Financial Planning
If you do not know where you are going, every road will get you nowhere”
This philosophy also applies to our personal finances, if not managed properly. Lack of budgeting, losing track of expenses and savings, buying a financial product without understanding the deep impact on overall finances are some of the typical examples of managing money in a haphazard manner. In the absence of a specific direction, we shall never know how adequate our resources are to meet our present and future goals.
Financial Planning provides us the road map to achieve our financial goals in a disciplined manner over a life time. The crux of this process is to define and plan your goals, set the time frame to attain the goals and then work towards attaining them with the use of available resources which are your income and assets. Financial Planning is not just about the future. It also involves conducting a critical evaluation of the present finances and plugging loopholes, if any.
Why Financial Planning
In today’s uncertain times, financial planning enables us to arrange adequate funds for our goals well in advance and helping us to stay financially secure. More importantly, it prepares us to face any eventuality which life may throw at us.
The regularity of salaried income stream cannot be banked upon as the concept of job security is on the wane. The nature of income generation from entrepreneurial assignments also initially tends to be erratic. The ‘wants’ have changed into ‘needs’ on account of life style changes.
Today, a plethora of financial products are available for investment which is much more complex and dynamic and carries different degrees of inherent risks. Hence it is essential to analyse the product suitable to your needs instead of chasing the ‘Highest Return Goose’.