8 steps to a flexible financial plan

You want to live your dreams. But you need a plan to pay for them. Even trickier, dreams change. Make a plan that’s flexible enough to change right along with you.

We've got the experience to help.

We’re financial professionals at Principal®. Every day, Principal helps people make financial plans that allow them to imagine their dreams and live them. Here, we’ll show you how to do it yourself—how to adapt your money to life’s changes. Whether it’s a new addition to the family, or loss of a job, or an unexpected move.

Heather Winston
Principal Financial Group®

Stanley Poorman
Principal Financial Group


Graphic of a checklist.

Step 1: Set your goals

Critical goals come before needs and wants.

When life changes—and it always does—your goals help guide your financial decisions and focus on what's important.


Graphic of a calculator.

Step 2: Make a budget.

With a budget, you align what you make with what you spend.

With goals set, let’s talk budget, which is simply a way to organize your money.


Graphic of a savings bank.

Step 3: Build your emergency savings

Without an emergency fund, your plan may never get off the ground.

“Oh, shoot” moments happen all the time. That’s life. Some are bigger—and more expensive—than others. An emergency fund helps you cover expenses in the meantime so you can continue toward your goals.


Graphic of an umbrella.

Step 4: Protect your income.

It’s good to hope for the best, but plan for the unexpected.

It’s those middle-of-the-night worries. What if you or your partner got too sick or hurt to work? Or passed away unexpectedly? Could those who depend on you still pay the bills—and save for the future?

No one likes to think of these things. But life can change in an instant. It’s good to hope for the best, but be ready for the unexpected. Insurance helps you do that.


Graphic of cutting a credit card to indicate cutting debt.

Step 5: Ditch the debt.

Debt can keep you from achieving your goals.

Not having an emergency fund is one thing that can keep you from achieving your goals. Debt is another.

Of course, not all debt is bad. A home mortgage, for example, may offer tax perks, and it helps build long-term equity (what you truly “own” vs. what you’ve borrowed).


Graphic of a palm tree.

Step 6: Save and plan for retirement.

The sooner you start, the more potential your money has to grow over time.

Your retirement might be a long way down the road, so you’re saving for it. Or maybe it’s just around the corner and you’re beginning to plan. The goal is relatively worry-free financial independence when you retire. So either way, saving and planning now is a smart idea.


Graphic indicating investing money.

Step 7: Invest some of your savings.

For mid- and long-term goals, you also need to invest your savings.

Saving is good for short-term goals (like when you save in a bank account for a new sofa.) For mid- and long-term goals (think college for the kids), you’ll likely need to invest your savings.

Think of it this way:


Graphic of a contract.

Step 8: Make your final plans.

Estate plans aren’t only for the wealthy.

In the end, it doesn’t matter how much money you have. What matters is the people you love. An estate plan can help you take care of them and carry out your final wishes.

It’s not just about a will. A good estate plan also lays out who you want to make decisions if you can’t make them for yourself.


Want the help of a financial professional? Find one near you.

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* An investment in the Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. You could lose money by investing in the Fund. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it cannot guarantee it will do so. The Fund's sponsor has no legal obligation to provide financial support to the Fund, and you should not expect that the sponsor will provide financial support to the Fund at any time.

** Asset allocation and diversification do not ensure a profit or protect against a loss

Investment advisory products offered through Principal Advised Services, LLC. Des Moines, IA 50392

Insurance from Principal® is issued by Principal National Life Insurance Company (except in NY) and Principal Life Insurance Company, Des Moines, IA 50392.