What is financial planning?
Financial planning is the long-term process of wisely managing your finances so you can achieve your goals and dreams, while at the same time negotiating the financial barriers that inevitably arise in every stage of life. Remember, financial planning is a process, not a product.
What are the six steps in the financial planning process?
Identifying and prioritizing objectives
By sharing with the financial advisor your financial goals, the priority in tackling them can be set. Gathering information
The financial advisor reviews your important documents, including bank statements, tax returns, budget, brokerage accounts, insurance policies, debt, and retirement plans. Analysis of information
Gaining the big financial picture of your situation requires an intensive and methodical analysis of the information gathered about your goals and existing financial situation. Proposal of recommendations
Contained in your written financial plan are accompanying recommendations that are in alignment with your goals and needs. Taking action
Once your financial advisor proposes comprehensive financial solutions to reach your goals, it is time to take action on your goals. Track ongoing progress
As your needs and goals evolve over time, your financial advisor works with you to track changes and progress as a component of the continuing financial planning process.
What do you consider as your most important goal in your financial plan? I consider the most important goal in my financial plan the managing the money and have it for future use. I want to be as successful as possible, and learn from mistakes I make.
Who do you think financial planning is more important to: a millionaire or an individual who lives from paycheck to paycheck? Explain. I believe that a person living from paycheck to paycheck would be more important because of needs and financial situation. If you have the money to do whatever you want, they are less...
Please join StudyMode to read the full document