Sam Tate of Stockton-based Vintage Chartered Financial Planners provides advice on planning for your financial future…
Have you ever thought about what you’d like your life to look like in retirement? How about how you’ll pay for university fees for your child or buy that holiday home you’ve often dreamed of?
Chances are you have a vague plan; you’re putting money in a pension and hoping that’ll be enough to give you a comfortable lifestyle come retirement day. As for the holiday home, well only if there’s some money left over at the end of it all, perhaps?
But how about looking at things a different way? How about understanding what you’d need to do to achieve those things and working towards making it happen, or at least to understand what you’d need to do to start heading in the right direction?
Just think, if you don’t plan at all it’s unlikely that you’ll ever achieve what you hope for. But if you do and you get there, wouldn’t that be great?
Financial planning is the process of defining your goals and aspirations, working out where you are now and then using the help of a professional financial planner to bridge the gap between the two. It includes looking at your plans for retirement, significant one-off purchases, tax planning and even what might happen to your money when you pass away. Your financial planner can also work with you to help plan for any unexpected events, so you can have peace of mind that everything will be OK no matter what.
The process has many benefits, the most significant being that having a plan in place means you’re much more likely to achieve your goals. What’s more, because you have a clear view of the ‘bigger picture’ it helps in fine-tuning any smaller financial decisions to support you in getting where you’d like to be.
Instead of having a mortgage broker, an IFA and several self-managed policies with different providers, everything is brought together under one administrative hub, so you only have one point of contact for your various financial policies.
Lastly, having a plan in place doesn’t mean that you can’t update it should you change your mind. In fact, proper planning would involve regular reviews to make sure that your plans are still on track.
So, what’s the process?
The first thing to do is to find a good financial planner. Don’t forget these will be the people who are looking after your assets for the long-term, so it should be someone you can trust and build a great relationship with.
When you meet with your financial planner, you’ll discuss your current situation where you are now, including reviewing and discussing any assets that you currently hold. You’ll then talk about what you’re hoping to achieve. An analysis of your risk profile will also take place, ensuring that any recommended investments or policies are suitable for your capacity for loss and attitude to risk.
Your planner and their team will then use a process called cash-flow modelling to determine your levels of wealth as you move through different stages of your life, testing out different scenarios to find out what would work best and then recommending policies to fit.
Once underway you’ll meet with your planner once a year to discuss any changes in circumstances, check that your plan is on track and that any investments are performing as expected. You can then relax in the comfort of knowing that you’re on track for the financial future you hoped for.
Vintage are Chartered financial planners. They provide bespoke financial advice to individuals and business owners using traditional values and are currently celebrating their 30th year in business. For more details visit vintage-fp.com.