The best laid plans

The financial world is full of plans: Retirement plans, investment plans, estate plans, and financial plans

They are offered as the solutions to all your problems, the keys to your successful, happy life. Problem is, they’re only a tool, a way to organize your thoughts, goals, and actions. It’s a roadmap, if you will, of a journey we all must make. Any plan is better than no plan, unless of course it’s a bad one.

Think of the way you planned your last trip

You didn’t simply go online, pick a good review and order your tickets. No, if you’re like most people, you probably had conversations with friends, compared destinations that were within budget (and maybe tempted by a few that weren’t). 

You narrowed it down to a couple of locations, then started doing your research. Maybe you called someone who had been there, or you signed up for a forum and started a conversation, or you went to Tripadvisor and started clicking through other people’s experiences. 

Whichever way you went, your goal was to gather as much relevant information as you could, so you could make an informed decision. 

Now you’ve sketched out the bones of the trip. You know where you’re going, you know when – now it’s time for the details. You’ve narrowed the flights to a couple of options that will get you there in reasonable comfort and without spending 12 hours in Denver Airport. You’ve selected a hotel based on price, location, and proximity to the beach. You’ve written down the rough price of everything, and have a pretty good idea what the trip will cost you. Now it comes down to availability and pricing. 

The next step is the tough one, committing your hard earned cash

So, now you’ve done it. You paid the deposits, booked the airfare, arranged ground transport, booked a couple of side tours or shows, and chosen a few restaurants. You’ve printed all the confirmations, and before you sits a great stack of papers outlining your journey. The question is, will this stack of papers guarantee you a great trip? 

No. What makes the trip great is the time you put into the planning process, the accuracy with which your choices reflect your desires, the timing of the different parts of your journey, and your ability to know what to give up and what to hold onto. Without all that, it’s just paper.

A financial plan, like a travel plan, is only as good as the time put into it

To be effective, a financial plan must reflect what you really want out of the rest of your life. It must balance your needs and wants with the funds and assets you have. 

When there are shortfalls, you must either make adjustments to your life or look for creative solutions and work-arounds. Your plan must be up to date and, most importantly, must reflect your reality. 

The nitty gritty

Don’t leave your future to chance - or to some company’s software program. 

Make sure your plan is what you and your family want. 

Make sure it covers surprises along the way, and leaves you with enough wriggle room to ride out the bad times. 

Make sure it addresses the things you really want to accomplish, the places you want to go, and the things you’re hoping to do. 

Most of all make sure it’s based on reality, not historical forecasts, pretty charts, and generalizations. 

If you are doing this hands on, be thorough, and be honest with yourself. 

If your using a professional, make sure they take the time to ask questions, gather facts (both good and bad), weigh options, and ultimately put forward a plan that doesn’t confuse or confound you. 

Make sure it’s a plan you can live with, because you may not have a choice once the plane has taken off.

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.

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About the Author

Jeff Stathopulos, CIM, CFP, Portfolio Manager

Jeff is an advisor and partner with The Navigation Team at Scotia Wealth Management.

He lives in Kelowna with his wife Tanya, their two university bound daughters and their canine kids.

You can contact Jeff by email at [email protected]

Website:  www.yourlifeyourplan.ca

The Navigation Team

Scotia Wealth Management

This column is for information purposes only. It is recommended that individuals consult with their financial advisor before acting on any information contained in this article. The opinions stated are those of the author and not necessarily those of Scotia Capital Inc. or The Bank of Nova Scotia. ScotiaMcLeod is a division of Scotia Capital Inc., Member Canadian Investor Protection Fund.

The views expressed are strictly those of the author and not necessarily those of Castanet. Castanet does not warrant the contents.

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