“If you do not design your life, it will be designed by default”


What is Financial Planning?

Financial planning is a step by step process of evaluating your current and future financial standing, identifying your family’s short term & long-term goals, and developing strategies to achieve them. It is a proven systematic process for financial stability and long-term success.

Having financial plan is like having a travel plan – it identifies your destination, tells you how and when you will get there, how much it will cost you and things to consider along the journey.

Your age, income or wealth does not matter, if you have aspirations in life, you have better chances of achieving them with a financial plan.

Why Financial Planning Is Important?

Better prepared for Life’s uncertainties

Efficient use of money

Clarity of Life’s goals

Proper investment choices

Beat inflation and ensure better standard of living

Peace of mind

The Financial Pyramid

Wealth Foundation

This is the most basic but critical stage in financial planning and no matter what, this should be in place first when you start planning. This stage includes cash flow analysis to evaluate where you stand financially, understanding your needs and wants and prioritising them, protecting you and your family’s life with various types of insurance and creating an emergency corpus for uncertain events.

It answers questions such as

  • What happens to my family if something happens to me? Will my children still be able to go to college even if I am not there personally to do it?
  • Where will I get my income from, if I get hospitalized for few months?
  • Will I still be able to maintain lifestyle that I currently have if I lose my job?
  • Is my cash flow sufficient to cover my family’s fixed expenses for at least next six months?
  • Am I on-time in paying my credit card and other bills?

Many of these questions are emotional in nature, but let us face the reality, if you are the only earning member of your family then you must create a strong wealth foundation, to deal with any financial uncertainties.

Wealth Accumulation

Once the cash flows are controlled and essentials are in place, next step would be to identify the medium and long-term goals and develop a strategy to achieve them. The goals can be child’s education and marriage, buying a dream house, or retirement. It is particularly important to prioritize goals and work towards the goals first which are important. Once the goals are set then depending on the time horizon of the goal, risk profile and overall asset allocation, investment decisions in suitable financial products are made.

It answers questions such as

  • Will my child get an admission in a top B school or a premier institute?
  • When will I be able to buy my own house?
  • At what age can I take retirement?
  • Will I be able to maintain the same lifestyle even after retirement?

Wealth Distribution

There will come a time when you will finally take a break from work or business. Retirement is a little scary for anyone who is used to the daily grind at work, but it is not avoidable. However, if you have planned your retirement in advance then rest of your life you can enjoy pursuing your hobbies and passion without worrying about the money.

It answers questions such as

  • Will I be able to continue leisure trips even after I retire?
  • Will I be able to leave a legacy to my children and their children’s future?
  • Will it be possible to give some money to my favourite charity?

This is the stage where you begin to answer such questions and address them through retirement planning, estate planning or gifting.

Financial Planning Process

Discuss and understand financial planning process

Data collection

Analyze and assess the financial status

Prepare a plan

Implement the plan

Periodically review and revise the plan if required

Invest Now For A Better Future