What is the first step in financial planning?

Answers

Step 1: Defining the Client-Planner Relationship

Even though you’re both the client and the planner, you should still make sure to identify roles for other people involved. If you’re doing the planning with a significant other involved you should define who is going to be responsible for implementing and monitoring the decisions.

Step 2: Collect Data, Determine Expectations and Prioritize Goals

Hopefully, you’ve started using Mint or other tools like it so you don’t have to go searching all corners of the world for your financial data. If you’ve been listening to us at Listen Money Matters this one should be pretty simple to start.

Now for the more interesting part, establishing your expectations. At this point you will want to look at things like goals (financial and non-financial), how often you want to have check-ins, as well as personal goals like when you want to retire, life expectancy or healthcare costs.

Some of them won’t be fun to consider but they’re certainly important you are creating your own financial plan. Most importantly, make sure that you’ve prioritized your goals. You’ll use that ranking throughout the rest of the process to determine where to allocate funds.

Step 3: Analyze and Evaluate Financial Status

You may not be a professional with access to software that can run Monte Carlo Simulations, but you can still make some very good headway here.

Start with the basics. answering any and all of these questions can help you find out where you stand today.

Are you cash flow positive? Do you have any glaring outliers in your cash flows? What’s your net worth? Did your expectations of cash flow or net worth not match reality? Do you have any goals that are within reach or are completely out of reach without a course correction? Do you have a system in place to help you save for your goals?

nasa comment po yung kadugtong

The financial planning process is a logical, six-step procedure:

(1) determining your current financial situation.

(2) developing financial goals.

(3) identifying alternative courses of action.

(4) evaluating alternatives.

(5) creating and implementing a financial action plan, and.

(6) reevaluating and revising the plan.

The financial planning process is a logical, six-step procedure:

(1) determining your current financial situation.

(2) developing financial goals.

(3) identifying alternative courses of action.

(4) evaluating alternatives.

(5) creating and implementing a financial action plan, and.

(6) reevaluating and revising the plan

Financial Planning Steps – From Start To Finish

Determine Your Present Financial Situation. ...

Develop Financial Goals. ...

Identify Alternative Courses of Action. ...

Evaluate Alternatives. ...

Create and Implement Financial Plans of Action. ...

Reevaluate (and Revise) your Plan.

Determining your current financial situation


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