Question

What is the difference between a financial plan and a retirement plan?

Answer 1

The difference between financial plan and retirement plan is that one is based on current actions and the other on future rewards.

Retirement plan is, in essence, a subset of a financial plan, there are subtle areas of distinction.

In definition, financial planning encompasses saving, investing, preparation for emergencies, major purchases and other goals that may require financial solvency. Retirement planning on the other hand, is based on evaluation of current variables as well as forecasting future cash flow, asset values and economic trends in order to create an unemployment replacement income.

Financial planning today is a comprehensive process that correlates the client’s current financial status with their retirement vision. The mission of the financial expert is ultimately about resource allocation that enables some semblance of security for short or long-term retirement.nancial planning today is a comprehensive process that correlates the client’s current financial status with their retirement vision. The mission of the financial expert is ultimately about resource allocation that enables some semblance of security for short or long-term retirement.