Need For Financial Planning

- A well thought-out and prudently drawn financial plan: Allows you to reach your financial goals in a set time period. Once your goals are defined and the time period for achieving those goals is set, then it becomes easier to achieve it. Ensures better management of money. A financial plan will keep an account of every rupee spent or earned. This will help you spend wisely while optimizing your savings. Helps you understand your priorities and risk preferences and invest accordingly. Priorities in life change with time and along with it your risk taking ability. A financial plan enables you to take into account these changes and accordingly make changes in your investment portfolio. Helps you to fulfill various responsibilities in life. We all have various family responsibilities to fulfil in life. And, we need finances to perform them. A diligently drawn plan ensures that you have adequate money to discharge your responsibilities. Helps you manage your assets and liabilities better. Financial planning can help you to manage your liabilities better by keeping an eye on your income and expenses. When you plan well, there is less chance of borrowing irresponsibly. Similarly, you can build assets for yourself over a period of time with proper planning. Helps you take better and informed financial decisions in life. Financial planning helps you understand your financial position better. And, based on the knowledge of your existing financial situation, you will be better equipped to take decisions.