How does wealth management fit into your financial roadmap?

Wealth management is only one component of a financial roadmap. An advisor can help guide you through the course of that plan. They’ll work with you when you are just starting out. Then they’ll give you the special expertise you need. That includes advice as you accumulate possessions that build your wealth, such as real estate, investments and business assets.

What does it mean to manage your wealth?

You take the value you’ve built up over time and invest it strategically, says Chris Poole.¹ He’s a Toronto-based Sun Life advisor. “We often use wealth management to create opportunities over the course of time.”

“An overall plan will truly deliver a more comprehensive and higher level of service for you, versus a well-tailored but strictly wealth management plan.” That’s according to Patrick Fitzgerald,² an Ottawa-based Sun Life advisor. “When you take wealth management into consideration as part of an overall plan, you’ll have a better understanding of your total financial picture.”

An overall plan helps you:

• Lay out your goals and aspirations, as well as strategies and tactics for achieving them.
• Create a regular system of checks and balances to ensure you are meeting those goals.
• Navigate the world of personal finance:
  • whether you’re saving money through registered RRSPs, TFSAs, RESPs^†, and
  • non-registered vehicles, or turning your savings into retirement income through RRIFs and annuities.
• Deal not only with savings, but also with spending on major purchases. Those include a house, and manage your mortgage and other debts.
• Put protection in place for yourself and your family if you:
  • become sick or disabled,
  • lose someone you love, or
  • are concerned about paying for long-term care.

Poole says it’s important for investors to think of your roadmap as a pyramid. The base is a written list of your goals and hopes. The sides ensure you have insurance protection against non-controllable risks. Those include disability, critical illness and long-term care needs, plus putting succession plans in place.

Another component of that pyramid is wealth management.

Wealth management helps you:

• Ensure you’re saving enough for your retirement and making the most of your RRSP and TFSA contribution room.
• Save for a specific goal. That may be a large purchase such as a vacation home, or saving for a child’s education.
• Set aside money in an emergency fund.

“If we start building wealth too soon and we haven’t built a base or controlled some of these uncontrollable areas and haven’t managed those risks, the pyramid could come tumbling down early,” says Poole.