One cannot start a journey without having a destination in mind. He would soon be going round in circles. Can one leave his financial needs and goals to chance and not make a financial plan. The result would be utter failure and frustration would follow. A financial plan involves setting a destination or a target which is financial security in life.
This plan stimulates action which involves making the right investment decisions and a continuous monitoring of the plan to secure the necessary result. Now ones destiny is truly in his hands. Remember good plans shape good decisions. That’s why good planning helps to make elusive dreams come true.
Financial planning is all about defining a financial goal such as purchasing that dream home, buying that beautiful car or taking ones family on a dream holiday. This goal also needs to have a value as well as a time frame in order to be defined as a financial goal. This could be the purchase of that dream home costing INR 50 Lakhs in a 10 year time frame or a foreign holiday for the family costing a lakh of rupees a year from now.
See Also: What Does A Financial Advisor Do?
See Also: Who is a Financial Planner?
One surely remembers the stock market crash of 2008. Panic selling in the market resulted in investors making a beeline for the exit. Many years of intricate investment planning were lost. On hindsight one needs to ask the question should the panic button have been pressed? One is plagued by doubts at this time. Has one made the right decision? Should one have focused on saving rather than bother investing? The answer is obvious. If one cannot stick to the financial plan in hard times why make one? Remember tough times don’t last. Tough people do. Whenever one makes an investment plan especially in equity the outlook should be for the long term. Equities give the best returns only with a time horizon of at least 3 years. Stay invested. It pays.
There is a famous saying “Let our advance worrying become advance thinking and planning”. Stress and worry is just a needless waste of energy. Use this energy to make a financial plan .This financial plan will stand good stead in tough times.
See Also: Steps in the Financial Planning Process
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