ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Financial planning includes both short-term as well as long-term planning. Short-term planning covers short-term financial plan called budget. Budgets are example of financial planning exercise in greater details. They include detailed plan of action for a period of one year or less.

Detailed explanation-2: -where you are today: While a budget helps you map out your key expenses and plan for the weeks and months to come, a financial plan allows you to set a course toward funding financial goals that are 5, 10, or 20 years down the road.

Detailed explanation-3: -A financial plan is sometimes referred to as an investment plan, but in personal finance, a financial plan can focus on other specific areas such as risk management, estates, college, or retirement.

Detailed explanation-4: -Financial budgeting is the process of planning company expenses and revenues for a time period. Budgets set forth the plans of management in financial terms. This includes allocating financial resources and identifying available cash flows for required spending.

Detailed explanation-5: -Definition: A budget is a financial document used to project future income and expenses. To put it simply, a budget plans future saving and spending as well as planned income and expenses.