Financial security starts with a plan
A goal without a plan is just a wish
We all have dreams. It may be our own home, a comfortable lifestyle, our children finishing school, expensive vacations or a worry-free retirement.
Many of us think that if we just work double time and earn money, we are well on track to achieving our dreams. But let me tell you, there’s a systematic approach to reaching your goals.
Just as every architect – before building a house – has a design and blueprint for construction, we should also have a roadmap that lays out in concrete terms what we need to do to achieve financial security.
Goals are good. But as the author of “The Little Prince, Antoine de Saint-Exupéry” said, “A goal without a plan is just a wish.”
Your goals should be SMART: Specific, Measurable, Attainable, Realistic and Time-bound. For instance, a P5-million, two-storey house on a 300-square meter lot in Sta. Rosa, Laguna within 10 years. Having a price tag and timeline for your goal makes it all real. This way, you can work backwards: how much should you save and invest each year to achieve your goal. Begin with the end in mind.
However, this is just for one goal. How about your other goals? Can they be put together in one plan so that all areas of your life are covered? The answer is yes. You can have a comprehensive financial plan.
A comprehensive financial plan is a document that outlines the goals of a person, assesses his/her financial status, and gives concrete recommendations on how to achieve those goals. Each plan is different as every person has unique status, needs and aspirations. Yet all comprehensive financial plans cover each aspect of a person’s finances – cash flow, debt management, investments, insurance, tax and estate, and retirement.
In more developed countries like the US, Europe, Canada, Australia, as well as in some Asian countries like Singapore and Malaysia, individuals consult professional financial planners to craft a plan for them. Here in the Philippines, Registered Financial Planners (RFP) offer the same service. RFPs are bound by a Code of Ethics that ensures client’s needs are put first, and that the RFP acts with integrity, competence and professionalism. Therefore, the client is ensured that he/she is getting help from a knowledgeable and unbiased professional planner.
Securing our financial future is an arduous task – lifelong, confounding and challenging. But if done well and with a professional, it is very much rewarding. Financial security starts with a plan. – Rappler.com
Rienzie Biolena is a Registered Financial Planner of RFP Philippines. He is a Senior Financial Advisor at asset management company, and Columnist of Business Mirror and Rappler.
Source: http://www.rappler.com/business/56591-financial-security-plan
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