Despite the Benefits of Financial Planning, Myths Persist

  • Only a third of Canadians fully understand what a financial plan is
  • Over 80% (wrongly) think it’s just about investment management
  • Canadians who have a plan are three times more confident they will achieve their financial goals

TORONTO, November 12, 2021 /CNW/ – To mark Financial Literacy Month, IG Wealth Management (“IG”) today released a study on Canadians and financial planning. Findings reveal that despite the value a financial plan can bring to help achieve goals, myths continue to exist around what a plan really is and the role one can play in building trust. and achieve financial well-being.

The study, conducted by Pollara Strategic Insights for IG, noted that Canadians who have a holistic financial plan (meaning a plan that brings together multiple dimensions of their financial world, including budgeting, debt , insurance, estate and retirement planning, and investing and a comprehensive tax strategy) are three times more likely to be very confident in achieving their financial goals than Canadians who are not.

Additionally, the study revealed the following:

  • Only one-third of Canadians feel they know “a lot” about what a financial plan is and how it can help them.
  • More than 80% said a financial plan was just about their investments, and very few thought a truly effective financial plan covers more than just portfolio management.
  • And, while 61% of Canadians said they have a financial plan, the majority said their plan was mostly “one-dimensional” and focused almost exclusively on their investments.

“We know that a truly personalized holistic plan can play a huge role in achieving your financial goals – we see this every day in the work we do with our clients,” said Damon Murchison, President and CEO, IG Wealth Management. “Despite this, there remain many misconceptions about not only the value a plan can provide, but also its components.”

Worryingly, the study found that nearly three-quarters of Canadians who both use a financial advisor and have a financial plan said their plan focuses exclusively on investments.

Mr. Murchison noted that while investment management is important, to be truly effective a financial plan must bring together all dimensions of a person’s situation, “The era of the ‘stock picker’ is over. Everything A financial advisor who wants to maximize the value they provide to their clients must work with them on all dimensions of their financial world and understand how everything is connected.”

“As an industry, we need to redouble our efforts to not only educate Canadians on the value of financial planning, but also to up our game in designing and executing financial plans,” concluded Murchison. .

About IG Wealth Management
Founded in 1926, IG Wealth Management is a national leader in providing personalized financial solutions to Canadians through a network of advisors located across Canada. In addition to an exclusive family of mutual funds and other investment vehicles, IG offers a wide range of other financial services. IG Wealth Management has $116.5 billion in assets under advisement at October 31, 2021 and is a member of the IGM Financial Inc. (TSX:IGM) group of companies. IGM Financial is one of from Canada leading diversified wealth and asset management companies with approximately $271 billion of total assets under management and advice as of October 31, 2021.

About the Pollara study
This study was conducted with an online sample of n=1,503 and was conducted between September 16and and September 20and2021. Results from a random sample of this size could be considered accurate to within ±2.5% X percentage points, 19 times out of 20. Results were weighted by age, gender, and region, using the latest Statistics Canada data, be representative of the entire Canadian population.

SOURCE IG Wealth Management

For further information: Hilary Bassett, IGM Financial, 416-951-7558, [email protected]