NEW YEAR, NEW FINANCES?
Everyone is full of good intentions at the start of January, so while you’ve got the motivation flowing you should set some goals for the coming year to improve your finances.
Review your ins and outs
Take a long hard look at what you have coming in, and where you spend it. Could you be making smarter decisions? A 70p chocolate bar every day is £21 per month. A £2.50 coffee is £77.50!
I’m not saying deprive yourself, but could that money be put to better use? You need to be honest here, and so I recommend either using an app or I can send you a form on email.
Check your credit report
Whilst keeping an eye on your credit score is a good idea, all the action is in your credit report.
See if your current and previous addresses are correct, who you are linked to financially, and if there are any accounts you don’t recognise.
Get your affairs in order
Do you have a Will? Is it valid? Research by Unbiased* revealed that less than a third of people aged 35 to 44 had a will and, perhaps more surprisingly, only three in five people aged 55 + had one. But only with a valid will can you be certain that your estate will go to the right people.
If you do not have a proper will, you risk depriving your spouse or partner of their home, increasing the inheritance tax (IHT) burden and leaving parts of your estate in the wrong hands.
Look at your mortgage
Could you manage to commit to an overpayment each month? It is incredible to see what even small amounts can shave off, both in interest and time.
Track down your old pensions
If you’ve got pension schemes from previous employers, or that you used to pay into it is important these are reviewed regularly. You could be paying more in charges than necessary, and the money may not be invested in accordance to your appetite to risk. To give yourself the best chance of a decent retirement you shouldn’t let old pensions just sit there unattended.
You all know the importance of car insurance, home insurance, pet insurance – even phone insurance. But the one thing people fail to protect is their income – without which most would be at significant risk of financial hardship if they are unable to work due to illness or accident.
Shelter say that £3m Brits are only one pay cheque away from homelessness. A sobering though. Many believe that the state will take care of them when they are unable to work due to accident or sickness, but will their support be enough?
Statutory Sick Pay (SSP) is £86.70 per week if you’re too ill to work, which is paid by your employer for up to 28 weeks. In order to qualify for SSP you need to have been off work for 4 more days in a row (including non-working days).
You may think your employer offers a decent sick pay package. But figures from Aviva reveal that the average claim length for all claims being paid in 2016 was 3 years and 16 weeks.
3 YEARS AND SIXTEEN WEEKS. ON AVERAGE. That means there were many claims paid for longer.
You’ll notice I didn’t mention Life Insurance
I’m assuming you already have that covered. If not, you know what to do. (Get in touch. Immediately.)
Try the £1,000 emergency saving challenge
Saving £20 a week will see you with an emergency fund of £1000 by the end of the year.
Ideally an emergency fund would be 3 months outgoings, but if that feels like too big a goal right now, then just stick to this if you can.
2 points to make
1. Don’t leave yourself short.
2 .If you get any spare, extra or surprise money, stick it in this fund.
Sold something on ebay – stick it in here. Got some money off something you were already going to buy – transfer the savings over. Found a bonus £5 in your coat pocket – you’ve guessed it – get it in here. To quote the Blue supermarket – every little helps.
That should be enough to keep you going for now. As always feel free to message, email or call to discuss any of the issues I’ve raised here.