Many individuals confuse financial planning with general savings and investing advice. While how to save, how much, and where and when to invest those savings, is important, prudent financial planning goes much beyond the realm of just saving and investing. The sooner you understand the role of financial planning in meeting your short, medium and long-term financial aspirations, the better you’ll be able to control your financial future.
A well-grounded financial plan is essential for anyone who wishes to accomplish specific financial objectives. Whether it be the idea of owning your home or vacation home (sooner, rather than later), making sure your children’s education is well funded, or ensuring a smooth and stress-free retirement; all of these seemingly disparate components come together under a unified financial plan.
The scope of an effective financial plan should therefore cover key aspects such as saving, budgeting, investing, tax planning, insurance planning, retirement planning, estate planning, and much more.