ivari logo

1-800-846-5970

My Insurance View

10 ways to plan for your financial future

Making sure your financial future is secure doesn’t need to be an overwhelming task. Simply follow these 10 tips and you’ll be well on your way to protecting yourself and your family.

1. Embrace the 3 P's:

Talk to a Professional
Consulting a professional is obvious when it comes to your health or legal matters, but not when it comes to your finances and life insurance. A professional advisor will sort through the options and provide a plan to help you achieve your short-term, and long-term financial goals.

Be Prepared
It may sound impossible, but you can plan for the unexpected. A strong financial plan, that includes life insurance, will help you prepare for any emergency and give you peace of mind.

Stop Procrastinating
No matter your age or financial situation, the best time to start planning for your financial future is right now. The financial plan you put in place today will be the foundation for the financial security you, and your family, enjoy tomorrow.

2. Plan your route:

As the saying goes, if you don’t know where you are, how can you know where you’re going? The first step in planning for your financial future is to take an honest look at where all your finances are today.

3. Make a list…check it often:

Emergency situations can leave you scrambling for documents and information. To best prepare yourself for an emergency, prepare in advance when you are calm and thinking clearly. Consider creating an emergency financial plan and update it regularly. This plan should include:

  • Three to six months’ total living expenses, set aside in a separate bank account that is readily accessible.
  • A list containing contact information as well as personal medical information for each family member including blood type, allergies, current medications and your doctor’s contact details.
  • A copy of your life insurance and any other insurance policies.
  • For each child: school/daycare name, address and contact information. Include a list of adults, including phone numbers, authorized to pick up your child on your behalf.

If you don’t know where you are, how can you know where you’re going?

4. Insure your family’s future:

If something were to happen to you, would your family’s future be financially secure? One of the best ways to ensure this is to have the right type and amount of insurance protection. Over time your insurance protection needs will change. That’s why you should review your protection needs with an advisor every 10 years, or whenever a major life event occurs, such as the birth of a child. Using a tool like My Insurance View can help you understand your protection needs for today and tomorrow.

5. Take care of what WILL happen after you’re gone:

If you don’t have a valid will it’s time to stop procrastinating! If you die without a will, the laws of your residing province will determine the division of your property and assets without considering your wishes, or the wishes of your family members. There’s a lot to consider when creating a will, so it is strongly recommended that you seek professional advice.

Along with a will, consider using estate planning tools such as trusts, life insurance and long term care insurance to protect your assets. Estate planning is complicated, so it is highly recommended that you obtain professional legal and tax advice. Remember to update your estate plan whenever you have a major life change such as a marriage, divorce, birth or death in the family.

6. Debt today…gone tomorrow?

The fastest way to feel more financially secure is to reduce, or eliminate, your debt. Because this isn’t realistic for many Canadians, aim instead to manage it as best you can. For example, try switching from a credit card to a debit card for a few months. With a debit card, you can’t spend what you don’t have! A financial advisor can also provide advice and strategies to help manage your debt.

My Insurance View

7. Pay yourself first:

Review your monthly budget to see how much money you can realistically save and start transferring that amount into a separate bank account. To avoid “cheating”, you can arrange with your bank to automatically transfer funds from one account into the other. Then, with the help of an advisor, use this money for long-term investing.

8. Allocate your assets:

Ever heard the saying, “Don’t put all of your eggs in one basket”? This is the thinking behind a strategy called asset allocation. This strategy involves investing in a combination of assets that will provide the highest expected rate of return possible at your desired level of risk. Your advisor can help you identify the asset mix that is most likely to achieve your financial goals.

9. Take it slow…win the race:

When it comes to investing, it’s often best to think long-term and avoid reacting to the latest headlines. In fact, investors who switch to the best-performing asset class of the previous year are often worse off than investors who maintain their investments in a balanced portfolio.

10. Get ready for retirement:

Step one of retirement planning is to determine the income you will need, monthly or annually, to maintain your desired retirement lifestyle. Your advisor can help figure out how to achieve this. There are three main sources for retirement income:

1) Employer-sponsored pension plans: either fully funded or a matched contributions program

2) Public pensions: Canada/Quebec Pension Plan (CPP/QPP), Old Age Security (OAS)

3) Personal retirement savings: RRSP and TFSA

Individually, each of these three sources may not provide enough to fund your retirement years, so it is important to start as early as possible and put away as much as possible.

A final word to the wise

Now that you know the ten proven strategies for achieving financial security, it’s time to recall the three P’s that will put your financial plan into action:

• Talk to a Professional
• Be Prepared
• Stop Procrastinating