Financial planning is using your money to achieve your life goals.
Investing is an important part of the financial planning process, but it’s only one small part of the overall plan. The financial assets are the means by which you achieve your life goals. It is an on going process and changes over time as per your life evolves. A financial Plan must include Cash Flow Management, Real Estate, Debt Management, Education Planning, Career Planning, Investing, Retirement Planning, Insurance and Estate Planning.
How much is your monthly inflow?
What are your expenses ?
What are your savings?How much emergency liquidity you keep?
Have you invested your money , if yes then what is the return
Do you own your own house?
Do you wish to own in another 5 years ?
Home Loan requirement ?
Down Payment plan buying your own house.
Investment in secondary home for rental purpose..is it ideal?
Loan against property?
Have you made the right decision by taking loan ? What is the scenario of Interest rate going forward ?
How much is your total monthly EMI ?
Should you pay off the debt or invest and save to maintain liquidity ?
Do you plan to study further?
What about your child’s education any loan facility available ?
What about the education planning for your children?
If both not then should you start saving for yourself.
What do you do for your livelihood and how much you earn ?
What is your plan for future and your income potential ?
Are you utilising the perks offered to you or not?
Have you started saving ??
What do you plan to do with your savings ?
How can you grow the savings ?
When will you reach the stage when money starts working for you ?
Are you investing tax efficiently ?
How much risk your portfolio should carry ?
What are your Short term and long term needs?
Have you arrived at a level when money starts working for you by following the financial plan ? OR
The situation arises when you have retirement money in hand. Where to invest ?
Should you be buying annuity to maintain your monthly inflow?
Should you invest in Equities or Fixed Deposits ?
Are your investments tax efficient ?
Are you and your family covered enough ?
What about post retirement Health planning ??
Do you have emergency fund to Co Pay ?
What all insurances you should be covered with ?
A financial plan should be made after considering all the above mentioned essential requirements in a persons life to lead to financial freedom in one’s life.
1. Clarity in your financial goals ie what you wish to achieve in the coming years ?
2. Freedom and positive attitude in life ie.Let the money work for you and be stress free.
3. More accumulation of Wealth ie A financial plan cannot make you rich overnight but a wise financial plan can help you in accumulation of wealth with more savings and curtailing expenses. So, plan strategically
Design your investment portfolio with the best in class investment products carefully selected to ensure diversification and the fact that they are specific to your growth needs:
Experience investing in equities for long term investment objective with: –
FIXED INCOME (LOW RISK INVESTMENTS WITH STEADY AND PREDICTABLE RETURNS )
Investment /schemes available keeping in mind the time horizon
AAA Housing finance companies deposits and AAA NBFC deposits
Before exploring investment strategies and planning, it is important to first gain an understanding of the individual and its needs. Basis this, the investment goals can be structured and the appropriate services can be employed to gather growth opportunities for your corpus.
The following aspects will help understand investment needs better:
When a wealth plan is made, the first step is to assess your capacity for undertaking financial risk. The capacity for risk depends on your responsibilities, objectives, personality and many other variables.
Cognition of your risk capacity includes understanding your financial needs and expectations in specific detail. The following should add up to your overall investment goal:
The following should add up to your overall investment goal:
An understanding of these dimensions is critical to form a view on the risk metric based on which investment decisions will be made.The reward in assuming higher risks lies in the possibility of generating higher returns. However, to know your ability and willingness to undertake financial risks, it is important to know your risk profile.
Asset classes have fluctuating returns and correlations over different time horizons. No one asset class tends to outperform others consistently. Therefore, it is critical to diversify and constantly adapt your portfolio. Asset allocation is the major contributor to portfolio risk and return. Hence it is important to spread the asset across equity, debt, structured products, private equity, real estate and other alternates to build a portfolio that balances both risk and return well. Design your investment portfolio with the best in class investment products carefully selected to ensure diversification and the fact that they are specific to your growth needs:
An understanding of these dimensions is critical to form a view on the risk metric based on which investment decisions will be made
The reward in assuming higher risks lies in the possibility of generating higher returns. However, to know your ability and willingness to undertake financial risks, it is important to know your risk profile
Different products play different roles in portfolio construction. If returns are one side of the story, risk is the other. Balancing these is the key to a customized investor portfolio.
The risks assumed in investments are dependent on your preferences and the returns calculated on your expectations. Given these factors, portfolios should be constructed such that they have the dynamism required to adapt to your profile and any changes to the same.
FOR DETAILS :
KD Financial Services having registered office in New Delhi is an integrated firm that specializes in offering a varied bouquet of customized financial services to Institutions. The firm today offers complete financial solutions including areas like corporate Finance, Equities, Mutual Funds, Wealth Management etcRead More