Financial Planning

What is Financial Planning?

According to Investopedia, a Financial Plan is a comprehensive evaluation of an investor’s current and future financial state by using currently known variables to predict future cash flows, asset values and withdrawal plans.

Financial Planning is an on-going process to help a person make sound and concrete decisions about money to help him or her achieve his or her short, medium, or long term financial goals in life.

Financial Planners help in devising a comprehensive plan but at a cost.

We can however create our simple yet sound plan by taking these 6 steps:

  1. Determine what our short-term, medium-term, or long-term goals are.
  2. Identify our current assets and liabilities.
  3. Given the current financial status, measure or evaluate how close we are from achieving the goals we identified in step 1.
  4. For each of the goals we have, develop a plan, sort of a “road map” to achieving them.
  5. Implement the identified plans and making sure we are on track with each execution.
  6. Monitor the execution, adjusting when necessary as our goals are achieved one after the other.

Below is a diagram of the Financial Planning process:


Financial Planning often is described in a pyramid which follows the inverse hierarchy with Protection being the foundation of Financial Planning, followed by Accumulation and then Distribution.


Most Filipinos, including me, fail to really address the need to plan for the future whether its for the achievement of short-term goals, mid-term, or the long-term aspirations. My advocacy for financial literacy sits well with my ambitious plan to compile in this web page a wealth of resources to help educate them, and myself.

Author: pruactiveadvisor

I am a Financial Advisor affiliated with PruLife UK, in the Philippines. I can help you with your Traditional insurance and VUL needs. But more than that, I am very willing to discuss with you your financial status and how we can find ways to improve it. I have been a strong advocate of financial literacy and financial wellness since 2010, sharing information related to achieving ones financial goals. If you want to set up a meeting to discuss your current financial status and needs, reach out to me thru

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