Financial Planning is an essential portion of both personal and organisational financial management. Additionally, having a plan in place is the first function of management.
In the last few years, financial planning has emerged as the gateway to your financial future. Here we look at the components of financial planning and what it entails. We also look at the components of a financial plan in terms of the steps to achieve your financial goals in life.
In financial parlance we often tend to confuse with terminologies. We often get confused in financial planning vs wealth management. But there a substantial difference between them. At a broad level, one can say that financial planning is the all-encompassing umbrella while wealth management is one such specialized focused practice targeted at high net worth individuals.
You must have often wondered as to what is the need of financial planning for individuals. One common question is who needs financial planning? Does it apply to everyone or is it only for certain age groups or certain income and wealth categories.
Financial planning is not just a one-off activity. It is a summation of a number of different types of plans, which actually constitute the sub-plans of the overall financial plan.