Personal financial planning involves the creation of a personal budget for the family expenses, planning for taxes and creating a savings account for saving the excess money from the family budget. It helps you to understand how to prioritize the financial goals and take effective decisions to achieve those goals. It also involves developing a debt management and recovery plan to manage the personal loan taken earlier. Generally, all these activities are outsourced to a financial planne, who is hired to assist you with your finances. They help you reach a long and short-term savings and investment goals. Personal financial planning can be utilized in a number of ways. Here are a few of them which would help you to realize your financial and investment goals.
• Chalk out a Financial Plan
The first important thing which should be done in personal financial planning is to chalk out a financial plan. A plan acts as a guide through your financial journey and, even if domestic and global upheavals dent your investments it would help you to stay afloat. Here you can identify your investment goals, develop a financial forecast using financial planning strategies, and obtain a credit assessment. A well-planned financial forecast and working budget help you to make sound spending and secure a strong financial future. You should calculate your existing worth and identify the goals for which you would require money in future.
• Start Early Save More
You should start investing your money to realize your financial goals the moment you land up a job. This would help you gain more financial resources from the power of compounding. It is a simple fact that those who start saving at 40 makes much less retirement kitty than those who start at 25. Moreover, at the beginning of your career you are not loaded with financial responsibility, so at this stage, you can allocate a major portion of your savings in the investment process. This would also enable you to stand in a better position at the unlikely event of a market collapse like that in 2008.
• How much to save
As a golden rule, if you start saving at 25, it is better to save 10% of your post-tax income as an investment. Over time, when your income increases you can increase the savings up to 15%. This would give you a head start and act as a buffer in case of economic slowdown. By your middle age, you should aim to save around 35% of your post-tax earnings. Personal financial planning services from a certified professional expert like iplan.co.in would help you with your investment plans and help you to secure a sound retirement kitty.
The financial experts of iplan.co.in would guide you to spend your extra cash, pay down your student loans, buy life insurance, or invest it in stocks or mutual funds. They are the best in the service and you can trust them with your hard-earned income.