PATRICK AND TINA

Proper Preparation Prevents Poor Performance.   This sentence is the absolute best way to describe how Patrick and Tina were able to achieve their dream of buying their first home.

Someone made a comment that Patrick and Tina seemed so calm during their home purchase.  Patrick and Tina’s purchase was effortless because they worked with a Financial Planner and they followed their plan and stayed on course.  Purchasing a home is the single biggest investment you will make in your life therefore it should not cause any stress, confusion or doubts.  Work with a Planner you trust who will listen and have your best interest.

Patrick and Tina’s journey started four years ago.   Patrick’s mother Corinne called and asked if I could work with Patrick to help him meet his financial goals and manage his money more effectively. Patrick called me a few days later and asked to meet with me.   He came to see me; we talked about his goals, and discussed his income and expenses.  During the discussion about his expenses Patrick discovered that he didn’t know exactly where his money went.  Most people do not know how and on what they spend their money from pay day to pay day. 

Patrick had to go over his list and return with a plan of what he wanted to accomplish.  I was introduced to Tina a few weeks later and was told that she was also part of the plan.  Together, we worked out a course of action that included Tina’s and Patrick’s goals for their future.

When the plan was in place they had to make some changes in the way they managed their finances.

Here are list of the savings accounts they put in place to enable them to manage their money more efficiently:

1. Registered Retirement Savings account
2. Vacation savings
3. Emergency savings
4. House account
5. Christmas and Birthday account

This may seem like many accounts but when you are planning for a secured financial future everything needs its own place. With the various accounts in order you are able to manage and keep track of how much money you have at any time for the various goals you have set.

Financial Planning is not a one size fits all, each individual or couple’s Financial Plan is different.  This is where the Financial Planner is able to take a look at what the goals and plans of each individual are and then put a plan in place to meet their financial goals.

Patrick and Tina stayed on course.  Some modifications had to be made, for example when the amount in their Registered Retirement Savings account reached $25,000 their bi-weekly automatic deposit was then redirected to their House Account.  The funds in their RRSP enabled them to take advantage of the First Time Home Buyers RRSP withdrawal of $ 25,000 without incurring a tax liability.

They had visited their bank a few months prior to buying their home and got their pre-approval in writing which they gave to the Real Estate Agent who then knew exactly what price they could afford.   Once they chose the mortgage they wanted they found themselves a lawyer.  When the right house in the right price range and the perfect neighbourhood came on the market they were ready to clinch the deal, which they did. The vendor wanted a short closing and since all their ducks were in a row they were able to do the short closing and move into their home sooner than they expected.  

Patrick and Tina worked as a team during the years of planning and made some difficult choices which gave them the opportunity to take advantage of a great deal when it came along.  A friend told me that Patrick and Tina were very LUCKY but their success had nothing to do with luck. I believe the definition of LUCK IS = PROPER PREPARATION MEETING OPPORTUNITY.  They were on a journey, stayed on plan, handled the detours with some advice and got to the finish line.

The planning stage is not complete for Patrick and Tina. We will be meeting in a couple of months to change and set some new goals for their future.

Everyone should meet with their Financial Planner annually to review and re-evaluate.

Tessa- Marie Shillingford is the author of Controlling the Debt Monster. She is Personal Financial Planner, with a designation from the Institute of Canadian Bankers, and a Financial Counselor certified by the institute of Canadian Banker. She is presently a Program Facilitator of Financial Literacy at JVS Toronto. Tessa- Marie was employed by TD Canada Trust for twenty years in the retail section of the bank. During her tenure at TD Canada Trust she held various positions interacting with customers of the bank. As a Financial Advisor and Manager of Financial Services she led a group of Financial Advisors in helping customers of TD Canada Trust successfully manage their finances. Details of her book… Controlling the Debt Monster, can be found at http://www.controldebtmonster.com