The road to financial freedom, wealth, and prosperity require an accurate map that will let you plot a journey, monitor progress, and change direction if you venture off course. To help you get there, here are ten ideas for developing a sound financial plan with your financial professional.

1. Know where you stand—complete a net worth statement listing assets and liabilities.
2. Define your financial goals based on personal needs and wants.
3. Know how much money you need now, five and ten years from now, and in retirement—including inflation and taxes. Consider increasing your net income by reducing or deferring taxes.
4. Increase discretionary savings by decreasing your expenses.
5. Know your monthly cash flow needs and separate that from major annual expenses such as trips, cars, home renovations, etc.
6. Expand your knowledge of financial issues and economics—check out the library.
7. Reduce or defer income taxes whenever possible. Review your tax plans and make sure your financial advisor has a copy of your tax return.
8. Develop a sound plan for your estate, including wills, powers of attorney, and life insurance—lower monthly life insurance costs can save you money.
9. Adjust plans and goals as your circumstances change, and review your written plans at least once a year to track your progress.
10. Use the services of professionals (accountant, financial advisor, lawyer). These professionals usually keep their clients up to date when taxes, investments, and laws change.

How much do you need to retire if you are not retired now? Of course, we all want to retire someday. However, some may be wishing it was sooner than later. Here are some ideas to help you.

First, retire to an income, not an age. How much income do you need to live on? Think in terms of the monthly payment. Once you know how much you need to live on per month, think of a significant emergency or slush fund to spend in early retirement. For example, this money can be spent on large items outside your monthly budget, such as extended vacations, home renovations, or vehicles.

Second, plan for where the money will come from. It would be best to calculate when pension will kick in (for example, company pension(s), Canada Pension Plan and Old Age Security). You can request that the government mail you a copy of your Canada Pension Plan estimate, or you can access this information if you have a CRA My Account and then link to the Service Canada website from there.

Then add up all your investments such as stocks, bonds, GICs, mutual funds, and RRSPs. Next, take the total amount of your expected income that you will generate from here annually. However, this depends on your risk tolerance, time horizon and how long you want the money to last. Take an average of 5%, for example, of $200,000, which will generate additional income of $10,000 per year or $833 per month. Finally, look at real estate and businesses. Do you plan to sell off real estate and downsize or generate income from rental real estate? Do you plan to sell any businesses or generate revenue from them? Now that you have all the sources of capital ask yourself what percentage of capital you would like to have at the age of 85. Do you want 100% of your money, 50% of your money, or do you want it all spent by then? This will help determine your time horizon as well as your estate wishes. Remember to retire to an income and lifestyle, not an age.