Young families• Paying off student loans

• Buying a home and managingmortgage payments

• Saving for children’s education

• Building financial security

• Managing debt moreeffectively

ng

ion

y

START NOWFinancial Planning Week, nowin its fifth year, takes placeNovember 17-23 across Canada.Presented by Financial Plan-ning Standards Council (FPSC)and Institut québécois deplanification financière (IQPF),this national campaign is an in-tegral part of Financial LiteracyMonth, raising awareness of thebenefits of financial planningfor Canadians and the impor-tance of seeking out a qualifiedplanner.

According to FPSC, finan-cial planning means differentthings to different people.Financial success and securitymight mean owning a home,travelling the world or enjoyinga stress-free retirement. Re-gardless of their specific goals,says FPSC, everyone can benefitfrom a comprehensive finan-cial plan created in conjunc-tion with a Certified FinancialPlanner.

Among their activities thisFinancial Planning Week, FPSCand IQPF are offering the follow-ing incentives and tips to helpinspire Canadians to get startedon a path to financial success.

ENTER FOR YOUR CHANCETO WIN AN IPADVisit financialplanningweek.cato learn more about FinancialPlanning Week and to subscribeto FPSC’s newsletter, featuringthe latest in financial planningtips and tools. And by signingup today, you’ll be automaticallyentered into a draw for a chanceto win an iPad!

THREE STEPS TO YOURFINANCIAL FUTURE

STEP 1: THINK• Reflect on your life goals, both

short-term and long-term.Financial planning is about

much more than planning fortomorrow – it also supportsand enhances your currentstandard of living.

STEP 2: TALK• Talk to your life partner.

Money sometimes comeslast on the list of relationshipconversations, but it is an es-sential part of family life plan-ning and should be treated asa priority. Plan now to avoidmoney becoming a stressoron your relationship.

• Talk to your children. It’snever too early to teach yourkids the value of money andthe importance of good finan-cial habits.

• Talk to a financial planningprofessional who can helpyou make sense of it all. Certi-fied Financial Planner (CFP)professionals are uniquelytrained to design meaningful

financial strategies that willhelp you meet your goals, nowand in the future.

STEP 3: ACT• Track your spending so you

know where your money isgoing. You may be surprisedat your ability to find savingswhen every dollar is accountedfor.

• Pay yourself first and start asavings and/or investmentprogram. Even small amountsadd up if you save regularly.

• Pay off debt, starting withcredit cards and other high-interest debts.

• Work with a CFP profes-sional to create and maintaina financial plan that looks atthe whole picture. It’s nevertoo early or too late to start,nor do you have to be wealthyto have a plan. Planning is foreveryone!

SpecialF R I DAY, N OV E M B E R 1 5 , 2 01 3 FPSC 1

AN INFORMATION FEATURE FOR THE FINANCIAL PLANNING STANDARDS COUNCIL

Financial Planning Week

At all stages of life,a financial plan offers a road map to well-beingStudy reveals that Canadians with financial plans feel they are saving more, living well andexperiencing higher levels of overall contentment in their lives

VISION 2020

Financial Plan-ning Week waslaunched fiveyears ago withthe vision that,by the year 2020,Canada will be

shaped by a nation of people,organizations and a regula-tory environment that:

• Values financial planning;• Shares and assumes re-

sponsibility to ensure thefinancial planning needsof Canadians are wellserved; and

• Has a viable financialplanning profession thatensures that those whoneed professional advicehave broad access to com-petent, ethical financialplanners.

This report was produced by RandallAnthony Communications Inc. (www.randallanthony.com) in conjunction with the advertising department of The Globe and Mail. Richard Deacon, National Business Development Manager, rdeacon@globeandmail.com.

Financial Planning Week is November 17-23

he results of a three-yearlongitudinal study thatincluded close to 15,000 Ca-

nadians provide important insightinto the potentially life-changingimpact of financial planning.

The Value of Financial Plan-ning, commissioned by FinancialPlanning Standards Council(FPSC) in conjunction with theFPSC Foundation, provides acomprehensive evaluation of thefinancial planning activities ofCanadians, measuring its per-ceived impact on emotional andfinancial well-being.

According to the study findings,Canadians who engage in compre-hensive financial planning reportsignificantly higher levels of fi-nancial and emotional well-beingthan those who do no planning oronly limited planning. Those withcomprehensive plans feel:• more on track with their finan-

cial goals and retirement plans;• they have improved their abil-

ity to save in the past five years;• more confident they can deal

with financial challenges; and• better able to indulge in their

discretionary spending goals.

Further, regardless of networth, Canadians who engageCertified Financial Planner (CFP)professionals for their financialplanning needs report they areexperiencing significantly higherlevels of financial and emotionalwell-being.

“Having a comprehensivefinancial plan with the guidanceof a CFP professional can providea road map towards greater finan-cial and emotional well-being,”says Cary List, president and CEOof FPSC. “Now with three years ofempirical research reinforcing thevalue of planning with the rightprofessional, we urge Canadiansto take that step and talk to a CFPprofessional about their goals andfinancial planning needs.”

Not all financial planners areequally qualified.Page FPSC 3

Navigating life’s many mile-stones with financial planning.Page FPSC 4

Achieving goals, realizingdreams in pre-retirement.Page FPSC 5

Bringing sleep-easy retirementwithin reach.Page FPSC 5

Financial planning that meetsthe unique needs of physicians.Page FPSC 6

INSIDE

Value study, Page FPSC 2

ONLINE?

For more information, visitwww.fpsc.ca.

“Having a comprehensivefinancial plan with theguidance of a CFP profes-sional can provide a roadmap towards greaterfinancial and emotionalwell-being.”

Cary Listis president and CEO of FPSC

TAKE ACTION

Visit www.financialplanningweek.ca/herestheplan for more suggestions.

Pre-retirement• Paying off the mortgage

• Final push to achieve wealth needed to matchretirement lifestyle goals

• Managing cash flow to achieve goals morequickly

• Buying a cottage

• Starting a hobby or small business for fun

• Helping family members –without putting self-interests

at risk

embers –

Retirement• Transitioning to a post-full-time

work lifestyle

• Finding a way to keep the familycottage in the family

• Managing investment risks to ensureincome lasts

• Minimizing the tax

• Creating a legacy

For more, visit globeandmail.com/financialplanningweek

Three years of empirical research clearly and consistently revealed that regardless of net worth, thoseCanadians who engage in comprehensive financial planning with a CFP professional confirm significantlyhigher levels of financial and emotional well-being. Further results from the Value of Financial Planningstudy are forthcoming. Raw data collected for the report has been made available to post-secondaryinstitutions across the country for further analysis.

FPSC 2 • AN INFORMATION FEATURE FOR THE FINANCIAL PLANNING STANDARDS COUNCIL

FINANCIAL PLANNING WEEK

the globe and ma il • fr idaY, november 15 , 201 3

Value Study: Helping Canadians realize their dreamsFROM FPSC 1

The Value of Financial Planning, a three-year study involving close to 15,000 Canadians, measured the perceivedimpact of financial planning on the emotional and financial well-being of Canadians. Here are several highlights:

On track withfinancial affairs

81% of those with comprehen-sive financial plans (CP) feel ontrack with their financial affairs,versus 73% with limited plan-

ning (LP) and only 44% with noplanning (NP)

Able to save62% (CP) report that theyhave improved their abil-ity to save in the last five

years, versus 56% (LP) andonly 40% (NP)

Living fortoday – and tomorrow

While saving for the future is important, it isalso important to consider the needs and wants of

today. Those who engage in comprehensive financialplanning feel more confident in reaching discretionary

goals that they identify as important.• 74% (CP) said they would be able to take an annual

vacation, versus 70% (LP) and 44% (NP)• 61% (CP) said they would have enough money to

live the life they want, versus 55% (LP) and only31% (NP)

• 65% (CP) said they would have enoughmoney for splurges, versus 58%

(LP) and only 31% (NP)

For the purposes of this study, financial planning was defined as follows:• Comprehensive Planning (CP): The main financial adviser has provided financial planning for major life goals and events, or at least three of the planning components: household budgeting, tax, retirement, estate

planning, investing, debt or risk management.• Limited Planning (LP): The main financial adviser has provided advice or services related to one or two of the planning components.• No Planning (NP): There has been no help obtained from a financial adviser, regardless of the situation.

For full results of the Value of Financial Planning study, visit www.fpsc.ca/value-financial-planning.

CFP professionalsmake a difference

• Canadians who work with a CFP professional aremore likely to report their financial affairs are on track than

those dealing with non-certified planners(78% vs. 54%)

• More Canadians who are using a CFP professional believethat financial planning has helped them have greater peace

of mind than those working with a non-certified planner(73% vs. 63%)

• More Canadians who engage a CFP professional be-lieve they are closer to achieving some of their

life goals as a result of planning than thoseworking with non-certified planners

(70% vs. 61%)

For more, visit globeandmail.com/financialplanningweek

g g

Readyfor retirement

Canadians who engage incomprehensive financial planning

and cite retirement as an importantgoal feel more confident in their

plans to retire: 50% (CP) feelon track to retire when they want

to, versus 39% (LP) and only22% (NP)

Canada

By Cary List, CA, CPA, CFP

President and CEO of the FinancialPlanning Standards Council

ood standards ensurethat we do not consumecontaminated milk, meat

or vegetables, while buildingstandards ensure that our homesare structurally secure. Similarly,standards for professionals likedoctors, lawyers and accountantsact as assurance of protection tothe Canadian public.

But what standards protectCanadians when it comes to theirfinancial well-being?

In most Canadian provinces,there is no legislated standard inplace for those who call them-selves financial planners or offer fi-nancial planning services. Indeed,with the exception of Quebec,people who call themselves finan-cial planners are not required to

obtain any credentials whatsoever.Financial Planning Standards

Council (FPSC) is a not-for-profitorganization that has set stan-dards for the financial planningprofession in Canada, in associa-tion with an international networkof 24 countries, through the devel-opment, promotion and enforce-ment of the Certified FinancialPlanner (CFP) certification for al-most 20 years. FPSC’s purpose is toinstill confidence in the financialplanning profession.

The CFP designation, longrecognized as the gold standardfor financial planning in Canada,provides assurance to Canadiansthat the design of their financialfuture rests with appropriatelyqualified professionals who willput clients’ interests ahead of theirown. Yet only 17,500 of the esti-mated 100,000 people in Canadawho claim to offer financial adviceare currently demonstrating theymeet FPSC’s standards and havedemonstrated the knowledge,skills, abilities and ethics requiredof CFP professionals.

It is FPSC’s view that every-one presenting themselves as a

provider of financial planningadvice should be required to meetstringent proficiency and ethicsrequirements, including high lev-els of education and experience –just as CFP professionals do today.CFP professionals demonstratetheir financial planning compe-tence through extensive educa-tion, a rigorous standardizednational examination process,comprehensive continuing educa-tion requirements and account-ability to FPSC for a code of ethics,practice standards, and the rulesand regulations of their profes-sional body.

For more tips and guidelineson choosing a financial planner,refer to the list below.

As President and CEO of the Finan-cial Planning Standards Council,Cary List has led the establishmentof FPSC as the premier standards-setter for financial planning inCanada and CFP certification asthe gold standard for financialplanners, elevating the standardsof the designation and working forrecognition of financial planningas a distinct profession. For moreinformation about FPSC, visitwww.fpsc.ca.

Not all financial planners are created equalOPINION

AN INFORMATION FEATURE • FPSC 3the globe and ma il • fr idaY, november 15 , 201 3

FINANCIAL PLANNING WEEK

Your choice of a financial plan-ning professional is an impor-tant decision that will affect allaspects of your financial well-being, today and in the future.

Although anyone can cur-rently call themselves a “finan-cial planner,” knowledge andexperience vary widely. In theabsence of statutory recogni-tion of professional standards,consumers are well advised toensure their planner is appro-priately trained, certified andheld accountable to profession-al oversight in this unregulatedprofession. Use the followingtips to help find a qualifiedplanner who is right for you.

BE PREPAREDDo some research to becomefamiliar with financial planningterms and strategies. Whilea good financial planner willexplain things as you go along,understanding the basics willallow you to be more involvedwith the process.

CONSIDER YOUR FINANCIALAND PERSONAL GOALSFinancial planning is aboutfinding the right strategies and

taking the appropriate steps tohelp you meet your life goals.Take the time to reflect onwhat’s most important to you,both today and tomorrow.

DEMAND COMPETENCEAND ETHICSThere are a variety of differentdesignations in the financialservices industry, some requir-ing minimal education such asday or weekend courses. TheCertified Financial Planner(CFP) certification representsthe gold standard in financialplanning, with strict education,experience, ethics and compe-tence requirements. In addi-tion, CFP professionals are heldto high ethical standards andobligated to remain currentthrough extensive continuousprofessional development.

UNDERSTAND FEESTRUCTURESUnderstand how you willpay for services – hourly, apercentage of assets undermanagement, or from thecost of products. Regardless offee structure, ensure that thefinancial planner has a written

professional obligation to putyour interests ahead of theirown.

PERFORM DUE DILIGENCETake the time to verify a plan-ner’s credentials by contactinghis or her professional body toconfirm good standing. Verify aCFP professional’s designationand status atwww.fpsc.ca/directory-cfp-professionals-good-standing.

GET IT IN WRITINGInsist on a written letter, some-times called an engagementletter, outlining the specificterms of your agreement andany potential conflicts ofinterest. The letter should alsoclearly disclose your planner’smethod of compensation andbusiness affiliations.

REASSESS THE RELATIONSHIPREGULARLYFrequent communication is im-perative to a good relationshipwith your planner. Make sureyour planner understands yourneeds as they change over time,and have your plan updatedaccordingly.

CHOOSING THE RIGHT FINANCIAL PLANNER

For more tips, visit www.fpsc.ca/10-tips-choosing-financial-planner.For help in finding a CERTIFIED FINANCIAL PLANNER in your area, visit www.fpsc.ca/find-cfp.

The CFP designation, long recognized as the gold standard for financialplanning in Canada, provides assurance to Canadians that the design of theirfinancial future rests with appropriately qualified professionals who willput clients’ interests ahead of their own. ISTOCKPHOTO.COM

In most Canadianprovinces, there is nolegislated standard inplace for those who callthemselves financialplanners or offer financialplanning services.

Adjust financial strategy to each stage of lifeMILESTONES

FPSC 4 • AN INFORMATION FEATURE FOR THE FINANCIAL PLANNING STANDARDS COUNCIL

FINANCIAL PLANNING WEEK

the globe and ma il • fr idaY, november 15 , 201 3

hether they’re recall-ing the past or lookingforward to the future,

people often view their livesin terms of milestones: schoolgraduation, their 30th birth-day, the birth of a child, animportant job promotion.

These milestones do morethan mark the beginning orend of a particular stage; theyalso signal a need to reviewyour financial plan againstlife’s new realities, says LeeBennett, senior vice presidentof TD Wealth Financial Plan-ning.

“A personal financial plan isa roadmap that helps peopleunderstand their short-, mid-and long-term goals and createstrategies to meet these goals,”says Ms. Bennett. “A finan-cial plan should be custom-ized to each person’s needs,and should evolve as you gothrough the different stagesof life.”

As they approach each oflife’s milestones, Canadiansneed to take the time to sitdown with a financial plannerto identify new priorities, jet-tison those that are no longerrelevant and redraw their fi-nancial roadmap, based on thenew path they’re taking, saysMs. Bennett. Here, she looks atsome typical milestones andprovides examples of what fac-tors in these life stages mightbe addressed in a financial plan.

• Starting outYou’ve finished school and arebuilding a career. At this pointin your life, a financial plan canhelp you set up a strategy forcash-flow and savings. If you’relooking at buying a condo orhouse, talk to your financialplanner about whether bor-rowing from your RRSP for adown payment is right for you,or if you should consider otheroptions.

• Merging two lives into oneYou’re ready to start a new lifewith your significant other. Ms.

Bennett says it’s important forcouples to have the “moneytalk” early in their relationshipand to create a financial plan

that works for both of them.“Each person may alreadyhave a plan, but building aholistic financial plan thattakes into account bothyour individual and jointgoals can help you builda solid financial futuretogether,” she says.

• And baby makes three– or four, or moreThe arrival of children inevi-tably changes priorities andmakes financial planning morecomplex, says Ms. Bennett.At this life stage, a financialplanner will likely discusseducation savings plans, addi-

tional life, health and disabilityinsurance, as well as creatingor updating a will. Your finan-cial plan may also expand toinclude estate planning, whichincludes designating guardiansfor your children as well as tax

strategies that help maximizeyour estate for your beneficia-ries.

• Switching careersWhether you’re moving to adifferent field or leaving a jobto start your own business,your financial plan shouldadjust to your career. Ideally,you should meet with your fi-

nancial planner before makingany change, to address suchtopics as what to do with yourcurrent pension plan and whatemployee savings plans youmight decide to join with yournew employer. You should alsoensure adequate cash flow andaccess to credit before makingthe switch from employee toentrepreneur.

• Getting close to retirementWith the end of your workinglife just a few years away, it’sa good time to review your fi-nancial plan to see if you’re ontrack to meet your retirementgoals. Depending on where youstand financially at this point,you may decide to work a yearor two longer, or ease intoretirement by continuing towork part-time. Your finan-cial planner can provide youwith guidance around how tomanage your retirement cashflow including the most tax-efficient way to receive yourgovernment benefits.

Whatever your stage of life,creating a sound financial planincludes having discussionsaround budget, investments, riskmanagement and retirementplanning. Your plan should befluid enough to take into accountthe various factors that can affectyour financial situation as youencounter life changes. That’swhy it’s important to work with aqualified financial planner, whocan help you adapt your strate-gies as you reach each milestone,says Ms. Bennett.

“Some people think that onceyou have a financial plan, you’redone,” she says. “But life doesn’tstay the same, so neither shouldyour financial plan.”

The arrival of children inevitablychanges priorities and makesfinancial planning more complex.ISTOCKPHOTO.COM

Revisiting your financial plan prior tomaking a career change helps ensureadequate cash flow and minimizestress. ISTOCKPHOTO.COM

Building a solid financial future together starts with creating a joint financialplan that works for both spouses. ISTOCKPHOTO.COM

“Because offinancial planning,

I worry less about money.”

(63% agree if planneris CFP professional vs.53% non-certified

adviser)

On track toretire

Those who havecomprehensive financial plans

and cite retirement as animportant goal feel moreconfident in their plans

to retire.

“A financial plan shouldbe customized to eachperson’s needs, andshould evolve as yougo through the differentstages of life.”

Lee Bennettis senior vice-president of TDWealth Financial Planning

For more, visit globeandmail.com/financialplanningweek

TD Wealth

Discover our approach to financial planning.Finding the help you need to balance your current priorities with futuregoals can be challenging. Which is why at TD Wealth Financial Planningwe spend time learning about your personal and financial goals beforecreating a plan that is uniquely yours. An evolving plan that keeps upwith the changes in your life. So start building your plan together witha TD Wealth Financial Planner to help get more from your future.

Visit tdwealth.ca or call 1-866-280-2022

Real conversations aboutreal financial goals.

TD Wealth Financial Planning is a division of TD Waterhouse Canada Inc., a subsidiary of The Toronto-Dominion Bank. TD Waterhouse Canada Inc. – Member of the Canadian Investor Protection Fund. ®/ The TD logo and othertrade-marks are the property of The Toronto-Dominion Bank or a wholly-owned subsidiary, in Canada and/or other countries.

hen the couple ap-proached certifiedfinancial planner Sandra

Abdool at RBC Financial Plan-ning in Burlington, Ont., they justwanted some advice on how topay off their debt.

In their forties, with two chil-dren, they were extremely debt-averse, recalls Ms. Abdool. “Butour approach is to consider eachclient’s situation with a muchbroader lens. And by doing so, wefound they were really trying toachieve multiple goals.”

Like many people in the primeyears before retirement, the twowere saving for their children’seducation, which they wanted tofully finance, as well as for theirretirement years. Their approachhad been to funnel the rest oftheir cash into paying off themortgage on their home, whichthey’d reduced to about $55,000.

During the financial planningprocess, the couple also con-fessed to a dream. “Just as a kindof blue-sky, out-there idea, theymentioned that they hoped to

one day be able buy a condo inCollingwood. They wanted to en-joy family skiing together beforetheir kids went off to universityand started their own lives,” Ms.Abdool says.

By taking a detailed look attheir cash flow and directing ittoward short-, medium- and long-term goals, the couple was able toachieve everything they wanted –and to realize their dream.

By lengthening the amortiza-tion on their mortgage, they wereable to free cash flow to purchasethe Collingwood condo and beginenjoying it immediately. “Theirdebt was such a small componentof their overall net worth. Weasked them if it might be worthholding onto it for a little whilelonger, in order to start enjoyingthe family lifestyle they wanted,”explains Ms. Abdool, noting thatthe couple will be able to pay offthe amount owing before retire-ment.

Financial planning tools arehelping Keith Thomson and hisclients achieve a different kind of

dream – a meaningful legacy.A certified financial planner

with Stonegate Private FinancialCounsel in Toronto, Mr. Thomsontravelled to Nepal with Seva Can-ada, an organization that restoressight and prevents blindness inthe developing world throughthe contributions of donors andvolunteers.

“After conducting my duediligence on Seva’s work inNepal, I knew I had found theentrepreneurial organization Iwas looking for, that did the mostpossible good with each dollar,”he says. “And through the simpleprocess of leaving a gift in mywill, I’m able to make a meaning-ful contribution.”

Mr. Thomson has helped manyof his clients create similar lega-cies. “It can be a hassle to changeyour will, but most people aren’taware that you can also use themultiple beneficiary designationfor your RRSP or other registeredassets. It takes 60 seconds to fillout the form out, and it happensoutside the estate, so there’s no

probate fee.”Life insurance contracts are

also an effective way to multi-ply the impact of philanthropicdollars, he says. One strategy herecommends is buying an insur-ance policy with funds that wouldotherwise be given directly to thecharity. “You can take a $10,000gift and multiply it – when youpass on, the charity could receiveup to $100,000, and your estatewill receive approximately$50,000 in tax savings. You’vemultiplied your philanthropicintent 10 times, and your benefi-ciaries end up with more moneythan they would otherwise,because of the tax savings.”

At a certain age, says Mr.Thomson, many individuals haveachieved financial success andwant to achieve something more.“Using some of these philan-thropic [financial planning] strat-egies, you can have a tremendousimpact on those causes that areclose to your heart, and bringsignificance to your life at thesame time.”

or certified financialplanner Karin Mizgala ofVancouver, the value of

financial planning was most viv-idly illustrated by the experienceof one of her clients, a woman inher late fifties.

“She was in a relationship, butshe wasn’t sure it would endure,and she wanted to be sure she’dbe okay on her own. Her financeswere causing her a lot of anxiety,”says Ms. Mizgala, CEO of MoneyCoaches Canada and co-authorwith Sheila Walkington of Un-stuck – How to Get Out of YourMoney Rut and Start Living theLife You Want.

The client also admitted to feel-ing trapped in her job. “She wasoverwhelmed by the idea that shehad to stay where she was for sev-eral more years, and just didn’tknow if she could handle it,” saysMs. Mizgala. “But by examiningher cash flow, investments andpension, and crunching the num-bers, we found she was in a muchbetter place than she thought.”

In fact, the woman was ableto retire immediately. “She wascompletely shocked and de-lighted. She had no idea that thatoption would be available to her.”

As they went through theplanning process, the client alsolearned that she was making bet-ter decisions than she thought,

and she found it helpful to hearwhere she stood financially, rela-tive to other people in her agegroup. “It gave her options, moreconfidence and the sense thatshe had a lot more control thanshe thought she did,” recalls Ms.Mizgala.

Clients who discover theyaren’t on track to retire as early asthey’d like also benefit from sucha process, she stresses. “Peoplesometimes procrastinate, becausethey’re afraid of what they’regoing to hear, but anyone whobreaks through that resistance isrewarded dramatically by peaceof mind. And even those whorealize they should have paidmore attention find they’re ableto make adjustments to get ontrack, once they have a plan.”

For an Edmonton couple on thecusp of retirement, financial plan-ning provided equally welcomebenefits.

The husband had a definedbenefit pension and was a do-it-yourself investor with assetsscattered between nine differentinstitutions. “It was getting to betoo much for him to handle, andhe was paying a lot of unneces-

sary tax on unregistered invest-ments,” says Al Nagy, a certifiedfinancial planner and regionaldirector at Investors Group in Ed-monton. “But their biggest issuewas certainty; they wanted to besure they had enough.”

The couple also worried abouta huge tax bill related to a capitalgain of approximately $800,000that would eventually have tobe paid on their cottage. “Theyloved their cottage and wanted tokeep it in the family. But they’ddone their homework and knewthat, after they were gone, their

children would probably have tosell it to pay the taxes,” says Mr.Nagy.

They believed that they haddiversified their portfolio bydividing it between institutions.But a closer look revealed thatthey did not have an adequatemix of asset classes and invest-ment styles, which the financialplanning process remedied.

“We were also able to providethem with the certainty theysought, with a guaranteed invest-ment fund that protects theircapital and provides income they

can count on to be there for themthroughout retirement,” reportsMr. Nagy.

Finally, he and his team recom-mended that the couple buy per-manent life insurance to pay thetax liability on the cottage. “I’llnever forget his reaction: ‘Howare we ever going to afford that?’”Mr. Nagy recalls. “I said, ‘Well,the kids are going to eventuallyget the cottage, and they all havedecent jobs, so why don’t we getthem to pay the premiums?’”

The result, he says, was “instantrelief.”

Pre-retirement planning helps achieve multiple goals

AN INFORMATION FEATURE • FPSC 5t h e g lo b e a n d m a i l • f r i daY, n ov e m b e r 1 5 , 2 01 3

FINANCIAL PLANNING WEEK

AGES 40 TO 65

Achieving peace of mind, security as retirement beginsAGES 55+

“…our approach is toconsider each client’ssituation with a muchbroader lens.”

Sandra Abdoolis with RBC Financial Planning inBurlington, Ontario

“We were also able toprovide them with the cer-tainty they sought, with aguaranteed investmentfund that protects theircapital and provides in-come they can count on tobe there for them through-out retirement.”

Al Nagyis a certified financial planner andregional director at Investors Groupin Edmonton

“... by examiningher cash flow, investmentsand pension, and crunch-ing the numbers, wefound [the client] was ina much better place thanshe thought.”

Karin Mizgalais a certified financial planner inVancouver

®/™ Trademark(s) of Royal Bank of Canada. RBC and Royal Bank are registered trademarks of Royal Bank of Canada. ©2013 Royal Bank of Canada. Financial planning services and investment advice are provided byRoyal Mutual Funds Inc. (RMFI). RMFI, RBC Global Asset Management Inc., Royal Bank of Canada, Royal Trust Corporation of Canada and The Royal Trust Company are separate corporate entities which are affiliated.RMFI is licensed as a financial services firm in the province of Quebec.

IT’S TIME TO DEFINE YOUR RETIREMENT. DIFFERENTLY.

Start the conversation today.Call 1-866-220-3918 or visitrbc.com/futureplans

You approached life differently from yourparents then, and still do today. Now it’s timeto define the rules again in your retirement.It all starts with a one-of-a-kind experiencecalled Your Future By Design™. Through a

number of eye-opening questions, we takea look at the next 20+ years of your futureand your finances – then help you figure outhow to make that future happen. Think of itas your next defining moment.

40 YEARS OF CHALLENGING THE STATUS QUO.HERE YOU GO AGAIN.

1969

1971

1973

1976

2013

1975 1984

1989

TM

here are few things inlife easier to accomplishthan spending every

penny you earn. But one youngHalifax couple has learned thatwith a comprehensive financialplan, achieving their dream ofowning a home was also withinreach.

Using a discovery process RBCcalls “Your Future by Design,”financial planner Evan Hickeyled the couple through a series ofconversations about their goalsfor work, lifestyle, family andother aspects of their lives to-gether. Those discussions madeit clear that they were both eager

to adjust their lifestyle in orderto buy a home of their own.“They really wanted to stop rent-ing and start building equity,”says Mr. Hickey, who is with RBCFinancial Planning in Halifax.

Once their goals were defined,the next step was mapping theircash flow, assets and debts. “We

try to make it as easy as pos-sible and, ideally, go through thebudgeting process with themright in our office, so that we canget that obstacle out of the way,”he explains.

The couple found that theirincome and expenses provided

them with excess cash flowenabling them to pri-oritize repayment ofstudent loans, their

only debt. “Beforewe started thebudgeting pro-cess, they neverhad any extramoney in theirbank account –

they just spentwhat they had,”

says Mr. Hickey.Once they un-

derstood that they werespending about $2,500 each

month on unnecessary itemsthat were much less importantto them than owning a home,they were happy to redirect thatmoney to loan repayment andRRSP contributions, he says.

“Their goal was to buy a homewithin a three-year time frame,so we prepared a plan to helpthem achieve that goal, with theminimum 10 per cent down pay-ment they wanted.”

Another important part of theplanning process was an afford-ability exercise. This includedexploring the amount of themortgage they could qualify for aswell as what they could comfort-ably afford based on their budgetonce they owned a home.

At the time of their first RBCconsultation, the couple hadsaved about $15,000 in a high-interest savings account. “Shewas the higher income earner, sowe put that into an RRSP in hername, and at tax time, she re-ceived a $6,300 refund, which weimmediately rolled into her RRSPas well,” Mr. Hickey explains. “Wethen set up a plan to maximizeher RRSP contributions first,then his, so they would each have$25,000 for the maximum RRSPHome Buyers’ Plan withdrawal.”

The couple was so enthusias-tic that they were able to reachtheir goals ahead of schedule. “Byabout two years in, they each had$25,000 in their RRSPs and wereable to purchase a home, using theHome Buyer’s Plan withdrawal toput 10 per cent down, cover all ofthe closing costs and furnish theirnew home,” reports Mr. Hickey.“By the time they moved in, theywere also able to eliminate theirstudent loans, making home own-ership a lot more comfortable.”

FINANCIAL PLANNING WEEK

FPSC 6 • AN INFORMATION FEATURE FOR THE FINANCIAL PLANNING STANDARDS COUNCIL the globe and ma il • fr idaY, november 15 , 201 3

PHYSICIANS

For Canada’s doctors, exclusive advice is the right prescriptionhysicians fall into aunique category whenit comes to financial

planning. “They spend most oftheir time and energy focusingon helping and caring for others,sometimes to the detriment ofthemselves,” says Glenda Covey,a certified financial planner withMD Management Limited, a sub-sidiary of MD Physician ServicesInc. (MD). “Many of them are sobusy they haven’t had time todevelop a financial plan.”

Today, MD offers financialplanning and advice on invest-ments, insurance, banking,medical practice incorporation,and estates and trusts to 43,000physicians and 59,000 sponsoredfamily members across Canada.Access to MD’s total wealthmanagement offer has been an

exclusive benefit of CanadianMedical Association member-ship since 1969.

MD understands physicians’unique financial needs, sayspresident and CEO Brian Peters.“This company was developedby physicians for physicians,” heexplains, adding that part of itsmandate is helping doctors un-derstand that their biggest assetis their lifetime income stream,which needs to be protected andmanaged to build a retirementfund in support of their goals.This is especially the case forthose who are self-employedand don’t have a pension fund tofall back on.

It starts with having a plan, hesays, and the earlier the better.MD works with medical studentsand residents, helping them to

focus on their finances early andto limit their debt. Once physi-cians start earning, the goal is tohelp them save, build up capitaland then invest in long-termofferings that will “stand thetest of time, as ours have formore than four decades.” MDalso offers a range of insurancesolutions to protect those funds,and can develop wealth manage-ment strategies to reduce taxliabilities.

“We help physicians to under-stand the value of incorporation,as well as the tax implicationsof various investment strategies,which a lot of investors oftendon’t think about,” he says.

In addition to helping clientsenvision their retirement life-style and think about when theywant to stop working – which

helps advisers choose the rightinvestment vehicles – MD offersestate planning and trust ser-vices to facilitate the transfer ofwealth to the next generation.

MD advisers work with physi-cians to assess their financialneeds, taking a comprehensiveand integrated approach, saysMs. Covey, who has been deliv-ering financial advice to physi-cians for 17 years. “We under-stand the unique career stagesin a physician’s life, and ourteams of financial specialistsprovide objective advice andbest-in-class solutions to meettheir goals at those differentstages. We put physicians first– and we’re the only financialservices company in Canadadedicated solely to physiciansand their families.”

AGES 25 TO 44

Couple realizes dream ofhome ownership ahead of schedule

“We help physicians tounderstand the value of in-corporation, as well as thetax implications of variousinvestment strategies,which a lot of investorsoften don’t think about.”

Brian Petersis president and CEO ofMD Management Limited

For young families, defining goals is the first step toward achieving them. ISTOCKPHOTO.COM

them withenorist

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wsa

Oderstoo

On track tosave

Those who have comprehen-sive financial plans are

more likely to report that theyhave improved their

ability to save in the lastfive years.

Those who havecomprehensive financialplans are more confidentthat they are prepared todeal with unexpectedfinancial emergenciesand tough economic

times.

For more, visit globeandmail.com/financialplanningweek

MD ExO is a collaboration among financial advisors and specialists who engineer total wealth managementstrategies and solutions exclusively for physicians like you. So, no matter what type of financial advice you require,you can expect a personalized and comprehensive plan when you work with MD.

Learn more at md.cma.ca/ExO or call 1 800 267-2332

Youand Your

MD Advisor

InvestmentsMedical Practice

Incorporation

Bankingand Lending

Financial Planningand Advice

Estate and Trust

Insurance

The MD ExO service provides financial products and guidance to eligible clients, delivered through the MD Group of Companies (MD Physician Services Inc., MDManagementLimited, MD Private Trust Company, MD Life Insurance Company and MD Insurance Agency Limited). MD Physician Services is owned by the Canadian Medical Association.Incorporation guidance limited to asset allocation and integrating corporate entities into financial plans and wealth strategies. Professional legal, tax and accounting adviceregarding incorporation should be obtained in respect to an individual’s specific circumstances. Banking products are offered by National Bank of Canada’s Partnership Branchthrough a relationship with MDManagement Limited.

Physicians First™

Your total wealth management strategy.All in one Expert Office.