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Concentrating on the Financial Planning process

Concentrating on the Financial Planning process

The Financial Process


As every process, financial planning has steps that help you to make this process easier and even beneficial. So, you are offered some steps that should be taken into your consideration.


1. So, at first you should identify and set short, intermediate and long-term aims. Ideally, each aim will have a date and dollar quantity attached to it.

2. Then evaluate your current situation and calculate your net worth. Doing this, you need to honestly assess your current financial status, including positives and negatives.

3. Reviewing your insurance coverage, including life, disability, home, auto, umbrella liability and long-term care, will be your next step.

4. For identifying tax-saving opportunities and potential deductions you have to review your current tax situation.

5. Reviewing your estate plan will help you to assure that your will, living will, healthcare power of lawyer and other estate planning documents are up-to-date and valid.

6. To make your retirement secured you should create a retirement funding plan that also covers when you plan to retire and how much you will need to support your retirement lifestyle.

7. You will have to make a college funding plan if you have children. This plan will help you to cover higher education costs.

8. The next point is developing an overall investment plan with proper investment portfolio. It supports your aims, while staying within your investment time horizon and risk tolerance.


Remember, that all of these areas are your aids. Be sure they will help you develop your initial financial roadmap.


Having thought over your plan, review it and progress periodically by giving yourself an annual check up to make sure you are staying on track. You have to be ready because life will throw you a curve-ball from time to time. It means that there will be many events and incidents in your life such as divorce, a serious illness and an unexpected job loss and for all these it will be better for you to have your financial plan.


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