IPS: A roadmap to financial success

Suppose you were about to embark on a trip. Let’s imagine that you know where you want to go, but you are not really sure how to get there. What are your options?

Suppose you were about to embark on a trip. Let’s imagine that you know where you want to go, but you are not really sure how to get there. What are your options?

One is to hop in the car and go … wing it. Sooner or later you might arrive at your destination. It might take longer. And it would most likely cost more. But it would be an adventure. It might even be fun … at least for awhile.

Another option is to study maps and determine in advance the most efficient route, then formulate a detailed travel plan. This approach may not sound as exciting. But of the two options, it is the more likely to succeed. And in the end, chances are it would be a lot less stressful.

Unfortunately many of us go through life winging it with our finances.

What does money mean to you? And what do you expect money to do for you? Or, what do you expect it to do for your children, or your grandchildren?

Ideally you should know the answers to these questions.

Perhaps more importantly, your financial advisor should know the answers to these questions.

A popular tool for identifying and documenting these and other important considerations is the Investment Policy Statement.

As the cornerstone of your wealth plan, the Investment Policy Statement (IPS) documents the following:

• Your liquidity requirements: short-term needs for cash

• Your income requirements

• Taxation considerations

• Time horizon: when will you need your money

• Your risk tolerance

• Your attitudes towards investing

• Your values

Based on these considerations, your IPS then provides detailed guidelines that will serve to govern the management of your investment accounts.

An asset mix is determined, and protocols are established that will mandate the manner in which your accounts will be monitored and adjusted going forward. The IPS should also clearly identify the fees you will pay, as well as how you will pay them.

In addition to promoting communication and understanding, the IPS details the responsibilities of all parties involved in the management of your money, and holds all parties accountable.


Jim Grant, CFP (Certified Financial Planner) is a Financial Advisor with Raymond James Ltd (RJL). The views of the author do not necessarily reflect those of RJL. This article is for information only. For more information feel free to call Jim at 594-1100.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

New BC Cannabis store opens up shop in Parksville

Outlet at Wembley Mall open seven days per week

‘We could see fire all over the landscape’: Parksville man recounts helping crews in Australia

Kevin Cochrane of the Coastal Fire Centre spent 38 days Down Under

Remote surveillance helps RCMP nab suspect following Parksville break-in

Stolen items returned after business owner takes quick action

PQB News editor battles cancer through pioneering treatment

Vancouver Island rallies around JR Rardon and family during stay in Seattle

Port Alberni man arrested after police seize suspected illicit drugs in Nanoose Bay

Car stopped, impounded after driver clocked travelling at more than twice the posted speed limit

VIDEO: Rare ‘ice circle’ spotted on Kamloops river

An ice circle or ice pan, has formed in the chilly waters just east of the Yellowhead Bridge

Uber, Lyft approved for ride-hailing in Lower Mainland

Kater Technologies Inc.’s application was rejected

B.C. man rescued after getting trapped headfirst in well as water level rose

The rescue involved crews from Oak Bay and Saanich

Investigators in wildfire-torn Australia head to site of B.C. airtanker crash

The B.C. government sends condolences to Port Alberni-owned Coulson Aviation

RCMP investigating sexual allegation against Lower Mainland police officer

Delta officer suspended while the alleged off-duty incident involving a co-worker is investigated

Former Mountie, sports coach convicted of sex abuse in B.C. granted day parole

Alan Davidson was sentenced to almost six years for abusing seven boys in the late 1970s and early 1990s

VIDEO: Person in wheelchair narrowly avoids collision with car in Kelowna

There were no injuries in the scary looking near-accident last week in Rutland

Here’s what Canada is doing to stop the coronavirus from getting in

Health officials are monitoring multiple possible cases in Canada

B.C. still struggling to control non-resident medical care fraud

Unpaid bills, out-of-province claimants a costly legacy of MSP

Most Read