Question

Strategic Plan Discussion

Budgeting is very important to any business as the budget serves as the financial “roadmap” to help guide you towards your goals. Just as it is important for you to adhere to a budget in your household, a business must also develop and adhere to a budget. Budgets are part of the financial plan which, in turn, is part of an organization’s overall strategic plan.

1. In your first post, answer the following questions:

-What is the financial plan and why is it important? How does the financial plan factor into the overall strategic plan of an organization?

-Locate the mission statement of an existing health care organization and share it in your response. Do you believe the mission statement you have chosen is effective? Why or why not? Without knowing specifically what the goals are of this organization’s financial plan, how do you suppose the goals would affect the mission statement? Be sure to include the reference citation for the organization where you pulled the mission statement.

2. Reply to at least two of your peers and comment on the mission statements they have profiled in their posts. Please offer feedback on the comments that your peer has made regarding the financial plan and how it fits into the organization.

Answer 1

Financial Planning: Has a role in building the
“budget” and the “forecast” and in general
terms, is the “top-down” version of the budget.
The output from the financial plan is the input
to the operational plan. Scenario analysis, stress
testing, working capital analysis and re-forecast-
ing of the full financial statements are the key
use cases.

1. Manage your Money
Managing one’s money need not be boring. It’s not rocket science and you need not be from a financial background. You only need to show a bit of commitment. Deciding to save is the first step towards money management. Saving money can be the powerful tool towards greater financial independence. Imagine yourself borrowing from a friend for that urgent visit to the doctor! In case you don’t have any friend, then you might have to swipe your credit card. And you know credit card is the most expensive form of debt. Repeat this a few more times and you end up in a debt trap even before you realize that.
You may have many financial goals in your mind. Like buying a vehicle or the latest smartphone or wealth accumulation. In all these situations, you need money. But where it’ll come from? You got to have savings! My friend saving money helps you avoid falling into debt traps. Not only this, but systematic saving on a regular basis can make you rich. You may achieve your financial goals in a timely manner. Now you might be wondering how to save? And even more important how much to save? As soon as you get your salary, start putting it under various heads. These heads can be expenses, EMIs, investments, and savings.

2. Regulate your expenses wisely
If you are living paycheck to paycheck and find yourself struggling for money even before the month ends, then chances are you are living way beyond your means. Maybe there are a lot of unplanned expenses! These might be leaving you with no money for the necessities. But there’s a way out of this. Try making a budget. Unless you have a budget before your eyes, you won’t be able to control your cash flows. A budget simply shows how much money you have coming in and how those funds are spent.

Start by categorizing your expenses into fixed and variable; urgent and non-urgent; necessities and luxury; avoidable and unavoidable. In this way, you will create a full inventory of expenses in front of you. The more you convert things from abstract to physical, the better you will get a hold of them. You can create a hierarchy of needs and decide which one’s to address first. It’s all about prioritizing. You need to accept that you have got limited resources and unlimited wants. But you have to manage your resources. The sooner you accept this fact, the better you can control your impulses towards avoidable expenditures.

You can even take the help of a plethora of apps like Mint, Level Money, Mvelopes and such kind available out there. After addressing all necessary expenses, you can allocate some money towards entertainment and leisure. To avoid overspending, you can create a list of groceries before visiting the departmental store. You can assign a no-spend day in the week. Be sure you commit to your budget. Consider it as a commitment instead of a burden. In this manner, you will be able to stick to the boundaries.

3. Maintain a personal balance sheet
Having a personal balance sheet helps to know what you own and what you owe! It’s a pretty powerful tool to take your finances to the next level. It’s a statement wherein you can jot down your assets and liabilities. The difference between your assets and liabilities shows your personal Net Worth. Before getting started, pull together your bank statements and other proofs of the liabilities. Then list down your assets like the bank balance, all investments, home value, and value of other assets. Take a sum of all the assets to arrive at the total value of your assets. Afterward list down your liabilities like the car loan, home loan, credit card balances and remaining balances in other loans. The sum of all the liabilities will show the value of the money you owe.

When you subtract the value of liabilities from assets, you get your Net Worth. Ideally, it needs to be positive which means money you own is greater than the money you owe. Don’t lose heart if it’s negative. As you keep repaying your loans, your Net Worth is going to increase gradually. Yet another critical thing in asset management is what kind of assets you need to own. You must always try to own those assets which increase in value and involve the lesser cost of maintenance.

In the end, it’s all about how much can you really use. Simply accumulating things which you don’t need leads to blocking money in unproductive stuff. It’ll be wise to be aware of what you actually use and what you can get rid of.

4. Dealing with surplus cash judiciously
How you deal with the surplus cash determines your future. When you don’t have a plan, you are likely going to indulge in overspending. This money could have been used to make you financially self-sufficient. In the backdrop of inflation, everything is going to be costlier with each passing year. If you don’t invest, your money won’t grow to bridge the inflationary gap. You might have to work beyond your 70s to pay your bills. It’s like not being able to retire forever. Investing can be a great way to channelize the extra cash and counter inflation. It can be used to grow wealth and divert it to goal accomplishment. The earlier you start investing the better. Investing need not be a difficult and boring task. Perceive it as a bridge between where you are and where you want to be.

Start with identifying goals like buying a car or planning for retirement. Categorise those goals into short-term and long-term. Goals that can be achieved within 1 to 3 years are essentially short-term. Goals that need a horizon of 3-5 years are called medium-term goals. Goals that require more than 5 years to achieve our long-term goals. Then identify your risk appetite i.e. the degree to which you are comfortable with a fall in the value of your investments. If you can digest say a 20% fall in the value of investments, you are a high-risk seeker. Else, categorize yourself as a risk-averse person. After identifying your goals and risk appetite, you can conveniently select the investment haven. A risk-seeker may go for a diversified equity fund. Conversely, a risk-averse short-term investor may go to a liquid fund or a balanced fund.

Mutual funds have come up as the most versatile investment haven. You can start Systematic Investment Plan (SIP) at a nominal sum of Rs 500. Under SIP, a fixed amount gets deducted from your saving and is invested in mutual fund scheme of your choice.

5. Create your personal investment Portfolio
Constructing your first investment portfolio is an achievement in itself. After all, it is your first step towards wealth accumulation.

Building a portfolio involves distributing your investment amongst asset classes like equity, debt, and cash. It is known as asset allocation. Although equity is the best tax-efficient and inflation countering vehicle. However, putting all your money in equity isn’t a prudent move. You need to diversify the sums that are to be allocated in each asset class as per your investment goals. It is always wiser to be a long-term investor in order to accumulate greater corpus. Your investment horizon would ideally be around 10-15 years.

Once you have constructed a portfolio, you need to rebalance it periodically to keep the portfolio risk within expected limits. This is relevant from standpoint of market fluctuations. At the very outset, you may decide the time intervals after which you will be rebalancing. You can do it once in every six months or a year.

6. Planning for Retirement
Planning for retirement has become all the more important today than it was a few decades ago. There are reasons behind that. Due to increased life expectancy, you are going to live longer than your previous generation. Owing to a sedentary lifestyle, you are more vulnerable to ailments like diabetes, hypertension and heart attacks. Healthcare costs are increasing with each passing year. Lastly, in absences of a social security net, you need to have your own funds to tackle all these issues.
Like many others, you might be thinking that it’s too early to start planning now. In this way, your retirement planning may get postponed forever. In fact, improper retirement planning can never let you retire from your job.

What you don’t know is that the earlier you start, the richer you retire. It happens due to the “magic of compounding”. In this way, you can even retire early and lead a hassle-free life. While planning for retirement, you need to clarify a few points like
deciding an age at which you want to retire. Along with that estimate how much money you will need every month to meet your post-retirement expenses.

Suppose that you plan to retire at 60 years and your monthly estimated expenditure after retirement is Rs 50000. , then assuming a rate of return of 12%, you need to contribute a SIP of Rs 2900 every month for 30 years to accumulate a corpus of Rs 1 crore.

7. Manage your Debt wisely
Lack of debt management may eat up a major part of your paycheck. You may end up borrowing fresh loans to pay off older loans. If it gets out of control, then you may fall in a vicious debt trap. Your critical life goals may get sidelined and even your retirement may get delayed. However, strategizing your debt payment may keep you away from such troubles. All you need is being informed about how much you owe to whom. And chalk out a schedule to pay them off.
In case you have a lot of debt to shoulder, start paying off the most expensive one. In fact, the credit card has been regarded as the most expensive form of debt. As soon as your salary gets credited each month, pay off your credit card balances in full. Don’t fall for the lure of paying off the minimum balance. Even before you know, the interest will spiral up to eat out all your savings. Make it a point to use the credit card only in case of emergency. Always keep debt as the last resort. As far as possible, make down payments for your purchases.

In case you are shouldering big-ticket loans, look for portability option. You can transfer your loan to another bank offering a lesser rate of interest. In this manner, you will save a lot of money going out as interest. Never borrow for assets which are depreciating. Additionally, tax-inefficient loans like personal loans can be avoided as far as possible. You can think of saving and building a corpus to fulfill your goals. In this way, you can avoid falling into debt trap.

8. Get your risks covered
You need to realize that your life and property is vulnerable to risks. These risks can lead to loss of income and put you and your dependents in a financial jeopardy.
Just like investing is essential for wealth accumulation, ensuring is essential for wealth preservation. However, investing and insurance are two separate things which most individuals don’t understand. They buy a ULIP and feel themselves at ease. But, this is the biggest mistake which they make. They end up paying more and remain inadequately insured. Instead of this, a term insurance plan will be a wiser proposition to buy. Term insurance plan provides you higher risk coverage at a reasonable price. Don’t expect returns from your life insurance policy.

Ideally, the sum assured needs to be at least 10 times your annual income. Apart from life insurance, you may need a health insurance as well. It will enable you to access high-quality healthcare at reasonable prices. Don’t end up shelling out more for less. Before buying life insurance, you can compare policies online to select the one which satisfies your requirement at affordable prices.

life insurance plan

9. Planning your Estate
Believe it or not! each one of us has an estate. Whether it’s your vehicle or your home; the cash lying in your saving and current account, every asset constitutes an estate. It’s your responsibility to decide what happens to these after you leave this world. You need to ensure that the right asset is assigned to the appropriate individual in the right manner. Ultimately, you need to think about estate planning.

Often, individuals misconstrue that estate planning is meant only for the wealthy. However, the reality is totally opposite. It is relevant for every person who can’t afford to leave his assets in the hands of the unwanted after he is no more around. Most of us might have never thought of doing estate planning. Some of us might be putting it off to a later date. But this is a wrong approach. You can start off estate planning as soon as you begin accumulating assets.

You can start by preparing an inventory of assets that you own. Create a list of beneficiaries & proportion of assets that you want to allocate to each one of them. Make a will which can be the best favor for your loved ones from your end. It will ensure that the beneficiaries do not have to face challenges in order to get the ownership of assets that you assign them. In case you are clueless about how to get things done, then consult an experienced lawyer.

10. Planning your Taxes
In tax planning, you analyze your finances from a tax efficiency point of view so as to plan these in the most optimized manner. You attempt to take advantage of the various tax exemptions, deductions, and benefits so as to reduce your tax liability at the end of the financial year. Even though tax planning is very much legitimate in nature, you need to ensure that you don’t indulge in tax evasion or tax avoidance.

From a tax planning standpoint, you can make use of a number of tax saving options. Like the deductions available from Sections 80C through to 80U that are given in the Income Tax Act. The most efficient way to take advantage of Section 80C is to invest in Equity Linked Savings Scheme (ELSS). It has the shortest lock-in period as compared to all the other tax-saving options available under Section 80C. In this, you can save taxes up to Rs 45000 and avail a deduction of up to Rs 1.5lac. Additionally, the ELSS is a diversified equity fund helps you to achieve your financial goals via investment in the equity market.

Before initiating a new business, the organization puts an immense focus on the topic of Financial Planning. Financial planning is the plan needed for estimating the fund requirements of a business and determining the sources for the same. It essentially includes generating a financial blueprint for company’s future activities. It is typically done for 3-5 years-broad in scope and generally includes long-term investment, growth and financing decisions.

Objectives of Financial Planning
Ensuring availability of funds: Financial planning majorly excels in the area of generating funds as well as making them available whenever they are required. This also includes estimation of the funds required for different purposes, which are, long-term assets and working capital requirements.
Estimating the time and source of funds: Time is a game-changing factor in any business venture. Delivering the funds at the right time at the right place is very much crucial. It is as vital as the generation of the amount itself. While time is an important factor, the sources of these funds are necessary as well.
Generating capital structure: The capital structure is the composition of the capital of a company, that is, the kind and proportion of capital required in the business. This includes planning of debt-equity ratio both short-term and long-term.
Avoiding unnecessary funds: It is an important objective of the company to make sure that the firm does not raise unnecessary resources. Shortage of funds and the firm cannot meet its payment obligations. Whereas with a surplus of funds, the firm does not earn returns but adds to costs.

Process of Financial Planning
Preparation of sales conjecture.
Decide the number of funds – fixed and working capital.
Conclude the expected benefits and profile ts to decide the number of funds that can be provided through internal sources.
This causes us to evaluate the requirement from external sources.
Recognize the conceivable sources and set up the money spending plans consolidating these variables.
Importance of Financial Planning
Financial Planning is the procedure of confining company’s targets, policies, techniques, projects and budget plans with respect to the financial activities lasting for a longer duration. This guarantees viable and satisfactory financial investment policies. The importance is as follows-

Guarantees sufficient funds.
Planning helps in guaranteeing a harmony between outgoing and incoming of assets with the goal that stability is kept up.
Guarantees providers of funds to effortlessly put resources into organizations which provokes financial planning.
Financial Planning supports development and expansion programmes which support in the long-run sustenance of the organization.
Diminishes vulnerabilities with respect to changing business sector patterns which can be confronted effortlessly through enough funds.
Financial Planning helps in diminishing the vulnerabilities which can be a deterrent to the development of the organization. This aids in guaranteeing security and benefits of the organization.

Sharp HealthCare's Mission, Vision and Values
Our mission statement.
At Sharp HealthCare, our mission is to improve the health of those we serve with a commitment to excellence in all that we do. Our goal is to offer quality care and services that set community standards, exceed patients' expectations and are provided in a caring, convenient, cost-effective and accessible manner.

Our vision.
We will transform the health care experience through a culture of caring, quality, safety, service, innovation and excellence, and be recognized by employees, physicians, patients and families, volunteers and the community as:

The best place to work
The best place to practice medicine, and
The best place to receive care
We will be known as an excellent community citizen embodying an organization of people working together to do the right thing every day to improve the health of those we serve. We will become the best health system in the universe.

Our values.
At Sharp, our core values are integrity, caring, safety, innovation and excellence.

I feel it's very much effective the way they have improvised their visions and mission for a health Care is just really nice and innovative.

These goals which they have mentioned will support the mission statement in various possible ways

an organization filled with passionate, determined and caring people - from our clinicians to our housekeepers, from our engineers to our call center operators. And together they are dedicated to creating an advanced, personal experience having a perfect planning to grow the organization in a unique manner.

Reference citation Dr Dawn long

The mission statement they have provided are very much genuine and effective to people as it being a non profit organization has made many people and also the elderly people to get themselves treated in very less money. The financial planning made by them is very simple and it truly fits in the organization because of they being compassionate and determined about what they are really doing.