The importance of a holistic financial plan for lasting financial security

In today’s unpredictable and fast-paced world, achieving financial success requires more than just saving money or investing in the latest trends. A truly secure financial future is built on a holistic approach that integrates various aspects of financial planning.

Where to start?

With many things in life, building a strong foundation is fundamental to achieving success, and your financial journey is no different. The foundation of a holistic financial plan should incorporate your needs, goals, and objectives. Start by defining what you want to achieve and what is most important to you. These objectives will differ for everyone, as we all have unique circumstances and want to achieve different goals. Having specific, measurable, achievable, relevant, and time-bound (SMART) goals will help provide direction and motivation.

A holistic financial plan should also be robust. Life is unpredictable, so your plan must be flexible enough to accommodate changes in your circumstances.

What to consider

Getting the right advice is key, and managing your financial journey with the right guidance will make all the difference. A financial adviser is a qualified professional who will provide advice based on your goals and objectives. They will also help you create a holistic financial plan and assist you in sticking to it to achieve your desired outcomes.

Once you have defined your goals and objectives, you should consider the following:

·       Assess your current financial health: Conduct a thorough financial assessment to understand your income, expenses, savings, assets, and liabilities.

·       Create a budget (and stick to it): A budget is the cornerstone of effective financial planning. It is helpful to categorise your budget into needs, wants, and savings.

·       Build an emergency fund: Life is unpredictable, so it is extremely helpful to have an emergency fund for those rainy days.

·       Manage debt wisely: Debt can be a major obstacle if not managed correctly. Understand your debt and have a strategy for prioritising which debts to pay off first.

·       Invest for growth: Investing your savings in the right portfolio is key. There are many options available, and it is crucial to understand the underlying investments and the growth expectations.

·       Plan for retirement: It’s never too early to plan for retirement.

·       Protect your assets: Safeguarding what you have already built is imperative.

·       Plan for your family: Ensure that your family has a secure financial future in the event of your death or disability.

Many factors can influence the success of your holistic financial plan so partnering with a financial adviser to guide you through this process is extremely beneficial. Investing in professional advice is an investment in your peace of mind and long-term success.

* Laubscher is an advice and product specialist, PSG Wealth.

PERSONAL FINANCE