Let’s talk about Personal Financial Planning….

We all ‘Plan’ for many things in our daily life. Be it your picnic with friends, or preparation for your project presentation or shopping for a wedding in a family!Planning is ‘integral’ part of our daily life. But, when it comes to your personal finance and investments, people often ignore it or postpone it. But when they face any real life problem, they regret about not paying attention to planning their finances.

Who needs financial planning?

A businessman thinks that, I have a well settled business and I have created a fortune, why should I plan my finance? A salaried thinks that, I earn salary which fulfils my household expenses, why do I need financial planning , its required for other wealthy people, where do I have so much money to plan for?

Well, you have goals to achieve in life, be it your home purchase, expansion of your business, your children higher studies or marriage, or simply maintaining and increasing the wealth you have so far accumulated. For all such goals, you always work hard. But, today lifestyle trends are changing and you try to keep pace with them. While doing so, you often experience imbalance in your earnings and expenses. To keep proper harmony between your earnings and expenses while maintaining your standard of living yet making provision for your future goals and make a road map for them to achieve, “FINANCIAL PLAN” is important!

So; whether you are salaried, self employed professional or a wealthy businessman, ‘YOU’ need financial planning!

What is financial Planning?

Well, as the name goes, its a comprehensive plan for all your personal finance and investments, done to achieve your goals from time to time, for your life stages! This plan considers your income, expenses, present investments, future goals, risk appetite, loans taken, responsibilities you carry etc. and suggest you best possible way and means of investments to achieve your goals. It takes care of required health insurance and life insurance needed for you.

Who should do financial planning for you?

Well, there are many investment advisers in market but ‘CERTIFIED FINANCIAL PLANNER’ is the one professional whom you should approach for your financial plan. They charge their fees to carry your planning activity.

To get more unbiased and pure financial planning services, you must approach CERTIFIED FINANCIAL PLANNERS who are SEBI Registered Investment Advisers! They operate on ‘FEE ONLY’ basis! Here , they charge a fee for their services but they are not involved in distributorship of any financial product and insurance. So, this is beneficial for you because you give ‘only fees’ to them and since they are not involved in any distribution, they always give unbiased advice.This makes their services more transparent.

How financial planning is done?

Typically, financial planning is done on the basis of data received by you during a discussion and through a datasheet supported by some details of your existing investments, goals and insurance. Lot of discussions happen about your dreams, needs and responsibilities too before finalising on them to achieve.

Based on such qualitative and quantitative information, a planner drafts a plan for you considering all the best possible solutions. When he/she presents a plan to you, again he/she discusses the plan and possibilities , you ask queries /doubts, give suggestions if you have any. Considering all the best possible solutions, then final draft is made and presented to you. You need to start implementing the advice given in a plan. Then yearly review is made by the planner and you must review your plan to judge the progress and performance of the investments made. Active and regular review by a planner is important!

When you should make your financial plan?

Earlier is better! You should start your investments and make a plan from the month when you start earning. At young age, you can set some more goals as you have time by your side to achieve them. When you get your planning done, you get more focused in your approach to achieve them. You can better protect your health and life at the early age. This automatically curtails unnecessary expenses and waste of your hard earned money.

So, plan well and in time to make your money work for your own good!

Planning is important as They say “Before starting a journey, you must know the destination! This makes journey even more beautiful!!”

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