Why do you need Financial Planning

Simply put, financial planning is the process of meeting your life goals through proper management of your finances. The life (financial) goals can include buying a home, saving for your child's education & marriage or planning for your retirement or protecting your family. It is a process whereby a qualified person will consider your entire financial situation and goals and provide you with appropriate action steps to fulfill your goals and better manage your finances. It is not a one-time process but is continuous in nature as your life situations and finances change over time. You also need to regularly review your financial plans & your investments to ensure that you are well on track to meeting your financial goals / objectives.

Given the nature of today's life, with growing uncertainty, rising aspirations and increasing costs of living, doing a thorough financial planning has become a must for each of us. It is also better to plan and be ready for any situation rather than be passive and wait for things to happen before doing anything about it. A special case to mention is of Retirement planning, which has become very critical since the average life expectancy has increased and appropriate planning is needed to ensure that your 20-30 years of your life after retirement is dignified, peaceful and self reliant.

Typically after you receive recommendations for asset classes or actual products from your financial planner, you are free to purchase such products from any source or distributor.

To summarize, the following are the key reasons or benefits that you would get upon undergoing proper financial planning

• ·        To look at your complete financial situation, including your assets, liabilities, cash flows, financial goals, risk appetite, life situation, family background, etc.

• ·        To plan systematically for your financial goals and objectives, including life insurance, health insurance, retirement, child planning – education & marriage, house purchase, estate planning, investment planning, etc.

• ·        To make your financial life better and secured for yourself and your family and ensuring that all financial goals are achieved.

• ·        To better understand and learn about your financial situation and understand the reasoning and logic behind all recommendations made. Also to better understand the different asset classes and financial products and their suitability to you.

• ·        To regularly review the progress of financial plans and/or to revise the financial plans to accommodate any major change in personal life or financial situation.

Most of us do not have adequate information about financial planning and only in recent years has there been some growing awareness about it. Most of us though still believe that they are knowledgeable and smart enough to decide upon their finances on their own ignoring the fact that this is a very broad subject that requires professional expertise. We are ready to visit and pay an accountant, doctor, lawyer or any other professional but are shy when it comes to financial planners. A better, secured financial life is a dream for all of us which, with proper financial planning, can become a reality. The need is to be understand this crucial part of our life and give it the importance and priority it deserves.