Your written plan also provides you with a means to formally monitor performance by comparing actual to budget in your monthly financial statements. In essence, the plan provides a context in which to measure performance. The data you draw from your actual performance will then in turn help you do a better job of planning in the future. Adequate financial planning must always include some long range thought. Every enterprise should be looking ahead at least several years, trying to anticipate where they are going and where they want to be.
Planning is never about knowing what's going to happen.
If you knew, you wouldn't have to plan. It's about thinking of what you would like to happen and then making an educated guess about what is likely to hap pen in the marketplace and what you would reasonably need to do to achieve your goals given that marketplace. Financial planning is nothing more than an educated guess, based on past performance and anticipated future parameters. As with all guessing, you could be wrong. The only way to learn about errors in your assumptions is to try them out.