By FPA member Philip Herzberg, CFP®, MSF

Last Updated: March 1, 2010

Financial planning success can indeed be attained as a young professional by cultivating and practicing disciplined financial planning habits to achieve near-term and future goals. Below are the following essential insights and tips that will help you on your quest for financial success:

• Start retirement planning with your first job: If the company or organization you work for offers a retirement plan (401(k), Roth 401(k), 403(b)), sign up at your first chance. Utilize Individual Retirement Accounts (IRAs), Roth IRAs, and other vehicles if your employer has no plan. Simplified Employee Pension (SEP), Savings Investment Match Plans for Employees (SIMPLE), and Keogh plans are viable options if self-employed.
• Be cognizant of your employee benefits: It is extremely vital for you to fully know and take advantage of your offered employee benefits, including health, short-and long-term disability, life insurance, and any Health Savings Account (HAS) or Flexible Spending Account (FSA) dependent care options. You can also supplement these benefits with insurance you buy on your own.
• Use credit cards responsibly: Over utilizing credit cards can result in adverse financial situations, including bankruptcy. You should comparison shop for your cards and keep in mind that you will be depending on your future earnings to pay for today's credit card purchases. Ideally, you should minimize your monthly balance to avoid paying interest at higher rates.
• Set savings goals: Pay yourself first and just begin with something small to get into the savings habit. Five to 10 percent of gross income is a steady starting point. Mortgage down payment, retirement savings, college funding and emergency cash reserves are noteworthy savings considerations.
• Plan for the unexpected: It is always critical to be prepared for unwelcome surprises, such as a job loss through no fault of your own. Plan today by stashing wages into an accessible three to six month emergency fund account at a bank (money market fund, savings account, checking account).
• Have these four basic estate planning documents: You should work under the guidance of a financial planner and an estate planning attorney to draft the following four basic documents: will, general durable power of attorney, medical power of attorney and a living will (medical directive).
• Make sure you identify all income tax credits and deductions due: Computer software can help you identify and obtain all of the credits and deductions on your income tax return applicable to you. A tax advisor or Certified Public Accountant (CPA) is always available to assist in this process and suggest tax strategies.
• Implement an investment strategy and save for the long-term: When considering implementation of an investment strategy, you should evaluate investments on the basis of appropriateness for risk tolerance, time frame and overall goals. Try to emphasize diversification in your investment portfolio. No-load mutual funds, exchange-traded funds, target date funds, and target risk funds are some of the options that could be utilized as part of your investment strategy.
• Teach your children financial literacy: The significance of saving, budgeting and growth of money over time can be taught to your children by hands-on education. Your children will learn and acquire family financial planning skills by watching how you handle finances.

Read the complimentary FPA guide, " Starting Your Financial Plan: A Beginner's Road Map," to help you start navigating your road map. The destiny of your future financial success is in your own hands!

Philip Herzberg, CFP®, MSF, is the FPA of Miami-Dade Director of Media Relations & Public Awareness.