What Are The 7 Steps In The Financial Planning Process?
What Are The 7 Steps In The Financial Planning Process?
The financial planning process is important to understand as it helps you create efficient action items to better your money. Financial Planning ProcessThis series of steps will be your go-to strategy that outlines how to budget, where to invest, and what other assets will help you achieve your financial goals.
Oftentimes you might be unsure of where to start with a plan due to a lack of know-how and might want to work with an expert. While you certainly can work with a financial planner, you absolutely can improve your finances on your own too. If you’re interested in DIY finance, then you can follow the basic seven steps in the financial planning process below.
A financial plan is a personal document created to help assess your current financial situation, create various money goals, and help you make better financial decisions going forward. You can create this plan on your own or work with a certified financial planner.
And according to the CFB Board, the financial planning process is defined as:
A collaborative process that helps maximize a Client’s potential for meeting life goals through Financial Advice that integrates relevant elements of the Client’s personal and financial circumstances.”
Why Is a financial plan Important?
During the financial planning process, you start to learn quite a bit about your overall financial health. And it’s possible that you might not have even realized you were in rough shape without building your personal plan.
Here are a few reasons a financial plan is important:
Helps you understand your income
Understand your current cash flow
Learn how to build more capital
Improve your family’s finances
Helps you start building better investments
Maximizes your budget and spending
Creates steps for you to achieve your money goals
The 7 Steps of the Financial Planning Process
To continue reading, please go to the original article here: