Learn More about Personal Finance

Personal finance is the relevance to the theory of finance in the monetary discretion of any individual or family. It point outs the ways through which individuals or group of people save, acquire, expend resources and budget taking into consideration various fiscal risks and uncertainties. Financial position, tax planning, security, estate planning, investment and retirement plans are the major areas of personal financial planning.
Learn More about Personal Finance
Planning of personal finance is considered as a major constituent of personal finance.  Financial planning is a vibrant process that calls for extensive reassessment and regular scrutiny. Firstly, it involves the exact assessment of one’s financial situation, which can be deduced by proper examination of balance sheets and income statements.  Personal balance sheet includes self owned assets such as house, clothes, stocks, car and bank accounts.
Personal liabilities such as bank loan, credit card debt, mortgage and many more also form a major part of the individual’s balance sheet.  Goal setting is the second most important step for effective financial planning. Forming exact financial goals helps to construct a better financial planning, to meet particular financial demands and needs. The third most important step of financial planning is generating a plan. A proper plan helps to complete preset goals of an individual by cutting off useless expenses, investing in stocks and commodities or increasing one’s income.
Appropriate execution of one’s personal financial plan is the fourth important step. This process demands for acute regulation and determination. If proper focus and concentration is not provided to the financial plan, it can lead to mismanagement and sudden pause. Hence, accurate execution stand on the must do list of an individual or family. Monitoring and re-examination is the fifth step of financial planning, which includes constant examination and scrutiny of one’s financial plan for adjustments to avoid any form of errors.