Understanding each client’s requirements, resources and constraints is the key first step in delivering the desired financial outcome. Sometimes, a new client is not quite clear on these items him or herself. With this in mind, we have developed a specific process that we follow with every client.
Instead of focusing on arcane issues and financial phenomena we cannot control, CSIC’s financial planning focuses on safely achieving the maximum level of spendable, inflation protected, after-tax cash flow, starting now. For most of us, our family’s lifestyle - the home, the cars, the memberships, the security, the bequests - is the reason we work, save, and agonize over investments.
For most clients, the key financial question is “will my assets provide my family and I with our desired lifestyle over a specific period of time?" Our plan will answer this question with great precision.
Our process can be best described as a four-part perpetual system designed to help us discover who the client is and how we can deliver the most effective financial planning solutions to the unique life situation that each client presents.
During an initial meeting, CSIC has a simple objective and that is to explore who the prospective client is and to find out what they really want their money to do for them. Our questions are designed to help clarify and prioritize each client’s financial objectives. By the end of the initial meeting, both the prospective client and advisor will have a good idea of whether there is a good fit between their needs and CSIC’s skills, and a decision is made whether to work together.
After the initial meeting, we want to quantify your specific goals, and understand your expectations. The best way to do this is to ask the right questions. Our questions are purposely designed to help our new clients to easily articulate what they really want their money to do for them and their families, today and in the future. In the days following the initial meeting, we will gather data to enable us to create a meaningful draft financial plan. There are many resources that go into this calculation: on top of your current RRSP and non-registered investment holdings, we consider items such as your salary, your pension, your group benefits, inheritances, and other assets. We look at your liabilities – a mortgage, fixed expenses such as for insurance or education, and other debts. We also factor in future expenses such as supporting a parent, or anticipated medical costs. Our plan will account for more of what really goes on in your financial life than virtually any other plan in the marketplace.
Our financial plan is different than most in the industry, in that we focus on maximizing your actual spendable income – after-tax, after saving, after inflation, and for your whole life. This is what financial planning should be all about, we believe finding the optimal solution, given the resources available.
Maximizing the effectiveness of current and future assets is the key to reaching your financial goals. Once the draft financial plan is prepared, we arrange a financial plan and income presentation meeting. In this meeting, we go through the assumptions used in the plan, such as income, inflation, rates of return, etc. The resulting outcome from these inputs is your “lifestyle” number, showing you your after-tax, after-savings, after-inflation lifetime annual spending power starting today.
Your custom CSIC financial plan is a playbook that specifically allocates resources each year from today to life expectancy, showing a clear year-by-year savings, investment and withdrawal schedule. These calculations are done with the purpose of generating the maximum spending power over your whole life, starting now.
A specific action plan is created for you with a set of behaviours, usually saving, that maximizes the probability of achieving your defined financial goals. We identify exactly how much of your income needs to be saved, if any, and make a specific investment and asset allocation protection plan that achieves the maximum spending power number.
As the months and years roll by, we monitor each client portfolio closely. Since frequent investment changes are almost always detrimental to real-life results, we rarely change course on investment plans unless circumstances have changed. In some cases, investment options, strategies, tax implications, or other suitable opportunities become appropriate. We are always looking for superior investment options for our clients.
We reach out to our clients at least quarterly and meet annually to review their financial plan and assets under management. We keep the client’s plan and associated financial behaviours valuable and real by keeping it current – the plan reflects current lifestyle circumstances; as the circumstances of your life change, the plan changes with you.
While it is widely held that good financial decisions result in good financial outcomes, we try to take that a step further. We protect our clients from the all-too-frequent danger of having done “all the right things” only to see markets take it all away. In most cases, and where suitable, assets invested according to our financial plans have many defenses and even guarantees against adverse market effects.