A roadmap for financial security
The value of financial planning advice
As incredible as it sounds, many people spend more time planning their next vacation than their financial future. Although people want to plan for their financial well-being, many do not know where to begin.
In many ways, a financial plan is similar to having a map to guide you on a long road trip. You start by determining your life goals and objectives and taking stock of your present circumstances. Think of it as choosing your destination, and locating it, along with your present location, on a roadmap. From there, you weigh a number of considerations before developing a detailed financial plan. Just as there are many different map routes that can be taken to reach your destination, there are many different ways to customize your financial plan to achieve your life goals and objectives.
A BALANCED APPROACH
When planning the route for your road trip, you might choose the fastest, the most scenic or, perhaps more likely, a blended route. Similarly, your financial plan will strike a balance between today's needs and tomorrow's goals.
EXPECT THE UNEXPECTED
Your financial plan will continue to evolve as your circumstances change, just as you would adjust your travel route for a road closure or other detour.
A common misconception is confusing financial planning with investment management. Although a significant part of the process, a comprehensive financial plan will encompass much more.
WHY YOU NEED ADVICE
According to a study conducted by the Investment Funds Institute of Canada1, 72% those who retained the services of a financial advisor were satisfied with their financial situation, versus 53% without an advisor. With this in mind, Laurie Renton, Owner at LR Future Insurance & Investments and Financial Advisor with Desjardins Financial Security Investments Inc. created an external network of partners who are available to offer full financial planning advice to her hometown clients.
ADVICE FOR REAL LIFE
We are here to help you make informed choices, by offering you honest and straightforward financial advice based completely on your needs. We call it advice for real life, and it starts with your life. Contact us today.
Source: The Value of Advice (2010), The Investment Funds Institute of Canada
Is your financial advisor registered?
(NC) — Did you know that most financial frauds are committed by individuals who are not licensed to sell financial products? You can protect yourself against these scams by ensuring that your financial advisor is licensed, registered and in good standing with regulatory organizations across the country.
Licensed financial advisors must complete continuing education programs to help them keep on top of new financial products, rules and regulations, and industry trends. If they do not comply, they are subject to stiff penalties, including fines and loss of license.
To ensure that the firm and financial advisor you are dealing with have met the appropriate requirements and are licensed to provide certain services, visit the following websites:
• The national registration search, at http://www.securities-administrators.ca/nrs/nrsearch. aspx?id=850, lists all registrants (individuals and firms) in Canada, except for those registered solely with the Ontario Securities Commission (OSC).
• A list of those registered in Ontario is available at http://www.osc.gov.on.ca/en/Investors_checkregistration_index.htm.
• The Investment Industry Regulatory Association of Canada member list: http://www.iiroc.ca/industry/Pages/Dealers-We-Regulate.aspx.
• The Mutual Fund Dealers Association of Canada member list: http://www.mfda.ca/members/members.html.
• La Chambre de la sécurité financière (Québec only): http://www.chambresf.com/en/.
To find out whether a financial advisor has been disciplined by securities administrators, check the Canadian Securities Administrators' Disciplined Persons list http://www.securities-administrators.ca/disciplinedpersons.aspx.
Source: The Investment Funds Institute of Canada (IFIC.CA)
Making informed investment choices
(NC) — Much like planning a trip, the key to successful investing is having the right information, a well-constructed plan and, often, the right advice. You don’t need a PhD in history to visit ancient Rome, but reading a travel brochure before your trip will give you information to help you decide how much time to spend there. Once you know the basics, a travel advisor can suggest where to stay and eat and which places of interest to visit.
On your financial journey, knowing some basics will help you ask the right questions, obtain the best advice and feel confident about your decisions.
Here are some key principles that will help you manage your investments effectively over time:
• Choose your investments based on when you expect to need the money.
• Spread money among different investments (called diversifying your portfolio) to soften the impact of any major changes in the market.
• Make sure you understand the full costs of your investments.
• If you need to withdraw money from a mutual fund earlier than planned, take it from a fund that does not impose a penalty for early withdrawal.
• Once a year or anytime you experience a major life change, review your investment choices and make changes if appropriate.
If you need assistance applying these principles to your situation, speak to a financial advisor.