FAQ

Frequently Asked Questions

What are the main advantages of using a Planwell advisor?

Advisors that hold the CFP® or CIM® designations attest annually that they will put their client’s interest ahead of their own which is important as for most financial advisors this is not a requirement.
Planwell advisors will prepare a comprehensive financial plan for you
Planwell advisors will establish measurable goals with you that can be worked towards through the Planwell Checkpoint system.
Planwell advisors will measure your actual investment performance against your goal rate of return established in your comprehensive financial plan as well as against the agreed upon benchmark index returns so it is clear how well you are doing.
Planwell advisors have access to use the Planwell Net Return Portfolios which offer superior long term returns with less volatility.
Planwell advisors take a holistic view of assisting each client in the areas of Wealth Accumulation, Wealth Maximization, Wealth Protection and Wealth Transfer.
See more about the Planwell difference here

What are the minimum requirements to use a Planwell advisor?

Planwell advisors are proud to have no minimum account sizes as we believe one of our jobs is to assist our clients with building their wealth which may mean they don’t have substantial wealth at the outset. We do however require our clients to have a desire to build their wealth if they are in the earlier stages of wealth accumulation.

Are there fees for the preparation of the comprehensive financial plans?

Planwell advisors will invest considerable time upfront with clients that are committed to working with Planwell to have a comprehensive financial plan completed and to allow the Planwell advisor to assist with wealth management and insurance elements.
No fees are charged explicitly for the consultations and preparation of the financial plan as this will be included as part of the Planwell servicing package. See the Planwell Fee Schedule for information on the fees for the wealth management services.
Planwell realizes that other financial planning companies charge considerable amounts up front for the preparation of comprehensive financial plans and in some cases also charge ongoing wealth management fees. At Planwell we believe so strongly in the value of every client having a financial plan that we will invest considerable time up front to establish the best possible long-term program for our clients without burdening them with any large up front fees.

Why is it important to deal with someone that has at least a recognized financial planning designation?

In the same way when you need professional medical or legal advice you are best to get this from a professional that is properly licensed in their respective field. Unfortunately, the regulation in Canada as to who can use the financial planner name is weak and many people use the title that do not actually have a financial planning designation.
Obtaining for example the Certified Financial Planner (CFP®) designation is a multi-year educational program which requires extensive studies and examinations.

How long has Planwell Financial Services Inc. been in business?

Planwell was founded in June 2002 by David Booth and has been in consistent operation since that time. David Booth has been a financial advisor since 1993 and was a professional accountant prior to this.

What is the Planwell investment philosophy?

At Planwell we find based on many years of experience that most of our clients would like to earn a good return that is more consistent. It is the declines in value that most clients would prefer to avoid. Therefore, our main goal is to create portfolios that generate above average returns with lower volatility, which allow our clients to not have to worry about their accounts.
The Planwell Net Return Portfolios offer a pension style structure to the investments with the inclusion of core Canadian Equity, Global Equity and fixed income components along with alternative investments and real estate and infrastructure investments.
The Planwell Net Return Portfolios are focused on the net return after fees as opposed to being focused on just low fees or the avoidance of higher fees. For Planwell we will use low fee solutions as long as the net return is good as low fees don’t always mean a higher return. Similarly, we may use active investments with higher fees if these higher fees have lead to superior net returns. However, all fees must be justified and lead to higher net returns for the portfolio while the components of the portfolio work together to create better downside protection and a smoother ride for our clients.

Will a Planwell advisor come to see me at my place?

Yes, we recognize that not everyone is able to make it to our office for meetings and we are open to meeting our clients and prospective clients in their home or office.

What areas do Planwell advisors serve at this time?

Currently Planwell advisors serve all areas in the Greater Vancouver area and Fraser Valley, extending basically from Vancouver to Chilliwack.

What hours are Planwell advisors available?

Office hours are from 9 a.m. to 5 p.m. However, evening and weekend appointments can be accommodated.

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ESTATE PLAN

Ensuring things have been properly planned for our end of life can not only save large amounts of money but can also make the process so much less complex for those left behind.
Wills, trusts, beneficiary designations, power of attorneys, and representation agreements all need to be reviewed and utilized where appropriate to ensure the transfer at the end of life happens in the best way possible.
For those with philanthropic desires planning for how to contribute to charities directly or through a foundation should also be explored.

TAX PLAN

Minimizing the amount of income tax paid should also be part of each financial plan. It is completely legal to try to avoid paying tax through various measures like RRSP deductions, interest deductions, using tax free savings accounts, etc. Tax evasion is illegal and could result in serious legal issues.
As income from various sources can be taxed at different levels it is important to structure investments and holdings in the most tax efficient way.

Long-term planning is also needed when assets are to be sold in the future that have large embedded capital gains. There may be ways to reduce or defer the income tax on these larger items with proper tax planning.

INSURANCE PLAN

Insurance is important in providing protection for families as well as protecting the wealth that is accumulated. Insurance can also be used to enhance the maximization of wealth especially due to insurance death benefits being paid out on a tax-free basis if structured properly.

A needs analysis should be part of a financial plan to determine what types of insurance are needed and whether existing plans are the most appropriate. This should encompass looking at the life insurance, disability insurance, critical illness and long-term care insurance needs.

REAL ESTATE PLAN

Real estate is one of the largest portions of wealth in Canada and is an important component of many Canadians wealth. Having a plan for the accumulation of real estate is important whether this is just a principal residence or multiple properties. Building the equity in real estate is important as it provides options for other opportunities. Rental revenue for many Canadians is an important source of income.

CHILDREN’S SAVINGS PLAN

Saving for children is very common for Canadians and different options exist. Most commonly used is the Registered Education Savings Plan but there are also informal trust accounts and open savings accounts.

Depending on the amount being saved strategic use of these plans should be made to maximize the grants and free money available from the government as well as other tax implications of saving for children.

PENSION PLAN

Pensions are a significant part of many Canadians financial plans and these pensions including private and government pensions need to be factored into the financial plan and their value maximized.
Plans around when to retire and what options to take in private pensions can be complex and need careful consideration and exploration. In some cases, it may also be advantageous to explore taking the commuted value of a private pension plan and transferring this to a locked-in RRSP or LIRA.
Similarly, with the Old Age Pension and Canada Pension options exist as to when to begin these pensions which should be assessed.

FEE PLAN

It should be clear in the financial plan what the fee levels will be for the work being provided by the financial planner as well as the products that are being used as part of the financial plan.
Ideally the financial planner will be able to demonstrate that by paying these fees the client is better off than having not paid these fees. The client should feel that the package of services being provided by the financial planner are well worth the fees being paid as evidenced through good rates of return, a sense of progress towards goals and a feeling of security in knowing that each area of the financial plan has been addressed and is being monitored.

INVESTMENT PLAN

The investment plan will look at what type of investments to use, the appropriate risk levels, the types of plans to use (RRSPs, RIFs, TFSAs, Open or Taxable accounts, etc)
Investments outside of real estate (see real estate plan) are an important part of a financial plan. Real estate is a more illiquid investment as it can be more difficult to sell in a shorter time frame. Other investments can provide more liquidity.
The investment plan should also provide a goal rate of return for the investments that can be measured against the actual performance and an agreed upon market benchmark return.

MORTGAGE PLAN

Mortgages have proven very useful to many Canadians by allowing them to invest in personal use properties, rental properties, recreational properties and commercial properties. Significant wealth has been built up especially over the last 20 years in Canada by investing in real estate.
As with other debt there are strategies and methods that can be utilized to assist in paying down mortgage debt in a more efficient manner and these should be explored in this part of the financial plan.
As equity is built up many people have used this equity to allow them to purchase additional real estate. Therefore, it is advantageous from many perspectives to try to build up the equity in real estate as efficiently as possible.

DEBT PLAN

Having a plan to pay down consumer debt and unsecured lines of credit is also very important. In Canada we have an obsession with debt which has been fueled by low interest rates for the last decade. Many peoples monthly credit card, car loans, and other installment loans and unsecured lines of credit payments are large portions of their monthly take home pay. Until these debts are under control and eventually paid down it is very difficult for many people to save at the levels, they need to in order to hit a meaningful financial independence number.
Various strategies and methods can be used to assist in paying down debt in a more efficient and methodical way. Of course, having a plan to stop building up debt is crucial and having a plan to eventually be out of consumer debt is the goal.

BUDGETING / CASHFLOW PLAN

Having a budgeting and cashflow plan is important for those that would like to maximize their savings and the accumulation and maximization of their wealth.
For most people it does take discipline to save and build wealth and starting with a budget and then monitoring the income and expenses against the budget brings clarity to the monthly actual financial situation. This then allows for spending adjustments to be made to allow the savings to occur at the necessary level to reach the financial independence goal.
As David Chilton described in the Wealth Barber it may be simpler and more advantageous for many people to turn the budgeting process upside down and start the budget with allocating between 10% to 20% of the gross income for savings (RRSP, TFSA and open accounts) and then live on the balance. In this way the saving component is prioritized similar to how a mortgage payment is usually prioritized. Unfortunately, most people budget the other way which is to deduct the various expenses from the income and then see if there is anything left over to save which many times is very little to nothing. Saving off the top and living on the balance is a great way to approach budgeting.

FINANCIAL INDEPENDENCE PLAN

Fundamental to a comprehensive financial plan is knowing what the target is or what is the amount of money needed for a person or couple to be financially independent. Sometimes we can equate retirement with financial independence, but it does not need to be the same thing. Some people do not plan to retire ever or until a much later age. Financial independence is a point where there is sufficient wealth accumulated to last for the projected life and also satisfy any transfers to heirs or philanthropic desires.
It is better to plan for a financial independence date rather than planning to never retire or to retire at a much later age. Life is unpredictable and even though the plan may be never to retire health and other issues can disrupt these plans and so it is better to have enough wealth accumulated at a reasonable age to then allow more flexibility around when retirement may occur.
Establishing an amount that is needed to be financially independent then allows us to determine how much needs to be saved on a regular basis to reach the financial independence goal.
Most important is to revisit this part of the plan every 6 months to a year to assess the progress towards the financial independence goal and make revisions if necessary.

FAQ