Business and Finance Analysis

Posts Tagged ‘Financial Plan’

Benefits of Financial Planning

Financial planning provides direction and meaning of your financial decisions. It gives you an understanding of how each financial decision you make affects all other areas of your finances. For example, purchase insurance products may help you to secure your assets or income potential, so that your work will be more peaceful, and family that you love will be protected financially. By viewing each financial decision as part of a whole, you can consider short-and long-term effects on your life goals. You also can more easily adapt life changes and feel more secure that your goals are still on track.

Have you made financial planning? Who needs financial planning? Who was most concerned with your life later? Do you own, your Parents, your children or someone else?

We as humans need the assurance of life in old age, we need a bit of certainty where we will be when we retire, we need well-being in old age. There are several options that we can do when we enter the age of retirement, including:

- Relying on others

- Dead

- Keep working

- Independent

- Rich & Prosperous

The decisions you make today will determine your future will be. We already know that in the future we have to face an uncertain and when asked to every human being would choose to live rich, happy and prosperous future parents. But how can we prepare our lives as a rich man, happy and prosperous? And keep in mind the wealth and prosperity is not built in a short time, it may not be built in a day, week or month. Welfare needs to be built in a long time by doing the accumulated bit by bit over the years.

In the future you should also be able to prepare the education costs for your baby, because it’s so expensive cost of education and of course the cost of living for his family in the future must also increase. We would be very unwise, when in old age, we rely on our children.

In doing financial planning, we just need discipline. We must have the discipline to make allowance for a portion of our income for investment, Invest with just because we can perform the accumulation of wealth so that when the time comes we will reach a value of wealth that will lead us to be RICH and PROSPER. Remember once again that wealth can not be formed in a short time, but need the process.

Good financial planning will make us get out of financial problems, we will finance our life with ease, we will prosper later in old age, we live free from financial problems and not depend on others. We are able to deal with future uncertain comfortably

with your financial plan that is easy to administer and make your financial future WARRANTED.

Many of us felt it was doing financial planning, but the facts show that the funds required at the time was insufficient. Survey conducted by AC Nielsen and Citibank showed that 70% of executives in Indonesia threatened poor old Day.

Step / Financial Planning Process You Must Go through

1) Determine your financial goals.

Is the goal to Children Education, Pension Funds, or pilgrimage, or other financial goals.

2) Calculate your financial goals and achieve them srategy.

You must determine the amount of funds needed in time, eg, while studying at Medicine would cost how much. Besides, you also must have a strategy so that goals can be achieved. One strategy is one of them is to choose a vehicle that suits you so that the goal can be achieved. It could be a vehicle insurance, or other investment instruments.

3) Implementation in accordance with the time available and the risks you

You will reach the goal must be to see when it’s time to be achieved, the sooner you start the better the results will be.

Example: Want to raise funds amounting to $ 500 million for the college in Medicine at Children age 18 years. Assuming the investment return of 15% per year then takes the savings amounted to $ 633,848,000 each month when you start  at Children 2 years of age. But when you put it off and just started at the age child 10 years, then you should set aside funds every month amounting to 2,722,703. That means the sooner you start the funds you set aside of course lighter. Remember Time is Your Friend in investing.

4) Monitor and conduct periodic evaluations

Once you’ve invested, the next step is to monitor to match the direction of the goal. Perform the evaluation as well so what is the goal could be achieved.

5) Revision of strategy and planning

Not his fault you do a revision of strategies and plans that you already use. This revision is intended to keep the financial goals can be achieved in accordance with the time, or can be used to accelerate the achievement.

With age, increasing career and income increased as well then certainly you need increased certainty, and this means that costs will continue to grow over time. And there is nothing wrong if you start planning your finances.

Whether it is financial planning?

Financial planning is the process to achieve your financial goals through financial management carefully. Financial goal may be to buy a house, saving for the pilgrimage, your child’s education or your retirement plan also includes having the appropriate insurance needs.

Basically, financial planning is needed to determine a clear direction for the management of personal finances or our families. Without a clear direction and goals, we will not be able to manage our finances well. Without good financial planning, we will tend to waste money we earn with difficulty. Without planning, we will tend to spend money we have today for today’s needs. Employees with a monthly salary tends to behave like this, because it believes that next month he will earn a paycheck again. One of the common goals of financial planning is to ensure that at a future time, we will be financially free, that we will have sufficient funds to meet our needs.

* Tip 1: bad and good habit Habit

Almost always the way to work, back in the car with a friend. I’m very protective of the people I love or anyone entering the car so we demand that you please use a seat belt, accidents are accidents and you never know when, where and with whom they will.

The first few months every day I had to ask my partner to put the belt, now you do unconsciously. This is a good habit, not using the belt a bad habit.

Financially the same thing. Bad habits can be compulsive or impulsive spending, debt, always use credit cards, not manage the finances, etc, etc, etc.

So the advice here is to try to target these bad financial habits you have and try to change them. If you smoke, surely you do out of habit, but when it is known that smoking is doing. Then with the money as well, you know when you are managing or using their money so that it can hurt.

Try making a list or write when you see those bad habits, then keep it in a place where the display.

* Tip 2: Have a spending plan

The famous phrase “the money I was out of control” or “money burning me” has to do with the lack of planning and cost control. Read the rest of this entry »

On the other hand live in a society where spending money is what matters. Today there is so much consumption, which are not part of it (speaking of objects not very important) would be like being from another planet.

In a consumer society becomes very difficult not to fall into the temptation to spend on something, not to mention the publicity that comes into our heads and we tinker with all cables. You end up buying 15 phones for years always saying “this is just the cell that was in need.”

Another important factor in the family, a subject already talked a bit but to summarize, our home education can not always be the best. For example, I come from a family that has had many money problems, trying to help at this point many responses were negative.

Even when I talk about investing or generate new revenue by some members oppose and tell me what I have to do really. My question at this point is: What advice can you give me one person on money management, when that person has such financial problems?.

However, that education and financial advice has been passed from generation to generción creating the illusion that it is part of our tradition. The study, work and earn money. The investment for them is impossible, in fact the word “investment” in their heads do not have a specific meaning, because it is an issue which does not speak much.

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In today’s entry I will make a short introduction to the reason why many people have bad habits with money. In a way I will advise based on techniques or tools that I gave good results.

The idea is that you begin to choose among those options that best suit your needs and even create your own financial plan.

The picture today is to put a ticket on fire. Here in Argentina is often hear the phrase “Money burns me” as saying that we lose it easily and that is why I decided to create this post.

* Why do we have financial problems?

Not to the point of talking at the level of the national economy, but rather trying to take as the axis center the subject or the person who has the money, we can say that A or key facto in this process is you.

Robert Kiyosaki mentioned in many of his books that people are accustomed to bad money management. At this point I strongly agree with him. But the key question is: What factors contribute to our financial ignorance?

* The answer is simple: The financial education that gave us

Until today I have not seen in schools and universities are touching on money management topics and personal finance. Not touch on issues such as taxes, banking. Issues we deal with almost 80% of our lives. So people are forgetting an important education 80%.

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Making a budget is an essential process which enables you to better manage your expenses and control your debt. The first step to controlling your financial situation is to make a realistic estimate of the money you make and money you spend.

These are the steps to make a budget:

* Start by making a list of all your monthly income.

* Make a list of fixed expenses each month, as mortgage or rent, car payments, insurance, etc.

* Then make a list of expenses that vary from month to month, for example clothing, entertainment, etc. Writing down all your expenses, including those that seem insignificant, is a way to help you see how you spend your money, identify necessary expenses, and prioritize the rest.

* If you do not know what your variable expenses (most people do not know) points out all your expenses for two months.

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