A recent survey by Financial Planners Standards Council reveals that Canadians are still confused about what financial planning is and how to go about it.
“The survey results are a clear indication that even Canadians who know enough to seek the advice of financial professionals need more information about the financial planning process and how it can help them attain their goals,” says FPSC president Don Johnston.
“Selecting the right financial planner can be as important as selecting the right doctor. Obviously, not all Canadians understand this yet,” he says. “
FPSC surveyed 685 CFP practitioners across the country about the most frequent financial planning mistakes made by their clients. The planners rated these on a scale of one to ten, with ten indicating a very high frequency and one very low.
The most common mistakes by consumers include:
- Neglecting to evaluate their financial plan periodically;
- Confusing financial planning with investing;
- Failing to set measurable financial goals;
- Thinking financial planning is the same as retirement planning;
- Expecting unrealistic returns on investments;
- Failing to understand how advisors are compensated; and
- Looking for quick fix instead of a long-term strategy.