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One size does not fit all in personal finance
In case you haven’t seen The Sisterhood of the Traveling Pants (shame on you by the way; I saw it in theatres three times as a budding teenager), the movie follows four girls with very different pant sizes, lives and experiences. Yet one miraculous pair of jeans, shared by all four, seems to fit them all.
I can assure you, this miraculous pair of pants does not exist. My three teenage amigas and I went on a purposeful hunt in 2005 and never found them.
When you’re looking for the perfect pair of jeans (you know, ones that don’t gape above your butt crack but which magically slim your thighs and remove any muffin top), would you be satisfied if the sales representative ushered you to the "one size fits all" table?
Of course not, because no two pair of hips are the same.
It’s the same for your finances. Why would you expect that what works for your girlfriend Lindsay would be right for you?
I know you trust Lindsay. She has never led you astray when it comes to BFF advice. However, unless you have identical financial situations, you can’t expect that what works for her will work for you.
Maybe she has more disposable income than you. Perhaps her parents help her out financially more than yours. Maybe she has student loans you don’t have. Maybe she doesn’t own a home like you. Maybe she rents with her boyfriend and you’re paying the bills solo. Maybe Lindsay wants to own a cottage and you want to travel the world in your retirement. Maybe you haven’t even thought about retirement.
Millennials love to think they are unique. So why not celebrate your individuality with an individual financial plan made just for you? One size does not fit all.
According to the 2013 report "Canadian investors’ perceptions of mutual funds and the mutual funds industry," prepared for The Investment Funds Institute of Canada, almost all investors agree they can trust their advisors to give them sound advice (94%), and a large proportion also agrees that they get a better return on their investments than they would without an advisor (90%).
That’s a 90% better chance to be successful working with a financial advisor than without one.
There are so many diverse strategies out there that you can easily overwhelm yourself by self-diagnosing on the internet. Sitting down with a professional to hash out your goals, talk about your concerns, and strategically make a plan of attack will likely be the best thing you ever did for your financial future.
But be warned: if you run into a financial advisor who has a "one size fits all" strategy, you should be concerned that this person may not have your best interests in mind and may limit your financial potential.
A professional financial advisor can be just like the sales girl at your favourite clothing store.
She’ll lead you to the section that will most flatter your figure, compliment your wallet and keep you coming back to shop.
Mine’s at Smart Set in Kildonan Place.
Vanessa Kunderman is a financial security advisor in Winnipeg. She writes every second week on money issues facing Millennials. Email her at: firstname.lastname@example.org
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(1 of 5 articles for this week)01/27/2015 11:12 AM 0
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