Have a Short and Long-Term Plan
October 30, 2018Building Your Future
Planning is one of those things where you can draw a direct correlation between success and failure based solely on whether you’ve actually done it.
One of Benjamin Franklin’s many famous quotes captures this quite clearly, “By failing to prepare, you are preparing to fail.” So why is it that 56% of pre-retiree Canadians don’t have a plan, four in ten have no idea of the amount required to fund their retirement plan, and not surprisingly 57% of us are stressed about retirement planning?
And, it’s not just long-term or retirement planning where many of us fall down; it’s even in managing our short-term goals, wants and needs, where we seem to be in desperate need of some guidance.
Consider a recent survey conducted for MNP, one of the country’s leading accounting firms. In January they found that 33% of Canadians can’t afford to cover their bills and debt payments. Similarly, CIBC released results of a poll conducted in December where 67% (of people polled) admit they need to get a better handle on their finances in the New Year.
So knowing this and also knowing that for most of us this likely isn’t a task we undertake with joy, before you start, consider whether this is something that you want to do on your own or in collaboration with a financial advisor. A financial advisor is bit like your personal trainer but for your financial fitness rather than your physical fitness. They have professional training, experience and insights that can help guide you through the process and customize a strategy that fits with your overall objectives.
Short-term planning is about being prepared for unexpected events that could happen tomorrow, such as needing a new furnace in the middle of winter or having savings in place in case you lose your job. Long-term planning is about creating a financial roadmap that will protect you financially. It is also about creating a plan to achieve other significant financial objectives like, paying for your children’s education, funding retirement and managing your assets wisely, including any charitable gifts or donations you want to make.
The key is to commit to the process and be disciplined in monitoring and adjusting your plan as needed. Some people can do this on their own but most people benefit by working with a financial advisor to understand their budget, tax status and the financial planning tools at their disposal.
It’s never too late to start building a long-term plan that will give you peace of mind as you look ahead to retirement. Put simply, the earlier you get started with an RRSP, the better.
Reaching your desired financial goals requires you to have both short and a long-term plans. For customized financial planning strategies contact your financial advisor or a FaithLife Financial Representative who will be happy to help you plan to be wise with your money so you can feel confident about your finances and live generously.
RETIREMENT READINESS: CANADIANS 50+, INNOVATIVE
RESEARCH GROUP, SEPTEMBER 9, 2016
CIBC, CONSUMER RESEARCH AND ADVICE, DEC 28, 2017