Chapter 1 Summary - Understanding the Financial Planning Process PDF

Preview

Summary

Summary for Chapter 1 - Understanding the Financial Planning Process...

Description

Chapter 1: Understanding the Financial Planning Process QUESTION: How can using personal financial planning tools help you improve your financial situation? Personal financial planning tools are essential to living a successful and stable life. Whether you have a lot of money or not, personal financial planning tools can be beneficial in managing your personal finances. Applying these tools to your life can ensure stability and security for anything that comes. This could mean being prepared if another recession were to happen. Furthermore, you are improving your standard of living so that you are able to gain more enjoyment from your income. Personal financial planning tools can help you improve your financial situation by allowing you to see how your money is managed and spent. It allows you to plan ahead and set specific goals of how you want to spend your money. You can evaluate how your money is being spent and make adjustments based on those spending’s so that you can save some money and improve your spending habits. This is important because you can begin to spend your money wisely so that you don’t accrue excessive debt or become bankrupt. Also, these tools help provide an increased accumulation of wealth as you direct your spending to more essential areas. Cutting down on spending of unnecessary purchases allows you to focus your money on other assets, whether financial or tangible, that improve your wealth. It’s better to implement these tools and be prepared than putting yourself in constant financial instability and unable to deal with any unexpected expenses....