4 Types of Financial Planning

Different types of financial planning can aid you in achieving discipline over your finances and a layout a concise direction of where you wish to be in your life. In this article, we’ll discuss the four types of the practice and how sacrificing funds to support them will benefit your life now and in the future.

Different Types of Financial Planning

As with any planning project for your life or small business, it is best to begin as young or as soon as possible. Prudent financial planning may ensure that your spending habits do not exceed the income of your household or business. It might assist with important decisions like personal growth or when to downsize to accommodate more profitable endeavours.


There are many areas where the intelligent use of available funds can benefit your life, but a few of the most common include:


  1. Planning Your Cash Flow and Budgeting

Determining how much money you have to work with is the first step towards comprehensive financial planning. Creating a budget which lists your income after tax against what you spend it on will assist in you taking control of where you spend your money. Prudent budgeting allows you to make harsh decisions in areas where you unnecessarily spend and divert these funds into areas where you may see profit. Following a strict budgeting routine might entail downsizing your home or motor vehicle. Shrewd savings and comprehensive planning now could mean greater profits later.


  1. Insurance Planning

This type of planning involves assessing your risk exposure and developing strategies to protect against or transfer that risk. Utilising some of your newly acquired savings, it is wise to invest in some form of insurance to protect yourself, your family, your assets, your business, and other belongings against loss, injury, or damage. Different types of policies cover varying needs from short-term insurance and general healthcare solutions to dread disease and disability cover, and life assurance. It is a good idea to explore these opportunities to protect your other savings and investments.


  1. Retirement Planning

You will have to protect and grow your income to provide for yourself in your retirement years. This can be done through several avenues. Unit trusts, retirement annuities, equity stocks, and other safe investments are a great place to start, but if you are still young, you could try investments that match your risk profile. However, it is best to take this under the advisement of professionals who understand the ever-changing investment market so as to limit your risk and increase your returns.


  1. Investment Planning

With the aid of specialist certified financial planners and equally qualified investment management professionals, you can start making your money work for you. Through regular saving and shrewd investment planning, you can provide for your future needs, goals, and requirements, like having a baby, purchasing property, your children’s education, and your eventual retirement.


How to Balance the Different Types of Financial Planning

At Efficient Wealth, we have developed comprehensive needs analysis systems so that our expert force of financial planners, investment planners, stockbrokers, and other professional team members can accurately assess your immediate and future financial needs. We believe in life-long relationships, walking with you through the good times and sharing the bad. Compare our services with others, and then partner with us at Efficient Wealth.