How to Do Financial Planning

Information about How to Do Financial Planning

Published on July 21, 2014

Author: elitewealth

Source: authorstream.com

Content

How to Do Financial Planning: How to Do Financial Planning Elite Wealth Advisors Ltd. S-8, DDA Shopping Complex Mayur Vihar Phase-1 Delhi-110091 9650901058 / 011-40000919 [email protected] www.elitewealth.in Why is Personal Financial Planning Important: Why is Personal Financial Planning Important To manage income and expenses. To create an awareness of your current financial status. To plan for the future by developing goals and devising ways to achieve those goals. To provide a system of evaluation and revision for your financial progress. Contact Us- 9650901058 Why Do You Need a Personal Financial Plan?: Why Do You Need a Personal Financial Plan? For most people it is easier to spend than save. To track your expenses, so you don’t spend more than you think you’re spending. You would like to achieve financial independence or retire someday. Contact Us- 9650901058 Why Should You Develop a Personal Financial Plan?: Why Should You Develop a Personal Financial Plan? To help you achieve your financial goals. To help you achieve financial independence. To help you understand where all your money is spent. To help you support those that have supported you. Contact Us- 9650901058 The Personal Financial Planning Process: The Personal Financial Planning Process Step 1: Define Your Financial Goals Step 2: Evaluate Your Current Financial Status Step 3: Develop a Plan of Action Consider Your Goals Step 4: Implement Your Plan Step 5: Review Your Progress, Reevaluate, and Revise Your Plan as Your Financial Status Changes Contact Us- 9650901058 Step 1: Define Your Financial Goals: Step 1: Define Your Financial Goals Specifically define and write down your financial goals to reflect your financial and life situation. Attach a cost to each goal. Set a date for when the money is needed to accomplish the goal. Contact Us- 9650901058 What are the time horizons for financial goals?: What are the time horizons for financial goals? Short-term goals can be accomplished within a 1-year period Intermediate-term goals take 1-10 years to accomplish. Long-term goals take more than 10 years to achieve. Contact Us- 9650901058 Why are goals the cornerstone of a financial plan?: Why are goals the cornerstone of a financial plan? Goals keep the future in mind by reminding you of the rewards. Goals entice you to keep the plan in effect. Goals provide tangibility for the question, “Why?” Contact Us- 9650901058 Step 2: Evaluate Your Current Financial Status: Step 2: Evaluate Your Current Financial Status Your income: What determines it. Your expenses: What determines them. Contact Us- 9650901058 Your Income: What Determines It: Your Income: What Determines It Earnings determine standard of living. Education is the key factor in determining income level. 70% of wealthy householders finished college. Contact Us- 9650901058 Your Expenses: What Determines Them: Your Expenses: What Determines Them Expenses are your costs of living. There are two types of expenses: Fixed expenses such as rent, car payments, and day care are expenses that don’t change in amount and are usually controlled by a contract. Variable (flexible) expenses, like your phone bill or the amount you spend on entertainment, are expenses over which you have control. Contact Us- 9650901058 Step 3: Develop a Plan of Action: Step 3: Develop a Plan of Action Flexibility -- The ability for your plan to change as your situations or goals change. Liquidity -- Your ability to convert non-cash assets into cash with relative ease and speed. Contact Us- 9650901058 Step 3: Develop a Plan (cont’d): Step 3: Develop a Plan (cont’d) Protection -- Your ability to meet the unexpected large expenses without destroying your plan. Minimization of Taxes -- Your ability to pay as little as possible to the federal government. Contact Us- 9650901058 Step 4: Implement Your Plan: Step 4: Implement Your Plan Use common sense and moderation; don’t force yourself to track every penny. Remain positive about your plan; don’t view your plan as a punishment. Rewards await you, so don’t lose sight of why you developed the plan. Contact Us- 9650901058 Step 5: Revise Your Plan: Step 5: Revise Your Plan Periodically review your progress to see if any fine tuning needs to be done. Make sure that your plan still matches your goals. Be prepared to start over if your plan no longer meets your needs. Contact Us- 9650901058 Summary: Summary Build your financial future around a financial plan: Manage the unplanned -- financial planning withstands minor setbacks. Accumulate wealth -- financial planning maps out strategies for meeting your goals. Save for financial independence and/or retirement -- financial planning helps you determine the costs of retirement and how much you need to save. Contact Us- 9650901058 Summary (cont’d): Summary (cont’d) “Cover your assets” -- financial planning includes protecting your assets with insurance Invest intelligently -- financial planning helps you understand the principles of investing Minimize taxes -- financial planning helps you keep your assets where they should be, in your own pocket Contact Us- 9650901058 Summary (cont’d): Summary (cont’d) Define your goals – you must first know where you want to go before you can decide how to get there. Evaluate your financial health – you must first know where you are before you can determine where you are going. Develop a personal financial plan – you must first draw a map before you can follow it. Contact Us- 9650901058 Summary (cont’d): Summary (cont’d) Implement your plan – you must begin before you can end. Review your progress – you must continue to check the map t ensure you are staying on course. Contact Us- 9650901058 Thank You: Thank You 9650901058 / 011-40000919 [email protected] Click Here to Contact Us Contact Us- 9650901058 Contact Us

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