Financial wellbeing is about having security and control over your finances and having the knowledge and reassurance that you have enough money to meet your needs. After all, one of the leading causes of stress relates to money concerns and we all want to be in control of our finances. This means having enough money to not just get by but to enjoy life!
When setting out a financial plan, it is of vital importance to establish the right foundations. Everyone needs an emergency fund which can be accessed immediately if, for example, the boiler packs up tomorrow! This can provide peace of mind and we would typically suggest at least 3-6 months' expenditure is kept to one side.
Protecting your lifestyle is of fundamental importance and an often overlooked area of Financial Planning. Most of us have large debts, for example, your mortgage, and it is important to consider what would happen to your loved ones if you were to die or are unable to work. Putting protection arrangements can potentially clear these debts. Life cover will normally get more expensive as you get older, and taking out a policy whilst you are young can provide you and your loved ones with peace of mind and financial security should the worst happen.
Once the above steps have been addressed, you can start looking to your retirement. Central to this is identifying how much you will need each year once retired. The full State Pension is less than £10,000pa per person currently, and for most people, this won’t be accessible until age 68. To top this up, pensions are a great way of saving for retirement and you benefit from tax relief on contributions. It is worth investigating what pensions you have, as you may have a number of these from previous employers which can be used to help fund your retirement.
Savings and Investments
If you have surplus funds after making retirement provisions, you can look at other ways to save and invest. Making the most of tax-efficient vehicles, such as ISAs, which are a fantastic way of doing this. There is no minimum age to withdraw from an ISA and there are no tax penalties for doing so. ISAs can be held both in cash and invested in Stocks and Shares.
If you have any financial planning concerns that you would like to discuss in more detail, please get in touch today.
The value of investments may go down as well as up.