As value-based Financial Advisors in Winnipeg, we help clients like you realign spending toward what really matters.
In today’s world, we are constantly bombarded with opportunities to spend our money.
Unfortunately, this “desire-based” spending may put you in a position where there really isn’t enough left over at the end of the day to take care of the things that are really important to you.
As value-based financial advisors in Winnipeg, we help you uncover these important things, then develop a plan to ensure they do not get left behind.
We also work with you to identify certain risks that may “roadblock” your plan and together, we design a solution that mitigates or eliminates their potential financial impact.
Throughout the planning process, we apply high level, unbiased, independent quality advice to ensure you have a secure financial future through a proven step by step financial compass process.
The first step in securing your financial future is risk management.
Risk management gives you a solid financial foundation which mitigates the risks of serious life events affecting your financial security as well as your loved ones’ future; and if you’re anything like most of us, your financial security highly depends on your ability to earn income.
This means that if you lose your ability to earn a living, your income STOPS.
A well-planned risk management strategy helps you protect yourself and loved ones from loss or reduced income in the event that your ability to earn a living is ever affected by life events that are beyond your control.
Illness or Disability
Unfortunately, it isn’t unusual that any one of us knows or at least heard of someone who has had cancer, heart-attack or stroke.
If you’ve never heard of anyone being ever affected by a critical illness or a disability then managing risks in this domain may not be important to you but then again, if you live in an imperfect world as we all do, managing risks against these potential life events is imperative.
Most of the times, a person inflicted with a serious medical condition or injury often survives and live on but most of them may never recover financially.
When a person gets sick or become disabled, he or she may not be able to perform his or her regular activities to earn a living, a solid living benefits plan ensures that you don’t have to worry as to when the next paycheck is coming should you ever find yourself in a position when you’re unable to work because of an illness or disability so you could focus on getting well instead of worrying about money.
How to Financially Protect Yourself and Loved Ones
Critical illness and disability insurances are living benefits policies that could serve as your financial safety net should an illness or disability prevent you from actively working at your job, business or profession.
Think of these living benefits solutions as your silent partners, your hedge against income loss incase of disability or illness thereby safeguarding your financial security, lifestyle and loved ones’ future.
As responsible providers to our families, we work hard at our jobs, professions, or businesses to provide for our loved ones’ needs and guarantee their lifestyle and future.
But what if your loved ones suddenly find themselves in a situation where the person whom they rely upon for financial support is no longer around to support them?
Sudden or unexpected death is one of the few conversations that many of us turn away from because most of us are not comfortable talking or even thinking abuot the posibility of this unfortunate event ever happening to us.
So instead of securing our loved ones against such a dreaded scenario; most of us ignore this fact believing, well hoping “that it won’t happen to them”.
Unknowingly, most people make the worst financial decision of their lives by not protecting their income in the event an untimely passing.
Planning for the worst will ensure your loved ones financial security, lifestyle and future in the worst case that if you’re no longer able to take care of them.
Life insurance protects your loved ones from your financial obligations as well as loss or reduced income should a breadwinner pass away.
It does not mean, in any way that you’re planning or that you’re expecting to die, it simply protects your loved ones financial well being so they can continue living the same lifestyle that you’ve always provided them with.
It’s like when you’re driving a car, you carry a spare not because you’re expecting to get a flat but because it may happen.
Having one means that you’re aware of your obligations and that you acknowledgment the fact that we’re mere mortals, hence, there is a need to secure your loved ones in the event that they find themselves without the person they depend on for financial support.
Life insurance ensures that your loved ones can still maintain the same lifestyle and still get the future that you’re capable of providing them even when (if) you’re no longer around to look after them.
In reality, life insurance is a benefit that we hope no one should ever need, at least, during our active working years or when our families are young but then again, enough coverage should be in place – just in case!
This way, our loved ones need not suffer the financial consequences of a breadwinner’s death.
Just like living benefits, life insurance is a silent partner that makes sure your loved ones are taken care of in the event that you’re no longer around to take care of them financially.
Why Insurance is Important
Insurance is an important part of your risk management plan because it protects you and your loved ones against the financial risks of events that are beyond anyone’s control.
Insurance protection is like carrying a spare tire, you don’t wish for a flat but you carry one so you can continue on your journey; just in case.
Insurance gives you and your family the peace of mind in knowing that life can continue on without the risk of financial struggle regardless of what serious event life might throw at you.
You Need Insurance if:
- You actively work for income.
- You have people depending on you for financial support
- You’re financially accountable to a person or an entity
- You have a business that needs to survive for your loved ones and/or employees even if you can no longer actively work in it.
- You have material assets or a sizeable estate that you want to pass on to your next generation
Basically, anyone who has obligations or responsibilities need insurance.
Insurance protects you and your loved ones from the following:
- Lost or Reduced Income
- Consumer Debts
- Mortgage Debt
- Children’s Post Secondary Education Costs
- Funeral & Interment Costs
- Taxes at Death
As breadwinners, the income that we contribute to our family’s cofer is one of our most important obligations.
When we’re alive and well and we lose our job or business slows down, it is but natural for us to look for other alternative sources of income so income continues coming in but unfortunately, there are times when loss or reduced income isn’t simply because of job loss or business setbacks; sometimes a person can’t continue working actively due to an illness, disability or death.
Unfortunately, these serious life events could happen to anyone.
As human beings, anyone of us could acquire a dreaded disease, become disabled or pass away anytime.
This is the unfortunate reality; we don’t want these events ever happening to us but then it could happen and the best thing that we can do to protect ourselves and our loved ones against the financial impact of these events is to implement the necessary insurance protection as hedge against these uncertainties.
The problem is, a person’s monetary obligations don’t necessarily stop when his or her income stops.
Consumer debt servicing like credit card payments, car amortization, bills, mortgage payments and whatever else monthly obligations an individual may have will continue collecting payments on a monthly basis which may put a strain on a family’s budget when the family’s income is lost or reduced.
Wills and Powers of Attorney
If you have young kids or any sort of assets on your name, I coudn’t emphasize more the importance of having a Last Will in place as I’ve experienced first hand how it was when a breadwinner passes away without a will.
Wills and Powers of Attorney are integral parts of a risk management plan and though, we are not lawyers ourselves, we can introduce you to our trusted lawyers if you don’t already have one.
Both of these legal documents empower you to take care of your affairs (especially financial) should you lose the ability to do so due to illness, disability or death through another person or the document itself through the lawyer in the case of a will.
Our clients qualify for a discount on these services when provided by the lawyers we recommend.
If on the other hand, you already have a lawyer of your own. Please talk to them about setting a Will and Power of Attorney.
An emergency fund helps take away the financial strain from emergency spendings such as vehicle and home repairs which helps you avoid dipping on credit cards and lines of credit for unplanned expenditures like the ones mentioned herein as well as a buffer in case of job loss.
On average, a person should build at least six month’s worth of salary or earnings on his or her emergency fund which protects the fund owner against monthly obligations in case he or she loses his or her job due to lay off or job shortage.
An emergency fund serves as an interim source of money to take care of your basic costs of living while you’re searching for another source of income.
Wealth Building / Asset Accumulation
The second step of the financial compass process is asset accummulation.
A sound financial plan is made up of both risk management and wealth accumulation and no financial plan is complete without a plan to build wealth over time.
Most people never really think of retirement when they’re young not realizing that the best time to start saving for retirement is the moment they earn their first paycheck.
According to then Finance Minister, late Jim Flaherty; while it’s good that we have government pensions in place, the problem is that it’s too small.
He also urged Canadians NOT to put all their hopes for retirement on government pensions and instead to save their own funds for retirement.
This is because government pensions are only meant to supplement our retirement income and shouldn’t be treated as the sole source of retirement income.
This is the reason why most retirees solely rely on government pensions at retirement.
And while it’s good that our government has pension plans in place; these are only meant to partially replace our active income when we retire from the workforce.
Going back to the workforce even on part-time basis in order to supplement your government pension isn’t a viable option.
You may argue that having a government pension is more than enough to meet your needs at retirement but this only holds true if you plan to live on half of whatever it is that you’re currently making.
Fact is, most will people go back to the workforce at least on a part-time basis to supplement their retirement income if their only source of income is their government pensions.
The Canadian dollar you know today will most-likely have half of its value from when you retire not to mention the fact that you will probably have more time and more opportunities for spending at retirement than when you’re actively working full time when you only have 1 – 2 days a week for leisure.
Remember that on your retirement years, your weekdays will all be Saturdays!
You will have a lot of free time for fun, leisure, hobbies, travel or whatever else you want to do with your time and each of this represents an opportunity to spend your retirement funds.
The challenge is to have enough income and NOT to run out of cash flow at retirement
There are two problems most retirees are facing today and they are as follows:
- Not enough retirement income, and
- Outliving their retirement funds.
It is expected that the majority of the population will not have saved enough money for retirement.
Planning your retirement early on will make a huge difference and yet, this is one of the major financial mistakes many of us make.
A lot of us don’t necessarily think about retirement when we’re young and just starting out in our careers and the majority will keep on putting it off for the most part of their working lives, amassing obligations instead of assets, only to realize it a little too late.
According to one of my favorite Chinese proverb:
The best time to plant a tree was twenty years ago. The second best time is now.
When it comes to your finances, the very best time to actually start saving for retirement is the moment we earn our first paycheck but most people miss this fact as personal finance was never taught in school.
The sooner you start saving and growing funds for retirement, the sooner you can retire and even if you don’t plan to retire at all; having money working for you at old age means you can still work at a job, business or career because you want to but not because you have to.
As your financial advisor in Winnipeg, our goal is to also help you implement a simple yet effective retirement saving strategy that will help you slowly build wealth over time, whatever it is you do for a living.
Slow and steady still wins the race!
“Get rich slow” is the key and if you keep at it, you will have more than enough money that will provide you with passive income at retirement.
Whatever stage you are in your life right now, either you’re just starting out with your career or you already have an established career, it’s never too late to start planning!
A well-thought-out insurance and retirement planning strategy will help you and your family plan for the unexpected and plan ahead for your future so you have money working for you whatever the future holds.
As your financial advisors in Winnipeg, my associates and I are here to guide you through the intricacies of living benefits, insurance planning, savings, and retirement planning to help you protect yourself and your family from the unexpected while silently building your financial future.