Financial Planning - PowerPoint PPT Presentation

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Financial Planning


Financial Planning Financial Planning ?? Financial Planning is the process of meeting your life goals through proper management of your finances. – PowerPoint PPT presentation

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Title: Financial Planning

Financial Planning
Financial Planning ??
  • Financial Planning is the process of meeting your
    life goals through proper management of your
  • Goals may include buying a house, business setup,
    higher education of children, retirement planning
  • Financial Planning provides direction meaning
    to the financial decisions. It helps to evaluate
    the impact of financial decisions on other areas.

Financial Planning Overview
  • Need for Savings
  • To fight / hedge against inflation
  • Growing dependency on savings with time
  • Meet the goals / objectives of life
  • Three Rs of Money
  • Reality money is limited
  • Responsibility use it wisely
  • Restraint think of Future

Why Plan ?? Life Cycle of Client
Why Financial Planning ??
  • Multiple goals / needs / desires
  • Limited resources at disposal
  • Increased uncertainty and complexity in life
  • Increased complexity in investments and presence
    of multiple products

Financial Independence / Self Reliance / Peace of
Financial Planning Services
  • As Wealth Managers you offer Financial
  • Planning services to your clients
  • A real financial advisor
  • Value-added Differentiated services to the
  • Additional business mobilisation
  • Customer Acquisition
  • Customer Loyalty retention
  • Differentiation Branding
  • Customer References

Financial Planning Scope
Inheritance Planning
Capital Management
Charity Planning
Life Insurance
Cash Flow / Budgeting
Non-Life Insurance
Liability / Credit Planning
Investment Planning
Risk Management
Tax Planning
Goal Planning
Disability Planning
Retirement Planning
Business Capital Planning
Risk Profiling
  • Every person has a unique personal, family and
    financial situation. Their decisions depends on
    this uniqueness.
  • Each investment is coupled with certain risk
    element and each person responds to risk
  • The amount of risk a person is willing to take
    depends on several factors such as his age,
    education, income, number of dependants,
    personal/ family goals and his mental attitude
    towards money.
  • The mental tolerance of a person in his mid-30s
    with a working wife and a kid would be much
    higher than a person who is retired and has
    dependant wife and aged parents. Hence, judging
    the risk tolerance of a client is an important
    step in financial planning.

Risk Profiling
  • Risk tolerance is the risk-taking ability of an
  • Risk Profiling is a method used for
    determination of risk tolerance of an individual.
  • Risk Profiling includes a questionnaire with
    weights attached to the answers selected. The sum
    of weighted answers shows the risk tolerance of
    the client.
  • Chief determinants of Risk Profile are
  • Age Group younger the person, higher risk
  • Investment horizon higher risk for long term
    plans (LIC)
  • Purpose of investment capital growth, regular
    income etc
  • Volatility market fluctuations affect investor

Financial Planning Process
Financial planning is the process of establishing
personal and financial goals and creating a way
to reach them
Establishing Defining Relationship
Data Collection, including goals
Evaluation Preparation of Plan
Presenting Finalizing Plan
Recording / Implementation of Plan
Regular Monitoring
Financial Planning Skills
  • Traits
  • Trust
  • Knowledge
  • Products options
  • Tax estate planning
  • Understanding Life Wealth cycles
  • Judgment
  • Balanced thinking
  • Organised
  • Relationship building
  • Focus on Financial well-being of client
  • Principles
  • Integrity
  • Objectivity
  • Competence
  • Fairness
  • Confidentiality
  • Professionalism
  • Diligence
  • Compliance
  • Terminology
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