What are the six steps in the financial planning process?

Having a fully thought-through plan for your finances is essential, whether these are personal finances or business ones. You cannot hope to reach your goals if you don’t map out the route to where you want to be. So, what are the six steps in the financial planning process?

1. Do you need professional advice?

Most people who are putting together a personal or business plan opt to get professional help from an independent financial advisor in Chester or wherever they are based. You can benefit greatly from their experience and expertise, but the relationship should start with them outlining what they will offer and how involved you should be in decision making.

2. What is your current status?

The next step will be to establish what your present financial status is. That will include looking at whether you are an employee, a business owner or self-employed, as well as what your earnings and outgoings are on an annual basis. This is essential to be able to work out attainable goals.

3. What do you want to achieve?

Your aims should become clearer once you have analysed your existing status. These aims represent the heart of your financial plan, whether it is a certain level of business growth or early retirement. This step should also involve setting out a realistic time scale for each goal.

4. What is your back-up plan?

With the help of your advisor or wealth manager, you should use the available information to create a back-up plan. This will offer an alternative map to realising your ambitions in case circumstances change.

5. Is your plan ready to go?

At this point, it will be time to give your plan a final evaluation and then put it into practice. That might feel like a daunting step at first, as every plan has an element of uncertainty about it. However, if it has been worked out with a professional and you also have a back-up, don’t let fear hold you back.

6. How is the plan progressing?

The financial plan should be reviewed regularly to ensure it is on track. There will be time scales for each goal, so those will make good points to conduct reviews and make any adjustments that may be needed to accommodate changed circumstances.

This should answer the question: what are the six steps in the financial planning process? At Hartey Wealth Management, we can also answer any other queries you have, so give us a call.


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