Financial planning involves looking at the entire financial picture to achieve short-term and long-term financial goals. From saving for education and planning for retirement to effectively managing expenses, we as financial planners develop valuable client-specific goals to provide confidence in the overall financial picture and assist in executing this plan as market cycles change throughout the years.
Financial Planning is a Five-Step Process
According to the financial planning pyramid, a derivation from Maslow’s Hierarchy of Needs, the five steps can be categorized as:
Managing your money: where the focus is on your daily expenses, reducing debt, and establishing a stable cash flow.
Building a safety net: where the focus is on creating your emergency corpus, growing savings, and opting for adequate insurance coverage- both health and life.
Accumulating wealth: where the focus is on growing your investment portfolio and retirement corpus and utilizing tax benefits and exemptions efficiently.
Preserving wealth: where the focus is on enjoying financial independence by converting retirement corpus into income and maximizing pension earnings.
Leaving a legacy: where the focus is on estate planning, succession, and continuity planning along with philanthropy.