Imagine you’re taking a road trip to the Rockies. Most people would put a GPS on their dashboard or at least pack a map, but you can’t be bothered. You know that the mountain range is west of Toronto. So if you drive roughly westward, you should get there eventually, right? Of course not. And, of course, you would never travel this way.
Yet this is how most people manage their money. They open a savings account, buy a couple mutual funds and hope for the best. This haphazard approach isn’t terrible, but it doesn’t amount to a coherent strategy.
The solution is in clear view: to make a financial plan. “A financial plan is your GPS on the road of life,” says Amardeep Sidhu, an advisor at Lawyers Financial, a not-for-profit that delivers low-cost investment products and financial advice to the legal profession. “A financial plan helps you get where you want to go.”
To build a financial plan, your first step is to speak with a financial advisor at a series of one-on-one meetings, where you talk through your life goals. Perhaps you want to buy property in five years, while also saving for your retirement. The advisor will construct a plan that allows you to work toward both objectives simultaneously. Your priorities will naturally shift over time, so you’ll meet with your advisor each year to update the plan.
At this point, you might be thinking, Okay, okay, I’ll get to it eventually. But, in truth, you should act now. Here are the most common reasons why people tend to avoid financial planning — and an explanation for why those reasons fail.
Before I make a long-term plan, I want to pay back my student debt. Debt is important, but it’s not the only thing that matters. You shouldn’t single-mindedly attack debt, for instance, while neglecting your retirement savings. And a good financial plan will spell out how to balance multiple priorities at once. “Conventional wisdom says that you should settle debts before anything else,” says Sidhu, who has 16 years of experience as a financial planner. “But in this case, conventional wisdom is often wrong.”
I don’t have time to see a financial planner. We get it. Lawyering is tough. The hours are long, and the work is all-consuming. That’s why the team at Lawyers Financial is happy to arrange a video conference with you on evenings, weekends or during your lunch break.
It’s too much money. In the for-profit sector, a financial plan can cost $3,000. But Lawyers Financial is a not-for-profit, so it can offer planning services for the low, low price of free. And best of all, you don’t have to buy their investment products to get an initial consultation.
I’ve read plenty of articles about investing, so I’m good on my own. Much of the advice you find online is, in certain circumstances, valid. You might have read insightful articles that spell out the advantages of stocks, bonds or tax-free savings accounts. But they won’t be able to predict what’s optimal in your life. “This is where our personalized approach comes into play,” says Sidhu. “An article can say what’s right for somebody. A planner can say what’s right for you.”
What you need to know about Lawyers Financial
It’s your one-stop shop. Lawyers Financial, a brand of the CBIA, sponsors a full suite of insurance products: life, critical illness, disability, business expense, office, employee benefits and travel, as well as home and auto. It can also meet your investment needs with personalized advice, TFSAs, RRSPs, non-registered plans, defined contribution and defined benefit pension plans and a best-in-class selection of low-fee investment funds.
It’s a not-for-profit. Lawyers Financial measures success in satisfied clients, not dollars. That’s why it offers some of the best rates in the industry.
It’s for sharing. Lawyers Financial products and services are available to your family and law-firm staff.
Ready to start adulting? Visit lawyersfinancial.ca/financialplanning or call 1-800-267-2242.
This is a story from our Fall 2020 Issue.