Hence, planning for retirement financially has to be thought of before it is too late. Many people have not planned for their retirement so they suffer from consequences. Many people will tell you that you should never waste time and money in making investments. Some companies will just close and take your money for good. On the other hand, there are also other people
Planning for the future is more important than most people actually realize. Having a future plan helps make individuals focus on goals they should obtain. Also planning for the future is an effective way to stay out of debt. Despite it seeming like future years are an eternity, it is right around the corner. It is better for you and everyone you are responsible for to plan out investments as well as calculate potential loses that may occur.
Personal financial planning, also called personal financial management, is the process that allows you to plan and manage your financial affairs in order to achieve personal economic satisfaction (“Personal finance basics,” n.d. p. 2). In other words, it allows you to control your financial situation and to plan your spending. It can also help you anticipate financial problems and manage them effectively. Why is a financial plan needed? Because it can help you lead a better life and can assist you in reducing uncertainty about your future (“Personal finance basics,” n.d. p. 2).
COULD YOU SAVE YOURSELF TO AN EARLY RETIREMENT? Do many people dream of being able to retire early? By early I mean before even being eligible to draw down from a private pension. I actually think that a lot of people do have this dream but discount it because they think that they would never be able to manage to save enough money to live on for an extended period of time. Obviously the amount of money you would need varies considerably depending on the kind of lifestyle you are likely to want during your retirement; if you are thinking in terms of travelling the word in luxury style then you really do need to plan for a hefty pot of gold, however, should you be hoping for a relatively simple life then your income could be substantially lower and far more feasible.
“Who or what has positively influenced you in taking the step to pursuing your education and career goals?” What benefits do you think you can gain by planning your future at an early age? For me, I think having an early start lets you focus on what you really want to be in life. It helps to build self-confidence as well as your character. Future planning is not just about saving money to build a house and a family nor is it just about finishing school and getting a job to pay the bills. It is a step by step procedure which helps to achieve goals within your life and making sure that those steps benefits you in some way.
You may also need to support a partner or other members in your family. People are living more healthy and active lives after retirement so it is important to know where your income is coming from when you retire. Many older people live in poverty because they haven’t been able to save enough. The help offered
Then we invest some of the savings amount in different assets and try to make a profitable portfolio to avail benefits in future. This concept of savings and investments sounds effortless but it’s not a child’s play. It is interesting but at the same time complex too. It’s not everyone’s cup of tea. When we face investment decisions, our mind starts questioning, what is my objective for investment, where to invest, how much invest, when to invest, how long to invest, etc.
And I know the final question to ask myself based on the type of life I want to create for myself: What is the one thing I would want to spend every single day of the rest of my life doing? If you’ve figured out your life goal, with some time and pondering, you’ll figure out what your final question is and that will cut off most of the options from your list. Something to remember is no matter what you decide to do in life, you will face hardships and there are things you will have to sacrifice along the way. You just have to pick something worth sacrificing everything else for. So instead of looking at “What do you want to do with your life?” as a 100 mark Higher Order Thinking Skills (HOTS) question - even if we all know it is.
Identifying Goals and Risk Tolerance: We need to think about why we are investing, before acquiring shares in any fund. What are its financial goal? Are long term capital gains desired, or is a current income preferred? Will the money be used to pay for college expenses, or to supplement a retirement that is decades away? Identifying a goal is very important it will help us right fund to take.