4 Financial Planning Tips For People Who Have Little To No Money

A lot of financial planning advice works off the assumption you have money. The reality for many people is there's no money, or very little left over after bills. However, even if you live paycheck to paycheck, there are things you can do to start your journey towards financial freedom:

1. Start Monitoring Your Spending

You need to know where every penny is going at any given time. Many people spend their money on a variety of things, but then have trouble recalling where all their money went. For those with less money to work with, it typically all goes to necessities.

No matter where your money goes, start monitoring it. This alone will give you valuable insight into your financial situation. Write it all down, don't just try to memorize it. Keep a running tally as well. For example, how much do you spend each day, and on what? How much do you spend each week?

2. Set Some Financial Goals and Objectives

Setting goals will give you something to work towards. It will also give you a tool you can use to come up with solutions. It's okay to set large goals, as long as you back those large goals up with more realistic smaller ones.

For example, maybe you want to own a house. No matter where you are financially, there are definitely things you can do to start the process that will end with you owning a home. The house is your large goal. Smaller goals help you achieve your large goal. Those smaller goals are your objectives.

3. Identify Where You Are Financially

For people at or below the poverty line, the idea of having a "net worth" may seem a little silly. Nevertheless, it's important for you to know exactly how much you have in assets, and how much in liabilities.

As you pursue financial health, these things will certainly show up. You also need to know what can stand in the way of you pursuing your goals. To that end, it's nice to have a list of all your debts and assets so you can refer to them. 

4. Start Making Adjustments and Give Yourself a Budget

Once you see where your money goes, you can start making adjustments. For example, you can start looking for things you normally buy and see if you can find cheaper alternatives.

You know how much you're spending, and on what. Use that information to set a budget. Don't go over that budget, but always try to find ways to stay as far under budget as you can.

You may even notice you pay for things you have no use for, such as larger cable television packages. Always look for ways to cut how much you spend, even if it's only by a few cents.

You will also have a better understanding of the types of debts you will have to deal with before you can really start to move forward. Try setting up a savings account for the money you're saving by lowering your spending. Use those funds to deal with debts. Or, save to fulfill one of your objectives.

You will discover other steps you can take as you go along this process. A lot of this is easier said than done, especially for those living paycheck to paycheck. But, these things are doable. Once you get into the swing of it, you can seek a financial planning service to help take you even further towards your goals.