What is a Comprehensive Financial Plan?

What is a Comprehensive Financial Plan?

Let’s start by clarifying that an Investment or a product is not a financial plan. 

Those, if well deployed, can, however, help you execute on your financial plan.

Technically speaking, a “Comprehensive Financial Plan” is a plan that encompasses your complete financial picture. 

It would cover areas such as investments, retirement and risk management.

Though this is technically correct, It still doesn’t tell you much about what it can do for you, your family and your future.

“Having an investment or accounts such as RRSPs and TFSAs or any product for that matter, IS NOT the same as having a Financial Plan”

A Financial Plan Is a Road Map To Your Future

To put it simply, creating a financial plan is similar to planning a road trip over an extended period. This journey could look at five years, 10 Years, 20 years into the future and often longer.

A financial planner’s job is to help you craft your financial future by making the most of what you have today.

What is Financial Plan- World Map For Financial Planning To Represent Goals as Destinations in Our Journey (1)

Your Financial Plan Will Give You Perspective

Having a comprehensive approach to planning, will prevent you from “winging-it” and unknowingly sabotaging another area of finances. 

These could hinder you from living your best life. 

This happens because you likely have conflicting goals and objectives. 

For Example:

Answering these questions would require you to understand what you are giving up by focusing on a key area of your life.

Looking at the Rent or Own example, you may be giving up property equity by renting. 

However, without understanding, the alternative for the equity, you won’t really know what the better choice is for you.

If you rent just so you can buy a nicer car, it may not be as wise as renting so you can use your capital to start a business.

Answering these questions is extremely context-specific.

What Is Included In a Financial Plan?

A Comprehensive Financial Plan Will Integrate With You and Your Life and Includes the Following Service In The Fee You Pay

We Will Integrate the following areas of your finances into cohesive and harmonious steps:

A Financial Plan Will Start With You Goals and Your Life Plans

Included In Every Plan

Aware Financial Service Catalog Fee Based Retirement Planning Goal Setting Icon

Understanding your, short term, intermediate-term and long-term financial goals will uncover “the why” behind your investments and savings activities.

These could be rooted in wanting to start a family or gifting assets to the next generation. Either way, these goals and dreams are uniquely you.

Having a Clear Idea of Your Cash-Flow and Debt Management Will Fuel Your Financial Plan

Included In Every Plan

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Cash-flow will fuel your financial plan, without managing your income and your expenses, you can’t implement your financial plan properly.

Reducing the cost of capital or interest could save you tens of thousands or hundreds of thousands in your investing life.

We'll Discover Ways To Increase Your Income By Having Career and Business Discussions

Included In Every Plan

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Your biggest asset is your ability to earn an income. Helping you maximize your earning power at work or in your business will have a far greater impact than investment performance. Focusing on this would often provide you with the quickest return per action.

We'll Find Ways to Keep More of Your Money by Creating a Tax Plan

Included In Every Plan

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Tax Planning on its own could be dangerous, but when added as a pillar to your financial plan, we can make sure your money is working harder for you, than the taxman.

Financial Plans are Designed to Match you Investments With Your Personal Goals.

Included In Every Plan

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As mentioned earlier, an investment is not a financial plan. However, when investments are based on a comprehensive plan, you are able to match your investment choices to your financial goals, your risk tolerance and capacity and your investment time horizon.

Retirement is not a single day or party, it's a new season of life. Having a Financial Plan Will Help Make That Season Enjoyable

Included In Every Plan

Aware Financial Service Catalog Fee Based Retirement Planning
Carefully structuring your investments so that you can eventually reach a “work-optional” lifestyle is great. However, this requires planning around your sources of income. The sequence of withdrawals from your accounts can determine how long and how comfortably you can retire. 

We'll Discuss RESPs and Education Planning Because Your Financial Plan Will Cover Your Family, Not just you.

Included In Every Plan

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The cost of post-secondary education continues to skyrocket. Whether you are planning for your kid’s education or continuing education for yourself, requires careful planning and proper funding

We'll Discuss Insurance And Risk Management So That You Keep What You've Worked Hard to Keep

Included In Every Plan

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What’s the use of working hard towards building wealth if the fruits of your labour could easily be snatched away? Proper income protection and asset protection plan will help keep you on track when life happens.

We'll Discuss What Your Legacy Goals are. Your Estate Is Your Parting Gift, Let's Make Sure It Has Meaning

Included In Every Plan

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Those who are self-made, start working for survival, then success, but eventually that translates to creating significance. Having a properly planned giving strategy will multiply your ability to leave an inheritance or a charitable bequest.

So How Do You Tell If You Have a Good Financial Plan or Financial Planner?

A Successful Financial Plan Should Give you a sense of possibility; it should empower you to take action. It should be realistic in its recommendations, plans that ask you to commit to actions which would require you to suffer will be tough to follow through.

A Successful Financial Plan Has Your DNA. You must be truly involved in its creation; it can’t be pumped out by a software simply focusing on benchmarks.

A Successful Financial Plan Evolves With You. It must be agile and flexible enough to adjust to your changing life. A printed plan is of no value when compared to the act of planning because life happens.