Why Personal Financial Planning Matters More Than Ever

Personal financial planning isn’t just about cutting expenses or saving aggressively, it’s about having control. A clear plan helps you turn money from something that stresses you out into something that serves your goals.

Why Personal Financial Planning Matters More Than Ever

Most people start caring about money only when it starts running out.

But real financial peace doesn’t come from earning more. It comes from planning better.

Personal financial planning isn’t about being frugal or sacrificing yourself. It’s about being intentional.It’s about deciding where your money should go, not wondering where it went.

1. Financial Planning = Clarity

Without a plan, money decisions become random and emotional. With a plan, every decision has context. “Clarity turns chaos into confidence.” Example: If you earn IDR 10 million a month, try this: 20% → savings 10% → investments 60% → essentials 10% → lifestyle The portion is not fixed. It’s flexible, however, the general view has been using around those percentage for each category. It’s simple math, but powerful psychology. Once you tell your money where to go, it stops disappearing.

2. Discipline Builds Freedom

Financial discipline isn’t about strictness; it’s about consistency. It’s choosing small, repeatable habits that make your future self grateful. Example: Saving IDR 1 million per month starting at 25 could grow to over IDR 136 million by 35 (assuming the returns at inflation level or around 4% p.a.). Wait until 35, and you’ll need to save twice as much to catch up. The earlier you start, the easier it gets. Time rewards consistency.

3. Planning Reduces Financial Stress

Money anxiety often comes from uncertainty. A plan gives you control, so that you can respond instead of react. Example: During COVID-19, people with 3–6 months of emergency savings handled salary cuts calmly. Those living paycheck to paycheck struggled to recover. Financial planning won’t remove uncertainty, but it makes you ready for it. Furthermore, it also protects you from the thought of using the likes of paylater for covering your daily needs as we know this would lead to an uncontrollable spending, not to mention the high interest rate that follows.

4. Be Ready When Opportunity Comes

Good planning doesn’t only protect, it positions you. When everyone else hesitates, you’re prepared to act. Example: When the markets dipped in 2020, those with cash reserves invested while others froze. That’s not luck. That’s strategy meeting opportunity. “Planning turns ‘I wish I could’ into ‘I’m ready to.’”

5. From Surviving to Growing

Once your basics are secure, your money should start working for you. Investing is not a luxury; it’s how you buy back your time later in life. Example: A 28-year-old who invests IDR 1 million a month in a balanced mutual fund could have nearly IDR 2 billion by age 55 (10% annual return). That’s compounding quietly doing its job while you live your life. This is what the “let money works for you” phrase is all about

6. Money Is About Choice

At the end of the day, financial planning is about freedom, the ability to make choices without fear. Example: A friend saved consistently for five years. At 30, he had enough to take a year off and start a small business in Bali. That didn’t happen overnight; it came from small, intentional decisions made early.

The Bottom Line

Financial planning isn’t about money. It’s about the mentality. It’s all about control, readiness, and freedom. Start with what you have. Be honest about where you are. Build a system that fits you. Because one day, you’ll thank your past self for starting, even if it was small.

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