According to MFPC, it’s definite that Financial Planning is a process or methodology of assisting clients in determining their financial goals, objectives and priorities and the resources to meet them in an optimal and practical manner. Thus, everyone needs at least basic financial planning.
However, many people still failed to do financial planning. The main reason is because they do not understand the process of financial planning. They think financial planning is only about picking investments or buying insurance products and these activities are obviously for those wealthy people. Since they are not wealthy, so they think there is no need for any financial planning. In additional, they also do not have enough money for it because they may think that financial planning services may cost very high fees. Perhaps, people avoid planning out of fear because they are unwilling to confront with the reality that they face in their life. Therefore, they choose to avoid from it. As a result, they will procrastinate it.
Financial planning helps an individual to evaluate both current and future financial position in order to establish the strategies to achieve their goals.an individual may run certain risks such as having insufficient funds to meet big future expenses like education costs, down payment for a home or meeting retirement expenses if financial planning is exempted. A successful financial plan will help an individual to beat inflation, minimize taxes, manage the unexpected, achieve the goals and meet the retirement expenses.
The sooner and the earlier the people do the financial planning the better. This is because the financial planning of an individual will change from time to time.People’s needs and goals are changing due to different life cycle. The earlier an individual conduct the financial planning, the easier to reach the financial goal……