Boston — Financial planning. Many Americans could be forgiven if they looked at these words, thought about their finances over the last 15 years or so, and said, ''You gotta be kidding!''
How can we think about financial planning, they might say, when we've had one recession after another, inflation that's left the United States dollar with less than half the value it had in 1967, and a Congress that makes major changes in the tax laws almost every session?
Indeed, people trying to embark on a program of financial planning - of setting realistic financial and personal goals and devising a strategy to achieve them - seem to regard the current start of the recovery and sharply reduced inflation not with relief or joy but with suspicion.
''People are taking a dim outlook on this so-called recovery,'' says David Nadler, a New York lawyer who works with financial planners. ''They are very cautious on how real it is and how long it will last.''
''People are just not convinced inflation is under control,'' adds Paul Meyer , a financial planner with Paine, Webber, Jackson & Curtis. ''They don't believe interest rates are going to stay down. This recession is going to have an effect for several years.''
Still, these and other experts say, people are embarking on planning programs and are finding ways to achieve their financial goals. For now, these plans are taking the form of aggressive savings programs, helping people take measures now to protect against what they see as the possibility of future recessions, future inflation, and even a possible loss of social security or pension benefits.
People are also looking for plans to help avoid paying additional taxes. ''Over the last 20 years there's been an enormous change in the United States,'' observes Joseph Deitch, who heads the Cambridge Group, a financial planning firm in Boston. ''Before that, there was more patriotism and taxes were reasonable. . . . Now, people are facing economic survival, they don't trust their government as much, and they don't want to pay taxes. At the same time, inflation and the progressive tax system took almost the entire middle class and put it in the 50 percent tax bracket.''
This has led to an enormous growth in tax-sheltered investments, such as municipal bond sales and tax-free mutual funds, as well as growth in the ''underground'' economy, where taxes are not collected.
For those who have been making financial plans, these economic changes mean that the whole planning process must be repeated every year or two.
''Financial planning changes just about every year because of the economy and tax laws,'' notes Maxine Hassensahl, a planner with Peter Ferucci Consultants in Suffern, N.Y.
Not only do the plans change, but the goals those plans are meant to achieve are altered occasionally, too.
''Goal-setting is typically a short-term thing,'' says Bruce M. Dayton, chairman of Multi-Financial Services Inc., a financial planning firm in Weston, Mass. ''After two or three years, on average, we have to review and update the whole thing.''
For instance, many of the ''baby boomers'' who put off having children before are having them now, Miss Hassensahl notes. These new families have discovered that the costs of raising their offspring and saving for college are ''a tremendous expense.''
In many cases, moreover, the ''family'' doing the financial planning is quite different from what it once was. Today, financial planners' clients can include single working people living alone, singles sharing housing, and single parents.
Another financial planner notes there are the older people who used to say, ''We want to leave something for our children.'' For whatever reason, many of these people don't want to do that anymore, this planner says. ''If they're saving money for retirement, they plan to spend it.''
(For those who do want to leave an inheritance, new tax laws in 1981 brought on another change in financial planning. Now, one spouse can leave an entire estate to his or her partner tax-free, while other heirs can receive increasing amounts tax-free, up to $600,000 in 1987.)
Whatever situation people find themselves in, financial planners agree, the tried-and-true practice of setting goals and drawing up a plan to reach them is still a necessary part of achieving financial independence.
''Financial planning is really the essence of common sense,'' Mr. Deitch says. ''There's really very little magic involved.'' He sees six steps to developing and living with a financial plan:
1. Get your data together. Find out your net worth by making a list of everything you own and everything you owe. Under ''own,'' put things like cash, savings, life insurance, and money owed to you. You can also include investments , personal property, real estate, pensions, life insurance, and annuities.Under ''owe,'' include such things as current bills, loans owed to institutions and individuals, taxes, and mortgages. Subtract what you owe from what you own and this is your net worth. (See table, page B 10.)
2. Establish goals. Decide what the financial plan is for. For many people, there are several goals, some or all of which may be desired at once. These might include saving for college expenses, a new car, retirement, a vacation abroad, a boat, the down payment on a house (either primary or vacation home), or simply a larger ''nest egg'' to be used for investment, emergencies, or special occasions.
3. Analyze data in light of these goals. In many cases, Mr. Deitch says, people have unrealistic goals, considering how much they earn or their immediate prospects of earning more. So it is necessary to select realistic goals.
4. Establish a game plan. ''In order for the plan to be successful, the client has to have confidence in it,'' Mr. Deitch says. ''If they're not confident, they're not going to stick with it, and the plan is worthless.'' So the savings program, the investing strategy, or whatever the plan may be has to be something the client can afford and still maintain what he sees as a comfortable life style. It also has to fit in with the client's ''risk tolerance.'' Stock options, for example, may be fine for someone who can tolerate higher risks, but they should be avoided by more conservative investors apt to sit up nights worrying about losing their money.
5. Follow the game plan. With many commercial financial planning packages, such as Merrill Lynch's $300 ''Pathfinder'' program or E.F. Hutton's $150 Money Allocation Program, the plan does not get this far. The clients have to invest money on their own. But other planners, including those who have their own brokerage or investment services, can invest the money for their clients.
6. Update the plan. Depending on the client and the financial planner, this can be done as often as every six months or as infrequently as every two or three years. Most planners who work with their clients on a full-time basis try to go through the entire financial planning process every 12 to 18 months.
''Inflation changes just about all the numbers in a retirement plan,'' says David M. Polen, who heads a New York financial planning firm bearing his name.
But the beginning of all this, Mr. Deitch says, is saving money. ''It's a very common phenomenon that people spend what they make,'' he says. ''So we have to focus on the asset base.''
Fortunately for those in the mood to save, this is a good time to do so. Inflation is low and interest rates are silll high. At times like this, the banks are subsidizing depositors who are earning more than the inflation rate, like 8 percent in a money market deposit account. Since January 1982 one of the most popular places to save has been the individual retirement account (IRA). But there are also Treasury bills, US Savings Bonds, money market deposit accounts, Super NOW accounts, money market funds, certificates of deposit, and tax-deferred annuities from insurance companies.
It could also be a pretty good time to invest in stocks. With corporate profits and sales going up, while expenses are under better control, many analysts see good prospects for a further rise in stock prices. ''I see a strong market for about 10 years,'' Mr. Polen says. His firm specializes in equities. For those who prefer to minimize the risks somewhat, shares in some mutual funds have done better than the Dow Jones industrial average.
But sooner or later, these financial planners say, all this will change. In a year or two or three, some of the goals a family has set will no longer seem relevant. Changes in the strategies for reaching those goals must follow. And as long as Congress, state legislatures, and voters can make changes in the tax laws and as long as people are faced with economic cycles that seem beyond their control, more changes will have to be made.
''Are financial planning strategies different today? Sure they're different, '' says Alexandra Armstrong, a financial planner in Washington. ''They're different from a year ago and they'll be different next year.''