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Financial Planning: A Guide To Allocate Your Investments

Anjali was completely confused about how to go about her financial planning matters. She was trying to handle things, which went sideways because she had no ground knowledge of the matter.

Anjali came across a person, who was a financial planner. Before that, she had no idea how important financial planning could be. Now Anjali carefully plans her investments and makes an informed decision based on the focused knowledge that she received from the planning manager.

Most people, in today’s time and age, think about financial planning as a waste of their time and resources. People are not able to realize how financial planning can save your precious time, which can always be used for some emergencies, or during other crucial times.

Financial planning refers to allocating your time and efforts to dedicating your resources in the right direction. Financial planning enables you to construct a road map to achieve all your financial goals.

What is financial planning?

Financial planning can be referred to as an exercise that evaluates your current and future financial standing. Being a financial planner can always give you better hold on your finances and help you make better future decisions.

Financial planning includes budgeting your expenses, investing in the right assets, setting active goals, choosing the right asset allocation, and much more.

How to go about it?


Defining your financial goals; the main objective of financial planning is to set your financial goals and achieve them actively. Start by listing down your financial goals for the short term, and also for the long term.

Make sure your financial goals are specific, measurable, realistic, and time-bound.


Prepare a budget after setting your financial goals. Budgeting is the process of creating a balanced formula on how to make optimal use of your money hard-earned.

Start by making a detailed budget of the anticipated income and expenses for the first month. This habit will help you keep your expenses in check and keep you out of debt.


It is always an important point to keep in mind, to maintain an emergency fund or as it’s called, a contingency fund. Life is uncertain and it is good to keep in mind various situations that emerge out of nowhere.

A contingency fund is nothing but your monthly expenses saved for a few months. There are regular expenses which need to be dealt with. Apart from those, keep a fund stored away for real emergencies.

Asset Allocation

This one step is the foundation of financial planning. There is one thumb rule of this objective. As you start getting older, the less time you get to recover if the stock market tumbles and the risk of your finances going down rises.

Your portfolio needs to shine and that can only be done if you invest your finances in shares or any market you deem fit. Investing your money is a suitable option, better than letting it sit idle in a bank account somewhere.


When you have various liabilities and are stuck in a debt trap, you need to realize that your finances should be put in order. People want a better lifestyle in today’s world and to have that, you need to make sure to learn to save better.

To make your lifestyle better, be careful and don’t end up taking loans to fulfill your desires. Financial planning not only helps you from making a dull decision but also maintains a healthy cash flow of your finances.

It is very essential in this era to not have a debt on your head, no matter how close you are to the creditor. These kinds of relationships tend to become complicated when it comes to monetary terms, so be careful.

Right Investments

Many people invest in asset class through shares or mutual funds. But the issue with such investments is that they are done after the recommendations through friends and family, and not through a recognized firm.

Unplanned and non-researched investments lead to a loss of money for the investors. It is extremely important to research extensively and then invest your money after a thorough procedure.

Rather than investing money in fluctuating shares and companies which you are not aware of, think of investing your hard-earned money in more stable shares, and can deliver more.

Making a Habit

Regular investment is the key to creating wealth in the long term. Discipline is crucial even for a child to achieve his goals. Similarly, a grown-up also needs to be disciplined.

Invest small amounts regularly and it will also prove to be light on your wallet. It will enable you to invest slowly but strongly in your future financial goals. Start small and then gradually formulate a habit of regular investment.

Importance of Financial Planning

When you are earning, it is easier for you to manage your expenses through a fixed monthly salary. But you also need to consider the time when you would stop earning.

Savings and investments done during the right time and period are essential to lead a comfortable life at any point in life. So, it becomes inevitable for you to plan for your retirement in advance.

Also, there are always unforeseeable situations and circumstances in life, for which we need to prepare ourselves.


Having financial planning thinking from the beginning of your youth can be very beneficial for you. Starting early in life and saving throughout can prove to be a golden decision when you are near your retirement age, or are getting older.

People should always have a contingent policy ready for emergencies which can never be predicted. These situations prepare us for a future unseen. Having a strong financial backbone would enable you to not ask for money from anyone else. Make sure you have a fund handy whenever required, so that any kind of loan and help would not be your last resort.


When Is The Right Time to Invest Your Money?

Investing has no right time, but it is always the right time to invest your money after careful consideration.

Should You Hire a Professional?

Hiring a professional or handling your finances all on your own, is a decision that should be entirely up to you. You can take guidance and carve a path on your own or you can always hire someone to safeguard your finances for you.

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