Financial Planning

Financial Planning

Financial Planning is only for people with so much money, they don’t know what to do with it, right?

Actually, studies show that a comprehensive financial plan can benefit people at all income levels. Not a lot of South Africans know this.

Comprehensive financial planning covers savings and investments; planning for retirement, education, emergencies, major purchases, and other financial goals; and insurance needs.

But few people have plans in place to cover even a part of their finances. Few people have a plan to meet any of the savings goals, such as for emergencies, retirement, a child’s education or a down payment on a house.

The way you get into the higher income bracket is to have a financial plan. And don’t dismiss financial plans as being for older people. In fact, it is recommended that people in their 20’s have financial plans, to help prevent them from making financial mistakes.

If you look at people who are financially successful, most of them have been making very smart financial decisions all their life. The sooner you start making smart decisions, the sooner you know where you want to go, and if you have a plan to get there, the more likely you are to attain it.

Time is the one thing nobody can give us. If you start in your 20’s, you don’t have to save that much. The longer you wait, the more you must save to make that goal. The more time investments have to grow, the less money an individual needs to put away in order to achieve the same returns as someone who gave their money less time to grow. This principle is especially helpful for long-term savings goals such as retirement.

Here are ten reasons to get a comprehensive financial plan if you don’t have one yourself:

1 – It will help you define your financial goals.

Most financial planners will begin your plan by asking you what your financial goals are. For couples, sometimes doing this exercise alone is enough to get the two partners on the same page. Most people spend more time planning their vacation than planning for retirement or for their financial goals.

2 – It will help you see whether your goals are realistic, especially for your timeline.

After looking at the goals, the financial planner will look to see how you can get there — how much to save, what types of investments to make. Then, the financial planner can do a cost-benefit analysis. Are your goals realistic? Are they attainable? Most of us have more goals than financial resources, and time is a huge factor. It’s usually not that the goal is not attainable, it’s that the timeline is not attainable, noting that many goals, such as saving for retirement, a down payment on the home, a child’s education and paying off debt, take years to accomplish.

3 – It will help you see how you can bring your spending in line with your goals. 

Once you know where you’re headed and how long it will take to get there, then you can look at your cash flow to find out if you’re spending more money than you’re bringing in. If you have negative cash flow, there’s no way you can meet your goals. The exercise of analysing expenses often surprises people. “They say, ‘I had no idea I was spending that much on take always or eating out”.

4 – It will show you what money mistakes you’re currently making.

Aside from spending too much, analysing not just spending but the overall financial picture sometimes exposes mistakes — and easy fixes. Sometimes people look at their credit card debt and say, “I’m paying 21% on interest to a bank. Am I making anywhere near 21% on any of my investments?”

5 – It will allow you to measure your progress on your goals.

Once the plan is in place, you can set up measurable goals, such as regularly contributing a specific amount of money toward either savings or debt over a period of time. During the annual review meeting with the financial planner it will be assessed if your financial objectives were achieved.

6 – It will help you find new ways to maximise your money.

Having an expert look at your financial picture might reveal opportunities to make or save money that you hadn’t thought of.

7 – It will help you identify risks you hadn’t thought of.

Part of a financial plan is looking at risk capacity: What is your risk of becoming disabled and being unable to support yourself or your family, or dying early and burdening your family with an un-manageable bond payment? If you die without leaving a will or if you leave an invalid will, your heirs will inherit from you in terms of the Intestate Succession Act, Act 81 of 1987. This Act applies to all South Africans – regardless of race or culture. Intestate succession are the “rules” that are applied in terms of the Act, to determine who will inherit your assets if you leave no will. This can mean that certain people may inherit from you that you maybe did not want to inherit from you.

 8 – It will make you more confident with your money. 

People who engage in comprehensive financial planning feel closer to achieving their life goals. To achieve these goals you need a trusted, experienced person who can help you plan and manage your financial life. People also feel a new sense of discipline. “I know what I need to do to achieve my goals. I don’t feel like my life is out of control anymore, but I’m in control.”

 9 – It will help you build wealth. 

Those with a plan also have more money saved and are more likely to pay their credit card bills in full.

10 – It will help you live more comfortably.

Those with a plan are also more likely to say they are living comfortably. While you don’t necessarily need to hire an outside person to create a financial plan for you, a lot of people do so to save themselves the time and energy of sifting through a lot of advice, some of it potentially contradictory.

If you have any questions, please complete the contact form with your details and we’ll call you.

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Thank you so much for all your support and help. You lot are really a friendly bunch

of people. With service like this your company will be Blessed.

Thank you for every one that helped me get this done.

Testimonial of

~ Naomi Lombaard ~

Thank you for getting reports and scans from my doctors on pre existing conditions

and for getting my waiting periods wavered. You guys are great!

Testimonial of

~ Almarie ~

Thank you for your excellent service, advice, enthusiasm and speed of

service – it has been a pleasure dealing with you.

Testimonial of

~ Sharyn Rook ~

Thank you for all your assistance over the time and all the follow-up phone calls.

You are surely the best advisor I’ve come in contact with.

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~ Lizette ~