Goal Based Financial planning
Financial planning is a step by step process of setting and achieving specific financial goals by creating a comprehensive roadmap that encompasses all aspects of your financial life. It helps you be in control of your income, expenses and investments such that you can manage your money and achieve your goals.
It involves evaluating your current financial situation, identifying your objectives, and developing strategies to help you reach those goals. In order to become rich and Financially free besides a regular income you need to make money work for you.
A financial plan ensures that you are well prepared to deal with dynamic circumstances that comes at personal as well as a macro level.
In the absence of a financial plan, you might not be prepared to accomplish what you have dreamt of achieving and might also be under-prepared to deal with contingencies.Financial Planning is a continuous process in which we assist you in defining your goals, estimating the cost of your goals and drafting a plan to achieve the same.
Why is Financial Plan important?
Many may wonder - "Do I really need a financial plan?" Some might feel that saving regularly in bank recurring deposits or Fixed Deposits does the job of allocating their savings to investments. However, these investments lead to inefficient utilization of your financial resources.
Almost everyone can benefit from having a financial advocate in their corner. Our specialized skills are specifically focused on giving financial planning services and financial consultancy to business owners, professionals, and retirees. Some of the reasons people need financial planning include pending retirement, receiving an inheritance, investment purposes, resource planning etc.
Financial planning provides direction and meaning to financial decisions. It allows the client to understand how each financial decision they make affects other areas of their finances.
Some key elements while creating a financial Plan.
- Assessment of Current Financial Situation:This involves evaluating your financial situation which includes cash flow analysis, expenses, assets, liabilities, and overall net worth. Understanding your current financial standing is essential for setting realistic goals and creating an effective plan. Reviewing your insurance coverage for life, health, general etc
- Goal Setting: Defining your financial goals is a crucial step in the planning process. Common goals include saving for retirement, buying a home, funding education, starting a business, or building an emergency fund. Goals should be specific, measurable, achievable, relevant, and time-bound. Identifying the goals as Short, Medium & Long Term Goals. After identifying, we prioritise the Goals & work towards achieving them.
- Risk Assessment and Management: Identifying and managing financial risks is an integral part of financial planning. This includes evaluating potential risks such as job loss, disability, illness, market volatility, or inflation, and implementing strategies to mitigate those risks. Insurance products, emergency funds, and diversification of investments are some risk management tools.
- Investment Strategy: Developing an investment strategy tailored to your risk tolerance, time horizon, and financial objectives is a critical aspect of financial planning. This involves asset allocation, diversification, and selecting appropriate investment tools such as stocks, bonds, mutual funds, PMS and AIF
- Streamlining Your Investments: If your investments are scattered and you are yourself unsure about where you have invested, then it’s high time for you to put your portfolio in order. Many often indulge in investing in a haphazard manner without conducting a proper need based analysis or undertaking sufficient research on financial products. Such investment portfolios need to be consolidated and re-aligned so as to meet your financial needs
- Invest In the Right Financial Products: Many people invest in the equity asset class through shares or mutual funds. However more often than not, such investments are done on recommendations from friends and relatives and without taking into consideration one's financial goals and risk appetite. In most of the cases these unplanned and non-researched investments result in loss of the investors' money. Hence, it is extremely important that you invest after considerable researching and choosing the right financial product.
- Calculating The Right Insurance Cover: In case of unforeseen circumstances, the right amount of insurance is necessary for your and your family’s security. While life insurance will ensure that your family members are able to maintain the same standard of living even in your absence, the right amount of health insurance cover can avoid burning a huge hole in your savings during mishaps or unforeseen tragic events. However, many people do not understand how much life and medical cover they should take. A holistic financial plan will take into account your income, expenses and goals amongst host of other aspects to determine the optimal amount of cover both - your life and health insurance needs.
- Review & Rebalance: Financial planning is a dynamic process. We will appropriately review the plan and progress made, to see if any modifications are required due to changes like inheritance, change in job status, birth or death in the family, etc. We will review the Investments period appropriately & make alterations in the Portfolio depending upon the Performance.
It's important to note that seeking guidance from a qualified financial planner can provide valuable expertise, personalised advice, and access to a wide range of financial products and services.
Remember, everyone's financial situation and goals are unique, so it's essential to alter your financial plan to your specific needs and consult with professionals who can provide personalised advice based on your condition.
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