Financial Planning is the process of meeting the life goals through the proper management of one’s finances. Life goals can include buying a house, saving for child’s higher education or planning for retirement. Financial planning is control over expenses, saving money and investing for future needs. It is the process of doing things in a disciplined way to achieve the financial goals within a fixed time frame. Each one of us needs “Finance” at various stages of our life. We need to ensure that we have the money available at the right time.
The Financial Planning Process consists of six steps that help you take a ‘big picture’ look at where you are currently. Using these six steps, we can work out where you are now, what you may need in the future and what you must do to reach your goals. The process involves gathering relevant financial information, setting life goals, examining the current financial status and coming up with a strategy or plan for how you can meet your goals given your current situation and future plans.
Benefits of Financial Planning:
Financial Planning provides direction and meaning to your financial decisions. It allows to understand how each financial decision we made affects other areas of our finances. For example, buying a particular investment product might help you pay off the mortgage faster or it might delay the retirement significantly. By viewing each financial decision as part of the whole, you can consider its short and long-term effects on our life goals. We can also adapt more easily to life changes and feel more secure that our goals are on track.
Stages of Financial Planning :
- Wealth Protection
- Wealth Accumulation
- Wealth Preservation
- Wealth Distribution
Need for Financial Planning :
Financial planning offers a coordinated and comprehensive approach to helping us achieve our personal and reasonable financial goals. Building, managing and preserving wealth is not an easy task. Maybe someone has recently retired and are concerned about outliving his/her nest egg. Perhaps a baby boomer trying to plan for a secure retirement. Maybe someone is the part of the “sandwich generation”, caring for his own children at home while also caring for the needs of aging parents. Or there is a misfortunate case of widowing or divorcing with all of the complications that these life challenges bring. Maybe someone has accumulated substantial wealth and want to protect your assets from lawsuits, spendthrift relatives, divorce or other potential threats not only to himself but also to his/her heirs. Further complicating the financial landscape is the vast array of advisors and publications that typically offer conflicting opinions and advice. Fortunately, SEBI registered Investment Advisors are available to assist you in the process of developing a sound financial plan. Selecting appropriate investments is simply one ingredient in the recipe for an effective financial plan that should also include retirement and estate planning.
Our experienced financial planning team will help you to:
- Identify your goals.
- Understand your current situation.
- Develop a plan that addresses your goals with your risk tolerance in mind.
- Implement the financial plan.
- Monitor the financial plan.