Financial planning? Read seven tips to help you get started today
Have you planned ahead for your retirement? While it may seem far off, it’s important to start preparing for it now. Find out why lifetime financial planning is so essential and read seven tips to help you start.
It’s all too easy to live in the moment – and focus on the money worries you have now (paying your mortgage, earning enough to cover childcare etc). But, as far off as it may seem sometimes, one day you will want to retire. And you’ll need to have some financial savings plan to do so.
If you don’t start planning for your retirement now, you could find yourself being forced to work long after you want to. Or living off the state pension – currently just £155 a week.
So what can you do to make sure your golden years are the best yet?
It’s never too late to start lifetime financial planning
Don’t worry if you haven’t already started paying into a pension. The best day to start preparing for your future is now. And every penny you can plan and put aside for it will get you closer to your savings goals, and the comfortable, worry-free retirement you deserve.
Finance experts call this approach ‘lifetime financial planning’, and there are a few tips and tricks you can learn to help you along the way.
Seven tips to help you start lifetime financial planning
Regardless of age, it’s recommended you start saving for your retirement as soon as you can. And with the average annual outgoings of retired folk in the UK running between £10,000 and £24,000, it makes sense to start stashing some cash away now.
With that in mind, here’s a quick guide to smarter long-term savings from experienced advice and investment specialists Flying Colours.
1) Set goals
Ask yourself what you want to achieve. Buy a car? Save for a deposit on a house? Enjoy a comfortable retirement? Write down both your short and long-term life goals. Use online calculators to estimate how close you might be to achieving those goals.
2) Assess your current assets
You need to take stock of your debts and your assets, like property. Are you paying off a loan? If so, how much and when will it be paid off? Remember, it nearly always makes sense to clear debts before starting to save.
3) So what’s your status?
Now you have an idea of what you want to achieve and your total net worth, you can see how close you are to achieving your goal.
4) Plan for success
Build for the future by writing down your roadmap to savings success. For example, can you afford to put £100 a month into a pension? Or is a standard savings account the best option because you need quick access to the cash? And do you need to make any changes to your existing outgoings to help you save?
5) Think of the tax man
Tax can have a huge impact on your overall wealth and savings. Understanding tax rules is a useful skill, and essential for successful financial planning. Getting advice from a financial adviser can be helpful for grasping complex tax rules and could help you save hundreds of pounds each year.
6) Start saving!
Put your plan into action! Pay off any loans and decide how much you’re going to save, and where you’re going to save it.
7) Always reassess your plans
Any financial plan is a living, breathing document that should evolve as your circumstances change. Always go back to the plan and see if it needs to take a new direction.
What can I do right now?
If you like the idea of making a formal (or just informal) plan to help you meet your financial goals, then following these steps will take a you a long way on your journey. But financial regulation and products change as time goes by, making guidance from a finance professional invaluable.
Financial advisers understand how to help you achieve your financial goals. Most importantly, they will help you avoid those frustrating financial potholes on the road to savings success.
If you would like to talk to friendly independent financial adviser to explore sensible, diversified saving strategies, give Flying Colours a call on 0333 241 9900 or click here to book a no-obligations appointment.