Whatever purpose we set ourselves, the shortest way to achieve it is a planning of the times, methods and resources needed, that is planning. This is also true in the family environment, because the family represents a life project .
In fact, forming a family means, just to give the most trivial examples, thinking of an adequate home in which to live, of giving birth to children to raise and to guarantee prospects of independent life (first of all through appropriate education and training). A family therefore also involves financial planning, to achieve that kind of life for which the family itself was created.
An ‘Industrial plan’ for the family
Basically, family planning for the family is the equivalent of the industrial plan for a company, that is, it is the programming tool through which you can evaluate your starting possibilities to see what you can do, how and how much you can make a profit. those possibilities.
A correct family planning therefore starts from the analysis of the economic and financial situation of the family itself, from the ‘balance sheet’ so to speak, as well as from the weighting of current and foreseeable and / or budgeted needs. The first step to avoid gambling and carry out effective, i.e. rational, planning is therefore the recognition of what the family unit (typically the two adults who formed it) possess both as assets (properties, accounts and so on. ) and income (income, annuities, etc.). On this basis, realistically achievable objectives can be defined , taking into account all the immediate charges that weigh on assets and revenues (any mortgage, taxes, current expenses for everyday life).
So far it is a matter of simply doing home economics and evaluating the family budget, but once you have ascertained how much you are able to save for investments, it is then necessary to define the purpose for which you want to invest and therefore give yourself a coherent time horizon.(the need for a new and more spacious house can mature in 9 months, the need for the school fees can mature in a longer time). Identifying the availability and defining the objectives for which to use them, purely personal choices, the last step to take to fine-tune your planning is to evaluate the possibilities that the market offers, a function for which you can also contact a consultant (it is not mandatory, but allows for a more precise analysis, especially for those less accustomed to finance).
Once the route has been drawn, you need a compass to know how to follow it
An essential prerequisite for being able to follow through on planning is the ability to save and in this regard it is good to keep in mind that current expenses can vary significantly over the time for which you have chosen to invest. A family plan developed for a newborn child to allow him to attend a good university must take into account the fact that that child will have an increasing cost over the years, even before university, as he passes from the cradle to the tricycle and then to the bicycle and maybe the scooter. To maintain the course that is taken with financial planning, Consob suggests drawing up a list of its ordinary expenses, placing them in order of decreasing importance, so as to be able to cut less essential expenses where the expenses to be faced risk compromising the savings capacity necessary to implement the programming that has been given to us (the list must clearly be updated with a certain regularity) .
As with any asset allocation, it is also good practice for planning to diversify your portfolio, so as to reduce overall risk exposure. Finally, it should be remembered that the more ambitious the goal to be achieved through planning (sending children not only to university, but to Harvard, for example), the greater the return that must be achieved and the higher it is therefore the exposure to the risk that must be faced (due to the natural correlation between risk and return of each investment).