How to do Financial Planning
How to do Financial Planning
Financial planning is a 6 stage process we must follow each and every step to get our financial plan right.
Our Philosophy
We empower our clients their financial FREEDOMM by way of 3 stage pyramid model, where the base of pyramid is most important, which is the client’s basic responsibility in life to be successful. The following things has to be taken care at the base of the pyramid
Living too long and living too short both are risky a good financial plan must address this risk, our family security provides solution for the families to maintain the economic value (life style or status) in case of unexpected demise of the bread winner.
This involves mathematical calculation based on the individual life style, family size and their spending pattern. We will not follow any general thumb rule for all.
Retirement planning in India has become one of the important planning where all individual who started their career has to focus on. India as a country we do not have any social security schemes by government for our twilight years.
Even government employees who joined their service post 2003 there is no pension scheme for them. Hence every individual must responsibly plan for their retirement to avoid accommodating themselves to poverty. Below is an example how to plan retirement plan for an individual aged 29 wants to retire at age 60 and like to have income for next 40 years i.e. up to age 100.
Emergency fund is the most important and useful planning which each and every family must have. The purpose of this fund is to manage the unforeseen events like pandemic, where there are lot of people paid only 50% salary whereas expenses will not be reduced to 50%.In this scenario your emergency fund will be very useful.
Apart from the above if a person is planning for job change 3 months’ salary will not be paid during notice period and entire salary will be released only as final settlement. In such case our daily expenses, EMI, child education and medical expenses if any will not stop or wait, hence if you have adequate emergency fund the same can be managed hassle free.
One of the important responsibilities in life for any parent is their children education. Considering today’s situation where our children lives in a very competitive environment providing them a good education has become inevitable.
The good education cost in India is increasing day by day and the person who do not have proper planning immediately after the child birth cannot think of big qualification of their children.
Hence child education planning has to be started as early as possible so that the children will not start their life in debt (education loan).
Let’s first understand what debt means. It is nothing but our loans like home loan, vehicle loan, personal loan and other type of loans.
Normally in India taking a loan for anything is not considered as good practice because we think the interest paid is an extra burden on us.
Hence we help out client to handle their loan in an effective way that the interest paid is not burden or wasted money.
We all know about Income tax which very commonly discussed by most of us. Especially for an employed person if we talk about tax planning it is only of 3 to 4 section with in that all the exemptions are over.
Apart from income tax now a day various other taxes like capital gain tax and wealth tax are all strictly scrutinized by tax department, hence we help our client to optimize on all these tax implications.
Most of the individuals lose their life time savings in the hospital spending to take care of their loved ones health. This happens to people who do not have adequate health insurance cover.
Normally individuals working in an organization thinks that their employer (office) will take care of the medical expenses, these assumptions are wrong, the employer will take care of the expenses of their employees only to certain extent, exceeding that, we have to settle the medical bills only with our savings.
To protect our hard earned savings it is always better to have adequate Health insurance cover for the family.
This is one of the most important and responsibility of any parents, Since it’s a once in a life time event anybody would like to provide best possible. If there is no proper planning for this people borrow money and perform their children marriage.
Mostly this will be last goal for anyone before their retirement, hence if they borrow for this goal they may not have adequate time for repayment. So this tends to cause dent on the retirement savings of any person. If the planning for this goal has started early, whatever big the goal can be achieved by investing small amount.
