Financial Planning is a dynamic process of identifying financial resources and allocating these resources to realize your financial goals.
In the last 4 years of my financial counseling career, I have met many clients/prospects who have (had) misconceptions about Financial Planning. Below are few for your reading:
- Financial Planning is only for the rich
- I do not have money/savings to invest, hence I do not require financial planning right now
- I am just 25, into first job, so I can postpone my planning
- Insurance Planning is Financial Planning
- Tax Planning is Financial Planning
- Financial Planning is a one-time process
- Engaging a Financial Planner means losing control on your finances.
- Nothing will happen to me right now
- I have enough money and confident that I can meet my post retirement living expenses
- I am going to inherit lot of wealth from my parents. Hence, there is no need to prepare a financial plan
If you have any of the above misconceptions then suggest you to work on your finances immediately.
I am not of the view that you must engage a Financial Planner to manage your finances. But, I am suggesting you to have a realistic and well thought out financial plan. Once you have a Plan then kindly implement and review it periodically. If you require professional help then do not hesitate to consult unbiased financial planner/advisor. May be, the advisor may clear some of your misconceptions (if any).
There are no right or wrong financial products. You need to select the right product as per your financial goals, time frame and requirements. At the same time, there are good and bad advisors (as is the case with any form of businesses) in the market. Be informed about the pros and cons of the chosen financial product. Be financially literate to make your hard-earned money work for you.
If you have any misconception about financial planning process then kindly leave a reply in the below comment section. I will be more than happy to answer your query.
(Image courtesy of Stuart Miles / FreeDigitalPhotos.net)