your current situation—what you own and what you owe.

This is your “Net Worth Statement”.  List what you own (Assets) on one side of the page and what you owe (Liabilities) on the other side.

Subtract what you owe (Liabilities) from what you own (Assets). If your assets are larger than your liabilities, you have a “positive” net worth. If your liabilities are greater than your assets, you have a “negative” net worth.

Don’t be discouraged if you have a negative net worth. If you follow a plan to get into a positive position, you’re doing the right thing.


The goal is to get to a point where the assets you’ve accumulated can pay you enough income to sustain your lifestyle.


  • Know your Income and Expenses.

The next step is to keep track of your income and your expenses for every month. Write down what you earn, and then your monthly expenses.

  • Pay Yourself First.

Are you paying yourself every month?

Include a category for savings and investing.

Many people get into the habit of saving and investing by following this advice: always pay yourself. This can be easier done by allowing your bank make direct deductions automatically into a savings or investment account (Think Standing Instructions! Ask your bank officer).

You’ll increase the chances of being able to stick to your plan and to realize your goals if you have automatic deductions made from your salary or bank account,.

  • Finding Money to Save or Invest.

If you are spending all your income, and never have money to save or invest, you’ll need to look for ways to cut back on your expenses. When you watch where you spend your money, you will be surprised how small everyday expenses that you can do without add up over a year.

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