In a perfect world, everyone would have enough money to retire comfortably and live the life they want. In reality, many variables influence a person’s financial future. Developing a financial plan is one way you can help control those variables. There are five key financial products you can add to that plan to help build a strong foundation.
“A health plan if you get sick. A disability plan if you can’t work. A life insurance plan if you have debt or dependants. An RRSP and a TFSA for your savings,” says Darren Devine,* Sun Life Financial advisor and President of Devine and Associates Financial Services Inc. “Those five things encapsulate the universe of financial planning for the majority of people in the marketplace.”
Here are some details about each product Devine – a CERTIFIED FINANACIAL PLANNER® professional – suggests:
- Health insurance. This is all about protecting what you have. It’ll give you access to basic medical services if you get injured or sick. It’s meant to be a short-term solution.
- Disability insurance. What if an illness or accident leaves you unable to work and earn income? A disability plan can help protect you and your family in those events.
- Life insurance. Regardless of the type of policy, you will have an added layer of security to cover any debts. It can also offer financial help for dependants if the unexpected happens.
- An RRSP. There are different types of registered retirement saving plans (RRSP), each with a number of advantages. These include tax-deductible contributions, flexible contribution schedules and returns on investments that accumulate tax-deferred inside the plan.
- A TFSA. A tax-free savings account (TFSA) is a smart way to save without paying taxes on investment growth. You can use it to pay for home repairs, weddings, or other expenses instead of dipping into savings that may have tax implications.
Devine says that incorporating these five products into your financial plan is a good first step. But there’s another priority that’s critical to the success of such a plan.
“The first thing everyone should start with is a basic budget,” he says. “The question to ask is ‘do we have more dollars coming in the front door than going out the back?’ A healthy budget is simply spending less than you make.”
To look at your financial future or begin building your plan, contact Devine & Associates Financial Services Inc. at 519-780-1730.
*Mutual funds distributed by Sun Life Financial Investment Services (Canada) Inc.
Sun Life Assurance Company of Canada is a member of the Sun Life group of companies.