What is “financial planning?”
As you invest and save for retirement, you will no doubt hear or read about it – but what does financial planning really mean? How does financial planning work and why do knowledgeable investors request this kind of approach?
Financial planning is about building wealth through a process, not a product.
Financial products are everywhere, and simply putting money into an investment is not the end-all to meeting your financial objectives nor a solution to your financial issues. To understand what financial planning is, there is much more to look at.
Financial planning is holistic.
Financial planning is about more than money. A financial plan is not only built around your goals, but also around your core values. What matters most to you in life? How does your wealth relate to those goals and values? Sure, we have to have enough money to cover our living expenses (and that can vary by person), but we need to focus beyond the basics. Some want to travel or own a vacation home. Others wish to support their religious organizations or charities. Others have a goal to leave money (legacy) to their children. Each person or family is different and your financial plan should be developed individually for you!
Financial planning considers the entirety of your financial life.
Your assets, liabilities, taxes, income and your business are never isolated from each other. Financial planning recognizes the interrelation and takes a systematic, integrated approach towards meeting your financial goals.
Financial planning is long-term.
Depending when we start your plan, it should address a strategy for wealth accumulation, maintaining your assets, and eventually the distribution of your wealth over time. This is a written plan that will be fine-tuned over time, as life evolves and your situation or goals change. This planning is a joint collaboration between you and your financial advisor. Both share responsibilities in ensuring the plan is complete. This planning process can also be a great way to develop a relationship of trust over time, as the plan evolves and becomes an essential part of review meetings.
What makes financial planning so necessary?
This is our roadmap. It helps us determine if we are on track to meet your goals. Think of your financial plan as your compass. If you are unsure of your financial plan at the moment, talk to a financial planner to get your finances in order. As you develop and refine this plan with your financial professional, it can serve as your navigator on the journey towards your financial and personal goal achievement. The plan not only provides direction, but can serve to improve your financial life over time. This approach can do more than help you save money, it may help you build and retain lifelong wealth.
NO BANK GUARANTEE | NOT A DEPOSIT | NOT FDIC INSURED | NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY | MAY LOSE VALUEAll Securities and Investment Advisory Services offered through Investment Professionals, Inc. (IPI), a Broker/Dealer, member FINRA/SIPC & a Registered Investment Advisor. The investment services offered by IPI under the name of Chelsea State Bank Investment Services are not offered by Chelsea State Bank, nor is Chelsea State Bank a registered broker/dealer and not affiliated with IPI.