18 Jan Why is financial planning important?
by Michael Cocco, CFP®, AXA Advisors
Question: Why is financial planning important?
Answer: You need strategies to turn your financial dreams into realities. Empower yourself to make informed decisions by focusing on your goals, planning for each life stage and educating yourself.
To help you reach your goals, start by outlining each of them in light of your current situation, and identify the gaps and opportunities in your financial strategies. Ask yourself:
1. How do my assets compare to my liabilities?
2. Have I established an emergency reserve?
3. Do I know how I spend my money each month?
Armed with this knowledge, you can develop a plan to help you feel in control of your financial well-being and confident that you are doing all you can to prepare for your future. Ask yourself:
1. Have I adequately provided for my family in the event of a death, disability or long-term care need?
2. Do I know how much income I might need when I retire?
3. Will I have the freedom to enjoy the lifestyle I worked so hard to achieve?
4. Am I properly planning to save for a specific expense such as my children’s education or a new home?
Even if you have a sophisticated understanding of financial concepts, you can still benefit from the expertise and perspective of a professional. Ask him or her:
1. Does my investment strategy allow me to achieve my goals?
2. How does my taxable income impact my savings and investment programs?
3. How do I address my concerns about reducing potential federal and estate taxes?
4. What do I do to arrange for the efficient transfer of assets to my heirs?
Each decision you make affects the one thereafter. So, while it is important to address each concern individually, it is even more crucial to assess how they interact. Evaluate each of your goals in the context of one, integrated strategy–because with a comprehensive plan, your financial dreams will become a reality.
Michael Cocco is a certified financial planner with AXA Advisors in Nutley. He may be reached at or (973) 667-8650.
This story was first posted in January 2016.
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AXA Advisors, LLC, 1290 Avenue of the Americas, NY, NY 10104, 212-554-1234. AXA Advisors, LLC and its affiliates do not provide tax or legal advice. Securities offered through AXA Advisors, LLC, member FINRA/SIPC. Investment advisory products and services offered through AXA Advisors, LLC, an investment advisor registered with the SEC. Insurance and annuity products offered through AXA Network, LLC. GE-103520 (05/15) (Exp.05/17)