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“Individuals with Financial Plans Feel Better Prepared to Deal with Difficult Economic Times; Feel More Apt to Achieve Life Goals”
– commissioned study called Value of Financial Planning
The Financial Planning Standards Council of Canada commissioned a study to find out if Canadians who engaged in comprehensive financial planning were better off than those who didn’t. Interesting to note – the study was conducted during one of the most difficult economic periods in Canada’s recent history, and the majority of respondents were not wealthy.
One sobering part of the study was that it indicated that less than two out of every ten Canadians engage in comprehensive financial planning. Not surprisingly, this group (less than 20% of Canadians) showed significantly greater levels of emotional and financial well-being as a result of their planning.
Also, the study revealed that:
- Those who receive professional advice and engage in financial planning tend to do more of the things that are good for their financial and emotional well-being.
- 83% of respondents who engage in comprehensive financial planning said that they feel in control of their finances, while 57% of those who do not have a plan said they barely get by every month.
- 70% of Canadians who engaged in comprehensive financial planning said they feel closer to achieving their goals as a result of financial planning.
- Only 13% of those without a financial plan felt they would be able to retire in the lifestyle they wanted.
- 76% of Canadians who deal with a Certified Financial Planner (CFP) said they feel more ‘on track’ as a result of working with their planner.
Financial Planning is the key; it always has been and always will be!
This is the first study I’ve ever seen that shows such concrete evidence confirming the value of comprehensive financial planning. Without financial planning, Canadians often don’t have a clear idea of what their financial goals are, yet alone how they are going to get there. Too many people find out how important financial planning is when it’s too late to make changes.
It isn’t enough these days to try to save some money, you need to define what you are saving for, when you are going to need the money, and what savings vehicle will best get you there. Regular check-ups are also needed to ensure that you’re on the right track. Everyone has different savings goals, so just shucking some money into a savings account isn’t going to cut it over the long term.
Additionally, by finding the optimal savings vehicles for your risk tolerance, comprehensive financial planning can help find extra dollars by taking advantage of tax savings. By earning more on each dollar you can reach your savings goals faster.
Regardless of how much you make, you and your family need a comprehensive financial plan to find out where you are financially and to help you get to where you want to be in the future.
