Page 6 - DMGT515_PERSONAL_FINANCIAL_PLANNING

Rupesh Roshan Singh, Lovely Professional University
Unit 1: Basics of Personal Financial Planning

Unit 1: Basics of Personal Financial Planning Notes

CONTENTS
Objectives
Introduction

1.1 Meaning and Definition of Personal Financial Planning
1.2 The Benefits of Financial Planning
1.3 Importance of Personal Financial Planning

1.4 Process of Financial Planning
1.4.1 Old Personal Financial Planning
1.4.2 New Method of Personal Financial Planning
1.4.3 Tips for making the most of the Financial Planning Process
1.4.4 Features of a Good Financial Plan

1.5 Scope of Personal Financial Planning
1.6 Financial Planner
1.6.1 Reasons for hiring a Financial Planner

1.6.2 Functions of a Financial Planner
1.7 Summary
1.8 Keywords
1.9 Review Questions
1.10 Further Readings

Objectives

After studying this unit, you will be able to:
Explain issues and concepts related to overall financial planning process;

Understand the goals and objectives of personal financial planning.
Introduction

As one of the most rapidly developing service industries in India and aided by a world of
economic, technological and social change, the role of financial planning is increasingly
important in the Indian community. In India, we have endured major economic and regulatory
change, including widespread changes in the banking system and, through the late ‘1990s, a
reducing inflation rate in stark contrast to the double-digit inflation earlier. We have seen
turbulent times in the stock market and adoption of the depository system, a transition to
rolling settlement and the introduction of derivatives. A well-developed debt market still remains
a distant dream forcing investors to hold on to illiquid instruments. Senior citizens are facing
the brunt of the impact of these changes and as the average age of our population climbs, there
is increasing pressure on an early introduction of a social security system for financial support.

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