5 Ways Financial Planning Can Help You
If you have a good work ethic and have been earning money from hard work, diligently saving and contributing money to your 401(k) and/or IRA, you are probably wondering if there is a legitimate need for financial planning. Self-reliance is certainly commendable yet asking for assistance from proven financial experts is prudent, especially in the context of financial planning.
In particular, a fee-only, fiduciary CERTIFIED FINANCIAL PLANNER™ will help expand your financial nest egg without steering you toward investments or investment related-products/services that provide a commission in return. A fiduciary CFP® works for a flat fee, meaning he or she does not have even the slightest conflict of interest.
Your financial planner will perform a comprehensive financial modeling of your situation, plan for the life of the relationship, and actively manage your investments. This gives you even more reason to lean on a professional for assistance. Here’s a quick look at some specific benefits of comprehensive financial planning.
1. Creating a Financial Plan Helps You Manage Money
If you are like most people, you struggle to remain within the constraints of your personal budget. You might not even have a budget, instead choosing to spend freely whenever desired. Instead of winging it and hoping everything works out at the end of the month, adopt an organized approach highlighted by a comprehensive financial plan.
Comprehensive financial planning in Canton, OH extends well beyond merely investing. In-depth financial planning extends to budgeting, saving, spending prudently and ultimately developing money habits rooted in logic, reason and foresight. Develop a financial plan with the assistance of an advisor and you will find it improves your quality of life, your financial security and your confidence.
Your financial plan will also include an emergency fund so that you always have money tucked away to access when life throws you a curveball. This way, if you lose your job, become ill, get into a car accident or suffer another unfortunate setback, you’ll have an emergency savings account to tap into.
Above all, your comprehensive financial plan will get you into the habit of saving and investing rather than spending freely and neglecting your financial future. The development of such productive habits makes it easier to gradually build your nest egg which ultimately pays off quite handsomely in the future.
2. Financial Planning Boosts Your Confidence
A written financial plan developed by an experienced planner based on your input paves a path toward financial freedom during your golden years or sooner. Once your unique financial plan is complete, you will have the confidence you need to move forward in terms of not only working hard but also allocating your earnings to savings, investments, spending and beyond.
The confidence provided by such a plan is invaluable. You’ll feel much more certain in terms of your financial safety net as well as your chances of reaching your financial goals. A written plan for your financial future establishes specific benchmarks to strive for as you gradually progress toward your overarching aim of retirement in accordance with your selected timeline.
3. Financial Planning Creates the Investment Portfolio You Have Always Wanted
Most people without a financial plan have longed for their own investment portfolio yet never got around to creating one. Some are understandably intimidated by the prospect of planning for their financial future and parking their hard-earned money in investments. Others fear they will make poor decisions and end up with stocks that underperform.
Instead of attempting to figure out the complexities of the stock market and investing on your own, lean on an experienced advisor to help you navigate the investment maze. Your advisor will help you establish financial goals, establish a reasonable timeline to reach those goals and strategically invest your money for a better financial future.
4. Financial Planning Helps Pad Your Savings
There is a common misconception that financial planning is strictly centered on investing in stocks, mutual funds, ETFs, bonds and other investment vehicles. Investing certainly plays a central role in most comprehensive financial plans yet it is only one aspect of planning for a better future.
If you already have a savings account, your financial plan will detail how to pad that stockpile of cash even more. If you don’t have any money in your savings account or do not have a savings account, your comprehensive financial plan will gradually move money into savings for posterity’s sake.
Your financial plan can be amended as time progresses. If your savings account continues to build and you prefer to pivot toward a more aggressive investing strategy or desire to shift your timeline for retirement a couple years sooner, you can move money out of your savings account to investments. Your certified planner can also help you strategically change the percentage of your earnings distributed to your savings, investments and other accounts to reflect your preferences and timeline for retirement as they change throughout your career.
5. Financial Planning Helps to Prepare for and Reach Life Goals
Everyone should have a detailed timeline for life goals that set temporal expectations for reaching financial aims by specific dates. Such a financial plan makes it easier to manage money throughout your career and also facilitates reaching major life benchmarks by your targeted dates.
Meet with a financial advisor in Canton, Ohio to develop a comprehensive financial plan with specific financial goals. You will find out exactly how much money you need for each, how much time it will take to reach those targeted aims and also have something positive to strive toward. Tax planning to support a sound retirement plan is part of these efforts.
Whether you are looking to buy a home, pay for an extravagant wedding, save for your child’s college education or simply retire in your 60s, your CERTIFIED FINANCIAL PLANNER™ will help you understand the financial commitment necessary for each. Your financial advocate will also provide a reasonable expectation of the length of time necessary to reach those aims.