The dictionary meaning of financial planning is planning current and future needs and expenses. We create assets to meet our future expenses but financial planning helps apportion the available current income to immediate expenses and savings for the future. We prefer to buy loans to meet expenses and to create assets but we forget that loans creates liabilities. And these liabilities are to be settled in future only from your future income. The efficiency with which a strategy is developed between ‘income and expenses’ and ‘assets and liabilities’ determines the financial health of an individual.
Financial planning is required for everybody irrespective of how much you earn. Investing money increases its efficiency. By investing wisely, you can create wealth for the future and improve standard of living. Inflation is increasing the cost of goods and services and eating away your capital, income and wealth. You need to save money and invest it well. To enjoy tax benefits, you need to invest efficiently so that your tax doesn’t erodes your capital and in come continuously.
There are two approaches for financial planning viz. Goal specific and comprehensive financial planning. In goal specific, each financial goal is looked in insolation and a dedicated investment plan is made to realise the financial goals. Comprehensive financial planning takes a holistic approach and view all goals in consolidation. The investment plan too is a consolidated one. Comprehensive planning is better if there are multiple financial goals.

The dictionary meaning of financial planning is planning current and future needs and expenses. We create assets to meet our future expenses but financial planning helps apportion the available current income to immediate expenses and savings for the future. We prefer to buy loans to meet expenses and to create assets but we forget that loans creates liabilities. And these liabilities are to be settled in future only from your future income. The efficiency with which a strategy is developed between ‘income and expenses’ and ‘assets and liabilities’ determines the financial health of an individual.
Financial planning is required for everybody irrespective of how much you earn. Investing money increases its efficiency. By investing wisely, you can create wealth for the future and improve standard of living. Inflation is increasing the cost of goods and services and eating away your capital, income and wealth. You need to save money and invest it well. To enjoy tax benefits, you need to invest efficiently so that your tax doesn’t erodes your capital and in come continuously.
There are two approaches for financial planning viz. Goal specific and comprehensive financial planning. In goal specific, each financial goal is looked in insolation and a dedicated investment plan is made to realise the financial goals. Comprehensive financial planning takes a holistic approach and view all goals in consolidation. The investment plan too is a consolidated one. Comprehensive planning is better if there are multiple financial goals.