New year a good time to revisit finances
By AdvocateDaily.com Staff
The new year offers many new opportunities for lawyers, including the chance to develop a clear picture of personal finances with an eye to planning for the future, says Dawn Marchand, vice-president of marketing, product and direct distribution for Lawyers Financial.
That process involves "taking the time to pull together a comprehensive look at your current financial situation, and perhaps making some decisions," she tells AdvocateDaily.com.
“You won’t get to where you’re going if you don’t know where you are financially,” Marchand says.
Lawyers Financial was originally set up through the Canadian Bar Association and designed to address lawyers’ personal financial issues, she explains. It now runs independently as a non-profit organization with 30 advisors available to lawyers across the country.
Marchand says lawyers generally live longer, allowing them lower rates on products such as insurance. She says the organization’s services also recognize that lawyers work longer and face certain types of stress in their profession.
There has been a tendency for lawyers to focus more on their professional lives than their own personal finances, Marchand says. So even a basic analysis of their financial situation and creating a plan can make a difference.
“The most important thing is to revisit your debt,” she says. “If you compare your debt from a year ago to now, have you made any headway on reducing it? If not, perhaps increase the amount of your monthly payments, even by $20 or $50.”
That alone, Marchand says, could alter the individual’s bottom line by the end of the year by speeding up the repayment.
“Also, review your financial plan — or get one,” she says.
Changes in one’s job, salary, and family circumstances all warrant a re-examination of long-term financial goals and objectives as well as insurance coverage, says Marchand.
Life insurance should be reviewed with any change of status to ensure it continues to be adequate to cover future needs, she says. Similarly, disability insurance should be revisited in order to protect existing income levels and ensure the entire family remains financially stable.
Marchand says insurance is available to individuals and law firms. The different products for individuals include coverage for life, disability, critical illness, home, travel and auto, while law firms can access employee benefit plans for as few as three employees.
“If you don’t have a financial plan, why not make this the year to create one?” she suggests. “Lawyers have access through Lawyers Financial to a network of advisors who really know lawyers. They are the only advisors who can offer our products to lawyers, and they understand the unique financial needs of the profession — like working longer, living longer, and the stresses that come with the job.”
Marchand says lawyers should also strive for maximum tax savings and try to save by looking at tax-free savings accounts and RRSPs.
“It’s not just about what you earn, it’s about what you keep. You have to be smart about how you manage your investments,” she says.
“We’re not an insurance company or an investment company. We’re an organization that is really here to serve the financial needs of lawyers, their employees and their families.
“We do the research and find the very best products. We manage the development of those products with the different providers, and we make sure they meet the needs of lawyers,” says Marchand.