Financial Planning

Financial Planning

Financial planning entails charting a road map of financial goals while taking into consideration an individual or businesses’ assets, liabilities and credit standing. Financial Planning is a decisive step towards achieving certain financial goals such as; managing one’s finances with a foresight of preparing for retirement, maintaining a balance, meeting a target, acquiring a fortune, settling an obligation, creating financial security, etc. It serves as a hedge towards removing all avoidable pitfalls of suffering financial injuries when the time of lack sets in.

Economically, one is poised with a challenge to set a target for the future due to the dynamic nature of the world. In order to bridge those tendencies of change, financial planning sets in. With a good financial plan, individuals and businesses take firm control of their finances, make the best decisions, paint a clear picture of the present, a strategy about where one is going and peace of mind towards the future. It’s never too late to start yours…



Retirement planning as a subset of financial planning is referred as the allocation of finances for a better retirement. Retirement planning sets aside convenient percentage of an employees’ entitlement on a regular basis (e.g. monthly) and then obtained at a steady level upon retirement.

Primarily, retirement planning is aimed at achieving financial independence so that when the terms of employment contract are fulfilled, liabilities do not set in. Some of the processes involved in retirement planning are as follows:

  1. Assessment of the need to have enough money on retirement
  2. Identification of actions to encourage retirement
  3. Acquisition of financial planning knowledge (through a financial planner)
  4. Selection of a reputable Pension Fund Administrator
  5. Making of consistent savings practices.


Once the goal or need is identified, the time period is calculated and the risk profile identified, an appropriate investment portfolio needs to be constructed for the amount saved for the goal.

Diversification: For every need, the portfolio constructed should be diversified. This probably remains the most important aspect while investing and has been proven to be right way of investing for ages. Diversification can be achieved by holding different asset classes, like equity, fixed income, real estate, gold/commodities, property, etc. One should avoid holding a single asset class portfolio as much as possible.

Liquidity: This is an important aspect one should consider while investing. A few pitfalls of not considering this: not being able to exit while the market is in for a serious fall (e.g. the fall of equities in 2008), the investment portfolio is illiquid and the invested paper is not saleable.


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