Financial Planning Basics

Hi Readers,

I believe you had read our last topic about “Why Personal Financial Planning”, which gave us an overview about what is financial planning.

In this topic, we are going to cover the fundamental concepts in personal financial planning.

Setting your financial goals

Financial goal is a target that you intend to achieve, driven by specific future financial needs, such as purchasing a home, child’s education fund and retirement expenses, etc (Paul Mckinney, 2018).

Financial Planning Process 2.PNG

(Referenced from Yong, 2018)


Budgeting is a process of expressing quantified resource requirements (amount of capital, amount of material, number of people) into time-phased goals and milestones (, 2019).

Financial Planning Process 3

(Referenced from Yong, 2018)

Net Worth Statement

Financial Planning Process 4.PNG

(Referenced from Yong, 2018)

Financial Planning by Life Stages

You may divide your financial planning into few different stages, such as below:

Financial Planning Process 5

(Referenced from Yong, 2018)

References: (2019). What is budgeting? definition and meaning. [online] Available at: [Accessed 16 Sep. 2019].

Paul, M. (2018). Financial Goal: Definition & Examples – Video & Lesson Transcript | [online] Available at: [Accessed 16 Sep. 2019].

Yong, P. (2018). I love financial planning. Johor Bahru, Johor: Sigma Wealth.

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