w h a t i s f i n a n c i a l m a n a g e m e n t ?

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10 Νοε 2013 (πριν από 3 χρόνια και 11 μήνες)

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wh a t i s f i n a n c i a l ma n a g e me n t?

Introduction

Financial Management can be defined as:

The management of the finances of a business / organisation in order to achieve financial
objectives

Taking a commercial business as the most common organisational
structure, the key objectives of
financial management would be to:

• Create wealth for the business

• Generate cash, and

• Provide an adequate return on investment bearing in mind the risks that the business is taking and
the resources invested

There are t
hree key elements to the process of financial management:


(1) Financial Planning

Management need to ensure that enough funding is available at the right time to meet the needs of the
business. In the short term, funding may be needed to invest in equipmen
t and stocks, pay employees
and fund sales made on credit.

In the medium and long term, funding may be required for significant additions to the productive
capacity of the business or to make acquisitions.

(2) Financial Control

Financial control is a crit
ically important activity to help the business ensure that the business is
meeting its objectives. Financial control addresses questions such as:

• Are assets being used efficiently?

• Are the businesses assets secure?

• Do management act in the best inter
est of shareholders and in accordance with business rules?

(3) Financial Decision
-
making

The key aspects of financial decision
-
making relate to investment, financing and dividends:

• Investments must be financed in some way


however there are always finan
cing alternatives that can
be considered. For example it is possible to raise finance from selling new shares, borrowing from
banks or taking credit from suppliers

• A key financing decision is whether profits earned by the business should be retained rath
er than
distributed to shareholders via dividends. If dividends are too high, the business may be starved of
funding to reinvest in growing revenues and profits further

Financial advisor

A
financial adviser

(UK spelling) or
financial advisor

(US spelling),

is a professional who renders financial
services to individuals, businesses and governments. This can involve investment advice, which may
include
pension

planning, and/or advice on
life insurance

and other insurances such as
income
protection insurance
,


Fin
ancial planning



Financial Planning




Budget & Save




Build Wealth




Protect What You Have




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Must Reads



Dealing With a Financial Emergency




How to Create a Budget




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Financial Tools


Getting O
ut of Debt

Learn How to Manage Your Credit and Get Out of Debt

Debt is a problem for many people and it isn't always easy to overcome. Find out how you can
overcome
your debt.

Read more

Further Reading



How to Establish Credit




Get Your Free Credit Report




Break the Minimum Payment Habit

Buying a Home

Buying a home is one of the largest financial decisions you'll make so it pays to make sure you're
making the best decision and getting the most for your money. You'll need to

consider a
mortgage, insurance, and the fees involved with buying a home.

Read more

Before You Buy Your Home



How Much Home Can You Afford?




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The Fees Involved in Buying a Home

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Getting the Most Out of Financial Aid for College

Sunday September 5, 2010

It's that time of year again. Most college students are back on cam
pus and starting on another
new school year. This means finding money for tuition, room and board, books, and spending
money. College can be expensive, so finding the funds to pay for it all can be quite a task.
Luckily, for many people, there are various
sources of financial aid that can assist in making this
a reality.

There are a various forms of
financial aid

available, from federal grants and scholarships, private
loa
ns, and federal student loans. These sources of funds can ease the burden on both parents and
students. Another alternative which may have attractive tax benefits is the
Sect
ion 529 Plan
.
These plans allow you to invest money tax
-
deferred and realize the gains tax
-
free if used for
qualified expenses. Not only that, but many states even provide tax credits for making
contributions into these plans. And don't forget, even
many U.S. savings bonds are eligible

for
tax breaks when used for college expenses. So, make sure you check out all of the options
available to you.



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Beware of Payday Loans

Tuesday August 31, 2010

When times are tough and you're looking for any financial help you can get, it's only natural

to
start thinking about some alternative forms of financing. While payday loans and cash advances
can really help you in a bind, it's important you really understand what you're getting yourself
into. It's quite possible to find yourself digging an even d
eeper hole while attempting to just get
through a few rough weeks. So, before jumping into a
payday loan

take a few minutes to learn
how they work, what

they really cost, and what alternatives you may have available.



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How to Set Financial Goals

Saturday August 28, 2010

The first step in personal financial planning is controlling your day
-
to
-
day financial affairs so
that you can do the
things that bring you satisfaction and help you reach your goals. This is
achieved by planning and

following a budget
. Controlling spending, saving money, and investin
g
for the future are all important aspects of financial planning, but those things mean nothing if
you don't have specific goals that you're trying to reach. In order to gauge your financial success,
you need to have goals so that you can measure your succ
ess. The second step in personal
financial planning is choosing and following a course toward long
-
term financial goals.

The four steps to setting financial goals:



Identify and write down your goals.



Break goals down into short
-
term and long
-
term goals.



Educate yourself.



Evaluate your progress.

More information on setting financial goals
.



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Comparing the Different Types of Life Insurance

Frida
y August 20, 2010

Life insurance is an important aspect of almost every financial plan, but how can you make sense
of all the different policies available? Everyone seems to have their own opinion, and
unfortunately there are also a lot of insurance salesm
en who may be more inclined to earn a
commission than to put you in the best type of policy. So, it's up to you to understand how each
type of policy works so that you can decide what's best for you.

Here's a quick overview of the four most common life insurance policies

with advantages and
disadvantages of each. If you're informed when shopping for insurance you can be sure to get the
best policy for your needs and b
udget.






Sound, Powerful Personal Financial Planning in India for Salary Earners...

About Us

|
Contact Us

|
FAQ

|
Privacy Policy


Are You Also Wasting Your


Financial Potential?



If Only You Act Fast, You Too Can
Surpass Your 'Ambitious' Go
als…



Y
es, that's right. This is absolutely
true.

And we can assure you that once
you read this message fully, you will
realise its true implications.


You can move away from your Auto
Sweep at your bank, visualise your
goals and needs over your future
years and set off on your path to
achieve each of them based on a
well thought out plan of action.


Yes, you needn't take unnecessary
financial risks and needn't curtail
your normal expenses.


What's the magic then?


In a way you can call it magic. But
fac
tors are more than one.


Does it interest you?


We will tell you in details…

Our Heartiest Welcome to
You!


We serve you anywhere.


We'd be delighted to make our
services available to someone like
you
at Mumbai
.

But before that do find out how
you can gain immensely from all
this...


You'll discover a few valuable
truths about your money
In
The Next Few Minutes
...

However, you'll nee
d to spare a
little time...

In case you are short of time just
now, you have the following
options

because you just can't miss
gaining these valuable insights...

Add to Favorite


To Read at Leisure, Send This Page
by Email
to Yourself or To A Friend.




Are you aware that you actually earn
a stream of earnings whose worth is
by no means small?




Get This Content Through Small
Length

Email Sequence


Print This Page
in An Easy
-
to
-
Print
-
&
-
Read Version

Happy Reading!

Privacy
Policy:

We do not and will never rent, sell or
share information that personally
identifies you for marketing purposes
without your express permission. No part
of your communication with us or any
personally identifiable information will be
provided to
advertisers.





Any doubts?

We'll prove it to you in a minute...

Do you often get calls with credit card offers?


Does your bank offer you easy personal loans even before
you ask?

Does your neighbourhood Insurance Advisor make it a
point to keep you in
good humour?



And they all represent Big Businesses.

Just shows how much Big Business is ready to bet on you.

Would you not bank on your own financial worth?

We'll show you how you can immensely profit from just knowing how
much you are really worth an
d acting on that knowledge.


Testimonial:

"I was impressed by the diligent preparation and lucid
explanations in a presentation he made at my company. I
later discovered how strictly he sticks to a product's
specific utility to a client while recommending
options."

-

Mr. K Yashwant Nayak, Sr Manager, M&M Ltd, Mumbai.


What Would You Like To Do With Your Extra Money?

∙ Achieve an Education Abroad?

∙ Go on a Memorable Honeymoon trip?

∙ Buy A Dream Home?

∙ Significantly Enhance Your Lifestyle?

∙ Acquire A
Self
-
employed Status?

∙ Settle Your Children in Life?

∙ Ensure an Enjoyable Retired Life?

You can possibly do all of it, or at least, most of it.



And it's not really a tall order...


And, we'd show you how...


But hang on...



Testimonial:

"
Traditional investment methods would be inadequate in
my hopeless situation when I retired. Today, I survive
financially by these scientific methods."

-

Mr. Ashok Kangne, Ex
-
Bank Manager, Mumbai.


How

we can help your finances, and
why

we can help you:

Founded by
Shiv N. Majumdar, FCA
-

trained at Price Waterhouse
Coopers and who has wide experience in industry and consulting
-

Celerity
Consultants, Mumbai
, started in 2000, has its owned office, full
infrastructure and 4
-
member staff.

Its presence is phys
ical too, not merely on the net.

Besides local clients who get serviced from this office, Celerity also serves
clients from other cities in India as well as abroad, mainly through
internet, fax and email interface.

They do not handle your investments or
money, but restrict themselves to
just advising on the best options.

They have a paid advisory service which charges for services irrespective
of the amount you invest. This service has a unique aspect of controlling
your investment risks while pushing up
your returns to a decent level.

Over the years, Celerity's Personal Financial Planning services have grown
to over Rs 20 crores of client funds under advice from investors big and
small.



Testimonial:

" Even with hindsight you cannot match these methods
-

Rs 7.5 lakhs to Rs 32 lakhs
-

that too with careful
investing."

-

Mr. K. Y. Nayak, Sr Manager, M&M Ltd.


Now, First Things First,...

How Much are You Really Worth?




Consider a monthly salary of Rs 10,000 per month. Over a 30
-
year period
this salary
will mean a total earning of Rs.36 lacs. If this entire salary
could be invested at 10% per annum (rate of return) at the end of every
month during this period, this will mean a sum of Rs 2 Crores 23 Lacs 70
Thousands at the end of 30 years. Check the foll
owing table to find out
results for different periods and different rates of return
:


Rs10,000 Per
Month Will
Become


At 10%
Per annum


At 9% Per
annum


At 8% Per
annum


At 7% Per
annum




Rs Lacs


Rs Lacs


Rs Lacs


Rs Lacs


After:










30 Yrs


223.70


182.58


149.73


123.42


25 Yrs


131.77


112.12


95.74


82.07


20 Yrs


75.67


66.96


59.41


52.85


15 Yrs


41.43


38.03


34.96


32.20





The above data give you an idea about the size of your
salary cake

for
the rest of your working life. Creating a fortune would begin with holding
on to
biggest possible slice out of this salary cake...


For example, a person holding on to 10% of his salary of Rs 10,000 per
month for 25 years will have managed to create R
s 11.21 lacs at 9% per
annum, a sum relatively immense for somebody earning only Rs 1.20 lacs
per annum...

This is true at every salary level and at any rate of return on account of
regularity and time value benefits...

Salary earners get known amount of e
arning at known dates. House and
consumer durable purchases are financed through EMIs (equated monthly
instalments) of loan repayments by utilising this known income stream to
make these purchases affordable...

You have to use the same power of salary to
build your wealth, and the
result will obviously be a miracle...



Testimonial:

" Strong conviction, elaborate execution, exceptional
integrity."

-

Mr. S.K. Chakrabarti, Vice President, Bombay Dyeing,
Mumbai.




The Truth About Your Money Now

Let us try to find out the quantum of
real gain/loss

in value of your money
with reference to a 8.5% annual rate of inflation that we should normally
plan against.
A sum of Rs 1,00,000 will be worth the following amounts

after the periods mentioned in column 1 at various rates of returns as
indicated in the following table:

After :

At 10%

At 9%

At 8%

At 7%

10 years

1,14,717

1,04,705

95,486

87,004

15 years

1,22,869

1,07,140

93,306

81,154

20 years

1,31,601

1,09,631

91,176

75,697

25 years

1,40,953

1,12,181

89,094

70,608

30 years

1,50,969

1,14,790

87,060

65,860

**(Tax Effect Not Considered)

Thus, if you are earning a rate of return lower than the rate of inflation,
you will not be actually growing your money...


Similarly, the more the actual growth rate of your money is above or
below the inflation rate, the faster your real money will grow or deplete,
not proportionately...

Read the above sentence again. Try to fully understand what we
are trying to say. This i
nformation is of immense import and most
of us are totally unaware of this...


Testimonial:

" Helps me build my ideas into a cohesive whole plan of
action, clarifies my gray areas, avoids my mistakes
-

most
importantly without risk to my investment."

-

Mr.
Aniruddha Bhattacharyya, Software professional,
Accenture Services, Mumbai.



The Changing Money Game, Fine prints and how They
Affect Your Money


There have been large changes in the investment arena over the last few
years, which all of us have experien
ced but might not have noted in an
overall framework. Let us look at the following for a quick recap:



Change

Resulting in

1.Income tax law
and rates have seen
many changes. More
changes are in the
pipeline.



Lower incentive
to avoid tax




Tax
-
free
incomes become
less attractive




A number of
investments can
reduce Taxable
Income
-

need
for the right
product choice


2.Interest rates
continually coming
down following lower
general inflation rate.



Inadequate
returns to cover
items of higher
price rise

l
ike
electricity
charges,
property tax,
healthcare,
education,
transport costs,
telephone bills
etc.


3.A number of new
banks has come up
and banks are given
freedom in fixing
interest rates.



Numerous
choices of
banks, products,
rates of returns
call for a

process of
shopping even
for keeping
money in banks.


4.PO interest rates
are no longer stable
over a reasonable
period.



Extent as well
as timing of
change is
unpredictable. It
need not be at
budget time or
while
announcing
credit policy or
even the
begi
nning of any
month.


5. PPF interest rate
reduction applies to
both new deposits as
well current balance
of as past deposits.



Long
-
term PPF
depositors
trapped at low
interest rates.
(Partial remedy
available
through
allowable
withdrawals)


6.Higher
voluntary
contribution to PF
affected by PF rate
reduction.



Huge long
-
term
costs by way of
low returns on
deposits that
were not
compulsory.


7. A number of new
Insurance companies
and widely different
Schemes are
available.



Buying right
insurance
policie
s would
need
considerable
analysis and
deciding on the
right choice.


8. Economic situation
continues to be
sluggish in general.
Also, businesses are
now exposed to new
risks.



Even good
companies turn
suddenly bad,
making
company FDs
the most risky
option

for an
investor.


9. Past experience
shows bullish
business sentiments
get completely
ruined by sudden
unforeseen
disappointments.
Only a few years


It is now clear
that all is not
well with our
public financial
institutions held
in high regard
for years mainly
because it
back, investors have
experienced huge
disappointments with
IDBI Flexibonds, UTI
Rajlaxmi, Unit'64,
etc.

represented our
own
government to
us.


10.Mutual
-
fund
industry has
developed at a fast
pace in the last few
years. But at adverse
t
imes, most fail to
make the cut by
performance.



There are about
1000 different
options
available to us,
which widely
differ in risk
exposure,
return
expectations
and taxability.
Moreover, there
are large
differences in
the level of
professional
skills disp
layed
by various fund
managers in
these funds.


11.A number of
changes has taken
place in the rules of
play in the stock
market.



Change of rules
have left many
investors (who
could not read
the implications
correctly)
stranded with
useless scrips
and
hardly any
chance of
recovering
money.


Thus, the above changes bring out a trend...

We notice that we need to unlearn old rules, understand the full range of
available choices and size up each option with latest up to date
information in the light of ou
r own goals, likes and comforts if we have to
take correct decisions...

For most of us this is awesome, or at least confusing...

We'd show you how
you

can deal with this challenge...




Testimonial:

" Agents and brokers have sold me products which often
do

not match my needs. Once I got into this, I identified
and got rid of them for better results."

-

Mr. Saurabh Talwalkar, Software professional, Pune.




Boosting your returns with Insights, Focus…

Thus, the above changes bring out a trend...


We notice
that we need to keep on unlearning old rules, keep abreast of
the full range of available choices and size up each option with the latest
up to date information in the light of our own goals, likes and comforts if
we have to take correct decisions...


For
most of us this is awesome, or at least confusing...


We'd show you how you can deal with this challenge...


Testimonial:

" I completely misread the simplicity of his financial plans,
added a lot of transactional activity and used different
ideas. Finally
I found my results to be much lower than if
I'd stuck to the Plan.

I came back on course in 18 months. These Plans are well
crafted but simply laid out."

-

Mr. Arindam Chattopadhyay, Project Head, Reliance
Comm, Mumbai.


Do You Also Make These Mistakes Wh
ile Dealing With Your
Money?

Those who came to us earlier made one or more of the following type of
mistakes.


Consider if these also apply to you:



Are you satisfied with the amount of attention that you are
able to give to your personal finance?

Or,

do you lack the required time?




Do you depend on your banker to recommend where to keep
your money
rather than personally comparing banks (or
investment options), their rates of returns or their various
products?




How do you decide where to invest? Do you depend on your
friends, relatives and colleagues?

Do you ignore your discomfort or unease that you might not
have chosen your best option?




Or, would you prefer the convenience of checking with your
agent or broke
r to help you decide where and how much to
invest?

Do you discount the possibility that you may end up not have
been presented your best avenue?




Do you sometimes end up choosing an investment product
without full satisfaction because of an impending dead
line
beyond which assured returns would reduce or the attractive
product would no longer be available?




Have you sometimes tried to emulate a friend or a colleague
in investing your money and later on felt disappointed with the
results?




Have you at any ti
me joined a group of friends in taking up a
moneymaking idea and later come to grief?

(Statistics show that most of these ideas are like lottery or
gambling when looked at from the point of view of
Mathematical Probability.)




Would you prefer to decide on

your investments by reading
newspaper and magazines and believe that you would not
miss any relevant aspect on the issue?

(Disappointments with IDBI Flexibonds, UTI Rajlaxmi, or
Unit'64 actually occurred due to overlooked risks.)




Mr. Kale attempted tax
planning decisions on his own and
landed into a tax problem at the time of scrutiny of his tax
return.

He was ignorant of some finer aspects, some of which
ironically were to his own advantage.

In each of these cases, your best interests are somehow in da
nger of not
being served...

Most of you would be taking it transaction by transaction. This would not
bring to focus your long
-
term interests and goals. The best for the
moment is very often not even good in the long run...

We'd show you a better way to ha
ndle your personal finances and how it
is easily available to you...


As you have noted in an earlier section, today's investment scene is
diverse and options are many. You need to devote a vast amount of your
time to be able to make the best choice...


We
'd show you a better way to handle your personal finances and how it
is easily available to you...


Is it a good time to start investing seriously?

We do not depend on timing our investments. The time horizon is also
long term. Therefore, this question is
not appropriate for our type of
work...


Our best performance has been when there is a downside risk. On this
count, our early clients have benefited immensely from our methods...

How We Helped Others Like You:

We apply systematic methods to steer you
clear of investment risks, at
the same time harnessing rich, rewarding returns for you...


It has taken us years to develop an effective method to understand,
analyse, categorise and effectively deal with risks to your money...


There is sound scientific
basis to all this. While it is impossible to find risk
-
free avenues, we shall choose for you building blocks which will carry
some types of risks which will be actually irrelevant in your specific case...


We shall also apply our secrets on creating the m
ost efficient investment
mix for you. We are constantly scanning all available choices with a
microscope...


We draw encouragement from the fact that every one of our clients, who
has come to us, is happy about our scientific methods as well as the
results

obtained. They are also appreciating our conservative approach
and honest commitment...


We are proud to exceed expected results in all individual cases in the last
6 years. It was actually a difficult period for investments in India...


Initially set
up to help VRS optees, word
-
of
-
mouth has brought us clients
among NRIs, normal retirees, senior Corporate Executives, salary earners
and others...

How you can set off on your high growth path:



o

An overall Personal Financial (Strategic) Plan rather than a
framework for decisions on each transaction with short term
focus. With this, you set out on your path to create your
fortune...


o

A Financial Plan which will take into account your specific
financial situation, earnings, responsibilities, likes and dislike
s,
fears, hopes, aspirations and concerns. In this way, you will
determine your safety and liquidity requirements...


o

A Financial Plan which is not only to your taste but also finally
personally approved by you. You are not being enrolled for a
standard Pl
an...


o

A realistic improved return ( 6% per annum or more higher
than normally available returns, i.e. 13% or more vis
-
a
-
vis 7%
per annum bank interest) due to informed and scientific
planning rather than sky high expectations akin to gambling.
Your rate o
f return will depend on your chosen level of
investment risks...

o

A scientific methodology, which will effectively comprehend,
analyse, categorise and deal with various risks to your money,
so that only chosen types of risks (irrelevant to your goals)
may b
e tolerated...

There will be an ongoing review of your investments made in pursuance of
the Financial Plan...



Testimonial:

"I must admit to have made a very costly mistake in not
following some of the recommendations. My good results
from the Planning wo
uld have been spectacular if I had
followed them."

-

Mr Subramaniam, Ex
-
Assistant General Manager, State
Bank, Mumbai


What else you can expect



We guarantee "no clash with your interests". We would neither
handle your money nor have any direct or indirect

interests in
selling or distributing any personal finance product to you...



A way of life which will take away the last
-
minute decision
making to save tax or to take advantage of an option which
will no longer be available...



A way of life that will be im
mune to manipulative push from
personal finance product sellers or incomplete media stories...



A higher return ensures a more effective hedge against
inflation over the longer run...



You will get highly tax efficient returns involving little or no taxati
on
related to investment income...

Evaluating Your Benefits:



You are
in safe hands
. There can be no clash with your interests...



You can say "Good Bye" to groping in the darkness on your personal
finance matters. With a Personal Financial (Strategic) Plan in hand,
you are virtually in control
...



You are able to earn
substantially higher returns

(at
15%

per
annum or more, you are
7%
per annum or more higher

than
generally understood safe levels of bank interests)
along with
comfort about safety

of your money...



You
need not worry about missing opportunities

because
investments that fit your personal plan are already considered and
inc
luded...



Your Personal Financial Plan will ensure that you earn more than
applicable inflation rate and do not lose your purchasing power. Your
worries about interest rates can be a thing of the past
...



You
can stop worrying about

stepping into prohibited
areas in
terms of
investment risks.
The risk control mechanism will ensure
that
no
h
arm comes your way from
overlooked risks

as had
happened with IDBI Flexibonds, UTI Rajlakshmi or Unit'64 to
many...



Personal Financial Planning includes your planning for y
our
tax liabilities. You will, therefore, not need to do any
separate Tax Planning exercise
...


If you can
save and invest Rs 30,000 per month

based on a Personal
Financial Plan, you are likely to benefit in the following way:

Earnings after:

At 15%

At 7%

Gain

Real

Gains

1st year

29,250

13,650

15,600

19,695

2nd year

1,16,888

69,750

47,138

68,062

3rd year

2,71,671

1,55,751

1,15,920

1,62,645



**(Real Gains take into account the fact that Bank Interest is Taxable)

Similarly,
every Rs 10 lakhs

of your existing savings invested according
to Personal Financial Plan will fetch you
an annual benefit of Rs
101,000 in the first year itself
...

This is

owing to your
gains on account of better Tax Planning
. You
are likely to have little or no Tax Liabil
ity on account of the investments...

Moreover, the Risk Management Tool is invaluable

(anything similar
is not readily available) and in absence of a better tool should be
considered as an
insurance against potential losses
...

Thus, substantial financial b
enefits can result from drawing up a
Personal Financial Plan for you, apart from the peace of mind you
get as a result of managing your money in an informed and
scientific way...




Testimonial:

" Novel methods, sound reasoning power, very educative
every
time. Makes it really easy for a layman."

-

Mr. V. K. Mehendale, Ex
-
Sr Manager, State Bank Of India,
Mumbai.




How Putting off Your Decision Will Play Out for You:




Opting for a Personal Financial(Strategic) Plan will help you to
deal with your lack of time.
It will free up your time for
pursuing your other interests.

This is a valuable gain to you...



It will bring to focus your goals and anxieties and your
personal
finances will be geared towards meeting your
personal needs
-
both present and future. You will deal with
your money efficiently without taking up unreasonable risks.
You will create a fortune for yourself at a pace with which you
will be comfortable...




You

will also be paying
no(or negligible) taxes on your
investment returns...




You will take away hurried decision
-
making and piece
-
meal
viewing of your personal finance for ever...



The entire process will bring quiet and peaceful efficiency into
your
life...




You can join the group of people already benefiting from such
an exercise...




Since it entails a substantial financial benefit and reduction of
hassles for you, putting off this for tomorrow can be costly in
terms of your missed benefits...



Beca
use your investment returns gather pace as time passes, the
annual return in later years are ever larger.

So, when you delay investing by a year what you miss is the last
possible year's return.

For example, if you have 5 or 10 years of investing possible

and
you delay by a year, your 5th or 10th year, as applicable, just
evaporates.

You will be missing not the first year's return, but that applicable
to your 5th or the 10th year as is the case.

Imagine that you considered investing Rs 10 lakh today. If you
had only 10 years of investing available today, if you miss your
10th year you will be poorer by Rs 2.30 lakh even if your
investment return is only 10% per annum.


Larger amounts, longer avail
able periods and higher targeted
return will involve proportionately more missed benefits...





YES!

I Do Not Want to Waste My
Financial Potential.

I Want to Find Out More About
My
Personal Financial Strategic Plan

Right Now!





I have made sure that my
money
would at all times be under my own
control.




I noted that I can enhance my
financial position to levels far
beyond my imagination as it
becomes possible to manage my
personal resources in a far more
efficient way.




I realize that I will have to
compl
etely avoid far too expensive
mistakes arising out of any
impulsive decisions on investing or
of investments resulting from
inadequate advice.




I have to strictly scrutinize inputs
from television reports, newspapers,
magazines, friends or family
members.




I am relieved that it is not necessary
to take recourse to risky options for
sustained gains from long
-
term
investing.



In fact, risky options may harm my
sound long
-
term prospects.




I understand that in order to obtain
substantial returns while avoiding
unnecessary risks to my money,
professional inputs resulting from
deep insights and tight focus would
be essential.




I am entitled to receive professional
advice and care of high quality,
which will strictly follow scientific
methods of investing; solely f
or my
own long
-
term interests and that
there is no unreal promise of a high
return.




My Strategic Personal Financial Plan
will take into account steps for
lowering my income tax liability.




I will also receive advice for a whole
year based on regular monit
oring of
my investments.


To Get Started with Your Personal
Financial (Strategic) Plan NOW
, you
need to click below to

mailto:sound@soundpersonalfinance.com

with your contact details.

The Sound Persona
l Finance team will
get in touch with you soon to guide you
through your next steps.








For Consultation With Appointment,

You Also May Contact:



Shiv N. Majumdar,

Personal Finance Consultant,


At


Celerity Consultants,

A
-
6, Nityanand Co
-
op
Society,

Next to Amruta Restaurant,

Uthalsar,Thane,

MUMBAI 400601, INDIA


Phones: 022
-
2547 5908, 098692 04793

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Us

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Copyright© , 2003
-
2006, Celerity

Consultants, Mumbai, India, All Rights Reserved








Home

Financial Consumers

Learn Financial Planning Basics






What is Financial Planning?






The Benefits of Financial Planning






Who is a Financial Planner?






Can you do your own Financial Planning?






Be sure you're getting Financial

Planning advice






How to make Financial Planning work for you?






Common Mistakes in Financial Planning Approach






What is Financial Planning?

Financial Planning is the process of meeting your life goals through the proper management of your
finances. Life goals can include buying a house, saving for your child's higher education or planning for
retirement. The
Financial Planning Process

consists of six steps that help you take a 'big picture' look at where
you are currently. Using these six steps, you can work out where you are now, what you may need in the
future and what you m
ust do to reach your goals. The process involves gathering relevant financial
information, setting life goals, examining your current financial status and coming up with a strategy or plan
for how you can meet your goals given your current situation and fu
ture plans.



The Benefits of Financial Planning

Financial Planning provides direction and meaning to your financial decisions. It allows you to understand
how each financial decision you make affects other areas of your finances. For example, buying a

particular
investment product might help you pay off your mortgage faster or it might delay your retirement
significantly. By viewing each financial decision as part of the whole, you can consider its short and long
-
term effects on your life goals. You ca
n also adapt more easily to life changes and feel more secure that
your goals are on track.



Who is a Financial Planner?

A Financial Planner is someone who uses the Financial Planning process to help you figure out how to meet
your life goals. The Pla
nner can take a 'big picture' view of your financial situation and make Financial
Planning recommendations that are suitable for you. The Planner can look at all your needs including
budgeting and saving, taxes, investments, insurance and retirement planni
ng. Or, the Planner may work
with you on a single financial issue but within the context of your overall situation. This big picture approach
to your financial goals sets the Planner apart from other Financial Advisors, who may have been trained to
focus o
n a particular area of your financial life.



Can you do your own Financial Planning?

Some personal finance websites, magazines or self
-
help books can help you do your own Financial Planning.
However, you may decide to seek help from a professional Financial Planner if:




you need expertise you don't possess in certain areas of your finances. For example, a Planner can help
you evaluate the level of risk in your investment portfolio or a
djust your retirement plan due to
changing family circumstances.


you want to get a professional opinion about the Financial Plan you developed yourself.


you have an immediate need or unexpected life event such as a birth, inheritance or major illne
ss.


you feel that a professional Advisor could help you improve on how you are currently managing your
finances.


you know that you need to improve your current financial situation but don't know where to start.




Be sure you're getting
Financial Planning advice

The government does not regulate Financial Planners as Financial Planners; instead, it regulates Planners by
the services they provide. For example, a Planner who also provides insurance transactions is regulated as
an insurance
agent. As a result, the term 'Financial Planner' may be used inaccurately by some Financial
Advisors. To add to confusion, many Financial Advisors like accountants and investment Advisors can also
offer Financial Planning services. To be sure that you are
getting Financial Planning advice, check if the
Advisor follows the six step process.



How to make Financial Planning work for you?

You are the focus of the Financial Planning process. As such, the results you get from working with a
Financial Planner are as much your responsibility as they are those of the Planner. To achieve the best
results from your Financial Planning engagement, y
ou will need to be prepared to avoid some of the
common mistakes shown above by considering the following advice:




Set measurable goals

Set specific targets of what you want to achieve and when you want to achieve results. For example,
instead of saying you want to be 'comfortable' when you retire or that you want your children to
attend 'good' schools, you need to quantify what 'comfortab
le' and 'good' mean so that you'll know
when you've reached your goals.








Understand the effect of each financial decision

Each financial decision you make can affect several other areas of your life. For example, an
investment decision may have tax consequences that are harmful to your estate plans. Or a decision
about your child's education may affect when and how you meet y
our retirement goals. Remember
that all of your financial decisions are interrelated.








Re
-
evaluate your financial situation periodically

Financial Planning is a dynamic process. Your financial goals may change over the years due to
changes in y
our lifestyle or circumstances, such as an inheritance, marriage, birth, house purchase or
change of job status. Revisit and revise your Financial Plan as time goes by to reflect these changes so
that you stay on track with your long
-
term goals.








Start planning as soon as you can

Don't delay your Financial Planning. People, who save or invest small amounts of money early, and
often, tend to do better than those who wait until later in life. Similarly, by developing good Financial
Planning habit
s such as saving, budgeting, investing and regularly reviewing your finances early in life,
you will be better prepared to meet life changes and handle emergencies.








Be realistic in your expectations

Financial Planning is a common sense disciplined approach to managing your finances to reach life
goals. It cannot change your situation overnight; it is a life long process. Remember that events
beyond your control such as inflation or changes in the stoc
k market or interest rates will affect your
Financial Planning results.








Realize that you are in charge

If you're working with a Financial Planner, be sure you understand the Financial Planning process and
what the Planner should be doing. Prov
ide the Planner with all of the relevant information about
financial status. Ask questions about the recommendations offered to you and play an active role in
decision
-
making.




Common Mistakes in Financial Planning Approach

The following are some of the common mistakes made by consumers in their approach towards Financial
Planning




Don't set measurable goals.




Make a financial decision without understanding its affect on other financial issues.




Confuse
Financial Planning with investing.




Neglect to re
-
evaluate their Financial Plan periodically.




Think that Financial Planning is only for the wealthy.




Think that Financial Planning is for when they get older.




Think that Financial
Planning is the same as retirement planning.




Wait until a money crisis to begin Financial Planning.




Expect unrealistic returns on investments.




Think that using a Financial Planner means losing control.




Believe that Financial Pla
nning is primarily tax planning.







Home

Financial Planning


You may be confused about how to distinguish Financial
Planning from other kinds of financial advice. To
help you understand what to expect from the Financial Planning process, CFP
CM

practitioners follow certain
standards
-

called Financial Planning Practice Standards
-

when providing Financial Planning advice
. Practice
Standards describe the process you should reasonably expect a Financial Planner to use during a Financial
Planning engagement. These standards are based on a six
-
step Financial Planning process as prescribed by
the Financial Planning Standards s
etting authorities around the world.



The Financial Planning process consists of the following basic six steps:



1. Establishing and defining the client
-
Planner relationship

The Financial Planner should clearly explain or document the services to be

provided to you and define both
his and your responsibilities. The Planner should explain fully how he will be paid and by whom. The Planner
should also disclose any restrictions on his ability to give unbiased advice and disclose any conflicts of
interes
ts. You and the Planner should agree on how long the professional relationship should last and how
decisions will be made.



2. Gathering client data, including goals.

The Financial Planner should ask for information about your financial situation. You
and the Planner should
mutually define your personal and financial goals, understand your time frame for results and discuss, if
relevant, how you feel about risk. The Financial Planner should gather all the necessary documents before
giving you the advice

you need.



3. Analyzing and evaluating your financial status.

The Financial Planner should analyze your information to assess your current situation and determine what
you must do to meet your goals. Depending on what services you may have asked for, t
his could include
analyzing your assets, liabilities and cash flow, current insurance coverage, investments or tax strategies.



4. Developing and presenting Financial Planning recommendations and/or alternatives.

The Financial Planner should offer Finan
cial Planning recommendations that address your goals, based on
the information provided by you. The Planner should go over the recommendations with you to help you
understand them so that you make informed decisions. The Planner should also listen to your

concerns and
revise the recommendations as appropriate.



5. Implementing the Financial Planning recommendations.

You and the Planner should agree on how the recommendations will be carried out. The Planner may carry
out the recommendations or serve as
your 'coach', coordinating the whole process with you and other
professionals such as solicitors or stockbrokers.



6. Monitoring the Financial Planning recommendations.

You and the Planner should agree on who will monitor your progress towards your
goals. If the Planner is in
charge of the process, she should report to you personally to review your situation and adjust the
recommendations, if needed, as your life changes.






Home

Financial Consumers

Choosing a Financial Planner




Parameters to choose your Financial Planner




Types of Other Financial Advisors




Questions to ask a Financial Planner before hiring him/her





Parameters to choose your Financial Planner



While you may choose to work with different advisors for different i
nvestment needs or work with a single
trusted Financial Planner year after years, you will find the following parameters useful in deciding if the
advisor you are choosing deserves your confidence and trust.




Qualifications



Check what qualification he has in the field of personal finance. Professionals like
Certified Financial Planners (CFP
CM

Certificants) go through elaborate education program & adhere to
strict ethical guidelines.




Experience



Choose an advisor wh
o has prior experience counseling individuals on their financial
needs.




Association /Professional Membership


Find the credibility of the Financial Advisor’s employer or the
professional organization he is associated with.




Reference


Always

ask for two references of his clients. Asking references keeps the advisor on toes
and doesn’t let him take you for granted. Also be ready to give reference if you are satisfied with his
services.




Types of Other Financial Advisors



Financial Advisors in the market can be broadly segregated as Institutional and Independent. Each one of
them has their own strengths and weaknesses. Whichever category they fall into and by whatever name
they may be called, most of them are driven by targ
ets and commissions. Let us accept this fact and learn
to choose a financial advisor and get the right advice for the financial products we are buying.

Institutional Financial Advisors:

They are the one who are employed by Financial Products and Services
Company. Most of them are MBAs or Graduates with AMFI and NCFM Certification. Their strength lies in the
company name they are employed with. It gives a great level of comfort dealing with well
-
established
company which is handling money of thousands of in
vestors like you. The advisors undergo continuous
training & have ready knowledge source for any kind of information you may ask them. But at the same
time one should remember, your financial success at times depends on your financial advisor and not on th
e
company he/she is associated with.

It may be noted that they may be driven by high sales target they get which makes them spare minimal
time on after
-
sales service/advice. Second, they are young professionals switching jobs from one company
to another i
n pursuit of higher packages. There is a degree of comfort level which is built, which is lost once
your advisor switches and you may have to deal with a new advisor. It is always beneficial for both the
advisor and the client to have long
-
term relationshi
p.


Types of Institutional Financial Advisors

Employed by

Products for sales and advice

Insurance Companies

Insurance Policies

Mutual Fund Companies

MFs, PMS Services

Equity Broking Firms

Share trading, IPOs & PMS Services

Private & Foreign Banks

MFs,

Insurance Policies, Bonds, Deposits

Distribution Houses

MFs, Insurnace, Bonds, Fixed Deposits, Govt. Schemes & IPOs




Independent Financial Advisors:

The Independent Financial Advisors are self
-
employed who run their
business from a small office with some support staff. Most of them are your friendly neighborhood LIC
agents and share sub
-
brokers. They are friendly, flexible & spend time to understand y
our needs & make
you understand the products which will fulfill them. There only marketing tool is a word of mouth and
reference, so they try their best keep you happy. But the disadvantage is they may lack training support &
professionalism in their servi
ce. You may also find it uncomfortable to deal with them unless you have
received very good reference about them.


Types of Independent Financial Advisors

Category

Products for sales and advice

Insurance agent

Insurance Policies

Mutual Fund distributor

Mutual Funds

Equity share broker/sub
-
broker

Share trading, IPOs

Income tax consultant

Tax Planning, Employee Benefits

Distributor/Advisor of multiple financial products &
services

MFs, Insurance, Post Office schemes, share trading,
tax etc






Questions to ask a Financial Planner before hiring him/her



While looking out for a competent Financial Planner/ Wealth Manager, Financial Consumers below are the
questions listed to ask a Financial Planner before hiring him/her.



1. What experience

do you have?

Choose a personal Financial Planner who has sufficient experience counseling individuals on their financial
needs.



2. What are your qualifications?

Look for a personal Financial Planner who has proven experience in topics such as insurance, tax planning,
investments, estate planning or retirement planning.



3. What services do you offer?

The services a personal Financial Planner offers depend on
a number of factors including credentials,
licenses and areas of expertise.



4. What is your approach to personal Financial Planning?

Ask the personal Financial Planner about the type of clients and financial situations he or she typically likes
to wor
k with. Make sure the personal Financial Planner’s viewpoint on investing is not too cautious or overly
aggressive for you.



5. Will you be the only person working with me?

The personal Financial Planner may work with you himself or herself or have ot
hers in the office assist in the
process. You may want to meet everyone who will be working with you.



6. How will I pay for your services?

As part of your Financial Planning engagement, the personal Financial Planner should clearly tell you in
writing

how he or she will be paid for the services to be provided.



7. How much do you typically charge?

While the amount you pay the personal Financial Planner will depend on your particular needs, the planner’s
level of experience and your geographic locat
ion, the personal Financial Planner should be able to provide
you with an estimate of possible costs based on the work to be performed.



8. Could anyone besides me benefit from your recommendation?

The planner may also have relationships or partnershi
ps that should be disclosed to you, such as business
he or she receives for referring you to an insurance agent, accountant or attorney for implementation of the
Financial Planning recommendations.



9. Have you ever been publicly disciplined for any
unlawful or unethical actions in your
professional career?

Ask what organizations the planner is regulated by and contact these groups to conduct a background
check.



10. Can I have it in writing?

Ask the personal Financial Planner to provide you wit
h a written letter of engagement that details the
services that he or she will provide. Keep this document in your files for future reference.






Home

Media Room

Media Guide




About Financial Planning




The Financial Planning Process




The Financial Planning Process




Terms Used to Describe Financial Planners and Financial Services Professionals




Download CFP Mark usage
guide for media





About Financial Planning

Financial Planning is the process of determining how an individual can meet life goals through the proper
management of his or her financial resources. Examples of life goals include a comfortable retirement,

buying a home, saving for a child's education or starting a business.

A Financial Planner is someone who uses the Financial Planning process to help clients figure out how to
meet their life goals. A Financial Planner can take a "big picture" view of a c
lient's financial situation and
make Financial Planning recommendations based on the client's needs in areas such as budgeting and
saving, taxes, investments, insurance and retirement planning. Or, the planner may work with a client on a
single financial i
ssue but within the context of that client's overall situation.

A Financial Planner helps a client analyze either all or selected areas of his or her finances and develops a
"plan" bringing together all of the client's financial goals, or provides advice
on specific areas as needed.
This big picture approach to a client's financial goals sets the planner apart from other Financial Advisers,
who may have been trained to focus on a particular area of a client's financial life. The Financial Planning
process
as described on the following page distinguishes Financial Planning practitioners from other Financial
Advisers.

The Financial Planning Process

The Financial Planning process includes the following six key steps:






Establishing and defining the
client
-
planner relationship.






Establishing and Gathering client data, including goals.






Establishing and Analyzing and evaluating the client's financial status.






Developing and presenting Financial Planning recommendations
and/or alternatives.






Implementing the Financial Planning recommendations.






Monitoring the Financial Planning recommendations.

Financial Planning is a process, not a product. While the practice of Financial Planning can be performed in
conjunction with providing financial products, it can also be performed as a distinct and separate function
from the practice of any other professi
on or occupation.

Expectation during the Financial Planning Process

The Financial Planning process includes the following steps:

1. Establishing and defining the client
-
planner relationship.






Does the Planner explain or document the services to

be provided?






Are the Planner's and your responsibilities clearly defined?






Are the compensation arrangements clear to you?






Have you and the Planner agreed on how long the professional relationship should last?

2. Gathering

client data, including goals.






Does the Planner ask for relevant information or ask you to fill out a questionnaire about financial
resources and obligations?






Does the Planner help you to define and prioritize your personal and financial goals and assess your
risk tolerance and time horizons?






Does the Planner request applicable records and documents?

3. Analyzing and evaluating your financial status
.






Does the Planner analyze and evaluate the information gathered above to determine whether or not
your goals can be met?

4. Developing and presenting Financial Planning recommendations and/or alternatives.






Are the Financial Planning recommendations tailored to meet your specific goals and based on
analysis and evaluation of the information provided to the Planner?






Does the Planner communicate the recommendations to you in a way that you can make
informed
decisions?

5. Implementing the Financial Planning recommendations.






Do you and the Planner agree on implementation activities and who should perform them?






Will the Planner help implement his/her recommendations or coordinate or refer you to other
professionals, such as attorneys or stockbrokers?

6. Monitoring the Financial Planning recommendations.






Have you and the Planner agreed to have recommen
dations and your financial progress monitored
periodically?






If so, does the Planner review and evaluate changing circumstances and make new
recommendations based on these changes, as appropriate?

Terms Used to Describe Financial Planners and Financial Services Professionals

The phrases "Financial Planning" or "Financial Planner" are sometimes used by individuals to promote the
sale of financial products, or are confused with the sale of such produ
cts. Many Financial Planning
practitioners may also be registered representatives who sell securities products, insurance agents who sell
insurance products, or investment advisers who recommend certain financial products. As a result, the
public is often
confused about the distinction among

1. An individual solely offering Financial Planning services

2. Someone selling financial products and related services in conjunction with his or her Financial Planning
practice and

3. A financial services representat
ive who offers no Financial Planning services.

To assist you, we have compiled the following list of terms describing individuals who work in the Financial
Planning and financial services professions.

Accountant

Accountants perform one or more of the foll
owing services involving the use of accounting or auditing skills:
issuance of reports on corporate and individual financial statements, consulting, preparation of tax returns
and the provision of tax
-
related advice. Many accountants have broadened their a
ctivities in recent years
into computer systems analysis, management advisory services, corporate or individual tax planning or
other areas of Financial Planning, such as investment planning.

CERTIFIED FINANCIAL PLANNER
CM

Certificant

CFP Certificants ar
e individuals who have met the FPSB India's Education, Examination and Experience
requirements, are committed to high Standards of Ethical conduct and who complete the FPSB India's
biennial certification requirements to use the certification marks CFP
CM
, C
ERTIFIED FINANCIAL PLANNER
CM

and
. A CFP
CM

Certificant is a financial professional authorized to use the CFP
CM

Certification marks that
has identified himself or herself to the FPSB India as being actively engaged in providing Financial Planning
services.

All CFP
CM

Certificants have voluntarily submitted to the regulatory authority of the FPSB India.

Chartered Financial Analyst

Holders of the Chartered Financial Analyst (CFA®) designation are securities analysts, money managers and
investment advisers who

focus predominately on the analysis of investments and the securities of particular
companies or industry groups. Individuals earn the CFA designation by completing the Association for
Investment Management and Research's® (AIMR®) experience, education, e
xamination and ethics
requirements. All CFA charter holders have voluntarily submitted to the regulatory authority of AIMR.

Fee
-
Based Financial Adviser

An Adviser who is compensated both by fees paid by the client and commissions that are contingent on th
e
purchase or sale of financial products.

Fee
-
Only Financial Adviser

An Adviser who is compensated solely by the client, with neither the adviser nor any related party receiving
compensation that is contingent on the purchase or sale of financial products
.

Financial Advisor (or Counselor or Consultant)

"Financial Advisor" is a generic term used broadly by consumers and financial services professionals to
describe an individual engaged in providing financial advice, services or products to a client for
com
pensation. The term "Financial Advisor" covers a broad spectrum of financial professionals including
Financial Planners, registered representatives, money managers, investment advisors and individuals who
sell, or advice people on, financial products.

Fin
ancial (Securities) Analyst

These professionals are usually employed by investment brokers, banks, mutual fund managers, venture
capitalists or investment institutions to conduct investment research and analyze the value of securities and
financial conditi
on of a company, group of companies or industry sector. Based on their analysis of a given
stock or market sector, analysts will make investment recommendations to buy, sell or hold a given stock.

Insurance Agent

Insurance agents are individuals licensed
by IRDA to sell life and health and/or property and casualty
insurance products. Many Financial Planners are licensed to sell or give advice on insurance products. Other
Financial Planners might identify insurance needs for a client, but turn to a licensed

insurance agent for
recommendations about which existing insurance products best meet the client's needs. Insurance brokers
sell products for two or more insurance companies; exclusive insurance agents represent only one.

Investment Advisor

Investment ad
visors may sell or recommend stocks, bonds, mutual funds, partnerships or other SEBI
-
registered investments for clients.

Portfolio Manager

The term "portfolio manager" is often used to describe the investment manager of a mutual fund or private
institutio
nal fund. The term "portfolio manager" is often used to describe the investment manager of a
mutual fund or private institutional fund.

Real Estate Broker

A real estate broker arranges the purchase or sale of property for a buyer or seller in return for a
commission. A real estate agent is an individual who works for a real estate broker. Real estate brokers may
help consumers finance a real estate purchase
through their contacts with banks, savings and loans, and
mortgage bankers.

Stockbroker

A stockbroker, is affiliated with a stock exchange and recommends to clients which securities to buy and
sell, and earns a commission on all trades as compensation. Al
l stockbrokers, including any Financial
Planners who execute buy or sell orders for mutual funds, stocks, bonds, commodities or other securities on
behalf of clients for compensation, must be registered with SEBI and licensed by the appropriate stock
excha
nge.