Financial Planning

Introduction to Financial Planning

Financial Planning is an ongoing process to help you make sensible decisions about money that can help you achieve your goals in life. In other works, financial planning is a systematic approach whereby the financial planner /adviser helps the customer to maximize his existing financial resources by utilizing financial tools to achieve his financial goals.

In mathematics terms, financial planning can be described with three major components:

• Financial Resources – FR
• Financial Tools – FT
• Financial Goals – FG.

When you want to maximize your existing financial resources by using various financial tools to achieve your financial goals, that is financial planning.

Financial Planning: FR + FT = FG

Financial planning is about the process of meeting once life goals through proper management of one's finances. Life goals can include buying a home, saving for child's education or planning for retirement. It is a process that consists of specific steps that help one to take a big-picture look at where you are financially. Using these steps one can work out where he are now, what he may need in the future and what he must do to reach his goals.