Why Financial Planning
Every individual has specific needs as well as preferences. Our circumstances also determine our choices. Growing financial world offers multiple avenues and large range of products – investment and debt, both.
For optimal results, all Individuals need regular professional guidance to strategise and manage their finances, align their assets with financial goals and an unbiased insight on money related issues such as savings, investments, insurance, mortgages, estate planning, taxes and retirement, Will preparation, etc.
Essentially, a financial plan is a map of how to achieve a set of objectives using financial products and services.
Why Financial Planning is important
Simply to attain your financial goals.
Prudent planning of finance is aimed to address the needs caused by – Inflation, Changing Lifestyles and Retirement.
Inflation causes fall in purchasing power of money over a period of time. Financial planning would help you to be better prepared to deal with the impact of inflation, more especially in your retirement years.
- Changing Lifestyles
Every individual would upgrade his/her standard of living and lifestyle, commensurating with increase in his/her disposable disposable income. After meeting his/her ‘necessities’, he/she would progressively opt for ‘comforts’ and then to ‘luxuries’. Financial planning plays a key role in helping individuals and families not only to upgrade but to also maintain their lifestyle.
Planning for our retirement is a compelling need. The length of retired period is also increasing. Average life expectancy is gradually improving, enabled by medical advancement as well higher health consciousness, healthy diet and regular physical activity. Responsibility to ensure that we have a regular income during our retirement years is no one else’s but ours. Financial planning helps prepare for this important phase of life, in ensuring generation of sufficient income.
What is Financial Planning Process
Financial Planning is the process of meeting your life goals through proper management of your finances. Life goals can include buying a house/car/durables, saving for your child’s higher education & marriage, international holidays, providing for unforeseen emergencies or planning for retirement. The Financial Planning Process help you take a ‘big picture’ look at where you currently are.
In a step by step process, you can work out where you are now, what you may need in future and what you must do to realise your goals and dreams you cherish. The process involves gathering relevant financial information, setting life goals, examining your current financial status and coming up with a strategy or plan for how you can meet your goals.
Thus, a financial plan would essentially involve setting short and long term life goals, quantifying and putting up a plan to accomplish them.