Do You Need A Money Plan?

Plan! Plan Plan Plan! We, as women, are known to plan things from time to time. We take care of many people in our lives and usually we spend time being in many roles. Yet, I have found that women, as brilliant and amazing and loving and capable as we are, often look at our own financial future last. Many of us look at “the now” and the “upcoming” but what about after that? Regardless of what stage of life we are at as adult women the steps to take in order to start looking at and working on our own or preserving our financial picture include many things.

Have You Taken A Money Inventory?

One of the first steps I suggest we take is to do an inventory of our ‘Assets and Liabilities’. This means, what do we own and what do we owe. List these items out, how they are held, jointly or sole. Are any of our assets depreciating? For example: a vehicle can typically lower in value right away and will usually require replacing.

Are any of our assets appreciating? (such as investments, property, a business, etc). How are each of these doing? Are they working to our expectation? What needs to happen to potentially make improvements? Regarding any debt; what is the interest being paid and for how long? Can that be improved? What needs to happen for it to get better? Also, while looking at that list, how should these items be handled when we die? Paid from our estate? Insurance? Is each item protected? Are any liabilities in the form of demand loans? Are there changes that might be considered? There are so many discussions to have regarding our assets and liabilities!

What Is Your Income Flow?

When was the last time you reviewed your spending?

Now, what about income flow? When is the last time we did a budget on a/with a calculator? What are we doing with any excess? Are we being realistic? Did we include birthday gifts, anniversaries, dinners out, fast food trips, holiday costs? Now don’t get me wrong, I truly believe that if we don’t enjoy life along the way just to scrimp and save every penny, we most likely wouldn’t be happy and how long would that serve us? We need to find a good balance and continue by reviewing how we are doing on a regular basis. After all, time flies by so quickly!

Do You Have A Will?

Do you have a Will? If we are an adult and have children, property (land/house/vehicle/other assets) we should seriously consider having a Will made. If we remain alive and are unable to (by choice or not) be able to attend to our financial or legal affairs, we should seriously consider also giving someone authority to act on our behalf via Power of Attorney documents.

These documents are created when we are in good health and able. We can put in restrictions, or have none, on this authority, it can be set for a future date or anytime, etc. Again, so much to discuss beforehand. Seriously give thought to having this arranged before it’s too late. When we don’t have these estate documents, and someone goes to the Courts to ask for Administrative duties or Committeeship, it is expensive and can be a long process. It’s much more responsible to prepare ahead of time. I always suggest using the professionals.

Are You Up And Personal With Your Credit Score?

What about your credit? In Canada we have several credit bureaus. Are you looking at yours? You can request, in writing, to each one for a free report every year. If you haven’t, I suggest doing so. I found several addresses that I had never lived at reporting within mine. I also found out just how many people are looking into my credit and I typically had no idea!

Do you know what your credit score is?

You are given a list of the names and telephone contacts so then you can start asking why they are nosing into your lives. This is a very powerful step to take to ensure your report is cleaned up, or at least confirm that it’s reporting correctly. What is in your credit report can determine if you are offered a lower or higher interest rate on items, you may need to request credit for, like a mortgage, a line of credit, a credit card, a car loan, etc.

So we:

  • Wrote out what we owe and own, how each is held and found room for improvements.
  • Discussed what is and is not within the estate and protected what we wish to happen with a Will.
  • Provided and appointed trusted individuals with authority for our financial and legal voice in the case of inability, or simply convenience, in the form of Power of Attorney.
  • Completed our monthly/annual budget.

Now, What Is In Your Future?

Now we need to think about what our future looks like. What do you want to do? Retire at 55, 60, keep working? Semi-retire? Travel? What kind of travel? Get on the plane and be there, or ride a big seated motorcycle and cruise around purposefully, from place to place? Timeshare or camping?

Whatever it means to us, write it down. How often will we go? How much will this cost us? We can plan for that. Also, I ask clients: Who will travel with you and will they be in the same position to do it? If you are someone that likes to stay at home, that’s okay too.

Is the house our home for as long as we live there or do we plan to downsize? Into what perhaps? What area, far away or close to where we are now?

What Is Important To You?

Are we wanting to pay for children or grandchildren’s education? How much of it? All? Half? First year only? Reimburse the student once they pay and graduate each post-secondary year? Do we have an Education plan set up now and do we know how much it will be at the time we use it?

How about a Tax-Free Savings Plan? I meet people who nod, yes, they have one. Yet they have no idea what it means when I ask, “What is it in?” Typically, they have had one opened, they set up $50 or $100 or more every two weeks or month but it just sitting in cash! This account can work as aggressively as we can stand. That means anywhere from ultra conservative to aggressive and the aim is to earn money with and the growth will not be taxed when we withdraw. This can end up being a substantial amount to access in retirement to offset all the taxable income we may be expecting.

Is Your Money Accumulating?

Now take a look at wherever our retirement and other savings is accumulating, take the time to look at when we started and where we are now. The person on our statement should be in our life, talking to us, explaining how we are doing towards our future plans. If we are happy without advice, without contact, without updates perhaps things are just fine.

We need to consider looking for a financial planner or making changes when we:

  • Feel we don’t understand what our savings is doing.
  • Don’t have any idea where we will be.
  • Don’t know how long our money will last.

Look for a financial planner that is actively engaging with their clients on a regular basis.

I have met women who feel they are behind, or don’t do anything because they don’t know exactly what to do. Start with simple steps like the ones listed above and seek proper, professional advice.

Plan, plan, plan! So many conversations to have with whoever is handling your accounts, investments, etc. These conversations make a difference and can help you see the future a little bit better. You can expect your future to be brighter with yes… a plan.

Tanya Lyn Werk, EPC®, RRC®
Tanya Lyn Werk, EPC®, RRC®

Financial Planner, Scotia Bank Canada

Tanya Lyn has multiple Financial Industry designations and a diploma in legal studies. She been a Financial Planner for more than 20 years and leads workshops where her favorite session is Women & Wealth. Tanya Lyn sits on the Langley Memorial Hospital Foundation Advisory Committee, is the President for Seniors Professionals Connect and a past Executive and Coordinator for Valley Women's Association.

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