Why do Financial Planning?
Part 1: Financial Planning Foundation Series
Welcome to the first article in the ‘Financial Planning Foundation Series’.
The Financial Planning Foundation series of articles will highlight the importance of financial planning in each of the main areas of personal finance:
Why do Financial Planning
Budgeting (even if just for a few minutes per year)
Emergency Fund
Mortgage/ Debt Management
Life Insurance (I dont sell it, but you may want some)
Investing Basics
Education Panning (RESP’s)
Retirement Planning
Income Tax Planning
Estate Planning
Each of the 10 articles is designed to be read in about 5 minutes or so and provide you with the information you need to have financial ‘ah ha’ moments. It’s the 20% of information you need, to confidently have 80% of the results.
More specifically, each article provides
Information on how to optimize the area of finance
How the area of financial planning ties in with the other areas of your financial picture
A short action plan on how to turn the ‘theory’ ’into reality.
We’ll cover the important bases here, but If you have questions or are looking for personal, fully customized assistance, feel free to reach out to me any time.
For now, let's get started on the ‘why’ behind financial planning, and what it is.
Why Financial Planning Is Essential
Let's face it—managing money isn't exactly everyone’s idea of a good time. Life is busy. There’s work and family demands, and when we have some spare time, it's far more tempting to spend the afternoon enjoying a patio or watching a good movie, than diving into budgeting spreadsheets.
But financial planning isn't about complicated calculations or boring budgets—it's about turning your dreams into reality. For some, it's simply keeping more money with your family, and less with CRA.
Whatever your starting point, think of financial planning as your personal GPS: it helps you navigate the course to your life's biggest goals. In fact, if you like planning things like vacations, and if you dont like financial stress (who does??), you’ll probably love the financial planning process. And who doesn't want to pay less tax and keep more money in your estate in the end?
Imagine your financial picture with a plan…
At its core, financial planning is simply aligning how you earn, spend, and invest your money, with your desires.
It's not about restricting yourself—it's about intentionally organizing your money to create the financial situation and the life you truly want. It's about creating clarity and peace of mind with your money. It's about planning for less taxes, with laser precision.
Imagine this: What do you want out of life? Is it retiring early and sipping a cold one on the dock in cottage country?
Perhaps it's mastering a new hobby or starting a small part time business.
Maybe it’s travelling the world or having the financial freedom to spend more time with loved ones.
Or maybe its just time to simplify, and de-stress.
Whatever your dreams, they're entirely achievable—but you’ll need a good roadmap to get there.
What Are Your Goals?
Financial planning begins with goal-setting. Goals give your money purpose. They transform vague ideas into clear, attainable targets. Ask yourself:
Am I planning to start or grow my family?
Is homeownership important to me?
When do I want to retire?
Do I want to retire early?
Do I want to travel more, away from the constraints of work, and if so where?
What other main or ‘bucket list’ goals do I have?
If you dont have any major goals at this point - financial planning is still for you. We can optimize your financial picture to grow optimally, with the least amount if income taxes. From here, you’ll feel a lot better about your financial picture and the options, and freedoms you have.
If goal setting resonates with you, write them down, no matter how big or ambitious they seem. This can help dramatically with achieving your financial plan.
How to Get Started
Here's the best part: you don’t have to become a financial expert overnight. Start small:
Set Goals Clearly: Be specific and realistic. Instead of just saying "I want to retire early," say "I want to retire by 55 with a comfortable income of $75,000 a year."
Know Your Numbers: Track your income and expenses, even just for a month or two. It's surprising how revealing this can be—like realizing just how much those fast food orders or trips to Costco add up!
Build Your Framework: Decide how much to save or invest each month, considering your timelines and priorities. Automate your savings to keep your plan running smoothly in the background.
Review Regularly: Life changes, and so should your plan. Check in annually to adjust your course as needed.
Ready to Map Out Your Future?
Financial planning isn’t about limiting yourself—it’s about intentionally optimizing your financial picture, reducing income taxes and building the life you want.
The rest of this Financial Planning Foundation series will help you along the way. Whether you're a ‘do-it-yourselfer’ or you want to partner up to achieve extraordinary results. You'll have a solid base to launch off.