Understand why having financial planning can bring more quality of life for you and
better results for your heritage.
Financial planning is the first step to ensuring
financial peace of mind. He is the most powerful tool to achieve life goals,
whether it's an exchange, dream wedding, owning a house, playing in a car, or
even financial independence.
Regardless of your goals, financial planning can
help you turn dreams into goals, which if followed with discipline will become
reality.
What is
personal financial planning?
Financial planning is a methodology used to make
people reach their life goals through the conscious use of money and the
financial products and services available.
The
financial planning process helps people get a complete and comprehensive view
of their finances, clearly showing where they are now, where they would like to
be in the future, and which path they should take to achieve their goals.
Currently, the financial planning process includes
several areas of a person's financial life, such as:
·
Financial management;
·
Tax management;
·
investments;
·
insurance;
·
Retirement
planning;
·
Patrimonial Succession;
By managing these areas well, it is possible to
have a peaceful and balanced financial life.
Why personal
financial planning is so important?
Having your financial life organized brings clarity
about your current life situation and gives you the chance to plan for the
future you want. If planning financially is so relevant that "Planar
" , the United State association of financial planning has a phrase to
describe the difference between those who have financial planning, and people
who still do not pay due attention to personal finances:
"Whoever
plans has a future, whoever does not plan has a destiny".
The excerpt above demonstrates that those who
organize themselves, make better decisions and manage to have the desired life.
On the other hand, those who don't think about it basically rely on luck.
United State is a country where the population in
general has low financial education, and the reflection of this is the high
indebtedness of families.
According to the National Confederation of Trade in
Goods, Services and Tourism), today more than 70% of women are in debt. One of the
causes for this situation is the lack of financial planning.
Not knowing how much you spend monthly is the big
problem for indebted families and financial planning helps to give back control
over money. In addition to helping to make better decisions, it works as an
alert of how much money is coming in and how much is going out, helping to
better manage the family financial flow.
What are the
benefits of personal financial planning?
Lessens
money worries
Financial stress can happen for several reasons
such as debt, financial out of control, professional and emotional instability.
We know that money has a direct impact on all areas
of life, such as work, relationships and self-confidence. Research shows that
most divorces are rooted in money problems.
Having control of your financial life gives clarity
to your current situation and allows adjustments to be made that can protect us
from financial stress, even if it is external.
Paying off debts, having an emergency reserve and
correct diversification of your investments are pillars of financial planning
and will greatly contribute to increasing your quality of life.
Accomplish
life goals
What do you want to accomplish in the next few
years? Buy your own home? Invest in your children's education? Retire?
Regardless of the complexity of the objective,
financial planning will help to trace the best path to fulfill each of your
dreams. When we are clear about where we are and what we are looking to
achieve, it is easy to make good financial decisions.
A person who knows exactly how much he needs to
save to reach a goal tends to prioritize his goals more than one who doesn't
know how much he needs to invest to achieve his dreams.
Financial
awareness
Financial photography is one of the steps in the
financial planning process. It serves to show exactly where we are today, with
the assets we have built or if we are creating debt.
With your financial picture in hand, you are able
to understand whether year after year your equity is evolving or decreasing. In
addition, being clear about your financial situation can contribute to the use
of money without guilt, since those who plan their goals have nothing to worry
about.
Avoid
interest and debt
We have seen that planning brings numerous benefits,
the conscious use of money is in fact one of the most relevant. Whereas,
interest and debt erode much of the income. A person in debt has a harder time
starting their journey towards financial independence than a person without
debt.
Planning a purchase, knowing what interest rate you
will pay the bank when making a loan, are fundamental steps for financial
health and with this it is possible to protect yourself from high interest
rates and not make a debt that can harm your financial life for many years. .
The credit card is currently one of the great
villains of family indebtedness. Using your credit card wisely is one of the
benefits of having your financial life under control.
Cut
unnecessary expenses
Ever heard of invisible spending? These are those
small expenses that we don't normally account for, but which together have a
big impact on finances. It could be that streaming account, cable TV, or even a
subscription service that we don't use.
There are expenses with services that we think are
necessary, but that at the end of the day, we use them once or twice, and
because they have a low value, we do not consider their impact on the total
value of the budget.
By having a global view of your finances, you can
see the expenses that can be cut, increasing your savings power, which is how
much you can save per month to achieve your goals.
Increase in
saving power
Saving is a habit, it is the time when you are
preparing for the future.
With your goals defined, you can estimate the
amount needed to achieve your goals.
Having a balanced financial plan that makes sense
to you will help you save more money. That's because we are emotional beings,
most of our decisions are made on the basis of intuition.
Having clear objectives means that decisions involving
money are treated with greater rationality, and as a result, people start to
invest more and more frequently.
A more
peaceful and quality life
Financial peace of mind! This is the main objective
of personal financial planning.
Having a plan brings the tranquility of knowing
that you are on the path to financial freedom, that you are not just living,
but being able to better enjoy what life has to offer us.
Want to have a more peaceful life? Talk to our
financial planners now and schedule your consultation.
Posted by: John
Labunski Dallas
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