Here are five tips to help you on the right path to a financially sound 2018:
1) Plan out your life goals
Work out what you want from life and make your money work towards that, rather than vice versa. Your priorities will naturally change over time, so taking the time to differentiate your short, medium and long term goals will help keep you focused and on track through the inevitable bumps in the road.
2) Use it or lose it – utilise your tax-free allowances
With tax allowances, it’s a case of use them or lose them. Ensure you and your partner are using all available allowances; personal, savings and dividends. The dividend allowance is reducing from £5k to £2k in April 2018. This will also affect you if you’re running your own businesses and drawing a mix of salary, bonus or dividends.
3) Review your pension-plan contributions
An increasing number of individuals will be affected by taper annual allowance as carry forward is used. For those with taxable incomes of over £100,000 per annum, it’s worth having a review to check employer and employee contributions remain appropriate. The Lifetime Allowance increases with CPI from £1 million to £1,030,000. Also make sure that your expressions of wish for pensions are regularly updated.
4) Build a picture of your current and future finances
Financial planning is all about anticipating the consequences of different choices and situations. By looking at your income, outgoings, savings and other assets, you can crunch the numbers to create a long-term projection of your finances. Identifying trends (positive or negative) can help to give you the best chance of achieving your goals and have a huge impact on how in control of your finances you are.
5) Peace of mind
One person in the UK develops dementia every three minutes, so stay in control and plan ahead by setting up a Lasting Power of Attorney (LPA) and allow powers for discretionary management . Every adult with assets should look at getting an LPA, otherwise your loved ones will need to apply through court. And don’t keep putting off getting or updating a will.
We’re here to help
With a few details from you about your financial situation and your goals, we can come up with an outline of what you need to consider over the coming years. Whether or not you decide to use our services, our team of Chartered Financial Planners will help you be clearer about your financial position and the next steps you should probably take.
Simply call us on 020 7488 7110 or arrange an initial chat.