What is your financial plan?

Does financial planning scare you? Does it give you a sick feeling in the pit of your stomach? If it does, that’s probably because you don’t have a financial plan.

You’ve thought about it. “Yup, I should have a financial plan…” But then you really started thinking about it. “Can I really do it myself? (This seems like a lot of work.)” “How much will it cost to hire someone? (It will probably cost me an arm and a leg and I don’t have a lot of money.)” “Will they just try to sell me some of their own mutual funds (and make even more money off me)?” 

Yup, it all seems too much and you decide to think about it another day. I know this because I’ve been there and then…my daughters decided to go to university… in other provinces. Drat… I should’ve done something sooner! Well, no time like the present. I began by doing some research and here is what I found. 

As with anything, there are always steps. These will help you get from where you are now to where you want to be. They help you get organized.

  • Collect your data. Gather together all your current financial information. Assess where you are now (gather lists of assets and liabilities, savings accounts, RRSPs, RESPs, records of securities transactions, insurance policies, wills, pension plans, etc.). What is your family income? What are your monthly expenses? What expenses could be coming up?  
  • Set goals and objectives. Understand what you want for yourself and your family. Do you need to save for your children’s education? Do you want to be debt free or at least pay down your debt? Do you want to buy your own house? What about your retirement? These goals need to be specific, measurable and realistic, and should be broken down into short, mid and long term and put in order of importance to you.
  • Analysis and solutions. Take each goal and analyze it further to figure out how much it will cost and how are you are going to achieve it. Be sure to be realistic.    
  • Implementation. This is the most important step. Now that you have spent the time to figure out where you are, where you want to be and how to get there… START. Pick one thing and do it! Get moving!
  • Follow-up and review. Life rarely ever turns out as we expect or plan. At least once a year review what you have accomplished (take pleasure in attaining those goals) and ensure you are still headed in the right direction. If your life has changed then adjust your plan to suit your current lifestyle. 

Now decide “What is my financial plan”

A financial plan is about being organized and in control of your finances (not the other way around). It’s an ongoing process to help you make financial decisions. By having a financial plan you will reduce your stress levels, gain peace of mind and have more confidence in the direction you are going. Achieving your goals will give you a sense of accomplishment that you can be proud of. 

Oh, and my daughters ended up going to universities on each coast.

Keep the conversation going

Do you have any tips on creating a financial plan? Post a comment below.


The views and opinions expressed in this article are those of the author and do not necessarily reflect that of Chartered Professional Accountants of Canada (CPA Canada).


About the Author

Debra A. King, CPA, CMA

Debra is the founder and CEO of Atlas Rand Inc. providing business management, accounting and consulting services to organizations across Alberta. She is currently serving as treasurer on the Board of Directors for the Canadian Information Processing Society – Alberta Chapter and sits on the CPA Canada's Financial Literacy Advisory Board.