Sarah Twomey | Desjardins Group
At key points in your life -- like buying a home, getting married, expecting a baby, or recovering from an illness or accident -- protecting your assets will be your top priority. The financial planning experts from Desjardins Insurance have some suggestions to help you get organized.
Starting a life together
Making sure the two of you are on the same financial page is essential to ensuring your marriage begins with a strong financial foundation. Here's a short check list:
- A personal finance review: Each partner should share their personal balance sheet to determine total assets and debts. Take this opportunity to plan how debts and income will be split or shared.
- Seek legal advice: Do you have a will and a power of attorney? Clearly defining your final wishes is a vital part of your financial plan.
- Consult a financial advisor or accountant: Since a marriage will change your tax situation, a financial advisor or accountant can show you how to minimize the impact.
Having or adopting a child
The arrival of a new baby is a joyful time but it's also the start of major lifestyle changes. To make sure your family stays in good financial shape:
- Create a budget to ensure your income from your savings, employer benefits and government benefits can cover all your family's expenses.
- Speak with a financial advisor to update the beneficiaries of your life insurance policies and to protect your assets. Also consider opening an RESP for his/her future education.
Accident or illness
Accidents or illnesses can happen to anyone at any time. If it happened to you, would you be financially prepared to be off work for a long period of time? According to Statistics Canada, more than 1 in 3 Canadians will suffer a disability during their lifetime with an average length of 2.6 years. To become better prepared:
- Set up an emergency fund so you'll have enough money to get through the waiting period until your disability benefits kick in and be able to pay for any extra expenses related to your disability (treatments, drugs, etc.).
- If you are covered by employee benefits, make sure you understand the details of your long-term disability coverage that your employer provides.
- Protecting your assets also means estate planning. Update your personal records with all your information and documents to make things easier for your loved ones and your executor. You should also meet with a financial planner to adjust your disability insurance or buy other coverage (long-term care, critical illness, etc.)