As we usher in the new year, it’s the perfect time to reflect on your past financial goals and set
new resolutions that will guide your journey toward financial security and success. Whether
you’re just starting your wealth-building journey or looking to optimize your existing strategies,
these financial resolutions can help you achieve a more prosperous 2025 and beyond.
The first mindset everyone should contemplate is having a well-thought-out financial plan that
serves as a roadmap to your goals. While your financial situation may change, a roadmap can
help you identify priorities, set realistic milestones (i.e. opening an FHSA now for additional
contribution room next year), and develop strategies to achieve them. Partnering with a Tradex
advisor ensures your plan is tailored to your unique needs and circumstances.
It is generally recommended to have an emergency fund which acts as a financial cushion during
unexpected events like medical emergencies, job loss, or major home repairs. We recommend
that you aim to save three to six months’ worth of living expenses in a liquid money market fund
or a high interest savings account or low interest credit that is readily accessible.
If you already reviewed your emergency savings, you should now consider your investment
portfolio. The saying “Don’t put all your eggs in one basket” rings true for investing. A
diversified portfolio reduces risk by spreading your investments across various asset classes,
sectors, and geographic regions. The best way to start off the new year would be to review and
rebalance your portfolio (if required) to maintain alignment with your goals and risk tolerance.
When rebalancing your investments, it’s essential to align your strategy with your specific goals.
While short-term gains may be tempting, wealth-building is a marathon, not a sprint. Stick to a
disciplined approach that prioritizes long-term growth over speculative ventures. Don’t be
tempted and fear missing out on the new shiny toy or hype in the market. Patience and
consistency yield the best results, coupled with an appropriate asset allocation and tax
minimization by appropriate asset location. For instance, an 8% compounded annual return from
equities can double your investment in approximately nine years, whereas bonds or GICs at a 4%
return would take nearly 18 years to achieve the same growth. This suggests holding your higher expected equity investments inside your tax-sheltered accounts first, while sharing lower expected returns with the tax department.
It’s never too early—or too late—to plan for retirement. Start the year off by determining how
much you’ll need to maintain your desired lifestyle and establish a strategy to reach that target.
Maximize contributions to your retirement accounts (e.g. TFSA, RRSP), take advantage of
employer matches or contributions and explore other savings vehicles. You never know if you’re going to achieve the retirement you want if you never account for things like this.
Life evolves every year, and so should your financial strategy. Regularly review your financial
plan and make adjustments as needed. Our Tradex Advisors and Tradex Team are here to help
you with any financial needs and here to inform you about market trends, economic changes, and
advise on personal life events that could impact your financial health. If you wish to contact us,
please call (613) 233-3394 or email us at info@tradex.ca. Tradex offers no-cost portfolio
reviews and retirement projections for our current and future members!