What Valentine’s Day Taught Me About Planning Ahead

Perhaps one of the most dreaded and stressful days of the entire year has to be the night before Valentine's Day. Let's face it, we're all a bunch of last-minute, I'm-too-busy-to-plan-properly, yet (hopeless) romantics. In this insightful article, our guest columnist Lionel Yeo shares with us what he learnt from a simple commitment to planning ahead: There are a couple of timeless truths about Valentine's Day:

• Restaurants will charge you crazy prices for a mass-produced prix fixe menu
• Guys will panic on 13 Feb because they haven't bought gifts or flowers yet
• Florists will see the look of panic in their eyes and use the opportunity to sell them a crappy bouquet for $150 a pop.

Dudes will know exactly what I'm talking about on that last point. Valentine's Day is one of the few days in the year when prices of flowers can double or triple, or go even higher if you count delivery costs. (C'mon, nobody wants to walk around with an embarrassingly large bouquet screaming I LOVE YOU SO MUCH THAT I JUST BLEW LAST MONTH'S SALARY ON THIS)

The V-Day Early Bird Discount

So knowing that my girlfriend wanted flowers this Valentine's Day, I ordered them… on 26 Jan. You might laugh, but placing my order 19 days in advance turned out to be a really good idea because it worked out for everyone: The florist got to lock in an order early, my girlfriend got her flowers, and I got a nice bouquet for way cheaper than what I would have gotten if I'd made my purchase closer to 14 Feb. At this point, a couple of commentators are snickering about what a sucker I am for falling for the commercialization of Valentine's Day. But hey, if you already know that a bouquet of V-Day flowers is going to make your girlfriend happy, why not plan for it in advance? Planning early has its advantages – You get things done with less stress, less time, and if you're slightly savvy about it, less money too. You might not really care about what I did on Valentine's Day, but the personal finance geek in me totally started drawing parallels between this and other areas of life, which I thought I'd share with you today:

Plan Ahead For Your Yearly Expenses

There might be a couple of things that you know you're definitely going to spend on this year. For example:

• Birthday gifts or Valentine's Day flowers
• Your annual family vacation
• Premiums for your car insurance
• New clothes for Chinese New Year
• Ang paos for your colleague's wedding that you don't really feel like attending because you'll be seated at the same table as your boss. Awkward.

These expenses shouldn't be news to you – you spend money on these same items year after year! So instead of stressing out or feeling depressed whenever you have to fork out 300 buckaroos for ang paos during Chinese New Year, why not plan for that expense in advance? Personally, I carve out small amounts of my monthly salary for things that I'm definitely going to spend on during the year. For example:

• Gifts: $100/month
• Annual vacation: $300/month
• Books: $50/month
• Valentine's Day: $1,500/month (just kidding)

I then add up these amounts and automatically send the total into a separate savings account (I use POSB's MySavings Account) every month. Whenever I need the funds for these predetermined purposes, I simply reach into my account and use them. No fuss, no muss.

Make A 10-Year Plan That Few Others Do

Budgeting for yearly expenses might sound nice, but there's a way to up your personal finance game even more. Because I'm a total weirdo, I love talking to people who're 10 years older and asking, “What did you wish you did more of 10 years ago?” Every single person I spoke to said that they either:

1. Wished that they had saved more; or
2. Wished that they had started investing earlier

Isn't that pretty telling? Yes – Spending money indiscriminately in our twenties might be pretty awesome. I know I'm running the risk of sounding sanctimonious here, but if you don't want to have the same regrets as everyone else in 10 years, it's time to do something about it now. As a first step, that means ramping up your savings rate (check our my free ebook Small Tweaks for some strategies on how to do just that). But if you've already saving a substantial amount, maybe you should start getting serious about learning how to invest and – here's the key part – start carving out a portion of your salary for your long-term investing needs. I mean, did you think that you were gonna wake up in 10 years and magically find $100,000 in your bank account just waiting to be invested? Of course not. That pile of cash had to come from somewhere. The sooner you start building it up, the better. If it's one thing I learnt from my V-Day flower experience, it's that planning ahead rocks. Set things up now, so that you can reap the rewards later. Now, let me go check out the flowers for Valentine's Day 2015. Lionel writes at cheerfulegg.com, which aims to help people hatch a rich life. As a special download for MoneySmart readers, click here to download his free ebook Small Tweaks – that'll show you how to boost your savings by $300 every month. How far ahead do you plan for Valentine's Day? Any stories on last minute mishaps to share? We'd love (no pun intended) to hear about your (un)romantic escapades here! Image credits: corrieb, epiclectic