What makes a good financial plan? That's what Canadian financial planning software company PlanPlus set out to determine through their third annual global competition to identify the best plan in each of three regions: the Americas, Europe and Asia.
The results of the 2015 contest were announced in July after a multiround assessment process that evaluated submissions for technical competence, and for how well they helped clients achieve their goals. Contestants participated from around the world and were not required to use any specific financial planning software.
2015 winners are Canadian planners
This year, the first-place winner for the Americas region is Jason Pereira, a fee-based financial planner at Bennett March/IPC in Toronto, while the runner-up is Ngoc Day, a fee-only financial planner at Macdonald Shymko & Co. Ltd. in Vancouver. Both Mr. Pereira and Ms. Day have provided financial planning advice for Canadians through The Globe and Mail's weekly Financial Facelift.
The winning plans were assessed on their clarity, how well they "explain the numbers" for clients, and evidence of the planner's in-depth knowledge – as well as on the specifics of the plans, which ranged from risk and liability management, cash-flow analysis and management, to investment planning, retirement planning and more. Highest-scoring plans are those that are "overwhelmingly clear and concise" while demonstrating financial planning knowledge at a standard that is "head above the crowd." Plans can also score points for addressing global situations, such as owning property in two countries or planning to retire in a different country.
Different plans for different priorities
The first- and second-place plans this year were prepared for Canadians whose financial situations were quite unalike, reports John Page, a certified financial planner who served as head adjudicator of the global contest for all regions.
The winning plan was created for a senior executive who was initially looking for advice focused on retirement planning, but deepened the engagement when he was presented with a new job offer and wanted to evaluate how accepting it might change his overall financial situation and plans.
In contrast, the subject of the runner-up plan was an 89-year-old woman with limited financial and investing experience who needed to chart a new course for her financial future when her spouse entered long-term care.
Despite the differences in the client situations, the plans showed the advisers "deeply understand their clients' issues and concerns, and are skilled in developing plans that are consistent with the clients' values, and can be implemented to accomplish the clients' objectives," Mr. Page says.
"The winners are always thorough, making certain that they have addressed all current needs – but it doesn't stop there," adds Mr. Page.
"They also provide solutions for problems they can anticipate on the horizon. The work of the winning planners is carried out with an uncommon level of concern for the people they serve. To me it is a thing of beauty that is very hard to quantify."
From still to shot glass
"Here's how I think of my job as a planner," reports winning planner Mr. Pereira. "First I build a still to house all of the client's financial information and circumstances, and create a comprehensive financial plan that might reach 100 pages – then I distill everything down to a 20-page 'wine bottle' summary. Finally, I present a 10-minute 'shot glass' of actionable advice and recommendations."
When does a financial plan make sense for you?
"Advisers often think they need a very high-net-worth client to show all the tricks that they can do," says Mr. Page. "But our planning competition showcases the difference that financial planning can make for ordinary Canadians from a wide variety of situations – and to demonstrate, for advisers and clients alike, the professional standards that financial plans can be held to."
So when might it make sense for you to seek out a financial plan? Despite their differing circumstances, the two Canadians whose situations were featured in this year's winning plans faced a common issue: sorting out the best path forward when facing change. In this way, a financial plan can be understood as a kind of decision support from professionals, to help people make decisions about problems they haven't necessarily faced before, but which a planner may have seen many times over.
Retirement planning, including timing the retirement decision and creating a retirement income plan, is probably the most common set of financial decisions that individual Canadians typically only make once. Thus retirement planning remains one common circumstance for Canadians where professional financial planning advice can provide a winning edge in a game where the stakes are high.
READ THE COMPLETE WINNING FINANCIAL PLAN BY JASON PEREIRA HERE.
Alexandra Macqueen, CFP, teaches and writes about finance in Toronto. She is co-author, with Moshe Milevsky, of Pensionize Your Nest Egg: How to Use Product Allocation to Create a Guaranteed Income For Life. You can follow her on Twitter at @MoneyGal.