Tag Archives: Investments

How financial planners create financial success

An Insight into Benefits of Financial Planning and Role Financial Planner Plays in Success of Financial Plans

Financial planning is quite important for us and there are several benefits of proper financial planning. You may well consult a financial planner and work according to suggestions provided by the planner to manage your financial details in a much better manner. In this context we will look into main benefits of financial planning, irrespective of whether you are rich or ordinary person.

6 Benefits of Financial Planning

Benefit #1: Manage Income in the Right Manner

financial plannerProper planning can help in proper management of income you earn. The benefit of correct management of income is that it can assist you in understanding the funds you will require for paying taxes, for meeting monthly expenses, and to save.

Benefit #2: Improve Cash Flows

A financial planner can closely monitor patterns of spending you have as well as your day to day expenditures and help in increasing your cash flows. Proper guidance from your planner can assist you in controlling your expenditures as well as following a well planned budget to achieve your saving goals.

Benefit #3: Improvement in Availability of Capital

As cash flows increase, you will have greater availability of capital. At this juncture you can start investing available capital in suitable investment products and generate more income to strengthen your financial position.

Benefit #4: Financially Securing Your Family

Financial security is quite important for your family, and as such, your financial planner can guide you about the right insurance products to select to will help you in this regard. Planners can explain features of all available insurance products and provide suggestions about options open for you as per your financial position and the health profile of your family members. This way you will be able to rest assured that necessary steps have been taken to safeguard the future of your family members in case something happens to you.

Benefit #5: Finance Industry Knowledge

A financial planner can share his or her industry knowledge with you so that you can fully understand how things work in finance industry. By having the required knowledge you will be able to fully understand implications of financial decisions you take and avoid making mistakes which can prove to be detrimental to success of your financial plans.Additionally, you will be able to properly review results of your investment decisions and implement changes in case any errors are found.

Thus, with right knowledge you will be able to properly control your finances and take investment decisions which will yield desired results.

Benefit #6: Creation of Assets

Proper financial planning can also be useful in building an asset base. The right planning can also help you identify problems which you are going to face in your endeavors. For instance, an asset can bring along certain liabilities for you to bear. A financial planner can analyze these problems as well as judge actual value of any asset so that you can take right decision.

Summary

To summarize it can be said that if proper planning is of critical importance if you want to manage your finances in right manner. By taking help of a financial planner you can simplify 

this process and achieve success in your endeavours.

What Is a Registered Retirement Plan and Is It Good For You

How Registered Retirement Savings

Plan Can be Useful for Building Savings?

If you want to build your savings then registered retirement savings plan can be quite helpful in accomplishing your goals. Let us find out more about registered retirement savings plan (RRSP) and how it can be beneficial for you.

An Insight into RRSP and Its Benefits

personal financial advisorHere we will look into several details related to registered retirement savings plan such as:

  • What are RRSPs?
  • How spousal RRSPs can be beneficial for you and your spouse?
  • What are the advantages of utilizing group RRSP?
  • What is referred to by locked-in RRSP?

Registered Retirement Savings Plan 

First thing you will have to do is contact your personal financial advisor to know more about RRSP and how it can be useful for you. So, let us delve into details of what RRSP is. Basically, it is one form of savings plan where earnings from investment as well as all your contributions build up on a tax deferred savings. It is also worth mentioning here that at the time of withdrawals, these will be taxed in the same way as other incomes are.

Usefulness of Spousal RRSP

As the name suggests, it is one type of RRSP in which contributions are allowed by a person to RRSP of his or her spouse. The main advantage of this from of registered retirement savings plan is that couple can utilize spousal RRSP for lowering taxes they have to pay. How this can be possible? Let us find out. Here spouse earning higher income makes contributions towards spousal RRSP and when both retire, spouse getting lower income starts withdrawing from the plan. This way if you have higher income then you can easily divert income earned after retirement towards your spouse and lower the amount of tax both of you will be liable to pay during your retired life.

Benefits of Group RRSPs

Such RRSPs are sponsored by employer and in this form of registered retirement savings plan participating employees get their individual accounts. You should discuss this type of RRSP with your personal financial advisor to fully understand all aspects related to it. However, the main positive point about group RRSPs is that you are allowed to contribute to this account directly from your payroll. Moreover, before tax funds are utilized for making the contributions, meaning you avail tax benefit right at the time without the need to wait for next year to receive the tax refunds.

Locked-in RRSP

Locked-in RRSP refers to a situation where funds available in a registered pension plan are transferred into registered retirement savings plan. Primary aspect about locked-in RRSP is that here you are debarred from taking withdrawals from this type of account and payments which are allowed are the ones related to retirement income payments. There are two things which can happen when you retire:

  • Conversion of funds available in RRSP into a form of life income fund or
  • Funds are used for purchase of annuity.

A Final Note

To from details it is quite clear that registered retirement savings plan is a very attractive investment plan and you should get more details about the same from your personal financial advisor.

How To Avoid Any Negative Impact On Your Retirement Investment

Financial Risks Which Can Have a Negative Impact 

Over Your Retirement Nest Egg and Measures to Reduce Those Risks

If you are interested in building investments which will help you live a stress free retired life then it will be necessary to consult a certified financial planner. By consulting a financial planner you will be able to clearly understand common risks you will have to face and how to overcome them. So let us delve into the details in the following sections.

Financial Risks and Retirement Nest Egg

Employment Risk – Unforeseen Requirements Risk – Inflation Risk – Interest Rate Risk

There are several risks which can prove to be bottlenecks in your retirement investment planning, let us look at some of the important ones here.

Employment Risk

certified financial plannerIf you perform retirement income analysis by including supplemental income you will generate by doing a part time or full time job after retirement then it will be a great risk you will be taking.

The reason it is considered a risk is because of the fact that chances of getting a job after retirement will largely depend upon your health, family conditions and necessity to develop new skills. In addition to it, these factors may well reduce your chances of getting a job. As such, best thing to do will be do take into consideration the age by which you want to retire since it will help you have a clear idea of job prospects you will have after retirement and income you will require. 

Unforeseen Requirements Risk

Risk of unforeseen requirements can be in the form of:

  • Expenditure on health care for parents
  • Education fees of children
  • Change in marital status of a family member (such as a daughter)
  • Loss of employment

You may have to face these situations after retirement and financially assist your family members. As such, your certified financial planner will have to consider these situations and develop a financial plan which will assist you in meeting these unforeseen expenditures.

Inflation Risk

Value of money will not be same after 20 years as it is now and this creates inflation risk that it to be considered at the time of retirement planning. The main here should be to offset inflation risk so that you have enough money to meet your expenditures after retirement. Few of the things your certified financial planner should do in this respect would consist of:

  • Select equities for investment
  • Make an investment in assets such as a home
  • Choose annuities that provide cost of living adjustment

Interest Rate Risk

In case investments are made in products that have lower interest rate then in such situation growth of retirement savings will be slow, which in turn means that you will have less savings at the time of retirement. As for instance, in case there is a drop in bond's market value then interest rate will start rising and have a negative effect over your retirement income.

Summary

To summarize it can be said that you need to pay attention to retirement planning so that each and every aspect which can effect your retirement income is taken into consideration and necessary steps are taken to avoid likely problems.

Make Your Real Estate Investment Better

Real estate investments are actually intended for the expert players of this field. However, people who have already tried investing in real estate knows very well that to get profitable returns easily, the investments should be made wisely.

Property Investments

As per the experts in this industry, there are numerous ways to earn major profits in the real estate deals. If you feel that the place where you have invested is quite cost-effective, you can earn a handsome amount of profit.

The following are few skills that are needed for investing in a real estate deal, which are compulsory for a profitable real estate deal.

Learn how to find the right sellers

Home Investment

You should know how and when to find serious sellers. These authentic sellers will help you to earn more profit in the field of real estate.

Do make sure that the sellers that you have selected are highly reputed, as if you are a beginner in investing; this may cause the investing at risk. You can check the freedom mentor reviews to avoid any mistakes while making investments.

Learn to be a master in negotiation while you are closing a real estate investment deal

Real Estate Investment

Try to acquire the skills of how to deal with issues related to the real estate investment. However, all the efforts may go in vein when you are not able to negotiate properly and end up with high prices.

Clever to analyse real estate investment deal accurately

If you are can analyse the real investment deal cleverly, you will be able to understand where and how to deal perfectly. This will help you to be a gainer in future, as you can estimate the risks to some extent.