What is Financial Planning?

E veryone has needs and aspirations. Most needs and aspirations call for a financial commitment. Providing for this commitment becomes a financial goal. Fulfilling the financial goal sets people on the path towards realizing their needs and aspirations. People experience happiness, when their needs and aspirations are realized within an identified time frame..

The needs or aspirations are a good starting point, but in order to plan, these need to be converted into financial goals. The financial goals must be defined in terms of time horizon and the amount of money required to fund the goal.

Financial planning is a planned and systematic approach to provide for the financial goals that will help people realise their needs and aspirations, and be happy.

Need for Financial Planners

M ost investors are either not organized, or lack the ability to make the calculations described above. A financial planner’s service is therefore invaluable in helping people realize their needs and aspirations. .

Even if the investor knows the calculations, the knowledge of how and where to invest may be lacking. The financial planner thus steps in to help the investor select appropriate financial products and invest in them.

Transactions such as purchase of house or car, or even education, necessitate a borrowing. The financial planner can help the investor decide on the optimal source of borrowing and structure the loan arrangement with the lender.

Taxation is another area that most investors are unclear about. Financial planners who are comfortable with the tax laws can therefore help the investor with tax planning, so as to optimize the tax outflows.

Financial planners can also help investors in planning for contingencies. This could be through advice on insurance products, inheritance issues etc.

The financial planner thus is in a position to advise investors on all the financial aspects of their life.

Steps of Financial Planning

The steps in creating a comprehensive financial plan, as proposed by the Certified Financial Planner – Board of Standards (USA) are as follows .

  • Establish and Define the Client-Planner Relationship
  • Gather Client Data, Define Client Goals
  • Analyse and Evaluate Client’s Financial Status
  • Develop and Present Financial Planning Recommendations and / or Options
  • Implement the Financial Planning Recommendations
  • Monitor the Financial Planning Recommendations

The comprehensive financial plan captures the estimated inflows from various sources, and estimated outflows for various financial goals, including post-retirement living expenses. The plan can go several decades into the future.

A comprehensive financial plan calls for significantly more time commitment on the part of both the investor and the financial planner. However, the time commitment needs to be viewed as an investment in a long term relationship.

Children's Education

E ducation is the foundation that we impart on the next generation. Every parent understands the value of a good education as it directly impacts their child’s future. Parents want their children to get access to the best education possible. However, quality education comes at a cost and hence planning for education becomes vital.

It is also of great significance to keep in mind what one is planning for. If you want your child to study abroad, apart from the exams and qualifications required, the total cost one will have to incur is equally important. This sets a goal in mind, and subsequently you can plan to work towards achieving them. After all, goals without thorough planning are just dreams.


F or a parent, seeing their child happily married is an unparalleled joy. Whether it is the pride of seeing your son bring home a bride, or the bittersweet joy of seeing your daughter start a new life with her husband. But giving your children the wedding of their dreams requires a lot of careful financial planning. We are here to help make that job easier.

Retirement Planning

U sually people start planning for retirement only closer to their retirement age, but anytime is a good time to start planning. With increased life expectancy, people live longer and as a result, they need to plan for those extra years of their retirement phase

We have put together a guide which explains the concept of systematically investing during the earning phase and subsequently systematically withdrawing during the retirement phase. It also highlights the benefits of diversification across different asset classes.

Healthcare Planning

P lanning and Investing are the two most important aspects to achieve one’s goals in life. Unfortunately, most people do not treat ‘good health’ as a goal. With increased life expectancy, spends on healthcare are going up. Lifestyle diseases are also on the rise along with the cost of treating them. Improved standard of living has resulted into people spending more on wellness services including cosmetic procedures, gymnasium services and spas which are becoming expensive by the day.

One needs to be cognizant of these things and plan for healthcare expenses. The right planning and investments can protect you and your family’s health.

Tax Saving

Is The Taxman eating into your savings? You don’t need a hero to save your money from the Taxman. All you need is to invest in an ELSS (Equity Linked Savings Scheme). You can save more for yourself and share less with the Taxman.


  • Save up to Rs. 46,350 in taxes
  • You can invest up to Rs. 1.5 lakhs in ELSS which falls under Sec 80C of the Income Tax Act, 1961.
  • ELSS offers one of the lowest lock-in periods amongst other tax saving instruments.
  • Dividend declared in tax free for investors.
  • Invests in Equities, a proven asset class that offers good potential for wealth creation over a long period.

Handling Spare Cash

If you don’t use your money wisely, you are likely to lose its value. The smart thing to do is to invest in Liquid Funds.

Liquid Funds have multiple benefits:

  • Get three benefits in one: Relatively safe, liquid and offers potentially good returns
  • No long commitments: You can invest your money for a very short period – one day, a week, a month or more!
  • Easy to use: You can withdraw your money by simply calling or sending an SMS. The money will be credited to your bank account the very next working day*
Invest on a Friday and redeem on Monday itself if you wish to! Use your money before you lose it.