With the growing uncertainty regarding the security of retirement income, more people are becoming concerned about the health of their future finances. Personal debt is still rising and most people are not saving enough, especially for retirement.
As well as managing short term budgeting plans, most individuals & households should also now be looking at long-term financial planning. If you want to better manage savings for college funds, mortgages and retirement, as well as calculate the financial effects of changing jobs, moving house, or having a family, then financial planning tools are crucial. If you want to know what your finances will look like in 10, 20, 30 years + then financial planning is the key.
Hiring an independent fee-only financial advisor can cost up to a few thousand dollars. Fee-based financial planners may cost less but do not offer impartial advice as they also receive commission for investment products they sell you. Another option, especially for those on lower or medium incomes, is an online/desktop financial planning tool.
Financial planning programs work by applying basic assumptions to the information you enter and processing complex calculations to provide your with financial plan results. Some of the benefits of financial planning software:
- Provide step by step guidance when inputting financial data
- Powerful forecasting engines
- Run multiple what-if scenarios to help you make decisions impacting on future savings
- Illustrated charts show projected plan results
- Provide detailed financial reports e.g. net worth, cashflow projections, investment plans, tax plans, estate planning
- Asset allocation recommendations
- Suggest steps to take to reach financial goals
- Access to user community to ask/answer queries and share information
If you’d like to go ahead and create your own financial plans, or want to try a free trial, there are some good programs such as:
- eFinPLAN Online, $98/year
- ESPlanner Windows Download, basic version free or $149/year
- FinancialFate Windows Download, Free
- Simplifi Online, Free
- Voyant Online & Mac/Windows Download, Free
Once you’ve explored these programs and realize the benefits of financial planning and if you feel that you want more in-depth and customized advice, a financial advisor can help. But in any case, these financial planning programs offer a great head start for a more secure financial future.
