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Life Planning vs. Financial Planning: Which Is Better? - Outside View by PersonalFN
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Life Planning vs. Financial Planning: Which Is Better?
May 19, 2017

It's May - the month of mangoes, long vacation, and of course the swelter.

Surely, many of you miss your school and college days when summer vacation was truly enjoyable.

We reminisce about the past because over the years 'life' has taken a materialistic turn with 'finance' being the driving force.

We have envisioned certain dreams, financial goals and run this rat-race to achieve them. But we also have to save enough money, invest it prudently - in a disciplined manner - so as to accomplish our financial goals.

The fabric of life planning is clearly embellished with financial planning. We must learn to rope in the varied elements of our life so that our 'financial planning' is wholesome.

Many of you may have reached out to a financial planner, but a traditional financial plan may not be in your best interest long-term. You need a 'financial guardian' who can understand you, your lifestyle, emotional quotient, goals, etc.; who can counsel you, and accordingly draw up a customised holistic financial plan.

A financial guardian or a life planner will literally handhold you to safeguard your financial future. He/she will even energize and encourage you to do better financially, whereby all your dreams / financial goals can be accomplished.

Sadly, there are few unbiased financial planners and investment advisers who understand your plight. Unfortunately, they're putting their interest before yours and not following high fiduciary standards.Here's what financial planning is all about...

Financial planning is a process, to achieve one's financial goals viz. buying a dream home, a swanky car, travelling abroad for leisure, planning for children's future (their education and marriage needs), and your own retirement among a host of others - with a definitive, personalised financial plan in place. And mind you, there's no one-shot solution or 'one size fits all' approach. Life is dynamic, it does not move in a linear direction, and hence all aspects need to be interwoven well in your financial plan.

And mind you, there's no one-shot solution or 'one size fits all' approach. Life is dynamic, it does not move in a linear direction, and hence all aspects need to be interwoven well in your financial plan.

It begins with:

  1. Understanding your current financial state,
  2. Accounting for changes (if any),
  3. Defining your financial goals,
  4. Charting your asset allocation,
  5. Choosing productive investment avenues for you, and
  6. Drawing a financial plan to achieve your goals.

Once the financial plan is complete, continuous monitoring and reviewing is a must.

Financial Planning vs. Life Planning

Often when you achieve a goal, you're happy and satisfied. However, there are numerous goals. Besides, life isn't that straight forward - there are many ups and down, along with several compromises and sacrifices. Hence, 'life planning' plays a bigger role.

Life planning is highly sophisticated version of financial planning that is done following high fiduciary standards. It involves an empathetic financial planner, who reads between the lines for you, understands and counsels you. Doing so brings a new meaning to one's financial plan.

Many a times people feel the burden of saving and consider goals as an obligation. Their fear makes them resistant about compromising today, when in fact in the long run this can secure their financial future. While saving for your child's future, you probably sacrifice a holiday but at the same time you are rest assured that you will provide for them a better future. A life planner or financial guardian counsels and guides you to take the corrective course.

Life planning simplifies the battle of mind and heart

So, a life plan simplifies the constant battle of the mind and the heart.

It's more compassionate and virtuous way of putting your financial health in order much more holistically and enables you to save even for that rainy day.

To Sum-up...

There is a lot more to traditional financial planning. Hence, choose a financial planner or a Certified Financial Guardian wisely. The one who will not only chalk out a well-rounded personal financial plan, but patiently listen to what matters to you and handhold you to achieve your financial goals.

Ultimately, life is lived only once and striking the right balance between the mind and heart is key. Hence, reach out to a financial planner or a financial guardian in your vicinity today and start living your dream life.

The approach to living life and planning is what matters to make it fulfilling. So, take the right steps and live in bliss.

Happy Investing!

PersonalFN is a Mumbai based personal finance firm offering Financial Planning and Mutual Fund Research services.

Disclaimer:

The views mentioned above are of the author only. Data and charts, if used, in the article have been sourced from available information and have not been authenticated by any statutory authority. The author and Equitymaster do not claim it to be accurate nor accept any responsibility for the same. The views constitute only the opinions and do not constitute any guidelines or recommendation on any course of action to be followed by the reader. Please read the detailed Terms of Use of the web site.

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1 Responses to "Life Planning vs. Financial Planning: Which Is Better?"

M.B.Ratan Singh

May 19, 2017

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