Financial planning may incorporate scenario analysis as part of the planning process.

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Scenario analysis is a technique used in financial planning to evaluate the effects of different scenarios on financial outcomes. It involves analyzing various potential scenarios and their likelihood of occurring, such as changes in interest rates, inflation, or market volatility, and planning accordingly. Incorporating scenario analysis into financial planning helps individuals and organizations make informed decisions and develop effective strategies for managing risks and achieving their financial goals.

Financial Planning May Incorporate Scenario Analysis as Part of the Planning