Investment Planning

What is Investment Planning?

Planning a strategy to align your goals with your investments is called investment planning. There is no one plan that suits all for investments. The investments for your individual goals have to be tailor made for your time horizon, risk profile and goals. A good plan of investments will assure you of a stress free financial journey towards achievement of your goals.

Is investment planning the same as financial planning?

Financial planning is assigning a monetary value to your various goals like child's education, retirement planning etc. Investment plan, on the other hand, goes a step forward and plans for investments into various financial instruments based on your risk profile, to build the corpus to achieve those goals.

What is the meaning of risk profile?

Before embarking on fixing a plan of investments, a financial planner will first assess your risk profile. Simply put, this means determining how much risk you can take. Suppose you have many dependents, then you do not have the appetite to take on too many risks in your investments as opposed to if you are just investing for yourself. Similarly, a young person will have a larger risk handling capacity than one who is closer to the retirement age, for example.

What kind of investments should you do for comprehensive investment planning?

While planning your investments, there are broadly three categories, you should look at:

Risk planning: You need to plan your investment in such a way that untoward incidents like accidents, or medical exigencies or death or loss of job are all factored for. Your financial planner will be able to provide for your requirements in the most judicious way.

Wealth Creation: One of the most exciting parts of investment planning is to plan for creating wealth in the long term for things like child' education or going on a vacation, or retirement planning. As is evident, these goals can be categorized in different time periods, like short term goals, mid term goals and long term goals. Your advisor will draw up a plan to help you plan for wealth creation aligning with your goals.

Tax planning: Tax planning refers to planning for payment of your taxes after taking benefits of all the deductions and subsidies available to you from the government. For example, for individual taxpayers, the 80C and 80D deductions among others, serves the dual purpose of saving on tax payment and investing for goals.

Start your investment journey today to ensure that you can have a stress free happy journey towards achieving your goals.