News Article

Evelyn Jacks: Your money is your business

Posted: June 06, 2012

What are you taking in summer school this year? Whether you are a financial professional or a consumer of financial services, investing in your financial education is a good idea. After all, you should be prepared to deal with important life events such as financing an education, purchasing and/or selling a residence and selecting financial assets that will produce adequate retirement income.

In the four years since the outbreak of the global financial crisis, it has become increasingly clear that the responsibility for financial well-being and decision-making resides with individual households. Crushing debt has tied governments' hands, requiring a postponement to universal pension benefits and an increase in user fees. At the same time, uncertain economic conditions have forced both public and private sector employers to trim costs ó including employee benefits. More than ever, it is up to you to take care of yourself and your family's future: is your current level of financial ability ready for that challenge?

If you feel incapable or unsure of grasping new concepts and turning them into meaningful strategies, actions and investment results for your family, you are not alone. We are all in uncharted waters. Global risks are greater; the financial recovery is fragile and market behaviour is unpredictable.

But there is good news. There are tremendous opportunities to increase your understanding of the decisions you have to make through a variety of educational opportunities. This year's Distinguished Advisor Conference (DAC), entitled "Navigation: Charting a New Course,î to be held in Naples, Florida, Nov. 11-14, is one example.

In its ninth year, this conference was born out of the need to take Canadian advisors to the places where their clients will retire. That way the advisors can understand the economic environments in which clients will spend their life savings and together they can plan their savings to accommodate future health vulnerabilities.

The DAC program focuses on cutting-edge issues ó from taxes to retirement to global investment strategies ó and gives delegates access to the most experienced and knowledgeable people in their respective areas of specialization. For example, on Nov. 12, Scott Mackenzie, president of Morningstar Canada, will explain how to improve portfolio construction in today's self-reliant, highly technical world, while celebrated economist Patricia Croft will analyze equity markets and Terry Jenkins, executive vice president and head of U.S. Private Banking for BMO Harris Bank, will discuss the behaviour of high-net worth families in a fragile economy.

"In the last half-dozen decades, research and technology have continued to evolve and improve,î says Mackenzie. "The result: better portfolio construction designed not only to perform in good times and bad, but with a firm reins on the attendant risks. What's more, each financial crisis has provided insights into which techniques work well, as well as those that could use improvement.î

Make no mistake, managing your accumulated wealth ó particularly if you have accumulated sizable net worth over the course of your lifetime ó is akin to managing a business. You need a strategic framework in which to set goals and budgets; you need financial knowledge and skills with which to make sound decisions. Abdicating your financial responsibilities ó having no strategic framework around which to make consistent and informed decisions ó is no longer an option for families of wealth, no matter how large or small the pot.

That's because, to a large degree, you are on your own. The right financial education can help you make those important decisions.

It's Your Money. Your Life. This summer, challenge yourself ó consider adding knowledge and skills to your "intellectual capitalî by taking a course, workshop or conference in a new financial discipline, be it tax, retirement, investment, estate planning, bookkeeping, wealth management. You will gain by making better financial decisions for your family and, if you are an advisor, those insights will spill over helping you improve results for your clients.

Next week: What are the best ways to put your money to work?

Evelyn Jacks is president of Knowledge Bureau and founder of the Distinguished Advisor Conference (DAC), now in its ninth year. This annual event attracts hundreds of top advisors from across Canada to discuss recent trends in economics, tax, investment, retirement and estate planning.

Additional Educational Resources: Distinguished Advisor Conference and MFA Designation Program.