Financial Planning 101: Life should only get better
Published: September 07, 2018
Nothing lasts forever, so getting your Will in order is always a good idea. But between now and that fateful day, we believe the lifestyle you enjoy should stay the same, or even steadily improve. That’s what financial planning is for.
Unfortunately, a lifestyle decline is actually more likely for most Canadians. It tends to happen when it’s time to pay for the kids’ university education, when you hit retirement, or because of something unexpected, such as an accident or illness.
People simply don’t know what to do on a monthly basis to avoid this problem. Solid financial planning has traditionally been reserved for the wealthiest of the wealthy, and the fees associated with it can be outrageous. As a result, everyone needs a plan, but almost no one has one.
Imagine if one of the things that you most enjoy about your current lifestyle is date night with your spouse. Then you might think of your plan as a way to enjoy date night with the same frequency and quality of food for the rest of your life.
A team of Canadian university professors have boiled this concept down to a single question:
“What course of action will help me maximize my standard of living - in the smoothest way possible - over the rest of my life?”
A financial plan is designed to achieve this. A good one will tell you exactly how to build up wealth through investing, protect that wealth through insurance, and minimize the amount of money that slips through the cracks, such as paying interest, fees and taxes. It aims to put as much money as possible in your pocket at the time you need it.
Tying your plan back to the aspects of your lifestyle that it supports - like spending time with family and friends, going out for meals, taking vacations and enjoying hobbies - really gives it meaning. It may also give you that extra bit of motivation to get started.
At last count, Planswell has built around 80,000 free financial plans for Canadians. Some are wealthy, most are not, and all have lifestyles that they want to maintain or improve while they work and when they are retired.
When you decide to work with Planswell, there are three main steps that you will experience:
This step only takes about three minutes. You’ll answer 30-40 questions about things like your family structure, how much you make, how much you own and how much you owe. We’ll take these numbers and do millions of calculations to deliver a brilliant financial plan almost instantly and absolutely for free.
You’ll see exactly what to do on a monthly basis to sustain your lifestyle into the future. How much to invest in which types of accounts. How much and which types of insurance to add. And how to reduce the amount of money you spend on debts and interest. The plan is yours to keep and you can (and should) update it regularly.
It’s not uncommon for people to find literally hundreds of thousands of dollars in potential savings when they build a plan. If you want to make those savings a reality, we are pleased to make it easy for you. Our PlanPros are trained experts who can help you get it done faster, cheaper and friendlier than anywhere else.
Now, what happens if your lifestyle changes? What if you get a big promotion? What if you lose your job? What if your family grows or the stock market goes way up or you buy a new house?
Life naturally evolves and so does your plan. Just take a few minutes to update it every six months. If your income has increased, your plan will adjust to a higher standard of living. If the market has made any major moves, your investments will be recalibrated. If you hit a rough patch or land a windfall, this will be captured in your updated plan too.
In the old days of financial planning, this type of update-on-demand was totally impractical. Today, technology makes advanced financial planning a snap, even if you have no prior experience.
Money can often seem complicated and stressful. Many of us try not to even deal with it unless we have to. But if you think it’s worth saving date night, then we think building a free financial plan is the best thing you can do in the next three minutes.
Grow your wealth. Manage your borrowing. Protect your assets. Planswell gives you a free plan that ties investments, insurance and mortgages together so you can maintain your lifestyle throughout work and retirement.