Financial planning and tax planning – two terms that many think are similar but in actuality, they are different in many ways. Yes, while they do go hand-in-hand together and have similarities, they are two totally different aspects in the financial world. Are you in need of a further explanation? Don’t worry, after you read this article, feel free to contact the executives at MBA Financial & Accounting Solutions to get a better understanding of each term. Don’t forget to ask about our FREE business consultation when you speak to one of our executives.
When it comes to financial planning, what is the stereotypical answer most people often resort to? “Let me talk to my tax guy about that…” – WRONG! Financial planning is far different from talking to your tax guy. Financial planning is the process of developing strategies to achieve life goals through effective management of finances. A benefit of financial planning helps control your income, expenditures, and investments. The main aspect of financial planning involves addressing your life goals and then creating a strategic, financial plan to help you achieve your present and future accomplishments. This type of planning is more of a holistic approach to managing wealth. It revolves around areas such as cash flow management, asset management, insurance, investments, retirement planning, and also tax planning. Some of the benefits that financial planning help you with are by increasing your savings by planning and tracking all of your expenditures. Planning to save can help you tremendously, especially in emergency situations when life situations sometimes happen. Planning ahead will always work in your best interest. Having a peace of mind with your personal finances will allow you to achieve a different level of financial security.
What is tax planning? Tax planning is the process of becoming more tax efficient by reducing your tax liability to a minimum. This type of planning involves creating a plan of action that allows you to reap some tax benefits by making use of legal tax deductions, exemptions, rebates, and other affiliated tax-related items. The essential aspect of tax planning is to help you receive the maximum tax benefits as possible, year after year. When a professional tax planner is helping you, they can help with filing your tax returns and help invest in tax-free options. Aside from becoming more efficient in preparing and filing your tax returns, tax planning allows you to budget and manage your taxes throughout the year.
Did you notice that financial planning and tax planning share some similarities? Ideally, financial planning and tax planning should be connected and overseen by a team or professional that you desire to hire. By having tax and financial synergy, your goals both financially and in life can be accomplished. When you want to work with a professional or team, you have to research them to see if they can actually help you with your goals. MBA Financial & Accounting Solutions have been rated as a Top 10 Accounting Firm in Los Angeles for our experienced, seasoned, and professional team. We make sure that your tax and financial planning work to your benefit. Contact us today for more information on how you can achieve tax and financial success, as well as, a FREE business consultation. Call 800-576-5746 today!