The goal of financial planning and a written financial plan are to make your money goals a reality. With smart financial planning and long term investing you can save a modest amount each month, and end up with the financial assets to retire comfortably in 30 years or less. Financial planning and developing a financial plan will help an investor identify their goals and create a long term investment strategy for achieving them.

Think of a financial plan as a written planning guide to remind you of what you want, where financially you want to be in the future, and what it will take to get there. A comprehensive financial plan will include many of the following parts:

• A personal net worth statement—a snapshot of what you own and what you owe. This will help you know exactly where you stand, and also give you a benchmark against which you can measure your progress.
• Cash flow is essentially income minus expenses—exactly how much money comes in and goes out every year, and understand if it is sustainable in the long term. The foundation for a budget includes identifying fixed and what’s discretionary expenses and if necessary, devise a debt management plan.
• A budget–helps to manage your money, to consider your immediate needs and wants, and to prepare you to achieve your long-term financial goals
• An Emergency fund–ensure adequate cash on hand to cover three to six months of living expenses to handle any unplanned expenses or loss of income.
• A debt management plan—is a crucial part of becoming financially responsibilities. Debt can be used smartly to achieve one’s financial goals, or debt can be used poorly to buy things a person may not need with money he or she does not have.
• A retirement plan—specifying how much you need to save each year to achieve the lifestyle you and your family hope to maintain. This includes a recommendation on how best to maximize Social Security benefits, to incorporate any pension funds and to utilize personal savings.
• An analysis of how current investment portfolio aligns with short, intermediate and long-term goals.
• A plan for college education funding offspring.
• A review of employee benefits, including equity compensation or deferred income planning.
• A review of insurance coverage—the key is to make sure that you have the right types and amounts and that you aren’t paying for unnecessary coverage.
• Planning for special needs—for a child, parent, or other dependent.
• Recommendations for creating or updating your estate plan, including charitable giving and legacy planning.