Prestige Professional Management
Your Consumer Resource Specialist
If you want to get serious about financial planning then you are going to need a financial needs analysis. Never fear – it is not as complicated as it sounds. Here is a beginner’s guide to a financial needs analysis.
A financial needs analysis is carried out to ascertain the current state of your finances and your future financial needs. It also ensures that you are not sold any particular financial product without an overall assessment of your finances and existing financial portfolio. The following factors have to be taken into account when you are constructing your financial needs analysis:
- Your income and expenses or your budget.
- Your current assets and liabilities - this would include assets such as property and liabilities such as your debts.
- A list of all the current financial products you own such as life insurance policies, funeral policies and investments.
- Your current and future financial needs depending on your life stage. For example, your marital status and whether you have dependants or not.
- Any employment benefits you enjoy, such as group life assurance and medical aid benefits.
- Saving for your children’s education.
- How much money you need to save for retirement so that you don’t have to dramatically change your lifestyle when you stop working.
- Your ability to earn an income is your greatest asset. You need to have income protection assurance so that you are financially covered if you get retrenched.
- Dread disease coverage if you have health issues and end up with, for example, cancer, the medical costs are incredibly high and are often not covered fully by your medical aid.
- Disability insurance coverage if you sustain an injury, for example a rock-climbing accident results in you losing the use of your legs, then disability insurance covers costs such as renovations to your home to accommodate a wheelchair, the cost of a wheelchair and physiotherapy in the long term. If you are unable to work your policy will also replace all or part of your income. Note that you will need to be aware that disability policies are either sold with a lump sum amount or an income component.
While this may seem like a lot of work, it ultimately protects you from being sold products you don’t need and possibly cannot afford to pay for. It also ensures that your family is financially provided for and that your finances are in order. Don't delay another day! Let us put together a financial need analysis for you today. Request your customized report below.
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