TITLE OF THE PROJECT

STUDY ON FINAMCIAL PLANNING OF AN INDIVIDUAL INVESTOR

INTRODUCTION

Financial planning is a critical process for individuals seeking to achieve long-term financial
security and make the most of their financial resources. For individual investors, financial
planning involves setting clear goals, assessing current financial health, and implementing
strategies to accumulate wealth while managing risk. It encompasses a wide range of
decisions—from budgeting and saving to investing and retirement planning. By following a
structured approach, individuals can navigate the complexities of the financial landscape,
reduce uncertainty, and build a strong foundation for their future.

Effective financial planning helps investors align their personal values and financial goals
with their investment strategies. It considers factors such as risk tolerance, time horizon, and
personal circumstances to create a tailored plan that evolves with changing life stages, market
conditions, and economic trends. Whether you're planning for retirement, saving for a child's
education, or aiming for financial independence, a well-crafted financial plan serves as a
roadmap that can help turn aspirations into achievable objectives.

This guide aims to walk you through the essential elements of financial planning, equipping
you with the knowledge and tools to take charge of your financial destiny.

IMPORTANCE OF THE STUDY

Financial planning is crucial for individual investors as it provides a structured approach to

achieving financial goals and securing long-term financial stability. It helps investors assess
their current financial situation, set clear objectives (e.g., retirement, buying a home, or
funding education), and create a strategy to reach those goals.

The key benefits of financial planning include:

1. Goal Achievement: A financial plan outlines specific steps to reach personal goals,
ensuring that savings and investments are aligned with long-term aspirations.
2. Risk Management: It helps identify and manage financial risks, such as market
volatility or unforeseen expenses, by recommending insurance and emergency savings.
3. Informed Decision-Making: A solid plan provides clarity and confidence when
making investment and financial decisions.

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 4. Financial Discipline: It encourages consistent saving, controlled spending, and
disciplined investing, which leads to greater financial security.
5. Peace of Mind: Knowing that you have a comprehensive strategy in place reduces
financial stress and gives you a clear path forward.

LITERATURE REVIEW

Agarwal et al (2015)

Agarwal et al. investigate the association between financial planning and personal investment from
2015 to the present. He also does multivariate analysis to get his conclusion. In his study, he discovers
that the likelihood of receiving accurate responses on financial literacy is greater for male respondents
than for female respondents, and increases with education level and aggressiveness.

Becker and Mullingam (1997)

Becker and Mullingam examine the relationship between financial planning and individual investment
over the period of 1997.

Construct an optimal period model where individuals can choose to consume now or in the future; the
balance that has achieved between the two desirable but incompatible features; a compromise this
depending on an Endogenous time discount factor.

Dow (2009)

Dow analyse the relationship between financial decision-making and individual investment from 2009
to the present. In addition to using data from the Survey of Consumer Finances, he employs
multivariate analysis to reach his conclusion. He concludes that stated investment horizons are crucial
for asset allocation. Our paper contributes to the field by analysing the investment horizon as a growth
variable rather than a marginal one. It is uncertain which elements other than age will have an impact
on financial planning. Other socioeconomic variables 140 that have been determined to be crucial for
financial decision-making can provide some insight.

Campbell (2006)

Campbell examines the relationship between individual financial management and individual
investment in 2006 and provides an outline of some of the most important concerns in family or
personal financial management. He also does multivariate analysis to get his conclusion. He concludes
that the relationship between time and investment behaviour is one of the fundamental issues. While
little research has been conducted on the causes of investing horizons, there has been extensive
research on how rational, forward-looking investors should behave. For instance, conventional
investment advice recommends that as an investor ages, their asset allocation should shift from
equities to bonds.

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Financial Planning helps us give direction and meaning to our business decisions. It allows us to
understand how each financial decision affects other areas of financing. It enables a person to
identify their goals, assess the current position, and takes necessary steps to achieve the goals.
Thus, it becomes essential to save and invest while working so that people will continue to earn a
satisfying income and enjoy a comfortable lifestyle.

OBJECTIVES OF THE STUDY

This project executed to know what is precisely the Financial Planning. How is it carried out? Who
carries it out? Why is it carried out? When it will be carried out?? What is the interest of carrying it
out?

• To take an overview of the investor’s short- term and long- term goals and objectives.
• To have the current financial strengths and weaknesses and effect on the financial plan for the
investor.
• To study the financial objectives anchored to current resources for the investor.
• To give a particular summation of all recommendations.
• To suggest an appropriate financial plan for mutually selected recommendation.

HYPOTHESIS OF THE STUDY

• H0:- There is no significance of financial strengths and weaknesses that the investors had to
implement financial planning.
• H1:- There is significance of financial strengths and weaknesses that the investors had to
implement financial planning.

RESEARCH METHODOLOGY

RESEARCH DESIGN

The study is about to find various avenues available for any individual investors and ways to achieve
long term and short term financial goals through financial planning.

The data required for the study would be acquired through personal interview and Questionnaire and it
was collected by the means of cold calling.

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DATA COLLECTION TOOLS & TECHNIQUES

• The Primary Data: The primary data for the study has collected by surveying investor's
investment objectives and risk profile
• The Secondary Data: The secondary data includes information obtained from various
sources, which provides for Books, Magazines, Newspapers, websites, etc.
SAMPLE DESIGN
Sample design was based on principle of Sample survey. The various parameters on which the
research was to be conducted are:
Awareness of financial planning
Alignment of life goals and financial goals
Investment distribution in various asset classes
Decision influencing Investment

SCOPE OF THE STUDY

Individual financial planners are not just for wealthy people also for any individual wants to have their
own business. Every person can benefit from objective help to create, grow, accumulate, and
utilize wealth to fulfill one's personal goals, family goals, and another lifestyle objective
systematically without any concern. Financial planners can lead individuals to achieve their ultimate
purpose of spending retired life peacefully without compromising living standards and the other issue.
An eligible financial planner will provide advice on Systematic saving Cash flow management,
Debt management and Assets allocation of investment Managing risk through insurance planning.

Tax strategies to increase inventible surplus.

Distribute residual wealth through estate planning.

Systematic saving.

Cash flow management.

Debt management.

The asset allocation of investment.

We are managing risk through insurance planning.

The Financial planning is a profession for people with good communication skills combined with
knowledge of how the financial service industry works and deal. As a financial planner, he could
work for a bank, insurance company, or have his own practice. Most important is to understand that
the suitability of products you are guiding people to purchase based on their risk appetite, age, and

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time frame of goals and objectives. Financial planners need to continually update themselves on new
products, services, and tax laws that might be good for their clients.

LIMITATIONS OF THE STUDY

• Life Changes: Unexpected events like job loss, illness, or family changes can disrupt
financial goals and require frequent adjustments to the plan.

• Market Uncertainty: Economic factors, market volatility, and inflation can negatively impact
investment returns, making financial plans less predictable.

• Behavioral Biases: Emotional decision-making, such as fear or overconfidence, can lead to

deviations from the plan, undermining long-term financial goals.

• Cost of Professional Advice: High fees for financial advisors can be prohibitive for some,
limiting access to expert planning.

• Inadequate Emergency Fund: Without a proper emergency fund, investors may have to
liquidate long-term investments prematurely to cover unexpected expenses.

PROPOSED CHAPTERS

CHAPTER 1: INTRODUCTION- It will include Objectives, Review of

Literature, Hypothesis of the Study, Scope, Limitations of study and Research
methodology.

CHAPTER 2: COMPANY PROFILE- It will include the details of Reliance

Money Company.

CHAPTER 3: DATA ANALYSIS AND INTERPRETATION- It will include

presentation and analysis of data, bar graphs, pie charts, and tables with their
Interpretation.

CHAPTER 4: CONCLUSION- It will include Findings, Conclusion and

Suggestions.

ANNEXURE 1: BIBLIOGRAPHY

ANNEXURE 2: QUESTIONNAIRE

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 BIBLIOGRAPHY

Becker, G. & Mulligan, C. (1997) the Endogenous Determination of Time Preference, the

Quarterly Journal of Economics 112, 729-758

Campbell, J. (2006) "Household Finance" Journal of Finance, 61, 1553-1604

Dow, James, P. (2009) Age, Investing Horizon and Asset Allocation, Journal of Economics and
Finance 33, 422-436.

Agarwal, S., Gene, A., Ben, I. D, Souphala, C &Evanoff, D. D. (2015). Financial Literacy and
Financial Planning: The Evidence from India. Journal of Housing Economics, 27, 4–21.
doi:10.1016/j.jhe.2015.02.003

Prof. (Dr.) Mahesh Chandra Prasad Name- Mithilesh Deep

Management Programe. Class- MBA (SEM 3rd)

Department of Applied Economics and Commerce. Roll- 19, Reg. No.- 11170028

PATNA UNIVERSITY Specialization- Finance

Session-2023-25

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