What is financial planning
Financial planning is a growing area of financial
services offered by accountants & attorneys.
First, gather factual data – tax
returns, bank statements, wills, investment information, insurance policies
(including beneficiaries), asset titles (with names and terms), etc.
preference information – nontax factors, risk preferences, goals & objectives,
special family needs, etc.
A comprehensive financial plan may require you to:
prepare personal financial statements – balance sheet and income
statement (current and projected)
prepare a cash budget (current and projected) include personal,
business, and investment items, debt service, taxes (based on income
analyze debt service – payment problems, refinancing for lower rates or
analyze investment portfolio – amount of investments, liquidity,
diversification, and risk
analyze retirement savings – establish pension plans, SEP, IRAs,
personal savings, consolidate 401(k)s accumulated over lifetime, social
security benefits, etc.