What are the steps in personal financial planning? Describe each step.
Answers
Answer:
The financial planning process is a logical, six-step procedure: (1) determining your current financial situation. (2) developing financial goals. (3) identifying alternative courses of action.
Answer:
Identify your financial situation: reflect on what is happening in your life right now. Expenses, household, budgets, taxes, investments, obligations.
Determine financial goals: Plan your future and how you will manage. Differentiate your needs from your wants.
Identify alternatives for investment: short, medium, and long term goals. Have objectives and analyze how far down the road you are close to your goals. Have backup plans.
Evaluate alternatives: Decision making. Notice your concerns and have alternatives. More opportunities.
Put together a financial plan and implement: Action plan. Carry out as early as you can. The longer you wait- the longer it will take for you to grow in wealth.
Review, re-evaluate and monitor the plan: Your financial situation will most likely change throughout your life. Make necessary adjustments to keep your goals in line w/ w your lifestyle.