Elements of financial planning

You’re young. You’re a professional. You’ve started making money.

The future may seem far off. But it’s coming.

Do your future self a favour now: have a financial plan. You’ll be thankful you did.

Your financial plan should examine these things:

Your Cash Flow

  • Regular income streams (wages, childcare benefits, etc.)
  • Regular expenses or outflows (savings, rent, paying debt, etc.)

Your Retirement Planning

  • RRSP contributions (retirement savings – yes, this early!)
  • Lifestyle choices (how do you want to live in your retirement ? how about now?)
  • Age, earnings expectations (are you starting saving in your 20s? 30s? how much can you afford to put away?)

Your Investment Portfolio

  • Time horizon (some investments for short term, some medium, some long)
  • Risk tolerance (can you tolerate a large drop in a volatile stock?)
  • Diversification (are you invested in one sector?)
  • Purpose (which investments are serving which ends?)

Your Insurance Planning

  • Life (do you have the life insurance that fits your situation?)
  • Health (are you covered for your health needs?)
  • Disability (your ability to earn income is your largest asset – is your largest asset insured?)
  • Critical Illness, etc. (you need to prepare for the unexpected)

Your Tax Planning

  • Minimizing tax burden (using tax-deferred and tax free accounts, etc.)
  • Maximizing savings and income (keep more of your money)
  • Maximizing deductions you’re entitled to (education credits)

Your Education Planning

  • Planning for your education (maybe you want to go back to school)
  • Paying student loans (a big challenge after graduating)
  • Planning for your child’s education (never too early)

Your Estate Planning

  • Wealth transfer (yes, it’s for later in life – but prepare now)
  • Having a will (who gets what?)
  • Includes tax considerations (keep more of your money)
  • Includes insurance considerations (protect yourself and your assets)


You might feel like it’s too early to plan for the future. It’s not!

Your future self thanks you in advance.