Financial Planning Process

Financial Planning Process Overview
The financial planning process is employed by business entities to set financial goals. Financial planning process also helps the companies to reach these goals. The basic idea behind the financial planning process, is to achieve success in their business efforts.

Financial Planning Process Steps
The various business entities follow certain steps as part of their financial planning processes.

They may be enumerated as below:
Monitoring the Financial Planning Recommendations
Establishing and Defining the Client-Planner Relationship
Developing and Presenting Financial Planning Recommendations and Alternatives
Gathering Client Data, including the Goals
Implementing the Financial Planning Recommendations
Analyzing and Evaluating the respective Financial Position

The various business entities take the help of professional financial planners to address their monetary planning needs.

Monitoring the Financial Planning Recommendation
The first step requires the personal financial planners and their clients to decide, that who would manage the process of financial planning. When the planners are responsible for overseeing the financial planning process, they provide their clients with periodic reports. These reports assess the progress of the financial plans.
Establishing and Defining the Client-Planner Relationship
This step requires the financial planner, to clearly state the various terms and conditions of the services, that are to be provided, like the time and amount of payment, for example. The planners also explain to their clients, the various details of their services, like the responsibilities of both the clients and themselves.
Developing and Presenting Financial Planning Recommendations and Alternatives
As per this step, the financial planners are supposed to provide customized services. The financial planners normally look at the various details of the financial plans, of their clients. The basic idea behind this exercise is to help their clients take proper decisions.
Gathering Client Data
The personal financial planners collect all the necessary information about their clients, before giving them any financial advice.

In such cases the planners acquire knowledge about the following issues:
Clients’ Ideas about Risks
Clients’ Expected Time for the Results
Financial Goals of the Clients
Implementing the Financial Planning Recommendations
The personal planners and the clients need to decide on the manner, in which the financial plan would be executed. The financial planners also act in co-ordination with the lawyers, accountants and the stockbrokers, in such cases, to help their clients.
Analyzing and Evaluating the respective Financial Position
The financial planner assesses the monetary situation of his clients before making any suggestions.

Normally they look at the following categories:
Liabilities and Cash Flow
Tax Strategies
Present Insurance Coverage


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Last Updated on : 1st August 2013

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