Why is Budgeting and Tax Planning shown as the first component of a financial plan? Budgeting and tax planning form the foundation for other components of the financial plan. Retirement and estate planning only apply to those in later life stages. Almost every financial decision has a tax impact that must be taken into consideration. Lack of budgetary control will prevent the ability to save, acquire assets and pay expenses. Investment cannot occur without the ability to save. A primary financial objective should be to minimize one’s tax bill. I, II, III and IV I, III, IV and V II, IV, V and VI I, II, V and VI