Remember that retirement planning is a long-term process that needs to be flexible to adapt to your ever-changing reality. Indeed, a competent advisor will update your savings strategy throughout your life course.
Wondering which elements your advisor will be considering? Here is the answer.
Step 1: developing a game plan
The first step, and certainly the most important one, is to establish a game plan that reflects your ambitions and your reality. This plan will be used to determine how much you need to save each year to live up to your ambitions, with regard to life expectancy. Your financial advisor’s guidance is essential because he will develop conservative assumptions according to inflation and rates of return. The goal is to have a comprehensive game plan, which includes your current employer’s pension plan, public plans, and personal savings.
Step 2: analyzing investment vehicles
In Canada, the mix of savings vehicle options are numerous—RRSP, TFSA, RESP, management company for entrepreneurs, RDSP (for people with disabilities), etc. Choosing the best options for your personal situation can seem overwhelming, since many factors have to be taken into consideration. That’s when your advisor’s expertise will come into play. He will analyze your current and future taxable income, the age of your children, your employer’s plan, and many other variables. The goal of this analysis is to provide you with the most tax-efficient investment strategies, so you can make an informed decision.
Step 3: choosing the right investment options
Now’s the time to select the investment options for your retirement. Your advisor with guide you through it, based on the results of the previous steps. He will also consider your overall risk profile, which varies depending on your personality, age and investment knowledge. One of the advantages of involving your advisor at this stage is that he will recommend a list of fund managers in Canada. This will give you the assurance that your assets are placed in the best investment vehicles.
Keep in mind that if your life changes, so should your retirement plan. A dedicated financial advisor will follow up with you regularly to help you adapt your plan to your new situation.
At AccèsConseil, our advisors work with you, and for you, to plan a comfortable retirement plan, today and tomorrow!
Special collaboration with Daniel Dionne, Actuary and Financial security advisor at AccèsConseil.