Review your finances – and your objectives
This is a good time of year to take stock of your financial situation and to see if you will likely meet your goals. Ask yourself what you wish to achieve in the short and long term, then see if your approach is realistic. You may need to save more or account for higher outgoings.
If you haven’t already created a financial plan, these steps can help you get started or refine the approach you already have. By simply registering with us you can also access our range of online tools to help you plan ahead effectively, with a specific tool for those who want to take a retirement health check.
For more information or specific advice we encourage you to get in touch with one of our expert financial advisers.
Markets can get choppy, but don’t get distracted
Short-term market movements can be distressing and compel you to consider changing course, or worse, to sit on the sidelines. But you should recognise that some volatility throughout the year is normal and there will be inevitable bumps along the way.
It is also usually best not to consider changing your risk level unless your circumstances change. Overall, the message is not to panic when markets swing like a pendulum, and staying invested – rather than trying to time exits from and entries to the market – is a far more assured option to help you meet your long-term goals.
Sensible tax planning is super… sensible
In the UK there are many tax-advantageous and tax-free options to help investors make the most of their money. So you should ensure you are making the most of your pension limits, are benefiting from the convenience of CGT harvesting (a service we offer at no extra cost) and also maximise your ISA allowances.
In this article we illustrate the benefits of making the most of available tax wrappers and we focus specifically here on how ISAs can quite remarkably boost the outcome for a family of four.
Do your finances pass the inflation stress test?
Even if you have a financial plan in place that you feel comfortable with, it may be a good idea to stress test it in the knowledge that inflation could be higher than expected. While we typically urge clients to allow for 2% inflation in their projections, it’s reasonable to assume it could be higher than that for a time. Who knows for how long this situation could persist?
But what you can assert is how your financial situation could be reflected if the long-term average became 3%. Try this tool for a quick appraisal of a potential longer-term inflation rise.
Define your inheritance plans – and let people know
You can’t take anything for granted. Even the task of passing on wealth to those you love can be terrifically complex, as we discovered in an inheritance report we commissioned in 2021. Your plans could be quite different to what others perceive they might be which makes it all the more important to have the right plans in place, and to communicate those plans.
You should also be prepared for unexpected events that could affect your ability to manage your personal affairs. Our head of compliance writes about how a lasting power of attorney (LPA) can protect your financial wishes.
Fees always matter, so bring them down to earth
We talk about this often, for the simple fact that it matters so much to your outcome what you pay in fees over the long term. Whatever the economic and investment environment, the accumulation of charges can have a considerable negative affect on your future comfort.
Here we examine how much better off you could be if you are facing retirement by paying just 1% less in fees – you'll see it's a considerable sum by any measure.
Please note, the value of your investments can go down as well as up.
