Investors and advisors can create a financial planning strategy for any portion of an investor's portfolio.
“Winging it’’ sounds like fun if you are going on a road trip, but for matters of personal finance, it is better to consider a financial planning strategy to get where you want to go.
Setting a financial planning strategy is not only good for the investor, it is good for the advisor helping to device the strategy. Spectrem’s Perspective on the relationship between investor and advisor – How Financial Advisors Can Increase Client Satisfaction and Loyalty – shows a direct relationship between the planning that takes place in financial concerns and the level of client satisfaction reported by investors. In some cases, the level of satisfaction is double between those that have strategy sessions with advisors and those that do not.
There are financial planning strategies for the purposes of personal budgeting, estate planning, tax matters, retirement or savings plans.
Most households should probably start with a cash flow management strategy, determining how much revenue they get and when it comes in versus the necessary spending that accrues, again with an eye toward when the bills are due or when the spending is done. This financial planning strategy will immediately determine what discretionary spending is available for the next strategy that comes up.
The next financial planning strategy that many households undertake is saving for the future. Whether it is college costs, or a new home, or retirement, a savings plan is usually required to make any of those things happen the way you want.
Many households wish to increase the amount of money they have for personal budgeting and saving for the future, and that requires an investment plan. Income that is earned through investment can be used to increase savings accounts, or can be reinvested to gain even greater wealth.
An investor who wants advice about these types of plans can get assistance using Millionaire Corner’s Best Financial Advisors search service.
Owning a business is not unlike having children, especially when finances are involved. A business plan can help improve business through investment while keeping an eye on costs and adjusting spending when and where it is possible to do so. Matters to be dealt with include funding for new or improved equipment, employee costs, tax considerations, and future business needs.
Caring for a child financially is similar. The immediate costs are something that is considered with a cash flow management strategy, but caring for their future, either in terms of college or estate planning down the line, requires a different form of financial planning strategy.
No matter what the reason, many investments have different tax considerations, and a financial advisor would be able to help with determining what is the best financial planning strategy for making as many dollars go as far as possible.
Kent McDill is a staff writer for Millionaire Corner. McDill spent 30 years as a sports writer, working for United Press International and the Daily Herald of Arlington Heights, Ill. From 1988-1999, he covered the Chicago Bulls for the Daily Herald, traveling with them every day through the nine-month season. He also covered the Bulls for UPI from 1985-88, and currently covers the team for www.nba.com. He has written two books on the Bulls, including the new title “100 Things Bulls Fans Should Know And Do Before They Die’, published by Triumph Books. In August 2013, his new book “100 Things Bears Fans Should Know And Do Before They Die” gets published.
In 2008, he resigned from the Herald and became a freelance writer. The Herald hired him to write business features and speeches for the Daily Herald Business Conferences and Awards presentations.
McDill also writes a monthly parenting column for the Herald’s Suburban Parent magazine.
McDill is the father of four children, and an active fan of soccer, Jimmy Buffett and all things Disney.