FINANCIAL PLANNING PROCESS

Define and Develop Financial Objectives - the first step in creating an accurate and workable financial plan is defining what it is you wish to accomplish from a financial perspective.

Information Gathering/Discovery Process - the second step involves determining your starting point with respect to your goals. What have you done so far? How have you invested? How do you typically go about making financial decisions? Just where are you exactly, today, in relation to the goals you established in the first step of the process? The key source documents are your tax return, net worth, cash flow and investment statements.

Quantitative Financial Analysis - the third step is the raw number crunching of comparing the actions of your financial past with the projections of your financial future. Are you on track for achieving your goals or not? This involves extensive computer modeling within the six key areas of financial planning, both in terms of future cash flow projections and portfolio allocation.

Qualitative Financial Recommendations - the fourth step takes a small step back from the numbers and incorporates the art of financial planning. Like it or not, there may be solutions which would apply to your situation that you aren`t willing to do. A workable plan should take into account you level of investment experience, risk tolerance, comfort level with the process etc. This is what creates a truly custom document.

Implementation - the fifth step is where you finally make some decisions based on the analysis and DO SOMETHING! The process of financial planning is worthless without the accompanying action which moves you toward your objectives. This may involve modifying cash flow priorities, re-balancing assets, changing tax filings, or meeting with an attorney for necessary legal work.

Ongoing Review - revising the plan as plans change as well as your overall situation, tax laws, investment strategies and so forth. No matter how good your plan is, it should be reviewed at least every three years to make sure you are still on track.