Having a financial plan in place is essential in ensuring you stay on track to achieving your objectives for the future, but it can be difficult to know where to start.
In celebration of Financial Planning Week, we have put together 10 practical tips to help you get started on your financial planning journey. Please see below…
Most importantly, have a plan
If you don’t know where you’re going how can you stay on course to achieve your objectives?
Get some professional advice
It is very difficult to be objective about your own circumstances, particularly when it comes to failures or shortcomings. You need an honest assessment of your financial situation, and the only way to get that is to have it done by an experienced third party.
Start saving early
If you start a savings plan at age 20 and stop contributing at age 35, you will have more money at 60 than someone who starts at age 35 and contributes double that amount from age 35 to age 60.
Pay off debt before saving
While it’s good to have a financial cushion for use in emergencies, there’s little logic in having savings if you also owe money.
Take advantage of available tax reliefs
Good examples are ISAs which can grow tax free and pensions which qualify for tax relief on the contributions.
Consider setting up a trust
A trust could help your beneficiaries pay an inheritance tax bill. You can also set up a special kind of life insurance to pay into a trust (so that it falls outside your estate) and cover the amount to be paid.
Prepare for illness, protect yourself and your loved ones
Consider policies to protect yourself and your loved ones; this gives you and your family peace of mind that liabilities are going to be met should the situation arise.
Review your pension arrangements
Not only do you need to make sure your pension fund is suited to your needs and retirement aspirations, but you may have old workplace pensions you’ve forgotten about. A good place to start is the government’s pension tracing service (click here).
Make a will
Around 54%* of adults in the UK do not have a will. Having a will reduces the time and cost needed to deal with an estate. If you are concerned about who inherits your assets, a will is imperative but in complex situations, a will also has the potential to reduce inheritance tax liabilities.
Regularly review your financial planning
Simple but often overlooked, don’t forget to make regular checks against your financial plan and update it to take account of changing circumstances. It will give you the confidence that you are on track to achieve your goals.
For financial planning advice tailored to you, please get in touch with Tara Maynard using the button below. We’re currently running FREE consultations so would be delighted to provide some tailored advice to help you get started on your financial planning journey.
*Source: Royal London, 2018
