The Power of Financial Planning
So, what is Financial Planning, who is it for, and why do we think that it is important?
The funny thing is that the finance part of it is not the most crucial element. The most important element is the planning side. And plans are pretty useful things. All great achievements have plans behind them - all great businesses have their business plans, all great explorers have their expeditions mapped out, all successful generals have their stratagems and a great financial future is no exception. Of course, you can have a great financial future without putting in place a plan, but we feel that putting in place the plan increases the likelihood of securing that great future.
What we at Capital seek to do when we first meet with you is to help to elucidate those things that matter most to you in your life, the goals that you have, when you want to achieve them and how much they cost. This is the discovery stage of our process.
We then create your own bespoke plan. Our expertise on the finance side of things then comes into play in the review of your existing situation, the creation of the plan and its subsequent implementation. All your investments, pensions, insurances, mortgages and tax planning will now begin to work in harmony and will be aligned with your goals. This is the planning and implementation stage of our process.
Just as businesses continually review their business plans to ensure that targets are met and that its performance is up to scratch, so you and your Financial Planner should continue to monitor the plan over the years to make sure that all is on track to meet your goals and make appropriate adjustments as circumstances or goals change. This is the monitoring stage of our process and we hope that our relationship with anyone we work with will evolve into a fruitful long term partnership.
In terms of who Financial Planning is for - we feel that everyone can benefit from Financial Planning - not just the rich, and that there is no time like the present to begin your Financial Planning - the sooner the better. You can build a Financial Plan on your own or work with a Financial Planner to help you. The important step is to begin to focus on what it is that matters to you in life and incorporate those desires into a plan. If you don't create a plan, you run the risk of drifting through life and not seeing your most important goals realised.
We think that the benefits of good Financial Planning may include the following:
- Giving you the freedom not to worry about financial matters
- Giving you a better quality of life by allowing you to concentrate on the things that are important to you
- Increasing or preserving your wealth and reducing your tax
- Permitting you to have a much clearer view of your future
- Creating a greater level of interest and knowledge in financial matters
- Educating and empowering you to feel in control of your life
And what have we been able to do for our clients? Well, take one of our clients, a partner at a City law firm, as an example. When he came to us, we helped him and his wife to formulate their goals, which included:
- Early retirement
- Maintaining their existing standard of living throughout their lifetime
- Ability to provide for their children's education and to help them onto the property ladder
- Not being a financial burden on their family in the future
- A review of their existing financial arrangements
- We were able to:
- Provide peace of mind that retirement could be taken at age 55, with a higher standard of living than currently enjoyed
- Increase the budgeted amount to be provided to the children for help on the property ladder
- Reduce tax bills
- Create more tax efficient income in retirement
- Give peace of mind that they would not be a burden on their family in the future
So ask yourself this question: have you in the last few years reviewed your existing situation and thought of your plans for the future, plus how best to achieve these? If not then perhaps it is time to start investing in "you" by taking time out to create your own Financial Plan.
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