Can You Create a Financial Plan Without Adequate Information?

Some people are worried about trying to write a plan before you have adequate information about the future.  They are concerned that without knowing how much they could be earning or knowing whether their job situation will last, they cannot create an accurate plan.

According to www.thefreedictionary.com, a model is "a simplified representation or description of a system or complex entity, esp one designed to facilitate calculations and predictions".  This is exactly what a financial plan is for.  Although the assumptions may not be accurate, all this means is that the predictions will not necessarily be accurate.

However, going through the process can allow you what to expect.  As assumptions become more accurate, over time you will be able to predict the future better.  Who makes better predictions, someone who has been predicting for 10 years and has feedback regarding the accuracy of the predictions or someone who has never made a predication?

How useful do you think a financial plan is if you are uncertain of what the future holds?  Does planning help?  If you are a planner, how has it helped you?

Read more at www.wikihow.com.

This post was reposted from http://finlit.biz/business/can-you-create-a-financial-plan-without-adequate-information/, originally written on February 2nd, 2013.