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Financial
Planning Process
Financial planning consists of the following six distinct
steps. When it's comprehensive financial planning guidance
you want, these are the steps that should guide your planner.
Be familiar with them. They'll help you get the most out
of the process. And remember, it's this big-picture approach
that sets financial planners apart from all other financial
advisors who may have been trained to focus only on one
aspect of your finances.
| 1.
Establish the client-planner engagement |
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Your
planner should: |
- Explain
issues and concepts related to the overall financial
planning process that are appropriate to you.
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Explain the services he or she will provide and
the process of planning and documentation.
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Clarify your responsibilities as a client.
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Clarify his or her responsibilities as your planner.
This should include a discussion about how and by
whom he or she will be compensated.
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| You
and your planner should: |
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Discuss the scope of the client/planner engagement.
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Agree on how decisions will be made.
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| 2.
Gather client data and determine your goals and expectations |
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Your
planner should: |
- Obtain
information about your financial resources and obligations
through interviews or questionnaires.
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Gather all the necessary documents before giving
you the advice you need.
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| You
and your planner should: |
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Define your personal and financial goals, needs
and priorities.
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Investigate your values, preferences, financial
outlook and desired results as they relate to your
financial goals, needs and priorities .
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| 3.
Clarify your present financial status and identify any
problem areas and opportunities |
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Your
planner should: |
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Analyze your information to assess your current
situation (cash flow, net worth, tax projections,
etc.).
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Identify any problem areas or opportunities with
respect to your:
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Capital needs
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Risk management needs and coverage
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Investments
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Taxation
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Retirement planning
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Employee benefits
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Estate planning
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Special needs (i.e. adult dependant needs, education
needs, etc.)
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| 4.
Develop and present the financial plan |
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Your
planner should: |
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Develop and prepare a financial plan tailored to
meet your goals and objectives, values, temperament
and risk tolerance, while providing projections
and recommendations.
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Present the plan to you and establish an appropriate
review cycle.
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| You
and your planner should: |
-
Work together to ensure that the plan meets your
goals and objectives.
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| 5.
Implement your financial plan |
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Your
planner should: |
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Assist you in implementing the recommendations discussed
if you want. This may involve coordinating contacts
with other professionals such as investment funds
sales representatives, accountants, insurance agents
and lawyers.
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| 6.
Monitor the financial plan |
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Your
and your planner should: |
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Agree on who will monitor and evaluate whether your
plan is helping you progess toward your goals.
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| If
your planner is in charge of the process, your planner
should: |
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Contact you to review the progress of the plan periodically
and make adjustments to the recommendations required
to help you achieve your goals.
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| This
review should include: |
- A
discussion about changes in your personal circumstances
and how they might affect your goals.
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A review and evaluation of the impact of changing
tax laws and economic circumstances.
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A review of your life circumstances and an adjustment
of the recommendations if needed as those circumstances
change through life events such as birth, illness,
marriage, retirement, etc.
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Stirling
has received the Certified Financial Planner designation in
2000, and in the last four years of his career with the CIBC,
and he and Teresa were Senior Financial Advisors with responsibility
for $80-90 million portfolios. Using a disciplined asset allocation
approach, they were able to steer their clients through the
adverse years while giving them good returns in the years
prior. It is this approach to balancing the risk and reward
of an investment account that enabled them to greatly increase
the number of clients and assets in their respective portfolios.
With
CSA, we continue to use the disciplined approach to asset
allocation, employing our own experience and sophisticated
software to find the optimum risk/return for your portfolio.
Because we are fee-based, we have no biases of how you invest
your money. We may, for instance, recommend that you pay
off a mortgage rather than hold an investment, or restructure
your debt to make the interest tax-deductible.
We can be in regular contact with your investment advisor
who actually handles your investments, your accountant who
can verify and implement tax strategies, your insurance
broker who can maintain protection for you and your family,
and your lawyer who will implement some of the solutions
we advise on for you.
Our goal is to increase your net worth year-over-year. This
is achieved through proper diversification, debt reduction,
and proper insurance protection. With our established contacts
in the various industries, we can refer you to a wide range
of professionals and Financial Institutions if you have
that need.
We are your partner in goal-setting and goal achievement,
and look forward to working with you.
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