Rare is the plan made 10 – or even five years ago – still relevant today.
Picture a climate scientist employing the same flood preparedness in the Fraser Valley as a decade ago, or the manager of a pro sports team trotting out the same lineup year over year and getting negligible results.
It just doesn’t work.
Thus, a senior financial advisor out of BlueShore Financial’s Lynn Valley branch, Mona Heidari, emphasizes an approach to retirement planning centered around upkeep and evolution.
“The strategies that were set up even five years ago may not work anymore so it’s important to adapt to these changes,” Heidari says. “You need to sit down with your advisor a couple times a year to do a thorough review of your financial plan – and if you don’t have a financial plan, get one.”
Those pondering their retirement needs are facing unprecedented market challenges that Heidari and her team specialize in tackling: inflation, interest rate uncertainty, market volatility and asset management.
And these needs are ever present when considering the sobering statistics offered by the National Institute on Ageing (NIA) in early February.
In what was the largest study of its kind, the NIA surveyed close to 6,000 older Canadians and found that only about 35% of working Canadians 50 and older say they are in the financial position to retire when they want, while almost 40% said they cannot afford to retire.
Even among older Canadians over 80, only half of those still working said they could afford to retire when planned.
Heidari begins helping clients by first taking a longer view of contemporary issues – volatile bond and equity markets, GIC rates or high borrowing costs – to help her clients understand how current conditions affect future plans.
From there, options are explored around RRSPs, TFSAs and RESPs.
“It’s important that you sit down with your financial advisor and figure out which account is right for you and what can be implemented specific to your needs and goals,” Heidari says.
Budget optimization is also a common talking point, where Heidari can uncover opportunities that can reduce costs or find extra cash sources that clients can divert to savings.
Debt management is also of particular concern to Canadians. If borrowing exceeds savings, Heidari can advise clients on how best to take money out of savings plans or GICs to pay down a credit card or car lease.
Asset location versus asset allocation is another critical area Heidari can help navigate. Many of her clients concern themselves with how much in equities or bonds they should hold, or the purchasing of GICs or gold—in other words, the allocation of their assets.
Heidari advises her clients on which assets to hold in taxable accounts – or asset location – and which assets to keep inside tax shelters to help mitigate taxes on investment income.
“If people are reviewing their financial plans a couple times a year, taking advantage of what’s available out there and getting proper advice from our team, I don’t think people should really be concerned about working until 70 or 75 or selling assets to be able to make ends meet,” Heidari says.
To learn more about how BlueShore Financial can help you get prepared for retirement, visit BlueShoreFinancial.com.
