The winning financial plan in this year's National Financial Planning Awards involved a professional corporation, a permanent life insurance policy and a child with a disability.ThongSam/iStockPhoto / Getty Images
A married couple in their 40s with two school-aged kids craves financial independence. As do-it-yourself investors, they followed a FIRE (financial independence, retire early) approach by aggressively saving half their household income.
Throw in a professional corporation, a permanent life insurance policy and a child with a disability, and the financial planning considerations become very complex.
That’s the client case study Louai Bibi, wealth advisor and associate portfolio manager at PWL Capital Inc. in Ottawa, submitted for the National Financial Planning Awards (NFPA). Presented by the Financial Planning Association of Canada in partnership with the Institute of Advanced Financial Planners, the award recognizes dedication to helping clients achieve their desired financial outcomes.
Louai Bibi, wealth advisor and associate portfolio manager at PWL Capital Inc. in Ottawa.Supplied
In the case, the father, a physician, draws his income from his professional corporation. He recently purchased a permanent life insurance policy through the corporation and wasn’t sure if it was an optimal decision. He also wants to work less and spend more time with his children, but wonders what that means for their goal of retiring at 55.
The goal of “buying back time” meant a shift in the couple’s household income, with less to save for retirement, Mr. Bibi says.
He mapped out three scenarios: the couple working longer, spending less in retirement or selling one of their two homes. They own a cottage outright as well as a house with a small mortgage.
Mr. Bibi stress-tested the plan for things such as market volatility and premature death of one or both spouses.
Ultimately, the best plan involved selling real estate, but the couple preferred to hold onto both properties for legacy reasons. And the other two levers, working longer or spending less in retirement, didn’t align well with buying back time or creating experiences with their family.
“What resonated was that the couple didn’t need to pull a lever urgently,” Mr. Bibi says. “None of those decisions have to be made today. But we mapped out the tradeoffs and started the conversation.”
Mr. Bibi looked at the corporation’s permanent insurance policy with a bit of trepidation, since he says some advisors encourage clients to buy more insurance than required. He was relieved to see that wasn’t the situation with this policy. The premiums were reasonable based on the couple’s household income and the policy fit nicely with ensuring a financial cushion upon their death.
Mr. Bibi calculated the permanent policy would provide coverage after the parents died to support their disabled child, with an added bonus of offsetting capital gains tax on the cottage.
While the parents already set up a registered disability savings plan for their child, Mr. Bibi helped them map out further contributions to maximize government grants.
NFPA judges who reviewed the case liked that Mr. Bibi demonstrated his value with multi-issue modelling and scenario planning.
Judge Jason Watt, an Edmonton-based financial educator, says Mr. Bibi’s careful delivery of the plan displayed empathy with the client’s situation. “There was lot of effort to get the client’s feedback,” Mr. Watt says.
“[He displayed] very thorough investment planning, including a well-explained recommendation to move to a reduced-risk portfolio and still meet goals.”
Entries for the award were open to financial planners who hold the certified financial planner, registered financial planner or qualified associate financial planner designations.
Financial planners submitted a client case they felt best represented the role of financial planning. The cases and identifying details about the financial planner and clients were redacted to protect privacy and prevent judging bias.
Mr. Bibi didn’t always want to be a financial planner. As an economics student, he was on track to be a stock broker or portfolio manager. But he became more interested in clients’ goals and how to achieve them.
He got his start working at a bank before moving to a small financial planning firm and then to PWL. He earned his CFP in 2023, followed by his chartered investment manager and registered financial planner designations. He’s currently working on his trust and estate practitioner designation.
Mr. Bibi works as part of a six-person team with 300 client families and $650-million in assets. He’s one of two planners.
He’ll receive his award in September during the IAFP Symposium in Winnipeg. The prize includes registration for the annual conference, as well as airfare and accommodation.