Building Up A Investment Plan is a process which includes Self Analysis, Goal Setting by Investor, Formulation of the Plan for Achievement of Goal, Implementation of Plan and Periodic review of Performance of Investment made.

Investment plan

STEP 1SELF ANALYSIS The first step in planning is that one should analysis him/her self, there are various factors that one should keep in their mind while framing their financial plans here are some of them listed below.

Step 1 - Self Analysis


We go through different stages of life & each stage requires planning, childhood, young individual & old stage. As a child turns into a young earner he requires planning of his finances where he should decide his goals & time required to achieve them. As the age grows the purpose & the objects of individual changes. 


Before start planning one must look into his current financial position i.e. how much money he can invest after covering up all his expenses. The mode in which he can invest whether in lump-sum or installments & also deciding about the time until which he wants to continue investing.


 Is there regular flow of income to an individual is also important, whether the person is running a business (through out year or seasonal ) or doing a job ( permanent / temporary). This factor brings us to analyse the flow of income is regular or periodic.


After analyzing income the person needs to also seek into his expenses, to save the person needs to increase his income or cut down his expenses. The major factor expense eats up money which one needs to control & divert towards investing.


  RISK how much an individual is willing to take depends on person to person. Young earner be able to take high risk but older person will divert them self to lower or no risk investment. Number of dependents also forms a part of risk profiling as the person also needs to take care of such dependents.

STEP 2 –   GOAL SETTINGThe next we come to GOAL SETTING, people are not aware about the financial goal which they need to set and work accordingly. FINANCIAL GOAL are defined as goal which need to be achieved in future which involves time & money.  

Goal Setting


First one need to identify what are their financial goal for example it can be buying a house, a car, going for a vacation, setting up a business, paying off debts, saving for emergencies & retirement planning. So one need to list out which all goals are yet to be achieved by him & plan accordingly. 


  After setting out goals one need to calculate the available time left to reach these goals. This measurement of time by self helps to analyze how much an individual need to invest to so that he might have the required corpus at the required time. This calculation of time & money boost the individual to save and invest more earn better returns. 


  The thing which people fails to plan is for emergencies, they do not have enough liquidity to meet for the emergencies. So when one start planning for self the they should also keep in mind that they need to have some funds in such way that they have  amount with them in emergency situation.

STEP 3 – FORMULATION OF THE PLAN  –  After identifying the goals (time & money requirement) person needs to decide how he is going to invest his amount & the where the investment should be done after keeping in mind the different option available to him for investment & the risk associated with them to. 

Formulation Of The Plan


    Person can evaluate different investment avenues where he/she can invest their amount according to goals & risk taking capacity. For example a goal which is to be achieved in 3-5 years debt scheme of mutual fund can be taken, for tax saving E.L.S.S of mutual fund or P.P.F Account is available, for retirement saving where tenure is 15-20 years equity mutual funds are better, Pension requirement can be fulfilled by investing in National Pension Scheme. 


  An investment option brings risk along with it-self, such as some option have lock-in period with them, some investment are highly expose to risk as investment is in equity market, some products have credit risk along with them, so risk shall also be evaluated along with the option chosen.

Take Measured Risk

STEP 4 –  IMPLEMENTATION OF PLAN  – After deciding the investment avenues person should start implementing the plan. Should complete all the formalities that need to be for investing filling up the forms providing the required documents.



Checking if the current investment are giving proper returns & also reviewing the risk related to investment with the change in time & market conditions, one can re-allocate the funds by diverting them to another mode of investment which he/she thinks suitable option for self & change accordingly.


 Making changes (if required) in the implemented plan one should continue to invest accordingly. A periodic review & Changes is an on going process which need to be done regularly on a periodic basis.

 One can follow these step to evaluate himself and have better understanding of his finances and look forward to new modes of investing and saving. 

Author Bio

Qualification: Graduate
Company: N/A
Location: AGRA, Uttar Pradesh, IN
Member Since: 24 Jul 2020 | Total Posts: 18
I have Cleared CA (intermediate) also cleared various series conducted by N.I.S.M (National Institute of Securities Market), Investment Advisory, Research Analyst, Merchant Banking & Retirement planning. Recently cleared exam of Independent Director conducted by IICA ( Indian Institute Of Corpo View Full Profile

My Published Posts

More Under Finance

Leave a Comment

Your email address will not be published. Required fields are marked *

Search Posts by Date

October 2021