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5 Key Components of a Strong Financial Plan

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Personal Finance

Retirement Planning

October 1, 2021

1. What is financial planning?

Financial planning is a step-by-step approach to help you meet your life goals. A financial plan, customized for you, provides guidance through life and helps monitor income, investments and expenses so that your goals can be achieved. A good financial plan helps to provide a holistic view of your financial situation. It includes not only money and investments, but a well-rounded plan also includes retirement income and expenses, tax-saving strategies, asset protection and more.‍

2. Why is Financial Planning So Important?

With the turbulence of the last several years and economic instability, there is an even greater need to focus on financial health. Although the clock can’t be turned back, and there are no future guarantees, you can create or revise your financial plan now to help pave a smoother road into and throughout retirement. This past year provides a reminder of why financial planning is not only important but crucial, to everyone regardless of age or timeline.‍

3. What are the benefits?

Aside from helping to guide you safely toward a retirement lifestyle that you desire, financial planning helps to create wealth for yourself and future generations. You might remember your parents or grandparents talking about when a movie ticket was two dollars and gas was just 89 cents per gallon. The cost of living will only continue to rise, so if you want to maintain your current standard of living or even increase it in years to come, financial planning is essential to ensure you’re taking the right steps to achieve your goals. Even small purchasing decisions can affect the long-term, so financial preparation, especially in the earlier stages of life, enables you to take advantage of the power of compounding over a 20-year or 30-year period, and also to make informed decisions along the way.

Is your financial plan optimized for YOUR success? Book a complimentary 15-minute phone call with one of our financial advisors to review your plan today!

4. What information creates a successful financial plan?

In order for a financial plan to be successful, your overall financial situation must be fully understood. You must be open and honest with your financial professional about your spending habits, debt, family needs, and income. Creating a financial plan also requires that you’re honest with yourself, so that you can recognize what habits may need to be improved and what may need to take place to achieve your goals. A successful financial plan also takes into consideration your age, risk, timeline, and taxation.

5. Why is financial planning essential?

The future is uncertain. Medical emergencies can arise, job loss can happen in an instant or an unexpected divorce can take place. So even if you believe you’re saving a considerable amount, one unexpected event can create a financial setback of many years. A financial plan prepares for unexpected events and is overall a road map for you to follow to reach the goals you set for yourself and your family. It manages your financial situation holistically and in the most optimal way possible to prepare for the unexpected as well as provide security.

Having a customized financial plan, especially during turbulent times, brings confidence and eliminates the stress of uncertainty. If you already have a plan, it needs to be monitored regularly for potential adjustments based on life changes. If you have questions about your financial plan, please schedule an appointment on Bayntree’s online calendar by selecting the date and time that is most convenient for you! You can also always reach us by emailing info@bayntree.com.

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Bayntree Wealth Advisors provides comprehensive financial planning and wealth management. The Bayntree team specializes in all aspects of financial health, including retirement planning, risk management, investment advice, tax strategies, estate planning and insurance.

Bayntree does not provide specific legal or tax advice. Please consult with your tax advisor or legal professional for guidance with your individual situation.

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