What is lifestyle based financial planning?
Lifestyle-based financial planning means creating a plan that aligns with the way you live. It is not about using the same plan for everyone. Instead, it looks at your life, income, spending habits, and what you want in the future.
For example, someone who wants to travel often will need a different money plan than someone saving to buy a home. A young worker and a retired person also need very different plans. That’s why lifestyle-based financial planning is personal.
It helps you use your money in a smart way. It includes planning for your daily needs, saving for your goals, and choosing the right tools like savings plans, or ULIPs.
This type of planning changes as your life changes. If your job changes, your income goes up, or you have a new goal, your plan can adjust too.
Lifestyle-based planning is about understanding what matters to you and building a plan around it. This way, you are not copying someone else’s plan. You are making one that is just right for your life, today and in the future.
Benefits of lifestyle based future financial planning
Lifestyle-based financial planning gives you many helpful benefits. It’s simple, personal, and keeps your life goals in focus.
Fits your life
This plan is made for you. Whether you want to save for a holiday, a new home, or your child’s school, it adjusts to your needs.
Easy to change
If your life changes—like getting married or changing jobs—your plan can change too.
Better control over money
You know where your money is going. It helps you feel more in control.
Helps reach goals faster
Because your money is planned around your goals, you can reach them step by step.
Mix of tools
You can choose savings plans, ULIPs, term insurance, or child plans depending on what suits your goals best.
Peace of mind
When your money plan matches your life, you feel secure and happy.
Builds better habits
It teaches you how to save, plan, and manage money better.
With these benefits, lifestyle based financial planning makes sure your money works the way you want it to.
Insurance: The bedrock
Insurance is the basis of a strong financial plan. It protects you and your family from life’s surprises. Here are some simple and useful types of insurance:
Term Insurance
- Gives life cover at a low cost.
- Best for people who want high cover.
Whole Life Insurance
- Gives cover for up to 99 years.
- Helps your family even after you’re gone.
ULIPs (Unit Linked Insurance Plans)
- Combines life cover and savings in one.
- Useful for long-term goals like a child’s future or retirement.
Child Plans
- Helps save money for your child’s school or college.
- Also gives life cover to the parent.
Endowment Plans
- Offers fixed returns and life cover.
- Good for people who want low-risk savings.
Insurance is not only about protection. Some plans also help your money grow. It’s a smart way to stay safe and build your future. Picking the right insurance keeps you ready for tomorrow, no matter what happens.
How to mitigate potential drawbacks?
Even a good money plan can face problems. That’s why it’s important to be careful and ready.
Sometimes, people plan too big. They may try to save for many things at once. This can cause money stress. So, it’s better to start small and grow slowly. Always plan for what you can do, not just what you want to do.
Another issue is not having an emergency fund. If you lose your job or face a health issue, it can break your plan. That’s why saving for 3 to 6 months of daily needs is very helpful.
Also, market prices keep rising. This is called inflation. So, your plan should include savings tools like ULIPs or retirement plans that can grow with time.
Review your plan every year. If something changes—your income, your goals, or your family—update your plan.
Lastly, it is not wise to put all your money in one place. It should be mixed up with insurance, savings plans, and fixed deposits.
With these small steps, you can keep your lifestyle-based financial planning strong and ready for any surprise.
Conclusion
Lifestyle based future financial planning is not just a new idea. It is a smart and simple way to plan for your future. This type of planning is all about you. It looks at how you live, what you earn, how you spend, and what dreams you have. Whether you want to live a quiet life or have big goals like travelling or buying a house, your plan can change with you. If your life changes—like getting married, having a child, or changing your job—your plan can change too. That’s what makes lifestyle based planning so useful. You can use helpful plans like term insurance, ULIPs, child plans, or endowment plans. These plans protect your family financially and also help you save for the future. They are easy to choose when your goals are clear.
FAQs
What is lifestyle financial planning?
Lifestyle financial planning means creating a plan that fits your life. It looks at how much you earn, how you spend, what you want in the future, and how you live every day. It is not about following fixed rules. Instead, it helps you save and spend based on your dreams, like buying a house, travelling, or saving for your child. Everyone is different, so the plan is made only for you. It changes as your life changes. This way, your money helps you live the life you want—now and later.
What are the four main types of financial planning?
There are four important types of financial planning. First is cash flow planning, which helps you manage income and expenses. Second is investment planning, which helps your money grow over time. Third is retirement planning, which helps you prepare for life after you stop working. Fourth is tax planning, which helps you save money by paying the right amount of tax. These four parts work together to keep your money safe and useful. They make sure you can meet your needs today and reach your future financial goals easily.
What is the lifecycle approach to financial planning?
The lifecycle approach to financial planning is to develop a monetary plan that changes with lifestyle events. For example, when you first enter the workforce, you may want to save money for something simple like a new phone or bike. Later on, you may get married, purchase your first home, or save for your child's education. Eventually, as you get older, you'll be saving for retirement. The lifecycle approach considers your age and income level, and your needs at each stage of your life. It also helps you save money or spend money wisely at each stage of your life.
An ISO 9001:2015 
