Whether you prefer property, shares, business, or even collecting, investment planning is what will get you to your financial goals.
Without investment planning, you don't know where you are going. It would be like going to a new country without a plan for what you wanted to see, or even carrying a map! Once you create a plan, you will have a clear idea of what you want from your investments. This should guide you to plan the best way to get there.
Financial planning is something that everyone should practice at least once every twelve months.
The end of your country's financial year is often a good time, because this is the time when you have to pull out most of your bank statements, share certificates, superannuation and funds to take them to the tax man. It's time to take stock, see what you have earned, what you have spent and what you might (or might not) have left over.
It's not difficult to do financial planning yourself, but you can also take your details to a certified financial adviser. Make sure you find a good one - ask around, do research, and don't jump in!
Remember - an investment plan is just a plan.
It doesn't have to be written in stone and carried out to the letter.
I don't mean you should write it and forget about it, but circumstances do change! Everyone knows that the Great Financial Crisis of the early 21st Century has affected billions of people around the world. Jobs change or disappear, as do relationships. Children are born, we move house, and we have to direct funds elsewhere...
The thing is, these changes in life should always be prompts for you to turn back to your investment planning.
Whenever something changes in my family's finances, I turn back to our budget and have another look. A budget is the starting point for all investment planning. I see what I can save here, afford to spend there, how much we can afford to spend on entertainment (without going crazy overspending, or from a lack of it!), and how much can be redirected towards our investments.
The aim is to have that grow over time, so that eventually, our investments keep feeding themselves!
What is involved in investment planning?
There are lots of factors to consider, but these are the steps you should take to developing a solid financial plan for your future:
I've put together a few pages of my own ideas about these subjects, and a few more, but if you want to find out more, I suggest you visit Your Money and Finance.com where you can find a whole site full of ideas and free tools to help you with your investment planning, how to make the most of your money, and how to make more of it.
In this section: