Taking the time to review your financial situation can really save you money and give you greater opportunity to save for your future. Vanessa McCloy explains the benefits of good preparation when it comes to financial planning.
Research by the Money Advice Service found that households who use a budget planner say it gives them peace of mind about how much they are spending and feel better about life in general.
By undertaking a regular review of your income and expenditure, you will find it easier to adapt your finances to any changes in your circumstances. Don’t forget to make some allowance for less frequent expenditure such as birthdays, cars, holidays or other large purposes. Managing your cash flow can give you control of your money and help you to plan ahead.
Meeting your financial goals
A good budget sets strong foundations for making progress towards your financial goals. As a starting point you should have access to a ‘rainy day’ fund to cover emergencies. We normally encourage our clients to have three to five months expenditure kept aside for emergency funds.
With a budget in place, you should then look to repay your most expensive debts first, whilst taking care to avoid any early repayment penalties and considering whether you could consolidate any debts into a cheaper overall payment.
You may already have some good financial practices in place, but can they be improved upon? You should set financial goals which are SMART – Specific, Measured, Achievable, Realistic and Time-scaled. Your adviser can help to make sure that your financial goals are achievable and affordable. A clear target or objective for your savings and investments helps to provide a stronger commitment for these plans.
Applying SMART goals can give your plans much greater purpose, such as:
- Repay my mortgage by 2027
- Retire at age 62 with pension income of two thirds of my current income
- Build up an investment of £20,000 by 2023 to meet the costs of a family celebration
Our advisers can help you to review your progress towards meeting your financial goals as well as ensuring that your current plans are still on track.
Strong foundations for successful financial planning
Having clear financial goals and a budget will put you in a great position to benefit from future financial opportunities or to tackle any financial challenges that you may encounter along with way. With a clear view of your financial position, your Origen adviser can help you and your family work towards reaching your financial goals.
This article is for information only and is not to be taken as Financial Advice.