For the majority of people, their Financial Planning needs start with the following 5.
Please note each step can be considerably more complicated and there will be many situations where this list is out of order or not applicable, for example self employed people will have additional needs that will need to be considered.
Rainy Day Monies
Do you have enough money put aside to meet any unplanned expenditure that might arise? Typically most Financial Planning Consultants would suggest you save until you have between 3 and 5 times your monthly salary in the bank.
Protect your Current Lifestyle and your Family
For most people, the first port-of-call for financial planning is to ensure that if the worst should happen in the future, you and your family can afford to stay in your home with a similar standard of living. Products are available to cover you should you become unable to work, or if you become very ill, or die. Having protection in place provides both peace of mind and financial security for you and your family, as well as being one of the simpler financial planning needs to address and is typically much cheaper than most clients imagine.
Use your Allowances
The government allow certain amounts of earnings and investments into certain products to be received or to grow free of tax. It is important to utilise these where available and before placing monies in other investments subject to tax.
Plan for Retirement
Calculate the level of income you require to retire comfortably and discuss with your Financial Planning Consultant the level of pensions and/or other savings and investments required to provide this. Once a plan is set in place, this should be reviewed regularly as well as your objectives and other finances to ensure this is still the most suitable plan.
Invest for Your Future
Investing for the future can be for a specific event (like sending your children to university or private school) or just to allow the monies to grow at a rate greater than that offered by bank accounts. To ensure the most suitable and best performing investments are selected, it is important you seek independent financial advice.