Before you can get started on financial planning, it is useful to get an overview and an understanding of the whole process.

The financial planning process can be broken down into 6 basic steps:
1) Defining Financial Goals
2) Developing Financial Strategies and Plans to Achieve Your Goals
3) Implementing Plans and Strategies
4) Monitoring Progress
5) Evaluating Results
6) Revising Plan if Necessary

Defining Financial Goals
The financial planning process begins with establishing realistic financial goals. It is not enough to say that you wish to upgrade to a private apartment in future. You need to state your goals in specific monetary terms and the time frame to achieve them, like you wish to move into a condominium that costs not more than $850,000 in 6 years time. Of course, you need to set realistic goals that are achievable.

Developing Financial Strategies and Plans to Achieve Your Goals
You will be surprised at how minor adjustments to various aspects of your financial life can have a significant impact on your overall financial situation. Tax planning, which aims to devise strategies that will defer or minimise your tax liability legally, can help to maximise your disposable income. Credit management ensures that you make the effort to use credit responsibly and manage your debt prudently. As we face all sorts of risk everyday, be it illness, fire or death, risk management through insurance can help to alleviate the financial impact of such unexpected events. As your income increases beyond basic needs, starting an investment programme will help you to accumulate assets to meet future financial goals. As you would want to enjoy a certain lifestyle when you retire, early planning and management of your finances means that you will have a higher chance of achieving your objectives for retirement.

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