Personal Finance

Realistic Financial Advice

  • Last Updated:
  • Dec 14th, 2019 11:13 am
[OP]
Deal Addict
Jan 1, 2013
1802 posts
982 upvotes
Durham

Realistic Financial Advice

Quick scenario. I was out of work for a good year and we got tied up, uneducated suckered into "no employment 2nd mortgage". Whatever, said and done. Things CAN pick up now but its a struggle. I put together a plan involving our pays after tax. Such as snow ball solutions, but my wife does not listen and rather listen to a pro. Last person we spoke with was unrealistic as they wanted to use pre-tax figures.

I don't want to invest right now, just pay off debt and manage our money. After all bills are paid (mortgage, prop tax, car etc) we are left with $1800/mth to cover groceries, entertainment. Do banks offer this kinda of advice or do they want you to invest to provide this type of planning. My wife only wants to hear from a pro :rolleyes:
8 replies
Deal Addict
Mar 3, 2018
1859 posts
1843 upvotes
GTA
I would be trying to establish a rainy day savings fund of at least 6 months expenses in case another employment setback occurs. After that top up your TFSA’s and RRSP’s. You can invest in ETF’s with low fees yourself depending on your risk level. Like Canadian couch potato type funds.

As for pro advice I would be leery. They usually want to steer you into funds that pay the highest fees and commissions for them. In particular banks like to steer you into their high fee funds.
Deal Guru
Feb 9, 2009
10818 posts
9194 upvotes
Hourly fee financial planner. They will have the least conflict of interest in giving you good advice
Deal Guru
Feb 9, 2009
10818 posts
9194 upvotes
Hourly fee financial planner. They will have the least conflict of interest in giving you good advice
Jr. Member
Dec 1, 2019
129 posts
113 upvotes
From another thread:
Deepwater wrote: There is a listing of fee-only planners here: http://www.holypotato.net/?page_id=1332
Money Coaches Canada has a list of planners: https://moneycoachescanada.ca/about/

Their fees may seem expensive, but it would be a fee for service engagement to create a detailed plan that would cost way less than the MERs you were paying every year to CIBC. I went to a planner twice, once about a decade pre-retirement to have a plan done, and had an update done a year before retirement to verify that I was on course. The end result was a detailed document that considered my income, expenses, assets, investments, expected returns, life expectancy, and had tables of expected annual withdrawals, growth, taxes, expenses and net worth. It also had recommendations on what accounts to withdraw from in retirement to minimize taxes.
Deal Addict
User avatar
Dec 24, 2007
1457 posts
1679 upvotes
BC
Kkhan15 wrote: My wife only wants to hear from a pro :rolleyes:
There are no "free" professional financial planners....only those that charge a fee. Bank investment "advisors" are just commissioned salespersons and are biased to selling you bank investment products

After covering all your living expenses what amount of net cash/month are you talking about here that you think really need a financial planner?
Sr. Member
Nov 6, 2015
948 posts
547 upvotes
Guelph, ON
Tell your wife to look up the definition of "professional" - it's the opposite of "free".
Deal Fanatic
Sep 23, 2007
5061 posts
1155 upvotes
There's a thread about tracking net worth in this forum. I recommend you and your wife stop trying to find a professional. The only one who ever has your interest at heart is yourself. So go read that thread and first get a picture of your financial health by listing your assets minus liabilities to see your net worth. Then go make an income statement to see what your household "profit" is after expenses. This tells you how much money you have to invest into whatever. Even then, either get a fee based planner, or just read various sources and come to your own conclusion.

There are lots of black and white things you can read like TFSA and RRSP rules. These are government regulated. All it takes is a google search. It is more time efficient then booking a planner, and driving out of your home to talk with this person.

The more grey areas would be like purchasing equity or real estate. No one has a working crystal ball and neither will a "professional" advisor.

For most people, their financial reality is somewhat fixed. They have a job. The average person isn't going to experience a massive pay raise every year. Meanwhile, everyone should know their expenses. You don't need any special expertise or app to track your expenses. Just go through your bank statement and your credit card spending. Generally there isn't a lack of knowledge. It is more of a lack of motivation that is the issue.
Deal Guru
User avatar
May 8, 2009
14086 posts
11737 upvotes
Not Leask
Get your ducks in a row and BT to negate the interest on high interest debt.
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