Financial Planning is Important – Here’s Why

Most of my clients have told me they could see the value of financial advice after they engaged in my services. Regardless of whether you do it yourself or work with an adviser, planning your finances becomes inevitable, as it is essentially planning a well-lived life.

It gives you a clear direction when you define your dreams and goals.

If you want to live the life you want, then you must create a clear vision of what that life will look like. Otherwise, life can feel like aimless wandering without clear goals, and plans to achieve those goals. This applies to all areas of your life, not just to your finances. Financial planning helps you turn your dreams into real dollar terms, and helps you achieve those dreams with sound planning and strategies.

It prompts you to take action.

“I will do it one day.” How many times have we heard that or said it to ourselves? We have all experienced problems with procrastination. With that attitude, we will achieve or accumulate very little over time. The barrier between your life now and the life you are capable of living is a lack of consistent actions directed toward your specific goals. Financial planning involves a defined and proven process that needs effective implementation with the help of an adviser.

It helps you create wealth.

Wealth creation is not as complex as you think. It’s simple. However, you need to start early to invest enough money in the right things to take advantage of compound interest. In addition, you must become a master of taking the right action in different market conditions to maximise your wealth by recognising both opportunities and threats. If you don’t want to become an expert on investments yourself, it is very wise to seek advice from experts.

It protects your wealth.

All the investment strategies that are designed to accumulate wealth are based on the pre-assumption that income is received on an ongoing basis. Protecting your current and future earnings from the effects of a long-term illness, disability or even death is considered in equal measure with wealth accumulation in financial planning. You also need to ensure that you reduce the risk in the wealth that you have worked so hard to build. Different structures – company, trust, and superannuation – can offer you different asset protection.

It helps you leave a legacy with peace of mind.

Effectively passing your life savings and assets to your loved ones can be challenging and complex. It also shapes how you want to be remembered. Financial planning helps establish peace of mind in terms of managing the future of your family’s wealth and passing down your value, stories, and assets.

It applies meaning to money.

Money itself has no meaning – you have to give it meaning. When you set goals and follow your plan, you will discover what’s important to you and eventually achieve it. A happy and fulfilled life doesn’t come from how much money you make; it’s about how you maximise the benefit of money to realise your life purpose and enhance joy and love in your life.

Financial planning is important for everyone, not only wealthy people. George Patton said, “A good plan today is better than a perfect plan tomorrow.” Life with planning is much better than leaving everything to chance and regretting missed opportunities.

Personal finance book | Your Best Life

Written more like a novel than a self-help guide, Your Best Life is designed to walk you through the journey of financial planning.