Recent reports suggest many Canadians are not saving enough for retirement.1 And with Canadians living longer, healthier lives than ever before, your retirement income will likely need to last for 20, 30 or more years.
That’s why having a plan for your retirement has never been more important – and one of the most successful steps you can take is working with a professional financial advisor.
There’s no doubt that financial advice can improve retirement readiness, according to a study which found that investors who do work with a professional advisor have a higher savings rate on average than those who do not.2
Here’s an example: You’ve been getting advice from a professional for 15 years and have been following that advice diligently. By doing so, the study says your household assets could be almost twice as high as those of a household without a professional advisor.
The reasons for that difference and why working with a professional advisor sets you up for a successful retirement might surprise you. The study barely mentions investment performance – the prime focus of many investors – but, instead, highlights the value professional advisors add by encouraging more disciplined savings and investment behaviour.
You may have the best intentions but it can be challenging to stay disciplined enough to try and achieve investment success on your own, especially when you are not following a well-designed financial plan.
But when you plan your retirement with a professional advisor, set realistic financial goals and work toward achieving them, success is more likely.
The recent study says that while setting those goals is vital, it is the professional advisor’s ability to create the discipline for you to save and achieve those goals that really brings value to your association with your advisor.
The study also found that the longer you work with a professional advisor, the better – because the longer you receive financial advice, the more assets you will accumulate and the closer you will be to achieving your financial goals.
This is the ideal time of year to begin or revise your financial plan. Registered Retirement Savings Plans (RRSPs) are a key component of most financial plans and, given that the deadline to contribute to RRSPs is March 2 (for your 2014 income tax filing) now is the time to talk to your professional advisor about your retirement readiness.
Give your advisor a call and soon you’ll be able to say with confidence, “Yes, I am ready for retirement.”
1 McKinsey & Company, 2012 report
2 Boosting Retirement Readiness and the Economy Through Financial Advice, Montmarquette and Viennot-Briot 2012 Canadian Study for the Conference Board of Canada
This column, written and published by Investors Group Financial Services Inc. (in Québec – a Financial Services Firm), and Investors Group Securities Inc. (in Québec, a firm in Financial Planning) presents general information only and is not a solicitation to buy or sell any investments. Contact your own advisor for specific advice about your circumstances. For more information on this topic please contact your Investors Group Consultant.
Contact David Brown at 250-315-0241 or at [email protected] to book your appointment.
