How Financial Planning Helps You Manage Your Money Strategically

Manage Money

Financial Planning is an integral element of personal financial management. It is a strategic approach in which a financial planner helps people deal with various financial issues in areas such as cash flow management, investment planning, retirement planning, risk management etc. It involves the incorporation of myriad of financial resources and financial tools to achieve financial goals.

All industries across the world have seen drastic changes since the last decade and better financial planning and management is required to handle the financial intricacies. Moreover, with recent economic slowdown and recession, people are realising the importance of financial advisers and planners, especially in Sydney, to manage their personal finance through proper assessment of current situation and comparison with the plan.

Important Aspects in Financial Planning: A financial planner should address all the areas of the client’s financial needs and successfully achieve the set goals. Some of the areas that must be addressed in the overall financial plan are:
? Risk Management
? Cash Flow Management
? Insurance Planning
? Education Planning
? Investment Planning
? Tax Planning
? Estate Planning
? Relationship Management

Steps Involved in Financial Planning: Financial planning involves strategic decision making. Discussed below are the steps that enable strategic financial planning:

Step 1: Goal-setting with the client- Primarily, the financial planner has to identify the client’s financial goals and life goals.

Step 2: Gathering information on the client’s cash inflows and outflows- Preparing a list of how the cash is coming and going would help the planner to better understand how well the money is utilised and how much has to be used for investing purpose.

Step 3: Identifying financial problems that can create barriers- After listing the goals and collecting information on cash inflows and outflows, the financial planner has to identify the pertaining or possible financial problems that can create barriers in achieving the financial goals. Some of these barriers may be recession, high inflation, inadequate increase or decrease in income etc.

Step 4: Making the plan- For each financial goal, a systematic investment plan has to be devised by choosing the correct investment instruments and planning the alternatives, wherever possible.

Step 5: Implementing the plan- A financial plan is only successful if it is put into action. This is done by utilising the resources allocated for each goal in the plan.

Step 6: Periodic review and revision of the plan: Many times the planned scenario does not match up with the actual situation. Because of this, it is important to review the steps to check for misalignment and changes in the client’s situation.

Importance of Financial Planning: In order to reap long term benefits, it is important to plan finances with the help of financial planners and advisers. Some of the reasons why financial planning is important are stated below:

? Increased cash flow: Financial Planning ensures proper flow of cash by undertaking measures such as tax planning, prudent spending and careful budgeting.
? Strong capital base: Through efficient financial planning, strong capital base can be established. It enables the person to think about investments and thus, improve their financial position.
? Income management: Financial planning facilitates management of income which helps in segregating it into tax payments and other monthly expenditures and savings.
? Fulfil financial goals: By planning the finances, an individual can fulfil his or her aspirations which may include enrolling for an educational program, going for a vacation or savings for retirement.
? Family security: From the point of view of family security, financial planning is crucial. Various policies available in the market serve the purpose of financially securing one’s family.
? Standard of living: A proper financial plan ensures that one’s standard of living is not affected even in difficult times. For instance, death of the bread winner in a family or recession may affect the SOL if the financial plan is not in place.
? Savings: Through planning, one can ensure financial security in the form of savings and investments.

Though financial planning is believed to be a time-consuming activity, it is worth all the effort.

Financial Management: managing your finance

Financial Management

Financial Management is planning, organizing, directing and controlling the financial activities such as procuring and utilizing the funds of the organization. It is thus, the management of finance for the fulfillment of financial objectives of an organization/company. Financial management requires a lot of expertise and the right skill sets.

The basic objectives of financial management are:
* Wealth creation for business
* Generation of cash
* Provide an adequate ROI

Financial management can’t be done in isolation. It is basically an amalgamation of various financial decisions. Financial management, in its essence, includes:
* Investment decisions
* Dividend decisions
* Financial decisions

Financial management is about procuring finance for the company at the lowest cost possible and allocating it in a way that it earns the highest return on investment. It thus refers to planning and controlling the finance of a company.

Financial management works on the principle of 5As. This refers to:
* Anticipation: This implies that financial management estimates how much finance is required for the organization.
* Acquisition: It acquires finance for the company for different sources.
* Allocation: It uses this finance to allocate it in the most profitable assets-fixed or current.
* Appropriation: It includes proper distribution of the generated profits among the various stakeholders like shareholders, debenture holders etc.
* Assessment: It also controls and analyses the profitability of various financial activities of the company.

Financial management is one of the most crucial areas of management. It is, in a way, the most important functional areas on management because all other areas depend on this function of management.

To be a successful financial manager, one should have a knack of money management. But, even if you aren’t born with the quality of managing finance efficiently it can be easily gained through short term or full time course in financial management. Financial management as a career option can be very lucrative option because financial management is that function of management which will always be in demand even if the economy faces a recessionary trend.

Since financial management is one the most challenging yet important function of management, we at have designed online certificate courses in financial management. These courses provide guidance in various fields of finance like financial management, banking ops and financial services management, Stock market, wealth management, CFA (part 1) preparation, FRM (part 1) preparation and FRM (part 2) preparation. If you want to enter and excel in the burgeoning financial sector then you can take up these industry relevant courses.

Financial Questions and Answers no Longer Need to be Mysterious

Financial Questions

When financial questions and answers are what you are seeking, you can get help from different sources. The most common sources are the financial books. If you are looking for financial facts, figures or statistics, you can get the information from national bank financial departments, financial trust institutions and commercial banks. Additionally, there are a number of websites available on the internet that can help in your quest for financial questions and answers. Such websites pack up loads of information making it a breeze for you to find specific information that you are looking for. The advantage with these websites is that you are able to easily flip through pages upon pages of content and if necessary easily use the search function that is generally provided in these websites. Additionally, the information on these websites is generally presented in basic terms that anyone can understand and these websites are generally designed keeping in mind the frequently asked financial questions.

When you are seeking answers to financial queries and issues, it is important for you to ensure that answers are founded on proven truths and are accurate. Hearsays, assumptions or even educated guesses can’t be relied upon. And if you are seeking information on serious topics such as business finance, personal finance and public finance, it is important that you seek the views of someone who has in-depth knowledge in these subjects. In this context, financial books can be a reliable source of information since they are published, read, and used by professors, students, financial analysts and are known to be factual and accurate. You may also like to refer to other financial publications such as financial reports, encyclopaedias, and financial magazines to get the information that you are looking for.

If you are not able to meet professors or officials working in financial institutions or if your busy schedule is preventing you from visiting a school or state library, you can still get your accurate and correct financial answers on the internet. It has now become increasingly easier to get information about any subject online, be it financial tools information or any other. In case you need help in dealing with money troubles or other financial difficulties, you can get online financial help. Through online resources, you can find a great deal of financial help for your household finances, online loan applications and even applying for loans online, without paying the cost of high fees. While you may get your financial answers from the web, some online resources are free and for some you may have to pay. There are experts working on the web who are willing to share their expertise to anybody who is willing to pay for their efforts.

The type of financial help you can expect to find online would generally range from informative articles on personal financial management to household budgeting to advice on debt consolidation, refinance or on getting financial aid. You may even be able to fill online loan application forms and may even find budgeting spreadsheets as well as free software to download. The advantage of getting online financial information is that you don’t have to sit through presentations, waste your gas, pay for parking or worst, waste your time and money getting the wrong type of advice.

Whether you are looking for financial information or wish to improve your personal finances, the online help resources available today can help you take hold of your financial life. The internet has indeed provided knowledge to us on our fingertips now and financial help is now available at the click of a mouse.

A Few Tips Of Caution From The Financial Expert

Financial Expert

In this difficult economy, it is wise to listen to the advice given by your financial advisor. It is important to be able to rely on the advice of your personal financial expert, or if you do not have one already, to secure the services of one who is familiar with your own financial situation, the stability of your job and investments, and any personal financial situation of which that expert should be aware, such as impending medical or housing expenses that must be taken into account in the foreseeable future.

The financial expert you have chosen may offer you a few tips of caution as you progress into the coming financial uncertainty. That expert may be able to point you toward investments and stocks which appear to be riding out the current financial storm. They may also be able to advise you to divest yourself of non-performing stocks or shaky investments.

A solid financial expert is one who should be keeping tabs on the movement of the markets and the cost of money. That up-to-date knowledge should inform him or her of the advice given about any sort of financial move that may be anticipated.

When trusting the advice of a financial advisor, it is vital that you understand the experts background, credentials, and current experience in the financial market. If that advisor has a proven track record of sound financial decisions and experience, that will be the advisor to trust. If, however, the financial advisor cannot display a background of success, it maybe best to seek a more experienced expert. Anyone can call him/herself an expert; the proof is in the past record of success and satisfied clients. Demand strict proof of that track record before risking money by taking your experts advice.

If your so-called expert is merely making general statements and giving general financial advice rather than advice tailored strictly for your own situation, take this experts advice carefully. Do not make any sudden financial moves without checking those moves for soundness with another financial advisor. A statement of advice made by an individual who does not understand your particular situation is not always going to be made with your best interests in mind.

Likewise, avoid experts who are not part of a well-established financial firm, or who do not come well-recommended. Choosing an expert who has the backing and confidence of other financial advisors is less risky than choosing an untried and unproven advisor. Always try to prefer an investment firm which deals in the type of investments and holdings that you prefer to deal in yourself.

The choice of a financial expert is a personal one; the expert must be someone in whom you have extreme confidence. Be certain that your expert is affiliated with a sound company. Try to prefer an advisor whose compensation does not depend solely on the financial products you purchase. And, be sure that any money which is invested in less than solid financial products is money that you can afford to lose, even in this unsteady economy.

The Role Of A Financial Intermediary

Financial Intermediary

If a financial intermediary is involved in the flow of funds from a lender to a borrower then this would be known as indirect financing. Financial intermediaries transform financial claims in ways that make them more attractive to the ultimate investor.
If a financial intermediary is involved in the flow of funds from a lender to a borrower then this would be known as indirect financing. Financial intermediaries transform financial claims in ways that make them more attractive to the ultimate investor.
Financial intermediaries include commercial banks, mutual savings banks, credit unions, life insurance companies and pension funds just to name a few and they can partake in the best forex trading. These and other financial intermediaries emerged because of inefficiencies found in direct financing.
For direct financing to take place the borrower must be willing to issue a security with a denomination, maturity and other security characteristics that match exactly the desires of the lender. Unless both the lender and borrower are satisfied simultaneously then the transfer of money will probably not take place. For example if Joe with his limited funds cannot purchase a three month commercial paper, which would have a higher yield than his bank CD because the minimum transaction in the commercial paper market is $1 million.
To overcome these problems financial intermediaries intervened between the borrower and the ultimate lender. Financial intermediaries purchase direct claims which are basically IOUs with one set of characteristics (terms of maturityFind Article, denomination) from borrowers and transform them into indirect claims with a different set of characteristics which they sell to the lender this transformation process is called financial intermediation.
Firms that specialize in intermediation are called financial intermediaries or financial institutions. These two terms are interchangeable. The opposite of this would be disintermediation which is the process in reverse. In this scenario lenders take their funds out of the financial institutions and invest their money in direct claims in the direct financial market. Depending on the state of the economy will largely determine role of the financial intermediary and forex trading tips they can provide. In either case the financial intermediaries are vital to any economy whether waning or waxing

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I Will Never Ignore Financial Planning. Will You?

There is an increase in the number of those people who are hitting the road for financial planner training. Why most of the people today have a question that- How Do I Become A Financial Planner? The reason is very understandable. The economic slowdown in most of the countries and high unemployment rate has forced people to have a careful inspection of their personal finances and to seek ways to maximize savings from their limited earnings. In our everyday life, there are lots of issues that imbalances our budget. The history has seen firms making big losses ignoring the financial formulations.

There are few common financial mistakes many small businesses may make and end up bankrupt which should be seriously kept in mind are-

– Many companies fail to set measurable financial objective.

– Companies may misinterpret that investment training is the same as financial planning education.

– Most organizations give preference to normal graduates over graduates with financial planner certificate as the former is cheap. By doing this, they de-emphasize the importance of periodically re-evaluating their strategies and don’t realize until they face a capital crisis.

– Anticipating unbelievable returns on their investments.

Most of the businesses have become aware of the losses they can face and hence emphasizes the importance of Financial Planning Education among their employees. The earlier you start with your financial planner training, you may get a better bang on your buck.

This has increased the demand of professionals with financial planner certificate who can guide and plan for the individuals to meet their business goals. It is very important that a financial planner must have certain set of skills to be successful in the industry. Companies usually need planners with the background in economics, finance, business, accounting and law. A certified financial planner must be strong in Mathematics and must possess analytical skills. Colleges of Financial Planning Association Georgia are the most accepted and famous stage to crack this difficult exam and to gain most distinguished Financial Planner Certificate. Within the Financial Planning Association Georgia, the colleges are high in number who provide financial planner certificate courses, but it is crucial to find a right institute which has been accredited by Ministry of Education. One should have a detailed knowledge of the course material provided by the institute and the year on which it has established. A research should also be done to compare the education cost with other financial planner certificate providing institutes.

A student has to go through a series of online course materials and then online tests. Although students with financial planning education do not require any certification, but to get a title of Certified Financial Planner (CFP) is very alluring, both to the professionals and the companies. But before going for any such financial planner training, a professional must ensure minimum three years of experience in relevant field. A person can choose a regular campus training or the online training which has become much more popular. Online courses are well designed to meet the speed of a beginner and advances as the training progresses. A Financial Planner Certificate through online can be earned in as close to six months. And what more, you can make a bright future in well established company as a CFP.

Make Sure You Ask These Financial Advisor Interview Questions

Choosing a financial planner can be one of the more important decisions you will ever have to make and these financial advisor interview questions can help you make the right choices. A financial advisor will help you manage your assets so that you can pursue your financial goals. We feel a good financial planner strives not to limit themselves to simply using your financial data to create the plan, but also be able to consider your personal issues. Here are some of the important questions we recommend that you ask any prospective financial advisor you are considering working with.

1. How long have you been a financial advisor? While a new financial advisor is not necessarily a deal breaker, one with at least five years experience is preferable. Or you can ask them who they have worked with in the past and call these people to check out their professional competence.

2. What is your investment philosophy and strategy? Many planners take a passive approach to investing. They recommend or sell investment and don’t actively monitor clients’ accounts rather they’ll just move on to the next sale. In today’s challenging and often volatile financial marketplace we feel it’s vital you work with a planner who proactively monitors your portfolio.

3. What type of clients do you normally deal with? Preferably, the financial advisor you work with should have experience with people who have similar financial circumstances to you.

4. What kind of information do I need to provide to you so that you can help me develop a financial plan? Keep in mind that financial advisor interview questions should involve not only your financial circumstances but also your personal goals. In short, any good financial planner will get as comprehensive a picture of you and your financial objectives as possible so that he can make specific financial recommendations that will suit your goals.

5. What products do you offer advice on? Of course financial planners will have their own products that they promote, but the best ones will put their client’s needs first and recommend a wide range of products. And if you already are using a particular financial product, can they advise you on it? Avoid financial planners who seem more interested in selling you their company’s products.

6. How are you compensated for your services? Work with a financial planner who charges on a fee-for-service basis rather than as a percentage of your assets. This will show you exactly what you are paying for their services. Some planners, however, may ask to be paid on a mixed basis model, i.e. charging a flat fee as well as commissions if you use their company’s products. Make sure you understand not only what your planner charges now but also in the future.

7. Will you provide regular consultations and how much will you charge me for these? Your financial plan is not static but is something that will change as time goes on and your objectives change. A financial planner should provide you with regular reviews and ongoing consultations as external financial conditions change to keep you updated on your investments.

8. How do you stay updated on the latest developments in your field? A good financial planner is constantly learning through ongoing education courses.

Securities and Investment Advisory Services may be offered through NFP Securities, Inc. (NFPSI), Member FINRA/SIPC. NFPSI is not affiliated with Universal Partners.