Q: I have been saving & investing for years. I have an investment advisor, an accountant, and an insurance agent. But up until now, I don’t have a financial plan. I never really thought much about it, but recently I have been thinking that it would make sense to have one. I’m not entirely sure where to start. Could you please guide me as to where to begin?

A: Well, most Canadians agree that financial planning pays off. Two recent studies – The Value of Financial Planning and The Value of Advice: Report – suggest a majority of Canadians agreed that by choosing financial advice they accumulated more assets and were better prepared financially, for retirement. Over 50% reported that they were on track to reach their desired lifestyle in retirement, compared to just 18% of those who don’t receive any financial advice. So do you need a financial plan? Yes – if you have an income, a family (or hopes of one in the future), retirement lifestyle dreams, and for many other financially-rooted reasons that are unique to you.

But where to start? In general your financial plan should include planning in the following areas: investment, cash flow, education, estate, insurance, retirement, and income tax. But the key to a successful financial plan is tailoring each of those elements to you and your needs. To achieve that, most competent financial planners will take you through this six step planning process:

Goal setting – to define and prioritize your goals and concerns.
Data gathering – bringing together pertinent information to understand your current financial situation.
Financial analysis – using your current and projected financial situation to establish how much tax you will pay and how to reduce your taxes; whether you’ll have enough income to cover your retirement expenses and ways to ensure that you will; what you can do to better meet your income needs; and strategies for protecting your family and income should you become disabled or die unexpectedly.
Plan formulation and recommendations – reviewing and agreeing on solutions for achieving your financial goals and improving your overall financial health.
Plan implementation – a written report that summarizes the steps you need to take to make your plan work.
Monitoring and plan review – staying on track by reviewing your plan at least annually and when major life events occur.

Now, while you can go about this on your own, when it comes to sound financial and investment information that reflects your life and your goals, Twitter, Facebook, blogs and websites may not be the best places to get what you need. Having an abundance of information at your fingertips is great — but

1 Study conducted by The Strategic Council for the Financial Planning Standards Council (FPSC), August 2009 to January 2010, 7,300 Canadians surveyed.
2 2010 Value of Advice: Report, Investment Funds Institute of Canada (IFIC), July 2010 including third party data from Statistics Canada, Ipso Reid and others.

Lynn MacNeil, Pl.Fin. is a licensed Financial Planner with Investors Group Financial Services Inc., with over 16 years experience working with retirees & pre-retirees. This column is presented as a general source of information only and is not intended as a solicitation to buy or sell investments, nor is it intended to provide legal advice. For more information on this topic or on any other investment or financial matter, please contact Lynn MacNeil at (514) 693-3384 or [email protected]

CALL NOW to receive your free copy:

Getting the most out of your retirement resources:
Top 10 tax tips for retirees

CALL (514)693-3317 (24 hours)**Limited quantities..

Related Posts