What is Financial Planning?
Financial Planning is the process of meeting your life goals through the proper management of your finances. Life goals can include buying a house, saving for your child’s higher education or planning for retirement. The Financial Planning Process consists of six steps that help you take a ‘big picture’ look at where you are currently. Using these six steps, you can work out where you are now, what you may need in the future and what you must do to reach your goals. The process involves gathering relevant financial information, setting life goals, examining your current financial status and coming up with a strategy or plan for how you can meet your goals given your current situation and future plans.
How does it Works?
1. Client Engagement : The process of finding out what you really want and need, your hopes, goals and fears. It is about you, not your money.
2. Discovery: The fact finding process of establishing your current financial position, taking into account your assets & liabilities, income & expenditure and any existing financial products you own.
3. Analysis :Where we fully evaluate the information gathered and analyse this in the context of what we have discussed at stage 1. Does what you already have work? Can it be made to work or do you need to do something different?
4. Presentation :This is where we present our recommendations to you in the form of a detailed written financial report. Once we have agreed how best to proceed, we will move onto the next stage.
5. Implementation :Where we take responsibility for putting all the agreed changes into place.
6. Review :One of the most important parts of the whole process – revisiting the financial plan with you, at least annually, to make adjustments as required. Life changes, as do rules and regulations, so being able to make ‘course corrections’ is absolutely vital. Remember, this is your plan and your story. Building a financial plan is the first time many people address why they are investing, rather than simply investing for investing’s sake. Done properly, it can be a thought-provoking and structured process, which can help you achieve the outcomes you desire.