Your Net Worth Summary combines and classifies the financial assets you hold today. Many people have never been able to get a clear picture of their current status, and it’s essential to know your starting point so you can plan effectively for the future.

Net Worth Summary: This example page from an Advice+ Plan report shows the summary of the customer’s net worth, broken down by Assets and Liabilities, with various categories of each itemized.

Retirement Goal Coverage ensures you have enough money saved to cover your retirement. After discussing your personal ambitions for your retirement, your advisor will calculate how far you are from achieving your goals. The plan your advisor will create with you aims to close that gap so you can feel confident and excited about your retirement.

Retirement goal coverage: This example page from an Advice+ Plan shows how far the customer currently is from hitting their personal retirement goals. As well as a graphic which places their current progress and proposed Scotia Plan against markers called ‘Getting Started’, ‘On Your Way’, and ‘On Track’, it breaks down in a table the assumptions built into both the customer’s current and proposed plan that lead to these assessments.

In Retirement Asset Allocation comparisons, your advisor examines where your money sits and looks for potential unused funds to re-allocate so that we can help achieve your financial goals. These suggestions form the basis of an Asset Allocation Comparison, which can show the path to help you reach your goals faster. Other goals, such as saving for education, are also covered.

Retirement Asset Allocation comparisons: This example page from an Advice+ Plan shows how the customer’s current asset allocation (composed in this instance of Cash, Fixed Income and Equity) might be improved by the Scotia Advisor into a different and more profitable allocation. In this instance, the Advisor’s recommendation takes the customer’s allocation held as cash, and spreads it across both Fixed Income and Equity.

Financial Planning

Planning your financial future can feel overwhelming for some, but you don’t have to do it alone. A Scotia advisor can work with you to get on top of all your finances and help you come up with a personalized plan made specifically for you.

In this guide to financial planning, we’ll shed some light on the process of working with a financial advisor and provide you with the essentials you need to feel more confident asking questions and making informed decisions.

Let’s take it one step at a time.

Here are 5 key benefits to having a financial plan:

Helps you set goals and plan for your future

Whatever you want to achieve in life, a financial plan helps bring focus to your overall strategies to help you achieve them. These goals can be long-term, like retirement planning, or shorter term, like saving to buy a house.

Identifies opportunities

Whether it’s growing your savings, cutting the interest you have to pay, or reducing debt, a financial plan can help you get better financial outcomes.

Plans for the unexpected

By analyzing your current financial position, we can help create a safety net for you and your family and plan for unexpected events in your life.

Helps you navigate the world of finance with confidence

Working with a financial advisor will help you know your RRSP from your TFSA, and your PAC from your HISA. We’ll talk you through the often-confusing world of finance so you feel confident in the choices you make. And we’ll stick with you over the years so you always have a financial expert on your team through all life’s twists and turns.

Provides peace of mind

A financial plan doesn’t give you only financial benefits. A major study of Canadians found that those of us who have a comprehensive financial plan have significantly higher levels of emotional wellbeing than those who just try to navigate one day at a time.**

Step 1

What is a financial plan?

A financial plan is a comprehensive approach to your financial future that you design with your Scotia advisor. Based on your personal aims, it gives you peace of mind that your finances are under control and headed in the right direction.

Scotia advisor Farah El-Masri explains the basics of what a financial plan is.

Step 2

Understand the elements of a sound financial plan.

A financial plan is about more than just saving and investing. It’s a plan that helps you navigate your short, medium, and long-term financial goals towards a vision of your future. Understanding all of the elements that go into your plan will help you stay on track.

Review of your financial situation

Your Scotia advisor will take the time to get to know you and get a clear understanding of your needs and goals, which is the first step in helping you build a financial plan. This includes looking at things like your mortgage, debt, dependents, and all other assets and accounts.

Investing

When it comes to investing, a financial advisor can help you determine the right mix of ingredients, or assets, to create your personalized investment portfolio. These assets will be defined based on the conversation you have, and geared entirely towards your financial goals, your timeline, and your attitude towards risk.

Education planning

Whether you are saving for your kids’ college education, or you want to go back to school as an adult, we can consult on all the available programs to help you get there and maximize all the available government grants.

Major purchase planning

Your plan can incorporate working towards buying a home, saving for a trip or other big purchases you want for you and your family.

Estate planning

Your estate is made up of everything you own. Making a plan for the transfer of your wealth can ensure that you provide for the financial future of your family and loved ones.

Government benefits

Many Canadians are entitled to claim from government programs they are not even aware of. A Scotia advisor will look for opportunities where any of these might apply to you.

Budgeting and cashflow

You can start to budget by taking note of your essential vs. non-essential spending, and create positive cashflow every month. Your essential spending is what you need to spend, while your non-essential spending is what you like to spend. Once you figure out what you need, you can plan for what you would like to have in the future.

Retirement planning

How much should you save for retirement? What will your future health costs be? These questions are a good starting point when planning for retirement. Your financial plan can be tailored towards the kind of retirement you want to enjoy.

Managing debt

Managing your debt can help you feel more in control of your finances. The first step is figuring out how much you owe. From there, with the help of your financial advisor, you can come up with a plan to consolidate and reduce your monthly payments, pay off debt sooner, or even get mortgage-free faster.

Risk tolerance

Risk tolerance is the amount of risk you’re willing to accept when investing. At Scotiabank, we categorize risk into five levels: low, low/medium, medium, medium/high, and high. Low risk preserves the money you have, while higher risk can grow your investment in the long term. Finding the right balance will set you up to achieve your financial goals.

Financial terms you may encounter

Here’s a cheat sheet to help you get comfortable with some more common financial terms.


Registered Retirement Savings Plan (RRSP)

An RRSP is a government-regulated investment account with special tax benefits to help you maximize your retirement savings.

Registered Retirement Income Fund (RRIF)

A RRIF is a plan that allows your savings to continue growing tax deferred while generating a steady stream of income during your retirement years.

Tax-Free Savings Account (TFSA)

A TFSA is a registered account that lets you grow your investments tax free. You don’t even pay tax when you withdraw funds.

Registered Education Savings Plan (RESP)

An RESP is designed to help you save for a child's post-secondary education. Any money deposited into this plan will grow tax deferred.

Guaranteed Investment Certificate (GIC)

A GIC is an investment product that keeps your principal investment safe and may have a guaranteed rate of return.

Mutual Fund

In a mutual fund, your money is pooled with other like-minded investors and is invested on your behalf by qualified investment professionals.

Pre-Authorized Contribution (PAC)

A PAC is a regular automatic payment that is withdrawn from your chequing account and deposited directly into your investment account. PACs are great as they help you to automate your saving without having to remember to do it every month.

Pension Plan

A retirement plan that requires an employer to make contributions to a pool of funds that are set aside for a worker’s future benefits.

Credit Score

A credit score is a number lenders look at to determine the probability that you’ll be able to pay back a loan. It’s based on your credit history.

High-Interest Savings Account (HISA)

This is a type of savings account that earns you more interest than a regular account.

Interest

Interest is the percentage of a loan that you must pay back in addition to the money borrowed. Interest is also earned when you deposit or invest so can add to your income.

Line of Credit

A line of credit is a flexible loan that you can access as needed and repay either immediately or over time.

Step 3

What can a financial advisor do for you?

Your Scotia advisor will be your partner in piloting your finances through every stage of life. They will help design your financial plan, and then monitor and adapt it as your life changes.

Farah El-Masri explains her role as a financial advisor and how the process of creating a financial plan works.

1. Your first conversation

Your advisor will use this time to get to know you, your partner and family, and learn about your financial situation. We will ask you questions about yourself to uncover your financial needs and what you're looking for in the future.

2. Creating a plan

Together with your advisor, you’ll organize your information using the Mapping Tomorrow financial planning process to create a comprehensive financial plan for your future. There’s more information on Mapping Tomorrow in step 4 of this guide.

3. Putting your plan into action

Once you and your advisor have created your plan, your advisor will take the necessary steps to put your plan into action. This might include opening new accounts, making changes to your borrowing accounts, reallocating money between investments, and setting up automated savings based on what you can afford.

4. Evolving your plan as your life changes

You’re building an on-going relationship with your advisor. After your initial meetings, you can agree how frequently you want to stay in touch to make sure your plan stays up to date and matches any changes in your life.

Here’s how Canadians feel about working with a certified financial planner

64%

say they are a trusted source of advice

65%

say they show how financial planning helps save money

62%

say they simplify and explain financial matters

Step 4

Create your financial plan

Mapping Tomorrow is a tool you and your Scotia advisor will use together to create a plan for your financial future. Over the course of your meetings, your advisor will gather your information and, when you’re ready, use it to put your plan into action.

You’ll be prompted to provide information on the following:

  • Your personal financial goals — What are you saving for?
  • Cashflow and expenses — What are you earning and spending?
  • Assets — Do you own property or have benefits through your employer?
  • Investments — Do you contribute to investment accounts?
  • Liabilities — Do you have any debt?

Your Scotia advisor will generate a comprehensive report based on your current financial situation and your new financial plan. And even after your first plan is in place, you can come back to it in Mapping Tomorrow to make changes you need through the years.

Here are some examples of the information you will get in this comprehensive report:

Your Net Worth Summary combines and classifies the financial assets you hold today. Many people have never been able to get a clear picture of their current status, and it’s essential to know your starting point so you can plan effectively for the future.

Retirement Goal Coverage ensures you have enough money saved to cover your retirement. After discussing your personal ambitions for your retirement, your advisor will calculate how far you are from achieving your goals. The plan your advisor will create with you aims to close that gap so you can feel confident and excited about your retirement.

In Retirement Asset Allocation comparisons, your advisor examines where your money sits and looks for potential unused funds to re-allocate so that we can help achieve your financial goals. These suggestions form the basis of an Asset Allocation Comparison, which can show the path to help you reach your goals faster. Other goals, such as saving for education, are also covered.

Step 5

Ask questions

It can be helpful to ask yourself these questions to get a better understanding of your financial situation. Don’t worry if you don’t know the answer to everything. That’s what our advisors are here to help you with.

  • What are my main financial ambitions — retirement, cashflow, portfolio, education — and how do I prioritize them?
  • Do I have a pension?
  • How would I handle an unexpected emergency or life event?
  • Am I entitled to any work benefits such as a group RRSP or share-matching program?
  • What does retirement look like for me? When do I want to retire?
  • How will I fund my retirement?
  • Do I have a will and power of attorney in place?
  • Do I have an understanding of how all the parts of my financial health work together?

Yes, your financial advisor will take you through ways to ensure your investments grow to meet your long-term needs. As an example of this, check out our calculator for Pre-Authorized Contributions. Put in how much money you have to start with, how much you can save each month, and how much you think you might increase this amount every year.

Everyone can benefit from financial planning. If you have short-term goals like paying off a credit card or loan, or long-term goals like saving for retirement or your child’s education, financial planning can help get you there faster.

In a comprehensive plan, a financial advisor provides financial planning for major life goals and events, or at least three of the planning components: household budgeting, retirement, estate planning, investing, and managing debt.

Start by identifying your goals. When you figure out what you want, you can work with an advisor to achieve it. A well-rounded financial plan will provide you with a better picture of how much money you’ll need to maintain your lifestyle, buy a home, retire, and more.

Your financial advisor will be able to make sure if your investment plan is on track to meet your needs. For example, someone who is within 5 years of retirement will likely need a very different set of investments from someone in their 30s. A financial advisor can help ensure your investments and financial plan stay in line with your changing needs.

Not at all. You are in complete control of your financial plan. Your advisor will help design it around your personal needs, and best of all, you can change it at any time depending on how your needs change and events that happen in your life.

Meeting with an advisor means building a relationship. Your first meeting will likely be about an hour. This will provide the opportunity for your advisor to ask you questions, get to know your financial situation, go over your goals and identify your specific needs. It can take 2 to 3 meetings to put your plan into action. After your meeting, you can expect to feel more confident knowing that you’re in a better position to accomplish your financial goals.

Ready to get started?

Now that you know the basics, you’re all set to meet with a Scotia advisor.

For your personalized financial plan, find an advisor and book a meeting at a branch near you.

Ask Kristin, Designated Financial Planner

What’s the biggest misconception about financial planning?

Kristin: I’d say the number-one misconception is that people think they need substantial wealth to build a financial plan. That’s simply not the case. You start a plan in order to begin building wealth.

How long does an initial meeting usually last?

Kristin: The initial discovery meeting lasts about an hour. Prior to the meeting, customers will receive a checklist so they’ll know which documents they should bring. The advisor will draft an initial plan based on the information submitted. During the meeting, the advisor will ask questions to understand the customer and their unique goals and needs. Then we’d have a shorter follow-up meeting to present the plan and discuss various options to help you achieve those goals.

When should people begin to think about creating a financial plan?

Kristin: The minute that you’re working and filing your taxes, it’s time to start a financial plan. While an initial plan for someone starting out in life might not be that extensive, it’s crucial to start the process early on. It’s all about financial education, so that people can begin to make better financial choices.

What are some of the top reasons people put off financial planning?

Kristin: I think a lot of it is fear. People procrastinate because it’s not always easy to examine their finances, especially if there are issues. As a financial planner, my job is to make people comfortable and put their mind at ease by building a plan to help them best meet their goals.

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** Financial Planning Standards Council, The Value of Financial Planning, 2012