Personal Finance By Newscanada 221 Views

Are you financially prepared for an emergency?

(NC) The pandemic has made many of us realize that we may not be sufficiently prepared to deal with unexpected life events like a health scare or job loss.

Key to being able to effectively navigate whatever comes your way in the future is having a sense of your overall financial well-being. However, the report indicated that just 22 per cent of Canadians currently know this.

Further, only a quarter feel they manage debt effectively, create and stick to a budget, have the right insurance in place and feel optimistic about their ability to save for future expenditures.

“COVID-19 has revealed that we all need to work on determining and, in some cases, building up our financial well-being,” says Damon Murchison, president and CEO of IG Wealth Management. “Our lives and finances are more intertwined than ever, so it’s important to think holistically.”

Dimensions of financial well-being

When it comes to planning, six dimensions of financial well-being need to be taken into consideration:

  • Optimizing your retirement
  • Managing cashflow
  • Sharing your wealth
  • Preparing for the unexpected
  • Planning for major expenditures
  • Maximizing business success (for entrepreneurs)

Aim to improve your standing in each area. Managing cashflow is important, but you won’t achieve true financial well-being if you are neglecting to plan for retirement, for example.

There are tools that can help you get a better sense of your overall financial picture. Partnering with a financial advisor who understands these dimensions can also be beneficial.