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How to plan and protect your future

19 Dec

It’s about that time of year when people start thinking about their new year goals. In 2019, make financial planning your aim. By making sensible decisions about money now, you can achieve your long-term goals and set yourself up for a financially fruitful future.

Don’t know where to start? In this article, we discuss three things that you need to consider when it comes to financial planning, to get you on the road to protecting your future.

1. Retirement planning and pensions

Reports suggest that your state pension alone won’t be enough to provide for your retirement. Compared to other developed nations where the state retirement income is an average of 63% of earnings, the UK comes in at around 29%. Thanks to improved living standards, people are living longer and this needs to be factored in when planning for retirement if you want to maintain, let alone enhance your lifestyle.

It’s never too early to start preparing for your retirement. An important thing to think about is how long you will need to fund your retirement for. Envision your future and what you want to do. Consider how your needs might change, and if you might need provisions such as long-term care. Click here to watch our video on cashflow forecasting and learn how it can help you understand your future financial needs and requirements.

Even if you only have a few working years left, it’s worth reviewing your current arrangements to see if you could pay more into your pension, or even set up an additional one. If you’re enrolled into your employer’s pension scheme, there’s a chance that it’s invested in a way that’s not fully suited to your circumstances. Your pension plan should be tailored to you, and you might be willing to take more risk with your money.

2. Saving and investing

Despite some arguing that ISAs are no longer as important as they were, the annual ISA allowance of £20,000 remains a hugely valuable benefit. With an ISA, you don’t pay tax on any gains you achieve, and this could make a major difference to your wealth over the long-term. Another benefit of having your money inside an ISA is that you and your partner can inherit each other’s ISA investments and receive the tax benefits, on top of your own.

When it comes to other types of investing, including stocks and shares ISAs and premium bonds, a period of downturns shouldn’t necessarily be a reason to be concerned as markets will always rise and fall. It’s important to keep in focus your long-term goals, and if you’re on track to reach them. What was once your best way to invest might not always be the case, especially with a changing market backdrop, so it’s worth reviewing your investments on a regular basis.

3. Life cover and writing a will

Planning for your future will not only benefit you, but those around you too. It can be very upsetting to think about how your loved ones would react if you were no longer around to support them. However, by considering the financial complexities that could arise, you could reduce some of that burden.

If your family depends on your income, life cover will provide your dependants with a lump sum payment in the event of death. It will ensure any outstanding mortgage and other living expenses are taken care of, to give them peace of mind and financial reassurance.

In addition, writing your will isn’t something that you should put off. A will helps your family sort everything out when you pass away as you can leave clear instructions for what should happen to your money, property and possessions. Without a will, the law will decide where the things you own will go, and this might not be in line with what you want.

Need some advice?

By speaking to a financial adviser, you can benefit from an expert helping you to review your funds and assess your investment plans, prepare for retirement and build the legacy you want to leave behind. Speak to one of our Wealth Management team today on 02920 853788 or ifa@thomas-carroll.co.uk and get one step closer to the future you want.