Financial planning involves more than just your investments—it is about your “big picture” financial situation. Research has found that more people with comprehensive financial plans feel they’re on track with their financial affairs than those who have done little or no planning.1
Working with a financial planner can make a meaningful difference in your life. That’s because financial planning casts a broad net and incorporates your household finances, your plans to save for your child’s education, your insurance needs, and anything else that could have an impact on your financial well-being.
Elements of a comprehensive financial plan
Your financial life might be more complex than you realize—and creating a comprehensive financial plan will often make this apparent. You need to think not only about your savings but about your tax situation, preserving wealth, your retirement and an estate plan.
Each of these elements has complexities. Take retirement: people are living longer, which can mean longer retirements. And if, like most physicians, you don’t have a pension, you will need your investments to help fund your retirement. This means that your retirement goals need to be incorporated into your broader financial plan.
Then there is your tax situation, which typically gets more complex as you make more money. And while it may be uncomfortable to talk about the end of life, planning your estate is essential for ensuring your wishes are honoured and your family is protected. A financial planner can help you create a strategy to meet all your financial goals.
Working with a financial planner through big changes
Your financial goals may change when you experience significant life changes, including the following:
- starting your practice
- buying a house
- having a baby
- receiving an inheritance
- getting married or divorced, or moving in with a partner
- encountering a health scare
- selling your practice
- entering retirement
At these times, it is important to rethink your broader financial situation, not just your investments. You may need to look at tax issues, time horizons, retirement contributions and much more, and make changes to match your new needs and goals. A financial planner (like your MD Advisor) can look at the big picture and help you adjust your plan accordingly.
Preparing for a meeting with your MD Advisor
Here are some things you can do to help make your next meeting a productive one:
- Organize your financial files. The most important documents include your income tax documents (tax returns, tax slips, RRSP contribution receipts, etc.), insurance policies and most recent investment statements.
- Document your current income, assets and expenses. The more information you provide to your MD Advisor, the better. These details enable him or her to build a more comprehensive and customized plan.
- Write out your financial goals. These may range from buying a cottage to building a substantial legacy for your heirs. List them all, and then prioritize them with your MD Advisor.
- Plan to have an open, honest discussion. A frank discussion about your goals—as well as the things that worry you—will ensure you have a productive meeting.
Your MD Advisor is committed to understanding your financial needs and goals, then developing a comprehensive financial plan for getting you there. As your life circumstances change, your MD Advisor will update your financial plan so you stay on track.
Having a comprehensive financial plan helps Canadians feel they’re on track, but it also delivers results. It turns out that households that work with a financial planner for 15 or more years have 2.73 times more assets than non-advised households.2 Over the long run, that can be a huge difference.
For more information about financial planning, contact an MD Advisor. MD offers objective advice at every stage of your career—from medical school through retirement. Find an MD Advisor near you.