THE IMPORTANCE OF PERSONAL TAX PLANNING

tax

“In this world nothing can be said to be certain, except death and taxes”

-Benjamin Franklin
Taxes are unavoidable and mismanaging taxes can result in paying more to the government than due. One should know that assets created without tax considerations is not a full proof personal finance strategy.

Here comes the need and importance of financial planning in personal finance world. Financial planning process encourages legal income and tax contribution that is due. It believes that by planning tax-efficient investment strategies for retirement or for any other purpose, one has a greater chance of keeping more savings for oneself which will be free from any liabilities for the beneficiaries to enjoy. Advice to invest your savings for better return is a pure investment advice, while advice to invest after efficient tax planning is a feature of financial planning.

Planning itself depicts that it considers every important points and aspect required. Personal finance is one of those important aspects which require a proper planning. Mere saving and investing will not serve the core objective of financial security. Financial planning is a systematic approach in dealing with one’s personal finance which projects a fully protected personal finance strategy for its beneficiaries. Tax planning is one of the areas of knowledge in financial planners’ course (CFP) under FINANCIAL PLANNING STANDARD BOARD, INDIA.

It is a universal duty of every citizen of the globe to pay his part of taxes to the concerned government who works on their behalf. Government strategies, policies and investigations may sometimes lately held one liable for its tax dues if found. So without being defaulters of taxes, one should pay it in due course of time as one cannot effort to lose their accumulated corpus by way of tax during retirement in particular.