The Difference Between an Investment Plan and a Financial Plan
At first glance, an
investment plan and a financial plan look relatively similar. While there is
some overlap between the two types of plans, each offers a unique set of
benefits that are key to establishing and maintaining your financial
differences can help you apply the most appropriate plan for your financial
situation, or help you understand how both can put you on a better path to
pursuing your financial goals.
Think about investment
plans in terms of how you
are going to meet your financial goals. Investment plans will tend to focus on
your current financial situation and will help you establish how and where you
will invest your money. They can also contribute to prospective planning if you
need to change your investment strategy.
An investment plan
begins with your current financial situation. So, to create the plan, you need
to evaluate the assets you have, or those you plan on acquiring and determine
where you wish to allocate them—typically in stocks, bonds, or real
The future status of
your investments depends on how well you adhere to the original plan while you
will continue to add funds along the way. The process can be complicated and
nuanced, so it helps to have a trusted partner in your corner. Our team can
help you understand your current financial situation, determine your risk
tolerance and asset allocations, and make recommendations based on which
securities or investments make the most financial sense for you. Your goals are
our guidepost, so we’ll help you manage your investments and make the
appropriate changes to pursue whatever it is you are hoping to achieve.
On the other hand, a
financial plan is about pursuing the future you want. These types of plans help
you work toward long-term goals, such as building a stable retirement fund. It
will also account for how many factors, your desired retirement age, for
example, will affect your plans.
A financial plan
considers factors such as your income, tax situation, cash flow, debt, and
expenses, as well as your estate and any other assets. Financial plans also
account for your spending habits; they are particularly useful if you’re
looking to set a budget or work toward specific goals for retirement, such as
travel or the purchase of a second home.
Financial plans and
investment plans can be complicated, especially if you have specific short- and
long-term financial goals. You’ll want to call in professionals with the
in-depth knowledge and expertise to help you maximize your finances and make
the most of the opportunities available to you now, and in the future.
Whether you have an
extensive portfolio of assets ready to manage, or you’re just getting started,
we’re here to help. All of our team members at Hapanowicz & Associates are just a phone call or
email away, ready to answer your questions and set you on the right financial
path. You can also feel free to reach out to me directly at firstname.lastname@example.org.
We look forward to
getting to know you!