Elements of Personal Financial Planning

I. Housing planning.

Clothing, food, housing and travelling are the most basic material needs of people, among which housing is the one that requires the largest amount of money, and housing planning is the most important part of personal financial planning. The first problem to be solved in housing planning is whether to loan meet the demand for housing by renting or purchasing a house, and the decision to rent or purchase a house should be made according to different needs, and the choice of purchasing a house should also take into account the problems of housing loans and other aspects. People should be at different stages according to personal needs for reasonable housing planning, prior preparation, so as not to fall into the housing dilemma.

Second, education planning.

It is not difficult to find out that most of the college graduates around us earn far more than high school graduates, and high school graduates earn more than high school dropouts. In other words, having a higher level of education usually means that you are likely to earn a higher income in life. Education planning, on the other hand, mainly consists of personal education investment planning, and children's education investment planning. Education planning is therefore an important investment that an individual can make in his or her own, or a parent's, child's future income. The investment in children's education can be divided into basic education planning and higher education planning. At present, the number of doctoral and master's degree students in China is increasing year by year, and the demand for senior talents in the future society is also getting bigger and bigger. In this era where knowledge is power, people prefer their children to receive good education and have more choices in their future life.

Third, investment planning.

In order to ensure a desirable living condition in the future, you can't spend all of your income today. Instead, you should set aside some of it and use it for investment, delaying the pleasure brought by consumption at this moment and allowing him to gain greater benefits in the future, which is called investment and financial planning. In investment planning, we must first clarify the investment objectives, investment risk assessment, combined with their own risk tolerance, through the appropriate investment and financial tools, the holding of assets for investment portfolio, and ultimately gain returns.

Fourth, insurance planning.

Insurance planning is an important part of personal ploan investment and financial planning, which makes analytical decisions and financial arrangements for insurance needs based on various risks in life or family life, such as death risk, disability risk, medical risk, old age risk, and property risk, etc., so as to safeguard the high quality of personal and family life by defusing the impact of potential risks. From a legal point of view, insurance is a contractual act in which the policyholder pays premiums to the insurer, and the insurer compensates the insured in the event of a contractual loss. Insurance planning has the function of risk transfer and reasonable tax avoidance, but also a safe and reliable means of investment.

Fifth, tax planning.

Tax planning is to make prior planning arrangements for tax-related matters with the help of a financial planner, before the person's tax behaviour occurs and without violating the law, by analysing the person's or family's production and operation or income status, etc., so as to achieve the purpose of paying less tax and deferring tax.