Importance of Financial Planning - A Key to Wealth Creation
23 Jun 2022
Financial goals are crucial in our lives be it child’s education / marriage, owning a house or family car, planning for post-retirement income. With proper financial planning you can devise an accurate plan to achieve these objectives in a timely manner.
- Define goals and categorize them as short-term (like pay off debt, house repairs, buying a car), medium-term (down payment on a home, starting your own venture), long-term goals (child’s college education or marriage, post-retirement income plan ).
- For each goal, specify a value and a target date. The more specific your goals, the easier it is to measure your progress.
- After finalizing the goals with a definite number, chart out a financial plan with suitable investments like equity funds / hybrid funds / debt funds.
- Regular review of financial plan is crucial so that you are on course to achieve your goals.
An illustration
Rahul is planning to save for his child’s education. Here is how a financial plan based on mutual Fund SIPs in equity funds can help him achieve his goals.
SIP
| Amount | 5 Years | 10 Years | 15 years | 20 years |
| 5,000 | 390,412 | 1,032,760 | 2,089,621 | 3,828,485 |
| 10,000 | 780,824 | 2,065,520 | 4,179,243 | 7,656,969 |
| 15,000 | 1,171,236 | 3,098,280 | 6,268,864 | 11,485,454 |
Popular Infographics
Tag Clouds
Related Infographics
-
Disclaimer
The contents of this article/infographic/picture/video are meant solely for information purposes and do not necessarily reflect the views of Bank of Baroda. The contents are generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. Bank of Baroda and/ or its Affiliates and its subsidiaries make no representation as to the accuracy; completeness or reliability of any information contained herein or otherwise provided and hereby disclaim any liability with regard to the same. The information is subject to updation, completion, revision, verification and amendment and the same may change materially. The information is not intended for distribution or use by any person in any jurisdiction where such distribution or use would be contrary to law or regulation or would subject Bank of Baroda or its affiliates to any licensing or registration requirements. Bank of Baroda shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information mentioned. Please consult your financial advisor before making any financial decision.
Leave a Comment
Thanks for submitting your details.