08 January, 2021 Financial Planning

Financial Checkup

keyboard pen

There’s no question the ongoing pandemic is a significant health issue. Not only has it impacted physical and mental health, but it is also disrupting financial health.


Among the factors that have made financial security less certain are unemployment (or underemployment), an extremely difficult environment for small businesses, and highly volatile markets. When it comes to struggles with financial health, the numbers tell the story.


In a recent Investment Planning Counsel survey,1 Canadians were asked if the pandemic has changed their financial priorities. Roughly 80% of survey respondents agreed that their financial priorities have shifted, and they stated that they’re focusing more on retirement savings, income stability and short-term cash flow as a result of the pandemic.


Not only that, but almost half (49%) of respondents said that saving for retirement has become more important given this uncertain economic environment. Concern regarding adequate retirement savings explains why roughly 40% are afraid they will outlive their money.


In addition, 20% have had to modify one of their long-term goals, believing that this goal is now out of reach. This belief aligns with a recent FP Canada survey of Canadians2 that revealed only 57% of respondents were confident about achieving their financial life goals, a sharp decline from the 67% who expressed confidence when the survey was conducted in 2018.


Also of note is that less than half (46%) of the FP Canada survey respondents within the 45 to 54 age group were confident about achieving their financial life goals. This finding is particularly concerning as people in this age group are typically nearing retirement and would be expected to have a clear sightline on their financial life goals. That’s how much the pandemic has negatively impacted the financial circumstances of Canadians today.


Financial advice is as important as ever

If you find yourself wondering about your financial health or questioning if you are still on target to meet your financial goals, the first step is to get a clear picture of your financial situation by conducting a review. List and prioritize your short-term and long-term goals, calculate your net worth (i.e., add together all of your assets and subtract all of your debt) and estimate the income you’ll generate in retirement (e.g., from converting RRSPs to RRIFs; TFSAs; company pension plans; government sources like CPP/QPP and OAS; and other investments). If you have a spouse/common-law partner, do this review together.


Not knowing the state of your finances may cause undue stress as you could be imagining financial hardship that might not even exist. If the challenges turn out to be real, then it’s good to be aware of them so you can take practical steps to improve your finances.


That’s where I can help you. In these financially uncertain times, more Canadians are recognizing the value of comprehensive professional advice. In fact, the Investment Planning Counsel survey revealed that 74% of Canadians are seeking financial advice to help them cope with today’s uncertainty. Also, one-third of survey respondents have actually increased the frequency of communication with their advisor since the pandemic began, looking for more personalized advice to navigate the challenging times.


According to the survey results, here are the top-three reasons why Canadians seek financial advice:

  1. To ensure their investments can withstand market volatility
  2. To stay on top of their financial situation
  3. To receive timely financial information and education

As your advisor, I can assist with your financial health “checkup” once you’ve completed your own initial review, and I’ll help you understand what the numbers mean. We’ll determine if any of your financial, retirement or business priorities should change, or if we need to adjust your financial plan and help you save more money if your income has been reduced or made less secure. The main objective is to keep you on track to meet the important short-term and long-term goals in your life.


Contact our office to learn more about how to assess your finances and interpret the results.


1 Investment Planning Counsel online survey of 1,000 Canadian investors, age 30, with $100,000 or more in investible assets. Survey conducted between August 13 and August 27, 2020.

2 FP Canada online survey of 1,538 Canadians completed between September 18 and 20, 2020.