Are you currently charting out your financial plan to achieve your goals? Has stress or anxiety caused by a life-changing event clouded your financial judgement? Are you trying to understand the processes of financial planning and financial transitions planning better? Here are the answers you are looking for. In the course of this short piece you will understand the differences between the two process and the significance of each. You will also see why every coherent financial plan must include a process of financial transition planning in its scope.

In general the process of financial planning involves preparing a comprehensive statement of the long-term goals for your security and well-being. It also includes a savings and investing regimen to achieve those goals. In this light, financial planning is not a one time exercise. All sound financial plans are dynamic and must remain relevant to your dynamic financial profile. This process of continually reviewing your own financial plan helps you stay on track to achieve your personal goals and provides you the necessary clarity to improve or alter these goals. In line with this, here are some features that sound financial plans include:

1. A clear understanding and articulation of your financial goals.
2. Recognition of risks that range from accidents, health risks and mortality, as well as identifying the need and quantum of insurance. 
3. Awareness of the rate of return and quantity of savings that is required to achieve your goals.
4. A psychometric test to measure your willingness to take risks. This is commonly known as a risk profile and allows you to identify your capacity for execution with respect to your financial profile. 
5. In terms of investments, the asset allocation decisions and selection of products, based on the above factors, as well as capital market expectations.
6. Necessary flexibility in order to alter the financial and investment plan, as and when you are required. 

However, when major life changing events occur – like receiving an inheritance, having to sell your business or deciding to retire – people tend to experience states of mental turmoil, stress and anxiety. These states are extremely overwhelming and can be hard for you to overlook. Overcome by stress, your rational long-term thinking is replaced by confusion, emotional turbulence and inconsistent behavior which often leads to regrettable financial decisions. A specialised process of financial transition planning is essential to guide you during this time. It is a personalised type of advisory service, designed specifically for you, to help manage these overwhelming life changing events and regain clarity of your thoughts and control of your goals.

Large moments of change are almost inevitable in life. It is for that very reason that financial transition planning is aimed at aligning the monetary side of finance with the chaos of real life so that you can make decisions at times that are emotionally exhausting. The financial planning in this case involves establishing order in chaotic periods, to regain balance in your life so that you may coherently explore your options and refine your decisions as you move forward. It allows you to hone your capabilities to achieve your goals at the time you need it the most. It is for this reason that it is imperative for you to hire an experienced and certified financial transitionist. 

All sound financial plans will include a facet for the planning of financial transitions in their scope. This adds a more personal element to the standardised features of the best financial plans. A financial plan can be created independently or with the help of a professional. It is advisable that you hire a certified financial planner or wealth management firm to assist you in devising your financial plan as the processes involved may be beyond the scope of your skill-set.