We all have dreams, be it owning a car, a house, child attending a prestigious college or building a healthy retirement corpus. But we seldom pen down these goals and work towards a plan for achieving them. These can be termed as your life goals. And that is where the importance of a financial plan comes into the picture.
Financial planning is a process of determining your financial goals with the help of available resources in a period of time. Financial planning involves wealth management , tax planning , estate planning, retirement planning ,investment planning , insurance planning and cash flow planning.
Need For Financial Plan :
- A financial plan Helps you to make the right investment decisions which helps you to grow your money
- A financial plan gives you a clear picture of how much risk you could take. Where some of us may be in a better position to take risks, few of us may be totally averse to risk.
- Helps to accumulate the correct source of income which helps you achieve your goals.
The Roadmap of Financial Planning :
A financial plan is unique to every individual. Its based on the basic principal of helping you achieve life goals, every plan is specific to individual goals. So what may be suitable to you, may really not work for another person. There is no right time to create a financial plan. Nevertheless the earlier in your career you do so, the better it is. So assess your needs and define your goals well. Remember to always define your goals according to “SMART GOALS”. Work towards channelizing your cash inflow as per your plan, to enable your money to offer you much more.
“A Goal Without A Plan Is Just A Dream. When The Plan Is Executed Then It’s Called Reality”