Our newsletter

Rogers Group Financial (RGF) publishes a quarterly newsletter, The Financialist, which is written by the advisors of our firm. The articles are aimed at providing meaningful information relevant to the specific needs of our clients, and each covers a variety of topics (including specific investment strategies and the details of individual investment products).  The latest issues of The Financialist are below; for a complete archive and access to printable .pdf articles, please click here

The Importance of Budgeting
BY NICK HEARNE, BComm

A strong awareness and understanding of your personal finances is an integral part of the financial planning process. This holds true regardless of your phase in the financial life cycle.

Budgeting is beneficial to those in the accumulation phase of life looking to identify their savings capacity. It is equally important for a retiree to understand their expenses when planning retirement income and estate planning needs.

In each case, the best place to start is to understand how you are currently spending your money. There are many apps and programs on the market that are designed to assist you in this process. These tools will track and categorize your expenditures to provide you with an over- view of where your money is being spent.

Accumulators:
Saving for retirement is a fundamental part of any financial plan. This is especially true now, as defined benefit pension plans are becoming a thing of the past, at least outside of the public sector. The majority of Canadians will need to accumulate an investment portfolio capable of generating a significant portion of their retirement income.

When reviewing the amount you allocate toward savings, there are some rules of thumb that can be beneficial to use as a guide. Elizabeth Warren established the well-known 50/30/20 rule. The idea is to spend 50% of your after-tax income on "needs" such as basic groceries, housing, utilities, health insurance and car insurance. The 30% is for “wants”, which includes any non-essential items such as your cable bill, entertainment, or vacations. The final 20% is then reserved for savings and debt repayments.

Retirees:
Perhaps the biggest risk facing retirees is outliving their money. Your financial advisor can generate a retirement income projection that will provide a sustainable withdrawal rate.

If there is a shortfall, knowing where your money is being spent can help identify opportunities to reign in your spending. While this is a good place to start, reducing expenses is not always the answer. There could be the option to access the equity in your home, down-
size, or sell the family cottage. Either way, a thorough understanding of your spending will be an invaluable asset when making these difficult decisions.

Alternatively, a surplus may allow you to spend more money on discretionary items like travelling or purchasing a new vehicle. It could also signal the opportunity for charitable gifting or providing an early inheritance to a child purchasing a home.

In summary, a comprehensive under- standing of your expenses is important when working with your advisor to prepare your financial plan. Your RGF advisory team can then assist you in projecting target levels of savings as well as sustainable withdrawal rates during retirement.


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