Components of Personal finance

As was written in my previous post, I am a newbie to personal finance space. I got some understanding the concepts and started crystallizing my ideas on this aspect of my life.

First question one encounters in this space is what is the requirement of planning.
A plan is required to achieve any goal. For example if I want to eat something, I should know what am I wanting to eat. Else, anything I eat, meets the requirement. Say, I became more specific and set a goal that I have to eat an ice cream. There is some clarity. But further clarity is required as to the time, today, tonight, tomorrow, next week etc.

Thus it can be seen that a goal should have an aim and time frame. In personal finance, they are safe future and time frame. Here safe future is again vague. I want to meet the goals of my retirement by (my)50 years with decent monthly income, education and marriage of son/daughter, a house etc.
Now that clarity of goal and time frame are frozen, one can plan for these goals. When one starts to plan for a goal, one has to understand that one needs a corpus for meeting the goal and the planning process is actually for accumulating the corpus in a time frame.

For obtaining corpus required for a goal, one has to have some income, disposable income, which can be deployed periodically to accumulate a corpus.

Here one needs to see what is the disposable income, one can spare on periodic basis(may be monthly). This can then be diverted to the corpus account. There are various instruments to accumulate the corpus. One has to choose the instrument based on one’s time horizon and risk appetite. The returns vary based on these inputs.

Thus one can channelize available surplus into investment to achieve a goal.

Here one needs some basic Maths to know if this way of funding meets the goal?

Will touch upon other details of financial planning as I understand it, in subsequent posts.

Please share your comments / suggestions.