Remember, Remember the 5th November!

Firework night is nearly upon us and hopefully this year we will all be able to celebrate with some sparklers.

We may remember this date each year, but do we remember to check our finances each year? Do we have a financial plan? It’s vital to keep on top of what you have and haven’t accomplished.

An annual financial plan is a way to determine where you are financially at a particular moment. This means taking into consideration all your assets—how much you get paid, what’s in your savings and current accounts, how much is in your retirement fund—as well as your liabilities, including loans, credit cards, and other personal debts. Don’t forget to include things like your mortgage or rent, plus utility bills and other monthly expenses. This snapshot should also factor in what your goals are and what you’ll need to accomplish in order to get there. This can include things such as when you would like to be mortgage free, do you want to retire early or reduce your working week and how much money you think you might need to enjoy yourselves and perhaps help the children financially.

The following steps will help you create a solid financial plan:

Establish your financial goals – having financial goals is the foundation for your financial success however ensure that they are well defined and prioritised accordingly.

Start an emergency fund – it is important that one of your goals includes a plan to deal with emergencies which may occur. You want to make sure that you are prepared to weather a storm.

Pay off debt – sadly, you can’t really kickstart your future if you are carrying a ton of debt. It is important to pay off any debt, so you may need to create a debt repayment strategy which is consistent.

Create a financial plan to invest – investing is key to building wealth. Well defined objectives and goals are needed as well as understanding that investing is a long-term activity which needs commitment in order to gain rewards.

Get the right insurance – After working hard to earn your money, the last thing you what is an unplanned occurrence to wipe you out. Ensure that you and your family are adequately protected in the event of sickness or death.

Create a plan for retirement – In order to have your desired lifestyle in retirement you will need to plan for it adequately. You'll need to determine how much you are going to need to retire, of course taking inflation into consideration,  and how you plan to save and invest in advance for that period of your life.

Plan for taxes – Not planning for taxes can impact your cash flow in a major way. In addition, you will definitely want to look into tax savings investment options and stay up to speed on any relevant tax deductions you can apply to help you save money on tax payments.

Create an estate plan – Estate planning is not something a lot of people like to think about, but it's essential! It allows you to determine exactly what happens to your assets after you are gone.

It involves listing out all your assets, creating a will, and making it accessible to the people who need to have access to it.

Review your financial plan frequently – Once you have your financial plan in place, it’s important to review your plan frequently and make the necessary adjustments if your goals or the circumstances around your life change.

At Fort Financial Planning we offer a fully comprehensive financial service which includes building financial plans for our clients and in turn helping them achieve their financial and life goals.

 November 2021