All of us spend more than half of our lives earning but in order to make your hard-earned money to work more effectively for you, one has to do financial planning. It starts with a review of your overall profile and planning your financial goals. These goals can include buying a house, saving a fixed amount of money for your child’s education or planning retirement.
The six steps which can help you in achieving your financial goals are namely, listing the financial requirements of future, setting life goals, examining your current financial status and planning a strategy to meet your financial goals.
Decide your financial goals
By viewing each financial decision as a part of your whole financial goal, you can consider its short-term and long-term effects on your life goals. As a result of this, you can also adapt more easily to sudden changes in life and feel more secure that your financial goals are on track.
Get a professional financial advice
The financial planners are not governed by the government. Instead, it regulates planners by the services they provide. For instance, a financial planner that provides insurance transactions is regulated in the form of an insurance agent. Many financial advisers like accountants and investment advisors can also offer the financial services. So, before getting a financial planning service, check if the advisor follows the six-step process mentioned earlier.
Commonly made mistakes in financial planning
The following are some of the common mistakes made by consumers in their approach towards Financial Planning.
• Not setting measurable goals.
• Confusing financial planning with investing.
• Not evaluating the financial plans periodically.
• Thinking that the financial plans are only for wealthy people.
• Expecting unrealistic returns on investment.
Hence, financial planning when done with an authorized financial planner protects you and your family from the financial uncertainties during the times of crisis. It can also help you to secure your present if you assess your current financial situation and plan your future accordingly.
The six steps which can help you in achieving your financial goals are namely, listing the financial requirements of future, setting life goals, examining your current financial status and planning a strategy to meet your financial goals.
Decide your financial goals
By viewing each financial decision as a part of your whole financial goal, you can consider its short-term and long-term effects on your life goals. As a result of this, you can also adapt more easily to sudden changes in life and feel more secure that your financial goals are on track.
Get a professional financial advice
The financial planners are not governed by the government. Instead, it regulates planners by the services they provide. For instance, a financial planner that provides insurance transactions is regulated in the form of an insurance agent. Many financial advisers like accountants and investment advisors can also offer the financial services. So, before getting a financial planning service, check if the advisor follows the six-step process mentioned earlier.
Commonly made mistakes in financial planning
The following are some of the common mistakes made by consumers in their approach towards Financial Planning.
• Not setting measurable goals.
• Confusing financial planning with investing.
• Not evaluating the financial plans periodically.
• Thinking that the financial plans are only for wealthy people.
• Expecting unrealistic returns on investment.
Hence, financial planning when done with an authorized financial planner protects you and your family from the financial uncertainties during the times of crisis. It can also help you to secure your present if you assess your current financial situation and plan your future accordingly.
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