As the cost of living continues to increase, research has revealed that 64% of Australians, close to 2/3 of the country, are worried about their financial future.
More alarmingly still, only 16% of Australians have a financial plan that would help alleviate their concerns and make them more confident and secure about meeting their current financial needs and long-term financial goals.
The question is, what is financial planning – and how does it work? In this post, we explain the financial planning process, why it’s important to create a personal plan, and why it’s wise to work with a financial advisor.
Financial planning is the process of developing strategies to ensure your and, when applicable, your family’s financial needs are met in both the short and long term.
A comprehensive financial plan should not only help you achieve your most important goals, e.g., buying a house, funding your children’s education, or retiring by a certain age, but also accounting for any unforeseen circumstances and their associated costs.
Generally, the financial planning process involves the following:
Many people work with financial advisors to create their plans because they simplify the process, highlighting the strengths and weaknesses of their proposed strategies. Better still, a financial planner has the expertise and experience to offer recommendations that most people wouldn’t realise were feasible.
Creating a financial plan is important because it allows you to take large – and seemingly overwhelming – financial goals and break them into manageable, realistic steps. This makes it easier to reach your long-term objectives and makes you more aware of how well you budget and how you can improve your financial management skills.
Here are different types of financial planning strategies you may employ, based on your needs and financial situation:
In reality, any individual with a regular income and long-term financial goals could benefit from consulting a certified financial planner. This is because financial advisors can identify strategies that will help accomplish your goals while avoiding potential pitfalls.
However, there are also particular circumstances or life events when it’s especially wise to speak to a financial advisor, including:
The skilled and experienced team at K Partners offer a comprehensive range of financial planning services. We tailor each financial planning strategy to your individual goals and circumstances, accounting for your present needs and financial future.
Contact us to book your free initial financial planning consultation
Please note that all the while the information provided above is factual in nature, it’s also intended to apply generally, and to a broad audience. Subsequently, the information hasn’t taken your personal circumstances or goals into consideration.