Financial planning is the process of setting goals, developing a strategy, and managing resources to achieve financial security and stability. It involves assessing current financial situations, identifying future needs, and creating a roadmap to reach those objectives. Key components include budgeting, saving, investing, and retirement planning. Effective financial planning helps individuals and families make informed decisions about their money. By understanding income, expenses, and potential risks, one can allocate resources wisely and prepare for unexpected events. This proactive approach not only enhances financial well-being but also fosters peace of mind for the future.