The Art of Financial planning

Believe me, financial planning is the most easiest thing you can do in life.

Naaahh, you disagree with me.. you feel It is complex.

For you financial planning is all about numbers, calculation and complex products available in the market.

You further get confused by all the noise in the market with someone selling mutual funds with “ Mutual funds sahi hai” , others trying to use coronavirus as a perfect opportunity to run advertisement for health insurance and term insurance.

You must know –

Financial planning is all about YOU?

Financial planning is all about managing your personal life?

You feel I have started giving Gyaan rather than straight away telling you that you should have health insurance, life insurance , invest in stocks and mutual funds. You will feel really great if I could name some good performing mutual funds and also name them.

I can tell you all things I specified above but it won’t have any long lasted impact in your financial as well as personal life. I want to make impact in your life, I want to bring some change in your life.

So to make some impact in your life I hereby present you the real life story of someone who is really close to me.Let us name him here Anant.

Anant, a boy born in a small town in India. He is youngest in his family with three sisters elder to him.

His father is a government employee and sole earner in his family. His mother is a house wife managing a family of ten members without any maid.

His parents did everything to make all their four children settled well in their life. Today all are earning a handsome salary in not only India’s but worlds biggest companies.

Anant did graduation and post graduation and started earning a handsome package.

Anant being aware of the fact that his parents have given their whole life to their children and her mother haven’t even stepped out the boundaries of the small town in order to save money so that her children can travel the world.

Anant decided that he will take her mother to different places not only in India but also in other countries so that she can also live her life.

But Turning point was awaited in Anant’s life.

His mother DIED at age of 60.

Anant got shattered. He was just thinking day in day out that her mother has sacrificed her entire life for him and his sisters. And when it was time to go out and live her life, she is gone.

BUT he learned a hard lesson at age 25.

He started analysing the human life.

He found that most of you run daily to offices to earn more and more money. You get increments , promotions and with that your lifestyle do increase and you start giving a life of comfort and a bit luxury to your family.

He found another important phenomenon happens in your life which you are not aware of.You start finding happiness in buying new gadgets, bikes, cars.

Though this happiness is so short lived that it starts getting diminished in a day or two. And then you get in search of another short lived happiness.

Credit card companies takes advantage of this and makes you to purchase anything, anytime at easy EMI’s.

You also decide to buy home because buying home is must as per society norms. Not You buy Home on easily accessible loan.

By the time you reach 30 you have accumulated so much debt in your life that you are now forced to run for at least next 15–20 years day in day out for money, increments, promotions so that you can pay EMI of your home, though you are the one who spend least time in your HOME.

And then reality hits in at age 50.

You start feeling that ‘ you have spent most of your life running for money/family responsibilities. But what about your dreams, your passion. Fact is you had planned your life so poorly that even at 50 you have no chance to get out of this vicious circle.


if you are lucky enough you are left with only few responsibilities as you hit age 60.

This is the life for majority of you.

Anant thought he doesn’t want to run a rat race which this whole world is running.

He wanted to enjoy his present as well as wanted to secure his future.He realised that money is very important. Whole life revolves around money. But money is not happiness.

Anant decided to plan his personal life.

He thought-

What is the purpose of his life ? what are the things that really matter to him in life? What are his top priorities? What gives him the most happiness?

He jotted down five priorities of his life in 2015 –

Freedom- His job requires him 13–14 hours on daily basis. He wanted to have more free time. With free time he will have more time to do what he wants to do.

Excitement- He wants to explore this world. He want to travel to many countries and enrich himself.

Family- He wants to see his family spend time happily.

Security- In today scenario where job is not safe, he doesn’t want to see that phase in life where he is struggling for money. So a good safety net is important for him to have a good night sleep.


FIVE years down the line in 2020 –

For Security he had created an emergency fund. Today he has 2 years of expenses in it only for occasions when there is actual emergency.

Do you think you will face any emergency in your life? If yes, you can also create one.

For Travelling he has a separate account invested in Debt products. He invests every month and redeems amount whenever he has to travel. In last 5 years he has made trips to Greece and Thailand. He has also travelled thrice within India.

Do you have travelling or some other passion then you can also start planning for it.

For Family- He knows that nobody knows about future. So he has taken TERM INSURANCE for himself so that in case something happens to him his family shall not suffer financially.

Further he has started investing in equity products for his kids so that their graduation cost and marriage cost can be taken care of to some extent ( Although he hasn’t has any kid yet)

Do you think you have family who is completely financially dependant on you or at least you contribute upto 50% of your home expenses. Then you can include Term insurance in your personal life planning.

Do you think you will need money for your kids education/marriage. If yes you must start planning atleast from the 15 years prior to the event. This will help you invest less and earn more because time is more critical factor than return.

For FREEDOM- He want to retire early in 2030 at age 40. His focus is to get away from this corporate life and do something which he likes.

He has started investing in Equity products to create wealth for his post retirement years.

For Health- He focuses on continuous physical activity. Further he has taken health insurance for him and his family.

This insurance has been taken considering increasing cost of health facilities. This insurance will save his pocket in case some health emergency comes in.

Do you also feel early retirement is one of your goals. Then why not start now. Remember time function plays more important than return( We will discuss this towards end of this answer)

Now you must be thinking he is earning a lot that is why he is able to plan.

BUT the scenario is-

He has prioritised his spendings.

He doesn’t spend much on new gadgets.

He doesn’t care about upgrading his car.

He doesn’t like to spend much money on dining out and drinks.

He doesn’t believe in doing impulsive shopping.

He has some debt but working towards zero debt by end of year 2020.

He is staying on rent but has no plan to purchase until and unless he can have it without loan.

He spends on what gives him happiness and good sleep.



It is the time you shall think. Once you get your priorities, source of happiness then financial planning will be really easy and full of fun. You will feel excited seeing yourself reaching near to goal.

Now to further clarify your doubts that you do not need lot of money to plan all such things and how time plays a critical role.You must see below Chart A and Chart B –

Cost of delay

CHART A – Your target corpus of retirement is 5 crore. And you are thinking that there is a lot of time to retirement you will start bit later.

This chart depicts- If you start investing ten years earlier you just need to pay Rs 3980 for corpus of 5 crore vis-a-vis Rs 14000 if you delay.

Food for thought – Can you take out this money for your retirement now? If yes, then please do it.

CHART B – TIME matters more and RETURN matter less.

Time matters than returns

A above depicts that if you consider 10% as return and time as 20 years you will get Rs 7.6 Lakhs with Rs 1000 SIP

B above depicts that if you INCREASE the return to 20% but keep time as 10 years you get only Rs 3.8 lakhs with Rs 1000 SIP. ( This clearly shows if you start late and even if you get double the return the accumulated amount will be half)

C above depicts that if you double the investment amount at return 10% but delayed by 10 years then you accumulate Rs 4.1 lakhs which is again half of the case 1.

Food For Thought-

Neither more investment nor more return can give you that much accumulated amount which more time can give. So it matters less how much you earn but what matters more how much time you have given your money to grow.

I believe Anant has clarified enough that-

Financial planning is all about YOU ONLY.

Financial planning is all about managing YOUR personal life.

If you are clear about your personal life values and priorities then financial planning is very easy. Further Anant has also given you lesson understanding this in early age is crucial.

I hope, now you understand how to start the process of financial planning 🙂

For your Info- Anant is targeting corpus of Rs 3 Crore by 2030 for his post freedom years.

I hope you have read the blog till end and will also implement suggestions. My only aim is to make finance so easy and fun activity that you start enjoying the process of wealth accumulation.

These words are by a money coach on Quora. You can follow him at Kapil Kukreja to be pro at personal finance.

Previous posts

2 thoughts on “The Art of Financial planning

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

Create your website with
Get started
%d bloggers like this: