Experts Share the Top

5 Pitfalls in
Financial Planning
Financial Planning

Financial planning is a must and most of us try to plan our

finances for a happy and worry-free future. When financial
planners were asked about this, they said, now most of the
people plan their finances but when they ask their clients
they spotted various financial mistakes, which need to be
corrected for better results.
Top 5 Financial Mistakes

No Track of non-recurring Expenses

 We all have a track of our regular expenses like our home rent,
grocery, etc. but when it comes to non- regular expenses such as
medicals bills, shopping are generally untraced.

 Having an estimated idea and planning for it before only can make
lots of change.
Investment without Purpose

 Most people simply invest their money without any defined

purpose of their investments. Relying on friends, bankers and
the insurance agents.

 People who invest like this has the risk of being mis-sold investing
products that they may not need.

 Hence, it’s important to be careful and know all the terms,

conditions, benefits of the product that you are buying.
No idea of where they Stand Financially

 One of the principal undertakings that a financial advisor does

while handling their client is investigating the Client’s funds to
know what they are doing financially.

 A large portion of their customers had either thought little of or

overestimated their accounts.

 More importantly, having a clear idea of where you stand

financially helps you to plan your future finances well.
Mixing Term Insurance & Investments

 Term Insurances are financial instruments which provides cover to

you and your loved ones when you are not there.

 All term insurance policies are one of the investment options.

 But all investment channels do not provide cover, but for sure gives
a return on investment to you.

 Both should be accounted separately, as the returns and purpose of

both are in contrast to each other.
Not Planning for Retirement Seriously

 Your liabilities may reduce but expenses are somewhat similar as

you can’t cut down on your expenses when you retire.

 Hence one should start planning for retirement and the

contribution towards it should be more than PF.

 To do so, one can open PPF accounts with banks which gives
your maximum returns, opening PLI accounts or FDs in the post
office is also an option.
Even a single mistake in your financial planning can stop you to
reach your goals. Paying attention to the above-mentioned
points can also help you to correct some of your financial
mistakes.