Have a Look At The Brief Guide on Business Financial Planning
Everybody has dreams of owing a house, a car and living a stress-free post-retirement life. Even we seldom write down such goals and start working in accordance for achieving them. These can be stated as your life goals.
Our motive is to spread consciousness about the role of business financial planning in assisting you to attain your financial goals. Don’t want to have a good business financial planning for your future life? Of course, you would like to.
Here is a brief guide to acknowledge you more about financial planning and why you should take part in it?
What is financial planning?
People usually believe that it is somewhat like investment. But it is not mere investing; rather it is a procedure or a way to reach your financial targets. It enables you to manage your funds in such a way that you can associate it with your goals.
Just investing in a standalone life insurance instrument is nil if you are unaware of the cover amount you will require or whether its maturity yield is proper or whether you require a life cover or not.
The Procedure of Financial Planning
Your business financial plan should be able to answer these three questions. Where are you at present i.e. your business balance sheet, where do you desire to be in future i.e. finances associated to your goals, and what you should do to achieve that position i.e. the asset distribution and investment tactic that will assist you to attain your objectives.
Building a Financial Plan
This requires consideration of several aspects. First, your motive or the purpose for which you are being investing is highly critical to identify. The time period is also crucial since the longer will be the time of investment, the higher it will be able to diminish the risks.
Also, the most significant aspect that most of us do not consider is inflation. The amount of inflation can diminish your capital gain from investment greatly. Present time expenditures of Rs 10,000 would be Rs 43,000 in 30 years if the rate of inflation average out as 5% per year for those 30 years.
Read Related Blog: Why Personal Financing is needed to secure your future?
Mutual Funds as Financial Planning Instruments
Mutual Funds as financial tools are designed to offer financial planning solutions to both individuals and businesses financial plans through means of several products offered by it. Mutual Funds as assets allow you achieve your financial goals over a period of time.
Do you think that mutual funds are risky to invest in?
Well, there is nothing so! You just know about the partial story while the reality is far beyond. You can choose a mutual fund according to your risk profile. There are certain mutual funds that are completely risk free like debt mutual funds or liquid funds.
Read More about Debt Mutual Funds
You can additionally invest in funds that can be riskier as much as you desire. There are several sorts of funds that have distinctive levels of risk. They are not just cost-effective rather tax-effective as well.
Various investment instruments like System Transfer Plans (STP) and Systematic Investment Plans (SIP) are ideal for persons earning from salaries that desire to invest persistently and ride the volatility of market.
By correctly understanding the risk you are capable to bear, your return expectation and your liquidity prerequisite, you can accordingly choose a fund which satisfies your investment objective.
Don’t forget, to invest only in products you know comprehensively and one more significant thing is to choose the fund that has a well-known record.
If you want to achieve success and your targeted goals in business, it will be better to approach any sophisticated business financial planner.
Mr. Ajay Kumar Jain, M.Sc, Chairman And Managing Director
Being the Chairman And Managing Director, he focuses on holistic investment planning and wealth management and tries to make investment planning simpler for retail and HNI investors. Investor education is one of the prime things that Mr. Ajay Jain focuses on as he believes financial education is the foundation of successful investing. With over two decades of experience, Mr. Jain has made a mark in the Indian mutual fund industry due to his compassion and sheer hard work.