Welcome to Smart Money Station Canada. This is where you’ll find tools, information and resources designed to help you make smart financial decisions in all areas of personal financial management. We have a comprehensive step-by-step program for all topics of personal financial planning. We also have the steps that will help you select types of financial products and credit such as mortgages, loans, and credit cards. You can also learn how to manage your credit report and credit score, exchange currency, transfer money, to protect yourself from identity theft and much more.
At Smart Money Station, we don't make assumptions about your financial knowledge. Instead, we provide everything needed to know how to make smart money decisions whatever your current level of financial knowledge. It’s easy. You can start at the beginning of a topic or skip past the stuff you already know.
Our Editor's vision is to help you understand your financial options and to make smart money choices. Through education, you will gain the confidence you need to take control of your financial future. Armed with a Master's degree in Economics and over 20 years of finance industry experience, including personal financial planning, her goal is to pass on her knowledge to those who want help making wise money and credit choices. Make sure to bookmark our site and check back often for updates and new sections that will continually be added. In the meantime, if there is a topic you are interested in or have any questions please feel free to contact the editor at editor@smartmoneystation.com.
Let’s get started on the journey to financial education and financial prosperity!
Most of us share the common goal of achieving a certain level of financial security or independence. We want to have a prosperous financial future where we feel secure and can maintain a satisfactory standard of living when we retire. To reach this level of financial well-being we need to build financial reserves such as savings and investments by paying attention to some key areas of financial planning.
Our step-by-step program is designed to help you work through the different areas of financial planning that can affect your financial future: cash and debt management, insurance, taxation, investments, wills and estates, and retirement. Each of these sections on our website has its own set of steps to guide you.
There are some important factors to keep in mind while planning:
Life expectancy is much higher today than it used to be. According to Statistics Canada, on average, men who have reached the age of 65 will live to age 83 and women will live to age 86. Therefore, we must be even more careful in planning to accumulate enough money for a longer life and retirement.
The labour market is rapidly changing on a global basis. The days of staying with one employer for 40 years and taking a sufficient pension at the end are long over for most people. Today’s workforce will experience working for several employers (many without pension plans), job interruptions (for things like down-sizing, layoffs, out-sourcing, etc.) and many will leave the labour market and seek self-employment solutions.
It’s wise not to assume that we will receive today’s level of Canada Pension Plan (CPP) or Old Age Security Benefits (OAS). There are an increasing number of people reaching retirement age while at the same time the percentage of the population working and contributing to these plans is decreasing. As a result, you want to be prepared since you never know when governments will have to scale back the payouts from these plans and make them available only to low income families.
THE FINANCIAL PLANNING PROCESS
With the above factors in mind, let’s get started on the steps you need to take for Planning for Prosperity.
The first thing you need to do is identify your current assets, liabilities, all sources of income and any opportunities for savings and reducing expenses. This is a snap shot of where you are today. During this step you will develop your statement of net worth (we have one that can help you get started: attach link ).
ESTABLISH GOALS AND OBJECTIVES
What are your priorities? What kind of things do you like to do in life? What do you want to provide for your family? This step will help you determine the level of income you need to achieve these goals and objectives while maintaining a comfortable standard of living. You’ll learn ways to manage your income, improve your investments and minimize your taxes.
Why should you set objectives?
To set specific goals you want to reach. Unless you know what you are trying to accomplish there is no way to know what steps to take to help you get there.
To help you establish a personal custom-made strategy. You need to calculate the amount you must to add to your income or save on a weekly (or monthly) basis in order to meet a goal.
To help set your priorities in order to meet longer term goals. Let’s say that you have a goal to save a certain amount of money each year - you know that you need to either find more income or cut some expenses. For example, you can scale back the amount you spend on your vacations or cut down on something like dining out. By doing this, you set your priorities and increase the chance of meeting your goals!
To take control of what you want to achieve and how you are going to do it. You determine the steps and actions you need to take. By being involved and understanding the process, you are less likely to be influenced by impulses of others and will be able to better assess the advice you get from any advisors.
To force you to look at your financial situation objectively. For many of us this can be an eye opener! But, this reality check will lead you to make decisions and take actions that enable you to take control of your financial situation.
IDENTIFY PROBLEMS AND OPPORTUNITIES
In this step you want to take an honest look at what you are currently doing and identify the areas where you can do better. Again, you’ll need to consider the same areas:
cash and debt management
insurance needs for all types
will and estate
taxation
investments
retirement
CONSIDER SOLUTIONS AND ALTERNATIVES
What actions can you take in these areas of financial planning to move you forward on your journey to financial prosperity?
IMPLEMENT YOUR STRATEGY
Make it happen! Take the necessary action as determined in Step #4. It’s probably easier than you think and it can be rewarding when you take control of your finances.
MONITOR YOUR SITUATION PERIODICALLY
It’s important to regularly monitor your situation and check if you are on target. If not, find out why. You may need to change your course of action or change your goals.
Areas to Focus On:
Once you know your objectives you can choose the pertinent financial planning section below. If you need to go through your entire plan, simply start with the first section and work your way through as necessary.
