Most people have this very important question running through their heads; do they need any sort of financial planning? The simple answer to this question is that; Yes, you need financial planning because it can help you manage your money in an effective way so that you don’t run into any kind of problem.
Financial Planning is basically long-term planning by which you manage your money intelligently so that you are able to achieve all of your goals and objectives while at the same time being ready for any sort of financial roadblocks that might come your way during different stages of life. Financial planning can prepare you for the scenarios that you might encounter in the future that require immediate financial assistance.
In a country like Nigeria, where the economy isn’t as strong as compared to other nations of the world, financial planning is very important. Although Nigeria has the best GDP of all the African nations, 40% of its people still lie below the poverty line, which shows how important financial planning is. Let’s have a look at the importance of financial planning in Nigeria:
Income Management
One of the best advantages or benefits of financial planning is that it helps to manage your income in the best way. This is a problem with most individuals nowadays that they are able to earn good amounts of money but they are not able to manage their money properly, which results in such individuals facing a financial crisis. Financial planning helps you to devise a strategy that will help you to calculate all the resources that you will need for your monthly expenditure.
Having a financial plan helps you to figure everything, from monthly bills to taxes that you will have to pay and the savings that you will be left with at the end of the month. Whether it is an individual or a company, everyone can enjoy income management benefits.
Increased Overall Retained Earnings
Financial planning helps to increase overall retained earnings by helping you analyze your spending habits and then assisting with budgeting. Whether it is for monthly expenses or for day-to-day operations, financial planning is a must if you want to increase your retained earnings.
Financial planning helps with expenditure prioritization and persuades you to spend on only those things or activities that you need. It makes you cautious about your spending, making you spend only on the things that you need, not what you want which helps to increase retained earnings.
Investments For The Future
If you have a properly devised financial plan then it will consider all the things including your current situation, any risks that might arise in the future, and long-term goals. All of these are important for a better future and having a financial plan helps you to make the best financial decisions that are best suited according to your needs and objectives.
Financial planning also helps for the creation of a better future by suggesting different plans for all ages and occupations. In India, we see people making investments in Lottery Sambad, which can help them for a better future. Dhankesari is also the same as lottery sambad and many people have benefited from it. So in short, a financial plan proposes different investment schemes that help in the planning of financial resources for the upcoming future.
Secures Finances For The Future
The whole world is currently in a financial crisis and in the foreseeable future, it is projected that the financial crisis will get even worse. The value of money is decreasing and decreasing with every passing day, month, and year. For a brighter and more secure future, it is imperative to have your finances properly organized so that you can tackle the upcoming financial crisis.
Having a properly devised financial plan with proper financial preparations helps you prepare for the worst so that you will be able to deal with growing inflation in the upcoming years.
Post-Retirement Period Guarded
Another benefit of having a proper financial plan is that it keeps you covered for the post-retirement period. Most people want to complete their term so that they have enough resources for the post-retirement period but if you want to retire early then a financial plan keeps you covered by making you invest as early as possible because it is more profitable when money is invested for a longer period.
A financial plan keeps your goals, objectives, and retirement plans in consideration to guard your post-retirement period and makes you invest early to achieve your life’s objectives.