FP Canada and the Institut québécois de planification financière (IQPF) jointly released April 28 the 2022 Projection Assumption Guidelines and Addendum for professional financial planners across Canada. The new guidelines take effect April 30, 2022. 

The guidelines are designed to support financial planners when making long-term (10 years or more) financial projections that are free from potential biases or predispositions, explain the organizations.

“After an extended period of stable and relatively low inflation, global economies are currently experiencing a rapid rise in inflation, prompted in part by COVID-related supply issues and recent geopolitical pressures from the Russian invasion of Ukraine,” notes the organizations. 

This year's release of the Projection Assumption Guidelines includes a chart in the Addendum showing the Consumer Price Index (CPI) results from 1997 to 2021 to offer context and perspective in the face of recent inflation increases. Inflation can show more marked movements in some shorter-term time frames. However, in looking at inflation rates over a longer period, it is noted that previous higher levels are not sustained for the long term. As of December 2021, the CPI has averaged 2.32% over the last five years and 1.82% over the last 10 years, adds the organizations.  

For more information, the 2022 Projection Assumption Guidelines, the Addendum, and the FAQs can be found on the FP Canada website.