In the Present Scenario planning is a necessity for everyone. Many think planning is required for only big plans or it is a tool for corporate, but Planning is required for Individuals also, to plan their finances at every stage of their life. Financial planning is nothing but the process of meeting life goals through a proper planning and management of finances. It helps an individual as well as corporate to translate their dreams and aspirations in to reality. It also helps you to provide meaning and direction to your financial decisions. Financial planning has to be done in a proper way, so that it can be implemented effectively.
Financial planning includes Personal Financial Planning
as well as Corporate Financial Planning.
Corporate Financial Planning includes
- Income Tax planning
- Risk Management/Insurance Planning
- Investment Planning
- Estate Planning.
Financial planning is important because it helps to manage your income more efficiently. It is important to increase cash flow and to keep an eye on spending habits and expenses. Proper financial planning will help in determining what should be done to create cash flow in order to make investment possible. It helps to build a long term capital-base and shape your financial future in terms of savings. With a strong capital base, you can have a wider portfolio of investment and it will help you to increase the wealth and to reduce the risk of investment. It helps us to distinguish investment opportunities appropriate to your financial situation. Financial planning can help in assessing the best investment opportunities. A good investment planning can transform your dream goals into realities. It is very important for your family to have financial security. This is possible only through proper financial planning with proper coverage and taking right policies. A systematic and structured saving and investment plan can be provided to fund children's education and to secure a comfortable retirement.
In India most of the people have not analyzed their dreams and the ways of realizing the same. So it is very important for you to analyze your dreams so as to convert it into reality. Now you have to translate your dreams and aspirations in to money. Define the time frame within which you should be able to realize your dreams. If you think, it is difficult to meet all your goals within the specified time frame, prioritize your goals based on urgency and importance.
Proper Financial Planning
Based on the above steps, comprehensive financial plan should be framed which contain an analysis of all pertinent factors relating to your financial status. Your financial plan should consist of your personal data, goals and objectives, mention your issues and problems, specify assumptions, mention the balance sheet/ net worth for the financial year of your company, their should be proper cash flow management. Merely designing a plan, no matter how sound, does not constitute financial planning.
Options for financial planning
- Financial Planning Consultant Services
- Financial Planning Magazines
- Online Financial Planning
Financial Planning Magazines
Financial planning magazines provide helpful articles and insights on the common issues faced by people trying to plans for their financial future. They also give an idea about the different alternatives available in the market. They may also provide comparison of companies, quotes, rate financial planning tools available in the market and much more.