What Is Financial Planning?

Financial planning is about taking charge of your finances and developing a strategy that will enable you to manage your money sensibly while working toward achieving your goals. Sound financial planning can help you prepare for marriage, children, buying a house or car, further education and retirement. For many people, financial planning is about achieving peace of mind. It starts with the drawing up of a financial plan.

What Is a Financial Plan?

A financial plan is a document that contains a comprehensive overview of your current financial situation and long-term financial goals. Financial plans are highly individualized, taking into account your specific circumstances, risk tolerance, and expectations. It starts with an assessment of your net worth and cash flow and details a strategy for working toward achieving your goals. A personal financial planner will help you draw up an effective financial plan and answer all your financial questions.

What Do Financial Planners Do?

A financial planner is a qualified professional who specializes in giving financial advice. They may also specialize in retirement planning, tax planning, risk management, and estate planning. They will meet with you to learn more about your unique situation, and they can create a financial plan to suit your needs. Ongoing advice and service will be provided, and they'll adjust your plan if it becomes necessary. A good personal financial planner inspires confidence and could remain your trusted consultant for life.

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Retirement Planning

We all hope to retire comfortably one day, but unfortunately, if you don't plan for your retirement, you may have to work until you die. Retirement planning considers your assets and income, realistically estimates future expenses, and predicts the amount of money you may need to retire comfortably. It considers all potential sources of retirement income, such as IRAs, 401(k)s, pension funds, personal savings, investments, and other sources of passive income. The sooner you start planning for the day you retire, the more likely you will enjoy a financially safe and secure retirement.

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Tax Planning

You work hard for your money and should not have to pay one cent more in taxes than you are legally obliged to. Tax planning is essential if you want to become tax efficient, enjoy the benefit of all available deductions and maximize your ability to contribute to a retirement plan.

Estate Planning

Estate planning is essential for the effective management of an individual's assets, should they become incapacitated or die. It includes making a will, naming an executor, and even stating future healthcare wishes, etc. It is important to realize that there are ways to limit estate taxes. This includes making charitable donations and setting up trusts.

Financial Planning FAQs

What Is a 401(k) Plan?

A 401(k) plan is a retirement savings plan with tax advantages where your employer pays a percentage of your paycheck on your behalf into an investment account every month. The employer may also match your contribution.

What Is a 403(b) Plan?

The 403(b) plan is similar to the 401(k), but it's only available to government employees and certain employees of public schools and tax-exempt organizations. This could include doctors, nurses, librarians, professors, teachers and school administrators. When compared to the 401(k) plan, it has both advantages and disadvantages.

What Is a Profit-Sharing Plan?

A profit-sharing plan is a type of retirement plan that allows you to share profits of the company you work for. You receive a percentage of the company's quarterly or annual profits, but usually restrictions apply as to how and when you may withdraw your funds without incurring penalties.

What Is a Money Purchase Plan?

A money purchase pension plan is similar to a profit-sharing plan. Your employer deposits a fixed percentage of your salary into the fund every year. This money comes from the employer's pocket and you don't personally contribute to the fund, nor do you pay taxes on the money until it is withdrawn. You do, however, have a say as to how the money is invested by choosing from the options offered by your employer.

Do I Need a Financial Planner?

If you don't really have the time, the desire or the knowledge to manage your own finances, you could certainly benefit from the services of a financial planner. Why would you want to navigate this difficult process alone when you could work with a professional? Our team has years of experience in financial services. It would be our privilege to work with you.

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