Blog - Fee-Only Financial Planning / Advising in Kitchener Waterloo Cambridge - WD Development


It might not seem like a large bank account balance would be a problem, but it often is.  Many clients hire me specifically to plan to deal with this issue.


Whether it's your job that gives regular bonuses, your spending is far below your income or you received a large one-time amount, cash in a bank account casuses pressue to make a decsision.  The right decision.


Some general considerations if you are in this situation:

  • do you have an emergency account?  If you lost your income for 6 weeks to 6-8 months, how would you pay your bills?  If you don't have any emergency account, consider moving the cash into a savings account (if it is currently in your main chequing account).  This money's job is to be available; it's not irresponsible to have the money 'sit there doing nothing'.  It's job is to protect your financial stability.


  • Are you saving for a specific purchase or a known expense?  If yes, leave that money in cash.  Sometimes, clients tell me that they feel like they could be gaining a higher return, or doing something else with the money.  If you are considering investing in either the stock or bond market, you are taking risk.  Risk that your investment might be worth less when you need to sell it than the day you bought it.  If your timeline is less than 3 years for a purchase/ expense, you don't have the time to invest without taking on large amounts of risk (aka- you would be gambling with money that you know you need in a certain amount in a certain time).  


  • Did this money come to you through a loss or a big life change?  Is this inheritance money?  Severance from a job loss?  A settlement after a separation/divorce?  Sale of a business?  I recommend taking time to review your priorities if your money came from any type of 'sudden wealth' event.  In my experience, clients take about 12-18 months to make any decisions on an inheritance.  You need time to review your new situation, set new priorities and test out what your life looks like now.  Using smaller amounts to pay off high-interest debt or purchase something that is meaningful to you is reasonable, but if you are feeling overwhelmed or a bit lost with the money goals, put it into a savings account, gather information and ideas and make decisions later.

If the bank or any other advisor is pressuring you to make a decision or purchase a product, I recommend getting another opinion.  There is rarely a situation that demands a decision on money like this before you are ready.  On the other hand, there are very real consequences to you to making a decision that doesn't align with your situation, goals or values.


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How Can a Certified Divorce Financial Analyst Help with Your Separation?

Separation and divorce are uncertain times.  Our routines and plans today and in the future need to be re-evaluated and re-planned.  Many of the questions that you have during these times are a combination of personal values and financial impacts.  You can answer these questions effectively by finding a Certified Divorce Financial Analyst (CDFA) to help you.

Below are 4 general areas that you will have questions and a CDFA can help.

Collecting Financial Information
  • What do you own?
  • What do you owe?
  • How much do you earn?
  • Is there any excluded property that won’t be divided?
Building a Spending Plan
  • We all spend money. Post-divorce, you may need to make different choices about where and how you are spending.  Discussing a plan during the division process gives you a clearer picture of what is necessary and what is possible.
  • When you have dependent children, it’s important to review and divide their expenses.  Both parties should understand the costs and who is responsible for what.
What Happens in the Future?

When you are making choices about how to divide assets and debts, it’s important to understand how your decisions today may affect your future.  Some common questions are:

  • Am I going to be okay if I keep the house?
  • My spouse has a pension; now that we’re separating, I don’t know what my retirement savings look like.
  • Paying for our children’s education is important to me; can that still happen?
Follow-Up Items (if needed)
  • Life insurance is often discussed during separation to secure spousal and child support obligations. I can follow up with you to ensure that the policies are in place with the correct beneficiaries.
  • Changes to wills and powers of attorney post-divorce- you need to re-plan for your assets to be given to your heirs.  I can follow up with you to update your plan to reflect your new situation.

If you have questions about your separation and the implications of the decisions that you are making, at whatever stage you’re at, please contact Sara at 519-569-7526 or [email protected]

More information about the Certified Divorce Financial Analyst designation here

Information about Collaborative Family Law here.  I’m excited to be working with this group of professionals who are committed to preserving the dignity, integrity and long-term best interests of your family.

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Sara McCullough
May 17, 2024
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Fraser Lang
May 10, 2017
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