Financial Management

To many, financial management simply means watching what you are spending versus what you are earning.  This is a good start.  To improve the likelihood of financial success and reaching life goals, there are many more elements to consider:

  • Goals (needs and wants: understanding the lifestyle you have or want, and the future you desire.  All while ensuring you are on track to achieving those goals
  • Income, expenses, assets, and debt: understanding all sources of income and/or potential income and how to manage within those resources. Knowing the assets you have, the debts you owe, and what is left to work with.
  • Planning: Managing your income and spending ahead of time (budgeting), to make the most of resources and to make sure you achieve your goals.
  • Savings and investment: planning to spend less than what you earn, and putting those savings to work for your future.
  • Investing: Beyond just saving, how can you make your financial assets work best for you.
  • Managing debt: Using and paying down debt in a responsible way to ensure you financial plan in sound.
  • Monitoring and adjusting: regularly reviewing your progress towards goals, and making adjustments as necessary to ensure you stay on track.

Sage Wealth Advisors has the expertise and tools to assist you in gathering the information necessary to understand your current situation, outline your goals (needs and wants), and plan in order to achieve those goals.  We can also provide assistance to help you implement your plan as well as monitor and review your situation on a regular basis and make recommendations for change when it is beneficial. Using expert advice will help you to better understand the requirements of a financial plan and will greatly increase the chance of completing a  sound plan (simple or complex) as well as increase the likelihood of achieving your goals.


Retirement Planning

One of the greatest challenges of retirement planning is the concept of time.  Time is one of the greatest tools when it comes to investing - time can compound your assets many times over while also smoothing out any rough spots your retirement investments might hit.  However, almost everyone believes, or believed, when young there is plenty of time to deal with retirement planning.  Those who are older gain the wisdom of hindsight and understand how time speeds up as life goes on.  If you haven't starting planning or saving for retirement, then NOW is the absolute best time to start.  Even if resources are tight, starting with the smallest of amounts and a bit of ongoing discipline can lead to much greater things in the future.

Sage Wealth Advisors can assist you in developing a retirement plan as part of your financial plan as well as helping you to implement and stay on track with your plan.  To put together an effective retirement plan you need to consider several factors including:

  • Understand time horizon: How old are you now, when would you like to retire and, therefore, the amount of time you have to build for your retirement.
  • Determine retirement spending needs:  What types of expenses are you likely to have that will need to be met as well as what type of lifestyle would you like to have and what costs will be associated with that.
  • Sources of retirement income: Understanding what sources of retirement income you are likely to have in place already such as private pension plan, government benefits such as Canada Pension Plan and Old Age Security, Income based on current savings (General savings, RRSP's, TFSA's, other).  Many of these can change based on numerous factors, but it provides a starting point to see what you might have.
  • Financial resources required to support retirement:  Determining what financial resource you will need at retirement in order to cover the expenses you think you will have and to pay for the lifestyle you want.
  • Minding the gap: Understanding where you are now with your finances, the resources you will require in retirement, the gap between those two and, of course, how to close the gap between now and retirement.


Investment Management

Given your current financial situation, your various goals, and ultimately, your desired retirement lifestyle, managing your investments is a key element to help bring your plan to reality.  Investing should be a more involved exercise than simply turning funds over to an investment manager or broker.  Making sure your investments are in alignment with all aspects of your financial plan is extremely important to ensure you will be able to achieve goals while sleeping peacefully at night.

Sage Wealth Advisors provides support to develop a personal investment policy and strategy, before funds are put into action.  In addition we provide ongoing support to monitor the performance of your investments, understanding your changing requirements and, changes that should be made to you strategy to help you keep on track.  Key steps in investment planning include:

  • Risk tolerance assessment:  Understanding your appetite for risk along with other elements such as time horizon (how long you can keep your investments without using them), and potential risk needs, is critical before investment funds.
  • Summarize current resources: Obtaining a clear view of your current resources and commitments will help to determine what is available as well as how existing investments fit with your risk profile and newly development investment strategy.
  • Determine asset class returns: Understanding potential returns on different investment classes is necessary to determine how your investment resources can grow and change over time.
  • Integrating investment options with goals: A critical step is to review potential long-term investment results (current investments + planned savings/investment + time horizon) to determine if you investment plan is sufficient to support your goals.  If not, then adjustments are required while still considering your risk profile and other elements of your plan.
  • Implementation: Implementing your investment plan will help to put your current resources to work while ensuring your financial plan contributes the appropriate amount of resources to help you achieve your goals.
  • Monitoring:  Ongoing monitoring and adjustments is critical to ensure you investment strategy continues to support your overall plan and adjusts as necessary to meet changing life circumstances and changing levels of risk tolerance.


Tax Planning

Tax planning goes beyond simply preparing and filing income tax returns - which is important to do.  Planning involves a review of your current situation and future plans and determining what alternatives and options are available to minimize taxes you pay which, in turn, helps you to preserve your financial resources.  There are various legitimate opportunities to utilize to help achieve tax reduction.

Sage Wealth understands the importance of integrating tax implications into the development and execution of your financial plans.  When planning for taxes, we take into account the various decisions and alternatives within other areas of financial planning, and then review opportunities to minimize taxes.  Often, this is an iterative process as significant tax implications can affect other financial planning decisions.

Tax planning starts with a review of your current financial and tax situation.  Adding in your future goals and plans then adds to our understanding of your situation and helps to inform the tax planning process.  There are numerous tax issues to review which are intended to help minimize the impact of income taxes on your current and future financial situation.  Examples of issue to consider include such things as:

  • Ensuring all available and applicable tax deductions and credits are being utilized.
  • Considering which investment account types to use and when.
  • Determining which legitimate income splitting opportunities are available.
  • Ensuring all allowable deductions for your business are being utilized.

There are many more considerations which Sage Wealth would review in determining the best approach to reduce your tax burden.


Estate Planning

Estate planning is an activity that most people put off until they are much older, often believing it is not that important until you have more wealth to manage.  However, there is much more to estate planning than having a simple will that helps to dispose of your assets.  There are many important elements of estate planning that should be considered earlier in life - because none of us know when we are gong to die.  Not having a plan in place can create challenges and stress to those dealing with your estate.

Sage Wealth can help you to understand the various issues to consider in developing and estate plan and in creating a plan that gives you peace of mind that those things important to you will be looked after should something unfortunate happen.  Some of the basic issues to consider in developing an estate plan include:

  • Designating guardians and back-up guardians for minor children.
  • Ensuring beneficiary designations for assets are in place if you want specific assets to go to specific individuals or organizations.
  • Documentation on gifts and bequests that are important to you.
  • Creating health care directives, or living will, and powers of attorney in case you are not able to make decisions for yourself.


Risk Management

Most areas of financial planning are concerned with maximizing your resources and helping you to achieve your goals while providing for you needs.  Risk management has the same goal.  However, risk management adds value by helping you to minimize the negative impacts of unforeseen events on your financial goals.  The process of managing risks involves some basic steps:

  • Identify possible, negative events that could significantly impact you.
  • Determine or estimate the probability of those events.
  • Estimate the amount of negative impact.
  • Determine options and cost to deal with the risks.
  • Develop and implement a plan to manage risks.

While most people think of insurance as risk management, and it is important, there are many other ways to deal with the risk you identify.  For example, the impact of some risks may be small enough, especially compared to the cost of dealing with them, that you may decide to simply accept the risk and live with it.  As simple example may be the decision whether to pay for glass insurance on your vehicle.  Many people choose not to pay for such coverage given the cost of premiums relative to the cost to replace.  Also, there may be options deal with risks such as actions you can take to help reduce or even eliminate risks.  For example, if you live on an acreage with lots of trees, you could move the tree line further from your house or clear underbrush to reduce the possibility of fire "leaping" onto your house.

And of course, insurance is something everyone needs to review and consider.  Insurance is referred to as a risk transfer strategy where, for a premium paid, the insurance company assumes the risk you are insuring.  When it comes to insurance you need to identify the potential losses you cannot accept on your own, and ensure your have proper coverage in place.  The other side of insurance is to ensure you are not over-insuring or carrying insurance on something that does not present a risk to you.  Sage Wealth, as a fee only advisor, can assist in evaluating and planning for the proper amount of coverage.


Small Business Consulting

Often clients will have a business they are involved in or which may be their primary source of income.  For small business owners or individuals with proprietorships/unincorporated business, ensuring your business is effectively run and maximizing its resources is an integral part of your personal financial plan.  Ensuring your business financial plans, tax strategies, and ultimately your success plan, is critical in helping you achieve your goals personally.

Sage Wealth has the experience to help you integrate your small business planning with your personal financial planning to make sure you move forward with all financial aspects of your life in-sync.  From budgeting to cash flow management, to owner withdrawal options and business tax planning, we are able to assist you in managing and integrating your small business finance into your personal finances.