Planning8 min read
What is financial planning?
Understand how your income, expenses, assets, liabilities, goals, investments and protection fit into one financial picture.
Read the basics→Planvesto Learning
Understand your moneybefore you act.
Financial planning becomes easier when you understand the decisions behind the products, numbers and recommendations.
Start here
Financial thinking, explained simply.
Start with the concepts that influence the biggest financial decisions in your life.
Investing10 min read
Why investment planning comes before product selection
Learn why the purpose, time horizon, risk and role of an investment should be understood before choosing a product.
Read the basics→Risk9 min read
Risk capacity vs risk tolerance
Understand why financial ability to absorb risk and personal willingness to take risk are not necessarily the same thing.
Read the basics→Planning
See the whole financial picture.
Financial planning is not only about investments. It brings the important parts of your financial life together so that decisions can be considered in context.
Explore financial planning→Concept
Financial health
Understand income, expenses, assets, liabilities, liquidity and financial position.
Concept
Financial goals
Define what your money needs to accomplish and when.
Concept
Cash flow
Understand how current income and spending affect future choices.
Concept
Net worth
See the relationship between what you own and what you owe.
Investing
Understand what your investments are supposed to do.
An investment should have a role within the financial plan. Learn the basic concepts behind asset allocation, portfolio construction, risk and investment selection.
01
Asset allocation
Understand why portfolios may combine assets with different characteristics.
02
Time horizon
Understand how the time available can affect investment decisions.
03
Volatility
Learn why investment values can fluctuate and why that matters.
04
Portfolio fit
A product should be considered in relation to the rest of your portfolio.
Risk
Risk is a financial concept, not just a feeling.
Your reaction to market uncertainty matters, but so does your actual financial ability to absorb adverse outcomes.
Explore risk in investment planning→Risk capacity
AbilityThe financial ability to absorb losses or uncertainty.
Risk tolerance
WillingnessThe degree of uncertainty or volatility a person is willing to accept.
Risk requirement
GoalThe level of risk associated with pursuing a particular financial outcome.
Decisions
Better decisions start with better questions.
Instead of asking only which product is best, understand the financial problem, available alternatives, constraints and consequences.
Question 01
What am I trying to achieve?
Start with the financial outcome rather than the product.
Question 02
What are my alternatives?
A financial decision can have several possible approaches.
Question 03
What changes if I choose each one?
Understand the trade-offs before selecting an approach.
Financial basics
Start with the numbers that describe your financial life.
Income
Money coming into your financial life.
Expenses
Money required to maintain your current lifestyle and obligations.
Assets
Things of financial value that you own.
Liabilities
Financial obligations that you owe.
These basic elements provide the starting context for many financial planning and decision-making questions.
Put knowledge into context
Understanding is the first step. Planning comes next.
Bring your financial position, goals, investments and protection together and start building your financial plan.