subject: Personal Finance Guide - Why You Need Financial Planning? [print this page] Personal Finance Guide - Why You Need Financial Planning?
Financial planning is about the thinking and the planning of what you want to do in your life, such as buying a house or a car, getting married, planning your children education. It also determines your financial capability to face any unforeseen circumstances in the future. It is an important process for people who want to have healthy financial life. Unfortunately, many people, especially those in young age don't realize the important of financial planning. It never too late to start the planning, but you should start it as early as possible so that you have sufficient times to plan and to shape your financial future that in-line with your financial goals.
Don't think that financial planning is a hassle process. Instead, think it as a need for our living process. If you have a good personal plan, you will be more prepared and informed about your future needs. With a proper planning process, you know the resources you currently have and what resources you should have in the future in order to achieve the goals you set in your plan. Regardless of many advantages in having financial planning, you will benefit from at least 4 benefits of them:
Benefit #1: Control of Your Financial Affairs
In financial planning, you will look at how you will be budgeting and spending your money over time, saving and investing to achieve your financial goals. Therefore, by knowing how and where your money goes, you will have a better control on your financial affairs and be able to avoid excessive spending that can lead unmanageable debt problem.
Benefit #2: Better personal relationships
Most often, debt problem causes relationship tension between you and people you know because they may get away from you as they afraid you will be borrowing money from them. If you have a good financial plan that makes you live happily without the need of borrowing money to make ends meet or expecting handouts from others. Indirectly, you with have better personal relationships with people around you, such as your family, colleagues and friends.
Benefit #3: Protecting your financial resources
By planning your financial effectively and control how your money goes with a good budget plan, you will have a sense of freedom from financial worries because you have planned for the future and be more prepared to face any unforeseen incident that may happen throughout your lifetime. Therefore, you will be more effective in obtaining, using and protecting your financial resources to ensure a healthy lifestyle through your entire lifetime.
Benefit #4: Plan for your retirement on time
How much money do you need to save for your retirement? Without the financial planning, you will never be able to get the figure. Nowadays, many people need to continue working to earn their living, just because they don't have a financial plan that enables them to retire when they reach their retirement age. If you plan to retire on time and financially healthy at the time of retirement, then you should start it as earlier as possible. In fact, financially healthy life is all about starting on time. The sooner you set it up and start saving for your retirement, the better off you will be in term of the sum of money invested.
Summary
Financial planning is not just a need, but a must-to-have for people who hope for financially healthy lifestyle throughout their lifetime. You need financial planning and it must be started as soon as possible to ensure you have sufficient times and the sum of money invested to achieve financial independent over time.
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