Follow the 5 steps
below and you can enjoy financial freedom and peace of mind:
#1: Budget planning
Before you can achieve anything, you need to figure out where you are now.
Before you can achieve anything, you need to figure out where you are now.
Take a good look at
your current finances including your liabilities (mortgage, loans, credit
cards), assets (house, cash, investments), incomings (salary, investment
income) and outgoings (direct debits, food shopping etc).
If you have a cash
surplus, you can start allocating to your financial goals straight away. If
not, think about ways in which you can cut back or make changes. Most
importantly, be realistic.
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Financial goals don’t just happen, you need to make them happen. Think about where you want to be in 5 to 10 years. Goals can be things like keeping up your current standard of living in retirement, being mortgage free, having freedom to travel or indulge in hobbies, spending more time with family and friends. Once you know your goals, you can plan how to get there.
Plan for your
retirement and ensure you’re making sufficient pension contributions. Think
about how much you’ll need to support your required standard of living in
retirement.
#3: Smart Saving & Investment
Take advantage of tax free saving such as ISAs and Junior ISAs. The 2013/14 allowance for a stocks & shares ISA is £11,520 and £3,720 for a Junior ISA. Don’t forget, you can’t carry over any unused allowance to the following tax year.
Take advantage of tax free saving such as ISAs and Junior ISAs. The 2013/14 allowance for a stocks & shares ISA is £11,520 and £3,720 for a Junior ISA. Don’t forget, you can’t carry over any unused allowance to the following tax year.
Ensure you have an
‘emergency pot’ available for an unexpected events. This should be in an easy
access account but do your research to ensure you are getting the best rate of
interest available and review regularly.
Ensure that your
investments are working for you whilst taking into account your attitude to
risk.
#4: Review regularly
Make sure you regularly review your goals, investments, savings and insurance needs. Plus ensure you have an accurate and up-to-date Will.
Make sure you regularly review your goals, investments, savings and insurance needs. Plus ensure you have an accurate and up-to-date Will.
Do this on an
annual basis or if there are any major changes to your circumstances.
#5: Seek
Professional Advice
Once you’ve gone through the 4 steps, you can put together your financial plan. Be proactive, not reactive.
Once you’ve gone through the 4 steps, you can put together your financial plan. Be proactive, not reactive.
And if in doubt,
seek professional advice to help you achieve your goals.