The simple financial planning Process


Financial planning may not help you earn more, but it can help you use the money you do earn to achieve your financial goals. 

When we first attempt to understand the subject of personal finance, we are often intimidated by the seemingly unending number of investment, insurance, and estate planning options, as well as by the fact that the subject has a language of its own. How can you make choices when you don't speak the language? Well, you can't. That's why you're reading this blog and to allow you to navigate the world of money. 

Financial planning is an ongoing process-it changes as your financial situation and position in life change. However, there are six basic steps to personal financial planning you should examine to win. And here they are:

Manage the unplanned: It may seem odd to plan to deal with the unexpected or unplanned. Hey, stuff happens. Unfortunately, no matter how well you plan, much of what life throws at you is unexpected. A sound financial plan will allow you to bounce back from a hard knock instead of going down for the count. 

Accumulate wealth for special expenses: Travel, a big wedding, college for your children, or buying a summer home are all examples of events that carry expenses for which you'll have to plan ahead financially. Financial planning will help you map out a strategy to pay for a house by the beach or a trip around the world.

Save for retirement: You may not think much about it now, but you don't want to be penniless when you're 65. A strong financial plan will help you look at the costs of retirement and develop a plan that allows you to live a life of retirement ease. 

"Cover your assets'': A financial plan is no good if it doesn't protect what you've got. A complete financial plan will include adequate insurance at as low a cost as possible. 

Invest intelligently: When it comes to investing savings, arm yourself with an understanding of the basic principles of investment. And beware: There are some shady investments and investment advisors out there! 

Minimize your payments to Uncle Tito: Why earn money for the government? Part of financial planning is to help you legally reduce the amount of tax you have to pay on your earnings. 

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