Financial Planning Checklist - Boxes To Check Off For Success

October 30, 2021
Financial Planning Checklist - Boxes To Check Off For Success

Financial planning, as important as it is, must not be rushed into because of its sensitive nature. It is a way of protecting your future by structuring your finance. It is advisable not to rush into a financial plan because things could go south faster than you imagine and you might end up wasting your time and money. The importance of financial planning cannot be overstated. The major importance of financial planning is that it puts you in control of your income, expenses, savings, and investments. It is advisable to break everything about financial planning into stages in order to have a solid financial plan. This will enable you to track each step of your financial plan to ensure you dot every ‘i’ and cross every ‘t’. If you want to do your homework before involving a professional financial advisor, you can research the different steps (you can read our blog on the steps to take on financial planning) you can take and the things to include while preparing a financial plan. Once you are done, you can then give your financial advisor to review. From analyzing your current financial situation to developing an effective strategy to implement your financial plan, financial planning involves a systematic way of making provisions for your future.


The importance of a financial plan requires you to be thorough. Therefore, asides from outlining the steps you need to take to have a good financial plan, you can also go the route of outlining a checklist of things you want to take care of and included in your financial plan. Having a checklist is a more comprehensive way of ensuring you tick all the necessary boxes of having a workable financial plan. A good financial plan must include some important elements in order to make it work, these elements can be recreated as your checklist which will guide you when you finally start developing your financial plan. You may be wondering how you will determine what should be on the checklist and what you should leave out. This article will discuss some of the major elements that must be on your checklist so you won’t miss out on anything while preparing your financial plan. Some of what will be discussed include your assets and strategies. At the end of it all, it is important to run everything by your financial advisor for a professional view.



What Should Be Included In A Financial Plan?

A financial plan is composed of different components that work together to guarantee you a financially secured future. While some of these components are a must, you may do away with others. It all depends on your financial status, needs, and financial goals. Some of the things that must be included in your financial plan include.


Estate Plan

Estate planning is a way of taking care of your finances when you are no longer around. It is usually in form of a Will or Trust. It will state your wishes on how to handle your assets, dependents, and the administration of your estate. Your estate plan should also include a section that will appoint the person that will make medical and financial decisions when you are incapacitated. Your estate plan should also include an up-to-date list of beneficiaries of your insurance policies and registered accounts such as RRSP and TFSAs.


Financial Goals

Financial goals are an important aspect of a financial plan that you must include. These goals can be divided into short-term, mid-term, and long-term goals. This will be a road map to how you will spend, save and invest your income to meet your various financial goals. Short-term goals which could be in a time frame of 1 or 2 years include paying off high interests debts, tax preparations, and short-term investments. Mid-term goals take a few years and it includes life insurance policies, real estate purchases, and starting a family. Long term goals, like the name implies, is usually for a long period and it includes your estate planning and retirement planning. Financial goals should also include your family goals which will take care of them in your lifetime and when you are no longer around.


Emergency Funds

An emergency fund is a fund you set aside to use for any unforeseen circumstances. Things you don’t plan for may happen anytime and this is one of the major reasons for having a financial plan. Having an emergency fund in your financial plan ensures your savings and investments continue to increase in value without touching it, even in the event of emergencies. Unforeseen circumstances could be in the form of unexpected job loss or unexpected medical bills. Financial advisors recommend that you have at least 3 to 6 months of savings that can cover your living expenses for the same period as your emergency fund. It is also advisable to put your emergency fund into a liquid checking or savings account in order to be able to access the funds in a time of emergency.


Retirement Plan

The essence of a retirement plan is to make you financially independent post-retirement. It is never too late to include a retirement plan in your financial plan to give you a much-desired independence post-retirement. For a sufficient retirement plan, it is advisable to save between 20% to 30% of your pre-retirement income. You should also create financial goals and a budget for life after retirement. This will ensure you judiciously spend your retirement funds to achieve your set out financial goals.


Financial Checklist To Include In Your Financial Plan

For you to have a comprehensive financial plan, having the following checklist will go a long way in helping build a solid financial plan.

Current Financial Analyses

Number one on the checklist is the analysis of your current financial situation. You cannot possibly plan for your future if you do not understand your current situation. In analyzing your financial situation, you must consider the following.


Financial assets

Your assets will tell you where you stand financially. You need to make a comprehensive list of all your assets which may include your saving and checking accounts, retirement accounts, brokerage accounts, investment accounts, emergency funds, cars, real estate, jewelry, artworks, and artifacts. Your assets include all your valuables and they must all be assessed to determine your worth before you start your financial plan.

Financial liabilities

You will also need to analyze your liabilities which may include loans, mortgage, credit card debts, business debts, and other expenses.

Credit Utilization Ratio

To calculate your credit utilization ratio, you divide your total debt by your total credit limit. This is also something you should include when preparing your financial plan.

Financial Insurance Portfolio

It is important to assess all your insurance coverage as well. Life, auto, health, and other insurance policies should be considered.

Paying Your Debts

Debt is not a pleasant thing to have on your neck, especially with the interest rates. While it is advisable to avoid any form of debt, there are some debts that you may not be able to avoid at a particular stage of your life. Some of these debts include mortgage, student loans, and credit card debts. While preparing your final plan, you should come up with a strategy to pay of your debts. You can start with the ones with high interest rates. This is important for the health of your financial plan. It will ensure that you are not buried in debt while trying to build your financial plan.

Financial Goals

This is another element of a financial plan you should have on your checklist. Your financial goals are what will drive your savings and investments and they will also give you a sense of direction on your finances. You can divide your financial goals into the following:

•  Short term goals

•  Mid-term goals

•  Long term goals

•  Family goals

•  Retirement goals

•  Career goals


Tax Issues

There will always be questions of tax when it comes to your assets. Your short and long-term profits on your investments are subject to capital gains tax. You can engage a tax professional to help you maximize every tax benefit available to you. Have a tax strategy before making any financial move that concerns your financial plan. You need to optimize your approach for tax benefits when you want to sell your assets, set up a charitable trust or donation, or shift your investments. It goes a long way in your financial plan.



This is also another important element to include in your checklist. You can break down your budget into weekly and monthly budgets. This will enable track your expenses and ensure that you are within your expected spending limit. It also separates your needs from your wants. It will also help you reach your financial goals on time.


Emergency Funds

Having an emergency fund in your financial plan enables you to grow your savings and investments even in times of emergency. You can put your emergency fund in a liquid investment to also grow it for your time of need.


Another important component of financial planning that you must include in your checklist is insurance policies. It goes side by side with your emergency fund as it ensures that certain aspects of your life are covered without you needing to dip into your savings and investments. Health insurance will cover your health needs, auto insurance takes care of your automobiles, life insurance provides for your dependents for when you are gone. Others include umbrella insurance policies and disability insurance policies.



This is arguably the backbone of your financial plan. It is a must on your checklist because it is what will ensure the growth of your savings. It is advisable to diversify your investments so as to vary your income and ensure a healthy financial plan. You should also align your fund allocation on each investment to suit your risk tolerance.

Retirement Plan

This is an important aspect of your financial plan because of its importance when you are no longer active to work. You should decide on the percentage of your income you want to save for your retirement plan.


Estate Planning

Estate planning will allow you to include your loved ones in your financial plan. It will be your legacy when you are no longer around to take care of them. Some of your wishes that you can include in your Will are the beneficiaries of your retirement accounts and life insurance policies. You can also include a durable power of attorney on who will handle your finances when you are incapacitated. You can also take care of your post mortem financial goals in your estate plan.


Consulting A Professional

The role of a professional financial expert in reviewing and putting together your financial plan should not be overlooked. You may choose to prepare your financial plan using this checklist, but it is advisable to engage the services of a financial expert to put everything in order and ensure you do not miss any component. A professional will also help you consult other requisite professionals such as a tax lawyer and an insurance agent to help you review sections of your financial plan that requires their input. Engaging a professional to guide you when preparing your financial plan should therefore be on your checklist.


Financial Planning Checklist Conclusion

The above checklist is not all-inclusive. Different strokes for different folks. Depending on your financial situation and financial goals, you may need to include some other components to have a comprehensive financial plan. That is why it is advisable to engage the services of a professional.

More Money Tips?

Connect with an advisor today!
Talk To An Advisor