Financial Planning involves setting financial objectives, analyzing current financial resources, and developing strategic techniques to allocate resources towards meeting these goals over a specific period. This process includes evaluating expenses, savings, investments, insurance, and other financial aspects to ensure financial security and growth. For example, a business might use financial planning to ensure it has the necessary resources to expand to a new market, establishing detailed budgets and forecasts to guide decisions.

Another key aspect of financial planning is making adjustments as circumstances change. For instance, an individual may plan to save for a real estate purchase but adjust the plan due to changes in income or priorities. By planning financially, individuals or organizations can avoid unnecessary risks and align their financial activities with their long-term strategies.