Kingston Financial Planning » Financial Planning

How can Financial Planning Help?

admin — Mon, 25 Jan 2010 02:44:32 +0000

If you are still thinking that financial planning is exclusively for the rich, you may just want to switch your mind on that now.

It is a truth that financial planning is even more important for the individual with an average income than it is for someone who earns a very high income.

The case is this: an average individual has to build his income stretch to cover many needs, and normally there is little cash left each month after paying all the bills and loan.

Hence, it is wise to say that financial planning can assist you in a number of ways, among them are:

- Financial planning can assist you set up beneficial use of your present income and savings. By having every household’s outlay budgeted and a savings blueprint drawn up, it should help you spend your cash wisely and effectively.

- It can contend the effects of inflation on your savings by having your savings invested in an investment vehicle that pays higher returns than the normal bank account, it will add in a couple of muscle to your savings and help you achieve your financial goals in a shorter term of time.

- It can thrust you to take advantage of savings and investment options that exist now, but may not be available later.

For example, you want to put in some of your savings in a particular unit trust fund that pays good returns. However, the fund’s approved size is fixed and the units are easily snapped up up by investors. Now, if you were to maintain some extra money and buy some of these unit trusts before they are all taken up, you will hopefully make your cash work for you through future gains from this investment.

- Finally, financial planning helps you identify the expected sources and total of your retirement income.

The key here is to START NOW!

By starting your retirement planning now (not later!), you can measure how much cash you will require to maintain your current lifestyle and where this money will come from.

Many individuals, specifically those who have just started working, often put their retirement planning on the back burner for reasons such as “I just started work” and “Oh, I am still young”.

Many, however, fall short to realize that by starting early to save for retirement, you will be able to save and put in more due to the concept of “compounding interest”, provided that you invest your savings wisely.

perhaps you do not want to wait till the age of 65 to retire. For all you know, by the age of 40, you might possess already reached your financial freedom and do not have to worry about getting up early to clock in or work till late hours because there are deadlines to meet.

You can then commence a business or alternative job that does not involve clocking in and reporting to your employer, especially if that person is other than you!

How to Create a Personal Financial Plan

admin — Sat, 23 Jan 2010 14:39:15 +0000

We all have desires and goals we wish to achieve in life. Saving for retirement, your children’s education or buying a home is attainable by most of us. However, at the end of the month you may wonder where your money went and how you will ever reach your goals. Regardless of your stage in life, income, or wealth, a financial plan helps you clarify and prioritize your goals and set objectives for reaching your goals.These six simple steps will point you in the right direction.Step 1 – Track Your Household Net WorthStep 2 – Track And Manage Cash FlowsStep 3 – Establish Your GoalsStep 4 – Establish A Savings And Investment PlanStep 5 – Cover Your RisksStep 6 – Review Your Plan AnnuallyStep 1 – Track Your Household Net WorthThe net worth statement provides a picture of your financial position at a point in time. A household net worth statement will help you track your financial progress and can be used to establish a strategy to improve your goals and feel secure.Simply put, the household net worth statement is the total value of what you own less the value of what you owe. By looking at your net worth statement you will be able to determine what your assets you own (such as your home, car, or investments) and how liquid those assets are. Similarly, a review of your liabilities (or debts) will show how debt affects your net worth and whether you have sufficient insurance coverage to cover your debts and provide for your family. The net worth statement also helps you identify problem areas and take steps to correct those problems.Your net worth should increase annually. If your net worth is negative (and in your earlier years it can be negative!), then you must take steps towards debt reduction, increasing your assets, increasing your investment income and therefore your cash flow or revise your goals accordingly.Your household net worth must be calculated annually and compared to the prior year if it is to provide any value.Step 2 -Track And Manage Cash FlowsYour household net worth statement looks at a single period in time while your cash flow statement measures a period of time. The only way you can grow your household net worth is if your cash flows are positive or if you have savings. If cash outflows (i.e. your spending) exceed your inflows (income), then action must be taken to correct the situation either by increasing your cash flows in or reducing expenses.Keep in mind that I have use the term cash flow as opposed to tracking your budget. Your cash flows may not always be timed the same as your expenses. By considering cash flows, you should be in a better position to cover the unexpected costs life throws at you.Tips to improve cash flow:

Four Things You Need To Know For Effective Financial Planning

admin — Tue, 19 Jan 2010 14:39:02 +0000

Everyone in today’s world keeps hearing the term financial planning and how it is needed. Personal finance and financial planning are used in conjunction always. That said for having that financial plan ready you need to know a few things. These things which we need to have are crucial to achieving that financial security and will help one get that desired money which is needed for old age and other special family needs.
Very few people can get the basics right about financial planning. Most understand it to be just about money being in bank account at all times. This money they assume will help them tide over a few things. This though is not adequate as the value of this money will diminish over time and by the time retirement is reached you will for sure be scrambling to make ends meet.
That is why all the experts stress the need for financial planning.It is the money at hand that will save you in dire situations.
Here are a few things that you need to take care of for effective planning. These will help you get the facts correct and will help you make some intelligent decisions.
First and foremost thing that you need to consider is your cash situation today. This will give you a picture as to whether you are on the right track or not. This will at least give that overall [picture of your finances. This exercise you can do it all alone or by getting the help of a financial planner.
Secondly you need to know the importance of investments. You can not allow your money to languish in the banks at 2% p.a. This entails working in tandem with a financial adviser to know what kind of investment avenues are available and how best they can meet your needs.
Third step is to have insurance for almost everything. That will help you protect your assets should things go wrong.
Fourth step is to have the effective tax strategies. I am not talking about avoiding tax altogether but at least work towards having the tax incidence reduced to a minimum. That will help your cash flow and will make sure that you have enough cash for planning.
That said all the four things above go a long way in achieving you desired financial goals. Remember to have effective retirement cushion as one of the goals of your financial strategy.

Financial Planning and Investing

admin — Fri, 15 Jan 2010 14:47:45 +0000

What exactly is financial planning, and why is it so important?

Financial planning is the process of determining how to manage money, investing, present and future financial goals, and the strategy that should be undertaken to obtain them.

Because our goals and desires change as we do, financial planning and investing is a task that is never finished.

How we are financially able to reach these goals, and the risk we are willing to take to get there, necessarily means that any financial plan must be specifically tailored for an individual or family.

Financial planning begins by taking into account each individual’s assets and liabilities at that particular point in time.

The asset category includes life insurance and monetary investments of all kinds, along with physical assets such as a home, automobiles and other items.

Liabilities may range from personal loans, credit card debt, and loans taken to obtain hard assets, such as mortgages.

Next is where sources of ongoing income and increases in hard asset wealth enter into the equation. Income most usually is earned by employment, but other sources, such as possible inheritances, must also be considered.

Increases in hard asset wealth, such as rising home prices, will be affected by general economic conditions as well as owner enhancements.

From here, things get trickier, and this is where the true planning begins!

Our particular stage in life — whether we are young, old, or somewhere in the middle — will usually lead us to desire a particular set of goals.

Financial planners often break down our life cycles into distinct phases. Which phase we are in is often determined by age but will also be dictated by how much risk we are willing to assume.

Younger people are most often described as being in an accumulation phase. Their earnings have not yet hit their peak, but at the same time they are striving to obtain both hard and soft assets.

Examples here include saving for a new home or a child’s education. Risk assumed here will be tempered by the time constraints of these goals as well as individual risk tolerance. In general, the longer the time frame, the more investments in the aggressive category may be considered.

The other phases extend to middle age and beyond to retirement. Our middle age years often find us at the peak of our earning power, with many of our former goals satisfied. This will mean greater savings are possible, and as time progresses towards retirement, our tolerance for risk will necessarily diminish.

Financial planning takes all of this into account and more. Other factors, including planning for health care and other insurance needs, preparation for emergency expenditures, tax and estate planning and the like will all be part of the strategy.

Unexpected windfalls may also enter into the picture. Saving for retirement becomes increasingly important as the time earned income will end draws nearer.

All of these variables add to the importance of financially planning across all stages of one’s life. It is a concept that encompasses your total financial picture — both in the present and for the future.

Financial Planning Services: Lead a Debt-free Life

admin — Thu, 14 Jan 2010 02:37:54 +0000

A major part of our life is spent in studying and pursuing a career so that we can get a good job and give ourselves a good life. You also would have a family and it would be your most urgent requirement to give yourself and them a good life. Now, good life means a life without financial burden which is very difficult to get in today’s financial environment. But, don’t worry you can use some very efficient financial planning services firms to remove any kind of finance related doubt and at the same time to maximise returns on your investment.

Generally saying, financial planning services firms strive to provide financial advices to individuals, professional advisors and corporate clients. It is their aim to provide financial services tailored to each of your financial needs. These firms may consist of chartered financial planners covering a range of specialist areas like investment, retirement/pensions, UK expatriates, ethical investments, personal banking solutions etc. You can seek advices regarding any of your financial doubt from these firms.

These days many companies and individual are fighting with debt problems. Now, financial planning services firms offer a full spectrum of rescue and financial plans on behalf of companies, partnerships and individuals who find the viability of their business in question. This is true that confronting financial difficulties in any business involves significant management strength and self-awareness. And any good business man would like to neglect or deny the problem but a bad commercial judgement can desert even the most experienced of business professionals.

However, not all distress financial situations lead to liquidation. Financial Planning Services firms may help in this situation by identifying real trouble. If you also are facing such a situation then you can seek help from these firms. They can provide advices so that you can enter into informal agreements with your creditors which can avert a crisis and you can return your company or business to profitability.

Therefore, if you are in a debt-problem then don’t panic rather consult a financial planning services firm and get ready to be relieved.

Financial Planning Services: Live Wealthy Life and Retire With Pride

admin — Wed, 06 Jan 2010 02:36:37 +0000

Your sources of income are more than one. You are doing a great job at your office or your business is pouring money for you. Sometimes it becomes very difficult to track the course of our income and expenses. You might have faced such situation on any point of time. This is a very dangerous situation as far your financial health is concerned and for avoiding such situations financial planning services are efficient tools.

Sometimes you may be trapped into difficult situations like a bad debt, if you don’t manage your income or expenses. Financial experts advise to utilize financial planning services tools to avoid such situations. These services build and protect your finance by suggesting some useful plans. A financial plan is a guide for you so that you can manage your wealth and spending habits efficiently.

A financial planning services organization may manage your wealth and investment plans in various ways. They educate you regarding wealth strategies and asset management. They also suggest you financial planning tools like funds, bonds, equities etc. You can also avail some banking solutions for better financial management and utilize bank accounts and deposits for savings..

Furthermore, financial planning services organizations may provide certain retirement planning tools also. Retirement services are designed to ensure that your financial decisions are executed without any hassle while you’re living your retirement years to the fullest. These services can provide retirement cash flow planning and advanced tax planning.

Also, having a sound financial plan is a great way to protect you and your family in times of financial hardship. Anything may happen in the future. These financial planning services make you ready for any future happening, like a job loss. A sound financial plan is necessary for a healthy present and safe future. Since financial market is fickle so these services also become more necessary.

Traditional Financial Planning: Get a Planned Future

admin — Tue, 05 Jan 2010 03:07:53 +0000

Have you ever thought that what are your future financial goals and objectives? What are your specific plans for your lifestyle, retirement, investments, large purchases, savings, your family, your children’s education and charitable activities? I hope that you must be confused and like you so many people are getting confused by the above questions. But, for all these questions there is only one answer that is traditional financial planning.

If you are a working couple then you must have plans regarding paying your various bills and educating your children. Apart from these daily issues you must plan for your retirement also. This is essential because in the old age you must earn and a pension plan can make that happen. Apart from pension plan a traditional financial planning may include many services.

Traditional financial planning may include the planning of retirement, insurance instruments and capital growth solutions. You must be focused for your past and next year’s taxes, past accounting and current business plans but do you have concrete financial plans for the future that are realistic. Now, the traditional financial planning firms can provide consultation in financial, retirement and estate planning so that you can make solid financial plans at low cost.

There are many benefits of traditional financial planning. By doing it you can make your future dreams a reality by having a concrete plan for the future. Financial planning firms may advise you so that you can retire on time and work afterwards only if you want to. These plans can make you feel financially secured so that you can plan for your children’s education, your retirement and your family needs.

Thus, for making realistic financial goals about present and future traditional financial planning is required. After all, your children deserve best of education and you deserve a retirement in which you are still earning.

Financial Planning Services: One Solution for Many Financial Needs

admin — Mon, 04 Jan 2010 15:12:53 +0000

Financial planning services providers can provide a full range of financial advisory and implementation services relating to individual, family, business or corporate requirements. They can help you to set various financial goals and assist you in meeting your goals through the right management of your finances because, a basic financial goal and objective is required before attaining a healthy finance.

You may wish to save money for your children’s education or for buying a home. You would be planning for your retirement and you are worried about the transfer of your pension in a new city. Whatever is your need, financial planning service provider may provide you great help and assistance. It can help you choose the right financial strategies and plans to create wealth now and preserve wealth for the future.

Financial planning services can help you for all your financial goals through the relevant investment options and it can assist you to make the right financial decisions. If your goal is associated with wealth creation, they can help you to get your money to work for you by providing comprehensive and relevant information regarding various investments. If your goal is saving, they can advice you regarding various saving tools through insurance or simple bank savings account.

Also, financial planning services may help you find the right financial products to suit your needs and lifestyle as your situation and objectives change throughout your life. Some of the financial services may include taxation planning, pension fund transfer planning, investment and retirement planning, estate planning and asset protection, superannuation for personal and business requirements, salary packaging advice etc.

So, make you financial plans, set your financial objectives and seek the advice of financial planning services, you can experience a whole new financial world waiting for you. These services are also available on the Internet where you can choose among various finance planners to make your life easy.

The Keys to Financial Planning

admin — Thu, 31 Dec 2009 16:07:51 +0000

What is financial planning, and how can it make you live a better life? Well the truth of the matter is, financial planning is something that everyone needs to do if they are going to make it in today’s market. Let’s face it; not everyone is rich, and they can not always go out and buy whatever they need when they need it. That is why you have to use financial planning to make sure that you have a game plan for life. After all, that is what financial planning really is; it’s a game plan for your life, and you have to make sure you have a good one!

So what are some of the keys to financial planning? Well the truth of it is very clear to see. You have to be able to tell the difference between something you need and something you want. You have to know what you must spend your money on. Things like bills and food are, of course, needs. You need to have money for this stuff to make sure that you can live a happy life. A want is something that you do not have to have, like a new CD or a new video game. These are things you can live without. Knowing the difference between the two is a key to financial planning.

The next thing that you have to know when it comes to Financial Planning is how to save. Let’s face it; life can come at you fast, and you have to be ready for anything. What would happen if you had to take your car to get it fixed. If you are spending all your money and are not doing financial planning, then you are digging yourself an early grave. Saving some of the money that you get every month can be hard, but it is not impossible. The more that you can put back and save, the better off you are going to be. In the end, the better your financial planning, the happier you will be!

Next on our keys to good financial planning, you need to know how to play it safe with your money. A lot of times people spend their money too freely. Now they are not always spending their money on things they want; a lot of times they spend their money with their financial planning mind, however, they are spending it on the wrong thing. A lot of people like to put a lot of Cash advance into investments as their way of financial planning. There is nothing wrong with investments, but if you are going to use them, you still need to have some money saved. Do not blow all of your money on it.

Before you start a family makes sure that you are able to follow the keys to good financial planning. Do not let this world get the better of you. When it starts beating you down, all you have to do is get back up and beat it back. Financial planning is something that is good for all families, and it can ensure that you live a happy life. Financial planning is the way to a better lifestyle!

Financial Planning – How It Helps Individuals Too

admin — Tue, 29 Dec 2009 16:49:10 +0000

Formidable as the words “Financial Planning” are and no matter how many times it is repeated, it must be remembered that financial planning is for all; not governments, banks, financial institutions, the accounts department of your office, but also for you personally.
After all finance is nothing but money, expressed differently. Therefore to take away the rather high sounding word “finance” substitute money instead, and you would immediately starting the way you should.
Everything in the world needs money, or finance. Be it investment banking, banking, capital markets, even social service organisations, governments, your next door grocery, insurance companies etc. You name it, and they have to have financial planning or ‘money’ planning.
The only difference between your finance planning and those of others is that they are regulated by various laws and regulations since they deal with other people’s money!
Banks have to maintain a certain ratio of cash, they can’t lend without going through a fiduciary process known as due diligence, their exposure to the capital market is restricted, their lending is subject to prudential norms; investment banking too has its own laws and regulations; investments and exposure of insurance companies too is regulated. That is why these institutions have to be very cautious in their capital allocation management asset valuation, and they risk analysis, and management. The larger the capital available for allocation, the greater the risk they have to undertake. They have thus to fine tune their performance in a manner as would give greater returns, while managing the exposure to risks.
You and I take loans from these institutions. Well, there are thousands of people like us who take loans and mortgages. Assuming that all of us paid up, there would be no problem. But if let’s say 10 of us default, then the loss of that revenue adds to the non performing assets of the institution. This is true of corporate loans as well. Banks are under a regulation to keep their NPAs, as the non performing assets are called, under certain limits. When they go overboard, then down the tube goes the bank. Thus, to protect the investors, the small depositors like you and me, there are caveats and rules and regulations.
As has been said earlier, we too need to plan our finances in advance. Of course the amounts we have at hand are far lower, yet, there is need for planning. We need to plan for our house maintenance, our family budget, consisting of groceries, provisions, white goods, children’s education, an occasional vacation, utility costs fuel costs, etc. These are nothing but the same items that financial institutions use except that they are clubbed together and put under different names. From these figures, they extract their exposure and risks, and the balance to be provided.
Further, since they are players in a larger market, they have to be constantly on their toes to foresee what is there in the present, and what it is likely to be in the future. That is why they have analysists and economists to provide them hard data and various scenarios for the management to consider and allow them to take decisions.
This is called financial planning: finding what is happening, what is likely to happen, and if such and such event occurs what would be impact on the finances. This is the role of financial planning services, normally a unit in itself in the various institutions.
How good financial planning services is for an institution is determined by its rating in the market. A good institution would get good ratings if their financial planning services are excellent. Others go lower down. One way of finding whether this is true or or not, is when you see the stocks of one institution going down, just because a SINGLE INDIVIDUAL left that institution. Why this effect? It is because that person who left is considered a wizard in financial planning services, and his departure may have a long term impact on the future of that institution.
To manage your own finances, small as they may be, it would certainly be advisable to use a financial planning services provider. They operate in a number of ways. You could join a service which invests in stocks and shares, or provides finances for industry or commerce, or is using a mix of stocks and foreign exchange markets, or is investing part ofits ratio in local markets, currency and finance, and in stock markets abroad. What you have to look at is its last three years balance sheets to find out whether it stayed above the board, especially in rough and tough conditions. When it is good times, there is no need for such verification.
That brings in another point. Always assume the worst, and accordingly use your finances as is there is going to be a disaster tomorrow. In good times, nobody bothers. Rightly so.
Financial planning services is not such a tough subject for you to learn. You can read a number of books that are available in the market on financial planning, which delve deep into the subject, other books on financial management, other management techniques, subscribe to business management articles, and of course you can always talk to your banker or financial advisor. You can tap the knowledge resource of your own company, which is also doing exactly what the banks and other institutions mentioned above are doing.