How financially fit are you?

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The New Year has arrived and while health and fitness resolutions easily come to mind, have you considered how financially fit you are? Undue stress from your finances can have a negative impact on your health and wellbeing, but there are several actions you can take right now. Check out our tips to help set out your 2021 financial goals on the right foot!

1. Review and refresh.

Blue Monday gets its name for a reason. The holiday cheer has worn off and your first post-holiday credit card statements have arrived. Check what you spent against your budget and make a plan. The New Year is a fresh start and you can take this opportunity to assess your budget, revise your financial goals and create a plan to repay any debt. CheckFirst offers a wide variety of calculators, quizzes and worksheets that can help you evaluate and set your 2021 budget no matter where you’re starting.

2. Don’t let new goals overwhelm you.

If you’re setting out with new investment goals in 2021, don’t let them consume you. It can be easy to get lost in the sea of investment options, unfamiliar language and complex mathematical equations by yourself. If you’re looking for a crash course in investing that’s taught in plain language and easy to digest, consider the wealth of resources, quizzes and videos at CheckFirst.ca so you pick the right investments for you and your financial goals.

3. Find the right fit. 

The root cause of financial stress can often be linked to a lack of information. If you aren’t working with a financial adviser, take some time to consider it. A relationship with the right financial adviser can help make you a more informed investor who is comfortable with their investment decisions. Before you work with anyone new, always be sure to check their registration and ask key questions to make sure they are right for you. With few exceptions, securities industry professionals are required to be registered with the securities regulator in the jurisdiction where they conduct business. Registration helps protect investors because securities regulators will only register firms and individuals if they are properly qualified, helping you to rest easy.

4. Break up with bad relationships.

Another big source of stress can stem from distrust in your investments or financial advisers. This year, once you’ve evaluated your finances and goals, don’t be afraid to end relationships that aren’t working for you. If an investment, financial partner or financial adviser isn’t providing what you need to feel comfortable and successful, don’t be afraid to speak up. Remember, they’re supposed to work for you.

5. Nothing is set in stone.

While goals can help you clearly define where you want to be, the path to get there isn’t cut and dried. Don’t be afraid to pivot on your financial plan, or change direction throughout the course of 2021 as needed. Your finances should be arranged so as to help you achieve your goals. If something is bringing you undue stress, now is the time to change it!

As you embark on your financial journey in 20121 don’t forget to visit CheckFirst.ca for free, unbiased resources. Wherever you are in your investment journey, CheckFirst is your go-to website for financial knowledge and investing wisely.

 

5 Steps to Manage Financial Stress

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We are living in challenging times and every day Albertans face the unprecedented combination of economic uncertainty, ongoing COVID-19 dangers, volatile stock markets, a shaky job market and rising costs of living expenses. In a recent national poll by FP Canada[1], more than forty percent of people in Alberta ranked money as their biggest cause of stress in life and more than half said the pandemic had impacted their finances.

Financial stress can impact your health and relationships, while negatively affecting how you approach money and planning for your future. The good news is that you can take control and do what’s right for you. By taking these five steps you can reduce your stress level, optimize your expenses to weather the storm and avoid unwise investments.

1. Start with your budget

When it comes to your finances, there is no better ally than your budget in order to understand where your money goes and give you a plan of action that can relieve stress. If you don’t have a current budget or know how to make one, visit CheckFirst.ca  to build your own. Compare the money you bring in to the house, and your expenses. Consider looking for areas where you can reduce unnecessary costs and make a few changes if you’re spending more than you make. For example, maybe you can take that step you always talked about and cut your cable or stop using food delivery services and cook at home instead. Once you have built your budget, make sure you review it at the end of each month to stay on track. Take note though, a budget isn’t a dream scenario – use real numbers and take action based on what you learn.

2. Establish or strengthen your emergency fund

Unforeseen events happen. Whether your hot water tank goes on the fritz or you unexpectedly lose your job, unwanted expenses can strike when you least expect them. Saving and protecting emergency funds are a great way to hedge your bets against these unforeseen circumstances and avoid the financial impact and stress that can occur. A solid budget includes dedicating some of your income to an emergency fund. Open a separate savings account, ideally one with a decent interest rate and low or no fees, and start automatically contributing what you can. Even $40 every two weeks can net you $1,000 in savings within a year – the key is to consistently save the amount you are comfortable saving, no matter how small.

3. Defer payments

You are not alone in feeling the financial stress of COVID-19. Many Albertans are facing unprecedented challenges, which has made meeting financial obligations like paying mortgages, utilities, and other monthly expenses more difficult. Fortunately, many businesses, banks, service providers and municipalities recognize this and are providing payment deferrals for up to six months to help ease your financial stress. If you’ve reviewed your budget and removed all unnecessary spending, your next step is to identify bills that may qualify for a deferral. Try and pinpoint the smallest bills you can defer that will help you balance your budget.  Just remember that deferred payments still have to be paid – they do not cancel or eliminate the amount owed, but instead put them on hold to give you time to either grow your income, or further reduce your expenses.

4. Consider using an investment adviser or planner

Sometimes calling in an expert is a necessary step to help reduce the stress you might be feeling about your financial future. If you have investments, you are not alone in worrying about the volatility of the stock markets and the rapid changes in your portfolio. Making an appointment with a registered financial adviser or planner and seeking their knowledge and guidance can be a great way to review your investment portfolio against your financial plan, ensure you’re staying on track with your goals, and make any adjustments as needed. Learn how to ask the right questions and check the registration of your investment adviser by searching “Choosing the right financial adviser” on CheckFirst.ca.

5. Beware of “get rich quick” opportunities

Current economic conditions create a breeding ground for fraudsters looking to capitalize on the fear and vulnerability of hard-working people trying to make ends meet. Fraudsters use economic uncertainties and current trends to sell COVID-related investments, forex trading work-from-home opportunities, and too-good-to-be-true offers with the sole purpose of stealing your money quickly and efficiently. If you’re approached with a red flag of fraud such as an investment opportunity with the promise of significant returns with little to no risk, you could be dealing with a potentially fraudulent investment that could make your financial situation worse. Don’t make rash decisions with your money. Learn more about the red flags to be wary of, and always check the registration and disciplinary history of the individual or firm offering you any investment at CheckFirst.ca

Financial stress is an overwhelming reality for many households across Alberta. Take control of your financial security and relieve stress by taking action through these five steps. Visit CheckFirst.ca for free, unbiased resources to empower you through every step of your investment journey, detours and all.

[1] Seto, Steve, Financial stress biggest concern for Albertans during pandemic: survey, 660 News, Jul. 13 2020.

Choosing the right financial adviser

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Just as picking the right opportunity for your money is important, choosing a financial adviser that’s registered and matches your needs is critical when it comes to wise investing. A good financial adviser may help you manage your wealth and build a sustainable future based on YOUR risk tolerance, goals, experience and stage in life. As a key member in your investment journey, here are four questions to ask when looking for the right financial adviser that matches your needs.

1) Are you registered?

The first step any investor should take when looking for a financial adviser is to ensure they are legally allowed to be trading or advising in securities or managing investment funds. By law, individuals who are trading and advising in securities, including stocks, bonds, mutual funds, and ETFs, must be registered with the provincial or territorial securities regulator of the province in which they are doing business. Registration may help protect investors from investment fraud because securities regulators will only register firms and individuals that are properly qualified. Albertans can easily determine whether their financial adviser is registered by visiting checkfirst.ca and checking the registration of any individual or firm that is in the business of trading or advising in securities or managing investment funds, as well as if they have a record of any disciplinary actions.

2) How are you paid?

There are a variety of ways financial advisers are compensated, including salary, commission, flat fees, or a combination of these methods. When a financial adviser is paid by salary, the cost of their advice is included in the prices of the products you buy, whereas others may charge an hourly rate or a percentage of the assets in your account. As an investor, you have the right to obtain disclosure on how your financial adviser is compensated, as well as any costs paid to the registered firm associated with your account. This information may allow you to properly assess if a financial adviser meets your investing budget and help you avoid unwanted fees or charges.

3) What kinds of products and services do you offer?

Not all financial advisers offer the same products and services or have the same levels of expertise. While some can offer a wide range of options, others may specialize in only certain kinds of investments and only deal with clients who have certain levels of risk tolerance. If you are new to investing, working with a financial adviser that offers fewer products and provides more guidance may be more helpful. If you are a more experienced investor, you might want an adviser that offers more products and allows you to customize your portfolio.

4) How will you help me reach my goals?

Your goals from investing are unique to you alone, and no one investment portfolio will work for everyone. Before working with you, financial advisers should understand whether your investments are for financial security, income, long-term growth or something specific, such as retirement. Additionally, financial advisers will ask you about your financial situation (including your stage of life and any big expenses you might have coming up, such as a house purchase or paying for a child’s university tuition), investment knowledge, and risk tolerance. It’s important to be honest with your financial adviser so they can make recommendations that are appropriate for your needs. And remember to ask questions about anything you are not comfortable with or are unsure about.

Overall, take your time when choosing your financial adviser because this decision may be just as important as the investments themselves. Remember: financial advisers are working for YOU. By conducting the proper research and asking the right questions, you can ensure that you are working with a financial adviser with the expertise, products, services and fees that best align to your needs in order to meet your financial goals.