Basics of financial planning

Here are some of the basic things that one can keep in mind, for sound financial planning:

1. Make financial projections (income, expense, savings etc.)
2. Asses risk profile
3. Set financial goals (short, medium & long term)
4. Determine the appropriate asset pies. Current & Ideal state (e.g. 10%Cash, 10% Gold, 25% Real Estate, 25% Equities, 30% Debt-Retirement)
5. Over a period of time, ascertain sub pies & sub sub pies e.g. Equities into 50% Direct Equity (DE) : 50% Mutual Fund (MF)...further classification of DE can be into IT:Banking:Power sector etc. and MF can be into Diversified : Tax Saving : Balanced and so..
6. Draw an action plan to reach your ideal pie, over a period of time, which should in turn help you to meet financial goals
7. Always invest or disinvest regularly & Never at a stretch
8. If you are invested in a not so great fund, don't sell in a hurry as there could be tax implications.
9. Track your portfolio regularly.

There are many tools available for most of the above, on the web. If you need help, let me know. I will keep sharing my thoughts on the basics of investments.

Cheers