Financial Planning for Life

Financial Planning

Your wisdom, understanding and skills of managing your finances, act as the deciding factor of your being on the side of financial success or financial struggle. Financial Planning involves managing money to achieve life goals. It is all about budgeting and cutting back the expenses.

Prioritize your Goals

As the first step to financial planning, you need to set goals. Try to be specific and grounded in reality. Make sure that, your cash inflows match the required outflows over the plan period. You can take care of that through proper prioritizing of your goals.

Goals and Time-period

You need to rank your goals based on urgency and time-frame. For two people with the same set of goals, some goals may rank differently based on needs and urgency. Based on the time frame, you can divide your goals into- short, medium and long-term goals.

Uninsured Emergencies

You should always keep aside some amount of money as an emergency fund to cover un-insured needs. For example, the amount you would need if you suddenly happened to lose your job or, your friend or relative landed in some trouble and you had to help them financially. You should ideally keep an amount you will need to meet six months of house-hold expense, in such a case.

As a thumb rule, do not use this amount for any other need or else, it might not be available when you actually need it.

Investing is Wise

Investment decisions should not be delayed in the hope of collecting a large amount of funds. Note that, the amount of time you stay invested is much more important than investment amounts.

Retirement Planning

The best time to start planning for your retirement is at the time you receive your first salary or pay. The earlier you save the larger your savings will compound to. Also, it is better if you save higher amounts early. This will help you stay at ease and spend liberally, once responsibilities catch up with you later.

The practical new Generation

When you were young, kids had to listen to parents, but with time, tables have turned and with the upcoming generation, parents will have to listen to their children as they grow up. It is not that, they will not take care of you, but chances are higher that, they will be living in a world, you cannot adjust to.

So, it is better to hope for the best and stay prepared for the worst circumstances by doing a sound and sturdy financial planning.


It is quite important to keep in mind the impact of inflation while planning for your goals. A graduate degree that costs 20-25 lakhs today, will cost around 40-45 lakhs, 15 years from now when your child grows up. That should give you an idea as to how much you must save regularly to provide the desired education or similar such things to your family.

Be Flexible Enough

Life moves in a sinusoidal curve and not in a straight line. Some of the twists and turns come for the better and some for the worst.

Life is what happens to you while you’re busy making other plans ~ John Lennon (Tweet this)

Your life-style can greatly get impacted by these ups and downs. You need to review your financial plans periodically to avoid any deviations from your goals and take corrective measures before it gets late.


Planning is important everywhere, including your finances. Life would be a mess without planning. The more you delay in starting financial planning, the lesser time you’ll have. So, the right time to start with your financial planning is now.


About the Author

Rohini Jha is an author, writer, poet and a management graduate. She ardently believes in taking life one day at a time. A spiritually inclined person, she treads life on the path of growth and self-improvement with a firm view that whatever happens, happens for the better.

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