Traditional financial planning is all about calculation and money. You look at how much you earn and what are your expenses. You figured out the amount you will require later on to fulfill your needs and keep up the desired lifestyle. Then comes up an investment plan that will help you to reach your desired goals. The procedure for the most part about as exciting as balancing a cheque book and as emotionally draining as paying taxes.
Unluckily, many individuals pick not to manage everything, choose to put off stressing over the future until it arrives. Others approach the procedure with a kind of abdication born of the way that, besides death and expenses, your bills are simply one more piece of life – they should be managed in light of the fact because you don’t have much choice.
In any case, there’s a minority of people that are taking an alternate strategy. It goes by a variety of names called “life planning”. Life planning is not the same as traditional financial planning because the concentration is more about who you are and what are your dreams. Unlike individuals engaged with traditional planning, individuals engaged in life planning don’t look forward with an end goal to make sense of how to keep up their present lifestyle in retirement. Rather, they look at how to change their present lifestyle to accomplish the lifestyle they had always wanted.
Read on to find how you can utilize this approach to financial planning.
The Ideal Lifestyle:
Many individuals credit the I.T. boom for this trend. The former educated children who grew up and were consumed by corporate MNC’s. They are used to the new techniques for work, business, and callings. Similarly, as the boomers re-imagined their “golden years” as an opportunity to be more dynamic than their ancestors. Some people want to go above and redefine themselves. And for some, it’s a lifestyle change that is similar to retirement planning.
Every individual who has a dream of buying a car, owning a house, and give higher education to their children. They are turning to financial advisors for help in making those dreams come true. Obviously, the money plays a big role too.
Money and Sacrifice:
There’s simply no getting away from the money. Everyone wants enough money so that he can fulfill his desires and goals. By daily savings, he can fulfill some of his small needs. But for big dreams like owning a house and car, he has to work with a Financial Advisor. The advisor will help them to realize their goals and develop a financial plan to reach their desired goals.
Rather than trying to earn more money or build a big house, people need to minimize their expenses to achieve their goals. It enables people to trade in their day jobs for lower paying, but personally-fulfilling, professions, and past-times. When you don’t like what you’re doing and know how you’d rather spend your time, life planning can help you make the transition.
It’s Your Life:
If your goal is simply retirement and still be able to pay the bills and other expenses, that’s one thing. If your goal is to trade in your job in the city for the job of your own business, that’s another thing entirely. Instead of asking yourself, “How much do I need to save,” ask yourself, “How am I willing to change my lifestyle in order to achieve my goal?” From there, you can save a certain amount of money and earn a certain rate of return on your investments.
Prior to taking the leap, you should carefully examine your motivation and your financial resources. Then all you have to do is come up with the plan that will get you there.
