subject: Peters Coat May Not Fit Paul [print this page] This statement is as appropriate in our financial lives as is in our social lives. We all agree that not only are we born and reared in different circumstances, we also differ from each other in terms of our various personality traits like our expectations from our lives, our desires, our priorities and their intensities ,our life time goals and the period at our disposal for their achievement, our incomes and expenditures, our assets and liabilities and so on. However, what we have in common is our unsatiable desire for materialistic things and our huge appetite for wealth. But given that though our incomes are limited and our desires are unlimited ,we must prioritize our necessities so that they are not sacrificed at the altar of our unlimited desires. But no two people can have the same necessities and the same financial background, as a result of which a financial strategy that suits person X, may not be the most optimal for person Y. But the dismal reality is that whereas we spend a lot of our energy to emulate the investment strategies of others as if no better alternatives can be available ,we forget to maintain the required FOCUS on our own financial goals and priorities. Though some of our lifetime financial goals like education of children, their marriage, buying a house and a car, retirement planning are more or less the same but the targeted amount for the achievement of each of these goals, our investment horizon for the fulfilment of these targets, our financial status etc can be remarkably different. So we must not loose our financial focus and must seek expert advice for the individual financial planning so as to achieve our realistically set financial goals most optimally. This will not only inculcate financial discipline in us, but will also keep us more cocooned during the times of turbulences in the financial markets. We will be better off in remaining invested in value stocks ,with long term investment horizon in our minds. Only a small part of our investible funds may be used to take advantage of short time market movements. We will also be able to appreciate the fact that nearer our financial goals better will be for us to systematically convert our variable income assets into fixed income assets with an eye on our nearest goal.Also as a coat that fits you today may not fit you tomorrow if your statistics change drastically, similarly if there is some drastic change in your financial status you must seek revised financial planning advice in order to achieve your financial goals most optimally. In short, financial planning will ensure that we proceed towards our financial goals most systematically and optimally and will save us from the most prevalent herd behaviour.
by: wealthforsure
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