What is the Top 21 Important Relevance of having a financial plan before making any investment??
- Helps to achieve financial goals: A financial plan is essential in helping an individual or business set and plan for and achieve financial goals.
- Provides a roadmap: A financial plan is like a roadmap that helps individuals identify where they currently are financially, where they want to be, and how to get there.
- Helps to manage cash flow: A financial plan helps an individual to manage their cash flow and understand their income, expenses, and where their money is going.
- Helps to avoid debt: A financial plan can help an individual avoid debt by creating a budget that is based on their income and expenses.
- Helps to identify financial risks: A financial plan can help an individual to identify and mitigate financial risks, such as market risks, inflation risks, or unexpected expenses.
- Helps to save for emergencies: A financial plan helps an individual to save for emergencies, such as job loss, medical bills, or car repairs.
- Helps to maximise returns: A financial plan can help an individual maximise their returns by diversifying their portfolio and investing in various assets.
- Helps to minimise taxes: A financial plan can help individuals minimise their tax liability by taking advantage of tax-deferred or tax-free investment vehicles.
- Helps to retire comfortably: A financial plan can help an individual plan for their retirement by identifying how much they need to save, how to invest their savings, and when they can retire.
- Helps to plan for major life events: A financial plan can help an individual to plan for major life events, such as buying a house, starting a family, or paying for college.
- Helps to reduce financial stress: A financial plan can help individuals reduce their financial stress by providing a clear path towards financial security.
- Helps to build wealth: A financial plan can help individuals build wealth by investing their money wisely and taking advantage of compounding interest.
- Helps to stay on track: A financial plan can help an individual to stay on track towards their financial goals by providing regular check-ins and updates.
- Helps to prioritise financial goals: A financial plan can help an individual prioritise their goals, such as paying off debt, saving for retirement, or investing in a business.
- Helps to make informed decisions: A financial plan can help individuals make informed decisions about their finances by providing a clear picture of their financial situation.
- Helps to adjust for changing circumstances: A financial plan can help an individual to adjust their financial strategy as their circumstances change, such as a new job or a major life event.
- Helps to track progress: A financial plan can help individuals track their progress towards their financial goals and make adjustments as needed.
- Helps to build discipline: A financial plan can help an individual to build discipline and stick to a budget, savings plan, or investment strategy.
- Helps to educate on financial matters: A financial plan can help educate an individual on financial matters, such as investing, taxes, and retirement planning.
- Helps to achieve financial peace of mind: A financial plan can help an individual to achieve financial peace of mind by providing a sense of control over their financial future.
- Work with a financial planner: A financial planner can help you develop a personalised investment strategy that takes into account your risk tolerance, financial goals, and overall financial situation. They can also provide guidance and support as you navigate the Indian market for your investment.?
About the author of this article: Taresh Bhatia, CERTIFIED FINANCIAL PLANNER PRO and author of the Amazon best-seller- “The Richness Principles.” He can be reached at?[email protected]
