What Are The Major Areas of Financial Planning? - Next Gen Financial Planning (2024)

Financial planning is an important part of ensuring financial security for the future. It involves assessing your current financial situation, setting goals, and creating a plan to meet those goals. If you’re interested in learning more about planning for your financial future, then speaking to a financial planner can be a great first step to financial well-being.

Financial planning is the process of managing your finances to achieve long-term financial stability, security, growth, and ultimately financial success. It involves setting both long and short-term goals and creating a solid financial plan that will help you reach those goals. There are 7 major areas of financial planning which include insurance planning, investment planning, retirement planning, tax planning, estate planning, cash flow, debt, & budgeting, and education planning.

Let’s take a deeper dive into these seven areas of financial planning in order to understand their importance better:

Investment planning involves selecting investments that are appropriate for your goals and risk tolerance. Investment planning also includes creating an asset allocation strategy, rebalancing your portfolio periodically, and implementing risk management by diversifying across different types of assets. We suggest having your investment accounts and insurance plans reviewed every three years or so. Our financial advisors can provide you with investment strategies tailored to your long-term financial goals and investment objectives.

Retirement planning involves setting goals and creating a strategy to achieve those goals such as determining the amount you need to save from your current income for retirement and selecting appropriate investments to reach that goal. A good retirement plan also includes creating a withdrawal strategy for when you retire and evaluating sources of income like Social Security, pensions, and retirement savings.

Estate planning involves creating a plan to protect and transfer your assets after you die. Estate planning includes selecting beneficiaries, drafting wills or trusts, selecting an executor, and developing strategies to reduce estate taxes such as gifting assets or setting up life insurance policies. At Next Gen Financial, we recommend having your estate plan reviewed periodically and keeping it updated.

Cash flow, debt, and budgeting involve managing your current finances in order to achieve financial goals. Cash flow planning involves forecasting income and expenses, creating a budget to manage spending, and developing strategies for saving money. Debt planning involves evaluating your existing debt levels and developing a strategy to reduce or eliminate debt. Budgeting involves tracking expenses, setting monthly financial goals, and developing strategies to meet those goals.

Education planning involves creating a strategy to finance your or your child’s education. Education planning includes evaluating different types of financial aid, understanding loan repayment options, and selecting appropriate savings vehicles such as 529 plans. We will guide clients through the complexities of college and other education planning so that you can make informed decisions about financing your or your child’s education.

If you want to create a financial plan for yourself and your family, it is important to understand these major areas of financial planning and how they can help you reach your goals. A certified financial planner can provide valuable guidance in creating a comprehensive financial plan that addresses your long-term objectives They can also help you select appropriate investments, develop tax strategies, and implement estate plans.

Get in touch with a qualified financial advisor today by contacting Next Gen Financial today!

Overall financial planning involves coordinating all of the above areas of financial planning to develop a comprehensive strategy for achieving your financial goals. It involves assessing your current situation and creating a plan that incorporates all aspects of personal finance such as investments, insurance, taxes, retirement, estate planning, cash flow and debt management, education planning, and more. Overall financial planning is key to creating a long-term strategy for achieving financial freedom.

Financial planning should include assessing your risk tolerance and ensuring that you are comfortable with the level of risk you are taking on in relation to your goals. It is important to periodically review your financial plan to ensure that it is up to date and still reflects your goals and objectives. A financial planner can help you develop an overall financial plan tailored to your needs and provide guidance on how to best achieve your goals.

Insurance planning, investment planning, retirement planning, tax planning, estate planning, cash flow, debt, & budgeting, and education planning.

You estimate retirement income by determining your expenses, calculating the amount of money you need to save for retirement, and assessing different sources of potential retirement income such as pensions, Social Security benefits, and investments. A financial planner like those at Next Gen Financial can provide valuable guidance in estimating your retirement income.

Yes, emergency funds are important as they can provide a financial cushion in the event of an unexpected expense or loss of income. It is recommended that individuals save 3-6 months’ worth of living expenses in an easily accessible account or fund. A certified financial planner can provide guidance on how to best set up and manage your emergency fund.