Getting into financial shape a lot like exercise

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No pain, no gain, expert advises

Getting into financial shape for the new year can be a lot like exercise, according to a wealth manager who knows more than a little about both.

Financial workout — Image by Thinkstock

Sam Sivarajan, the head of investments and sales at Manulife Private Wealth, says investing and exercise follow the same old adage: no pain, no gain.

“People often go in without a plan, without a goal and without a real thinking through of what is required,” said Sivarajan, who is also a personal trainer and spinning and kettlebell instructor.

Whether your goal is shedding those few last pounds or rebalancing your portfolio, the new year is a good time to reassess how things are working for you and what results you want to see in the next 365 days, he says.

The 43-year-old practices what he preaches. Sivarajan is up at 5 a.m. five or six times a week to lift weights, cycle or box. He’s also completed the Boston Marathon and reached the summit of Mount Kilimanjaro.

Sivarajan takes a similar regimented approach with his investment portfolio, knowing he will only get what he wants if he’s disciplined enough to work for it.

“People want to believe that they can get a free lunch — want to believe that there’s an investment out there without risks that can give you massive returns,” he said. “I’m a bit of party pooper to say ... I’ve never seen those things at work.”

One of the most important steps to achieving financial success is to set specific goals and detailed ways to achieve them.

You should also forget about those “get-rich” investment schemes, like ones that promises investors they can turn $100,000 into $1 million in five years.

Sivarajan said investing should be like watching paint dry — it’s boring, but it gives you the desired result.

“What I have seen, whether in the fitness world or the investment world, is the tried and true plain vanilla method … you do it with discipline and you do it with a plan (and) you will get the results that you’re looking for.”

Sivarajan said that with the current market, investors can generally expect an annual return of six to nine per cent over the next five to 10 years.

Meanwhile, he notes that different investment goals often require different financial strategies, much in the way that training regimens vary for different physical activities.

For example, there are different approaches for saving for retirement over a 30-year period versus saving for a winter vacation in three months. Sivarajan notes that your appetite for risk may be greater if you have a longer time span, so stocks might be a good bet.

But if it’s safe, short-term returns you’re looking for, guaranteed investment certificates or bonds might be the better choice.

Even if you already have a financial plan in place, Sivarajan suggests reviewing it in the new year to make sure you still have the same goals.

Sivarajan’s approach is one young father James Murphy can appreciate.

Last year Murphy made a New Year’s resolution to get into shape, and signed up for some sessions at the Toronto Sports and Orthopedic Clinic, a boutique gym near his downtown office.

“My only goal was to be able to feel good at the beach,” laughs the 35-year-old business director at an international energy company.

Twelve months later, Murphy’s still sticking to a daily, half-hour lunchtime exercise regime.

He says the key to his long-term success has been approaching his fitness goal the same way he approaches a financial goal: by getting professional help.

“You always need a (second) set of eyes on things,” he said.

“There are a lot of ways to go forward with stuff, but it’s worth it to have someone there to ensure you you’re on the right path and not missing things. It’s hard for us to be experts in all manners of our life.”

Organizations: Manulife Private Wealth, Boston Marathon, Toronto Sports

Geographic location: Mount Kilimanjaro.Sivarajan

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  • david
    December 23, 2013 - 10:07

    There is one (unintended) accurate aspect to this metaphor: People want to lose weight and get in shape with no effort or delay ---- just as they invest in 'get rich quick' schemes and buy lottery tickets. Neither one works, but no one cares.

  • Joe
    December 23, 2013 - 07:26

    You've got me. So a person who sells toxic crap to investors for a commission has lots of time for exercise. Who would have know!!!!

    • yo mama
      December 23, 2013 - 08:33

      Sounds like you've made some bad decisions Joe.