Getting smart financial planning can help with navigating life’s competing priorities.supplied
Canadians often feel like they’re walking a tightrope when it comes to money. They have their current needs, their goals for tomorrow, and only so much money to go around.
Prices for everyday goods keep rising, and investment markets seem more volatile and uncertain.
Investors consider balance when it comes to portfolio allocations, but a more fundamental balancing act involves juggling priorities. Like saving for a child’s education while you’re trying to pay down your mortgage.
Smart financial planning has the power to set many people free from their worries, and budgeting is at its heart, says Julie Petrera, senior strategist for client needs in Canada at financial services firm Edward Jones.
“People think of planning and budgeting as restrictive and all about numbers, but what it really allows you to do is design the life you want in the future, and what you also want today. Having all your goals, dreams, concerns and personal finances laid out in a plan is a great way to balance the present with the future.”
The benefits of comprehensive planning are well known, but according to a 2021 survey for the Canadian Institute of Actuaries, 54 per cent of Canadians lack a financial plan. Many individuals need help overcoming inertia because they feel overwhelmed by what seems like a difficult, complex task, Ms. Petrera says.
Edward Jones, which cares for more than $1.3-trillion in client assets worldwide, takes a four-pillar approach to financial planning.
Julie Petrera, senior strategist for client needs in Canada at financial services firm Edward Jones.supplied
“Financial planning obviously involves finances, which is one of the pillars, but health, family and purpose are equally important pillars,” Ms. Petrera says. “We often address these three first – a human-centric approach that pleasantly surprises new clients.”
At first, health might not seem to be an obvious fit, but she says it’s incredibly important to a plan. “It determines how long we might live, what kind of lifestyle we want to live, and even what risks loom over our ability to achieve our goals.”
Ms. Petrera says the family pillar goes beyond obvious questions about spouses and children to look at broader dynamics. “Many people want to support other family members such as stepchildren, children of siblings and even friends. We ask our clients who they consider family, and help them reflect on how their decisions will impact people in their financial circle, and how the decisions of these individuals may impact them.”
Many financial goals are closely tied to family, like saving for a child’s education or funding retirement dreams. Goals like these also touch on the purpose pillar: what do you want your money to do for you?
“A lot of people used to think about retirement planning, for example, as having enough savings to pay the bills and not run out of money. Yet our planning process also focuses on what gives purpose when they retire, like travelling, helping with the grandkids and volunteering,” Ms. Petrera says.
The remaining pillar, personal finances, provides the fuel to support the others.
“We’re a financial institution so this pillar is, of course, our strength, but we don’t look at it in isolation,” Ms. Petrera says.
Clients may be at different stages and in different circumstances, but they’re all going through ever-changing priorities as life happens. An advisor can help clients to both manage and clearly identify their financial goals.
You might not be able to do everything at once, but you can gain from advice that helps you look at your priorities in a more holistic way, weigh and make trade-offs, and address what keeps you up at night.
The result is a financial plan that’s flexible, comprehensive and realistic, and more confidence about the destination and journey. “At Edward Jones, we believe it’s important to have a partner who understands your values and what’s important, and who can educate you, making you feel secure and comfortable,” Ms. Petrera says. “After all, isn’t that what financial wellness is about?”
Advertising feature produced by Globe Content Studio with Edward Jones. The Globe’s editorial department was not involved.
