Life planning is the new definition of financial planning

Dubai - Financial planning is also not only about saving but how you maintain

Life planning and financial planning go hand-in-hand. As life planning is not only about your relations but also about how you maintain your relations, financial planning is also not only about saving but how you maintain and plan the savings to work for you now and in future.
For life planning, the focus is more on who you are and who you want to be than it is about people and relationships that you have. For financial planning, the focus is more about who you are and who you want to be than it is about money. People today don't look ahead in an effort to figure out how to maintain their current lifestyles in retirement. Instead, they look at how to change their current lifestyle to achieve the lifestyle of their dreams. So financial planning is no more just a thing for future but it is also about current lifestyle.
Traditionally, financial planning use to be all about calculations and investments of money. People would look at how much they earn, figure out how much they will need in the future to maintain the desired lifestyle and try to come up with a financial plan that will help them protect and reach the magic number that will allow them to retire.
The whole process is exciting for some and cumbersome for some others. Unfortunately, many people choose not to deal with it all, preferring to put off worrying about the future until it arrives. Some would accept the challenges as a part of life and they believe that the bills are just another part of life - they need to be dealt with because you don't have much choice.
However, there's a quiet minority of new generation whiz-kids that are taking a different approach. It goes by a variety of names, but "life planning" is one of the more frequently heard terms as compared to financial planning.
As I read it somewhere some time ago, life planning is different than traditional financial planning for this new breed. For these people, the concept of money is intertwined with the concepts of spirituality, creativity, family, service and other emotional aspects of personal satisfaction. Happiness is measured in more than just dollars and cents. It's not "he who dies with most toys wins"; it's "he who gets the most out of life wins".
For many, it's more of a lifestyle change than anything resembling the retirement-planning process. Financial planning experts are hence charged with innovative challenges to meet their client needs.
There are professionals like doctors who would like to pick up a hammer and open a repair shop and they might be able to do it in cash. There are top-notch CEOs who embrace aprons and would open up a fine-dining outlet. And there are artists who turn businessmen towards their retirement. Today most of us would like to have and make choices, so they work with a financial advisor in order to determine how to develop the financial plan that will allow them to realise their personal goals. You want more or even if you want less from your life, you still may need financial advisor's to achieve your goals.
Rather than trying to earn more money or build a bigger villa, a significant number of people are managing with less in order to achieve their goals. They give up on a big house, Ferraris, long trips and even they give up bigger jobs to fulfill their personal goals. These sacrifices can't be done on an impulse; they will need careful planning. One cannot just quit a job because that person believes that he or she wants a simple life and even by quitting he will manage to survive the way he or she wants. It will require thoughtful planning to understand your own personal goals and the then plan for less. And it can't be done at the cost of your current lifestyle.
If living in a small apartment frees up enough cash to increase time spent on the golf course, some people are willing to make the trade. In order to exchange the stress of corporate management for the quiet bliss of a career grooming pets, some people are willing to take a significant cut in pay. When you don't like what you're doing and know how you'd rather spend your time, life planning can help you make the transition.
Prior to taking the leap, you should carefully examine your motivation and your financial resources. Then all you have to do is come up with the plan that will get you there.
Its is not only about saving but it is more about what lifestyle you want and the changes you are ready to make in your current lifestyle to achieve your future goal.
The author is an entrepreneur and financial planning consultant. Views expressed are her own and do not reflect the newspaper's policy.