Learning to Identify Opportunities & Concerns

By Ian Calvert on February 24, 2023

A comprehensive financial plan, when done correctly, can be an extremely valuable document and planning tool for every Canadian family. Although financial plans can be delivered in many different formats, one aspect of the document that should be constant in each financial plan is the current financial position of the family. Every financial plan should encompass both a net worth and cash flow statement. However, only looking at the current position of family’s finances leaves the financial plan extremely incomplete. A more productive financial plan will not only assess where the family wealth, income and taxes are today, but more importantly, where it is going.

It is this forward looking forecast that allows the planner and family to then make the best decisions possible. In other words, by having a forward-looking document, you can then identify opportunities and concerns to be dealt with now.

Without this financial transparency, it is impossible to observe and execute.

I’ll never forget an introductory meeting I had several years ago. I was introduced to couple who needed help with both their portfolio and lacked a financial plan and clear direction. Shortly after the introduction and pleasantries, the couple immediately asked, “What do you recommend we do from here?”. I gave them my honest response of “I don’t know”. They both looked puzzled from my remark. I assume they thought I would have a quick and polished response to that question, but I wasn’t going to give a one size fits all answer. I then explained I need to take a planning first approach. If we create a comprehensive financial plan that allows me to understand who you are financially, and what path you’re on, I can then see the concerns and opportunities within your financial future. It’s only after this work is completed can I honestly and objectively answer that question.

When embarking on a new financial planning process, it’s important not to underestimate the value of time. As many financial planning strategies need to be executed and implemented over several years to achieve the goal, the early detection of the financial action items can make a meaningful impact over the life of the financial plan.

Families without a comprehensive and forward looking financial forecast are undoubtably missing out planning opportunities.  And unfortunately, solving financial planning problems can come too late.

It’s recommended to start this process as early as possible because when you fail to plan, you plan to fail.

Ian Calvert
See Beyond

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