Investments do rise and do fall in value and we strongly advise that professional advice is taken before investing your money
The sad fact is that the pandemic has had a significant impact on the global economy, the wheels of commerce had stalled and as I write the government is finishing its initial helicopter money exercise, (furlough), and are now trying to tempt you out of your hiding place with half price food. Interestingly, whilst on the one hand we are now seeing NHS initiatives to encourage healthy living, they are happy for you to spend your money on any grub you like!
The problem with mixed messaging such as this is that you create confusion and people don't know what they should or shouldn't be doing - did you hit the beach last weekend?
So what has this got to do with postponing retirement you may be asking, well, the sad fact is that for a lot of people their ability to save for their future has been hindered and there is still so much uncertainty that it can be difficult to cut through the noise and see the path ahead.
My advice is that it is at times like these when we need a clear plan more than ever and re-examining your 'numbers' is crucial if you want to know where you are in your financial planning journey and if the numbers don’t add up then consider, what action do you need to take?
If you are feeling confused and could do with a helping hand to navigate the way ahead with your finances then get in touch with us today.
A simple question you may think, but once you understand the answer to this question then your money will take on a whole new meaning.
Most people do not stop and consider what they would like from their money and how it can set them free!
Being free to sit and read a good book, travel, give their children a helping hand are just a few things that people who understand ‘what’s money for’ enjoy.
So take time and ask yourself, what’s your money for?
A lottery winner was asked the question, “what has winning the lottery enabled you to do?” and she answered simply, ‘live our best lives’.
You don’t need to win the lottery to have the opportunity to ‘live your best life’, but I would suggest that you do need to plan your future.
In my job I meet some very smart and interesting people but it always amazes me that even when these smart people are sitting in front of someone who can change their lives, they are oblivious to the opportunity that is in front of them and continue to procrastinate.
Now let me ask you, what would you do if good fortune was to present itself to you?
Life is what happens whilst you are busy making plans as the song goes, but when was the last time you stopped and thought about your future, after all if you do not know where you are going then any road will take you there, so my advice to all, is put some time in your diary to think about what you want from life…
May I suggest that successful people are typically time poor and cash rich and this is when buying services can save you time to do the things which are important to you. Perhaps you opt for home delivery from your supermarket, use a meal delivery service, employ an accountant or financial adviser, all of which will save you time and possibly even money as you would expect a good accountant to save you tax and a good adviser to increase your wealth!
Let’s say you are a business owner, where do you want the business to be in one, three, five years’ time in terms of turnover and profit? How much of your ‘day’ do you want to work in or on the business?
On the face of it these are simple questions, but if you sit back and consider each point let’s say profit, the amount of analysis needed to derive a reasonably accurate number is quite detailed. Spending quality time on your business plan can not only be very profitable but also inspiring. After all, we know that the most successful people tend to be driven to success because they have a clear picture of where they are going and what they want to achieve.
Remember, you need to know what you want and by when, in order to stand a chance of being successful, once you know the endgame you can plan the journey. So, my point is simple, take time to analyse what you want, decide what is important and set your goal. Once you have your goal build a PLAN!
Here at SM&A we offer bespoke cashflow planning for our clients and work with them to achieve their goals and save them time. If you are ready to put your plan into action give us a call and see how we can help…
Now I would suggest this is the question you need to ask sometime before you were planning on jumping!
However, it amazes me how many people just do not plan ahead.
Let me explain, if you were going to jump from a plane would you ‘just wing it’ or would you stop and think, consider all your safety options and plan accordingly?
I don’t know about you but if I were brave enough to do this, I would like to enjoy a successful jump and relish the bragging rights, not spend months in hospital, or worse, and lose my future...
The answer to the question seems obvious right? So, why would you buy a cheap ‘parachute’ when planning your life’s financial future?
Ready to jump?
We find ourselves in an environment that uses the ‘nudge’ theory as a way of getting people to do things, Government departments, schools and even society itself are using this theory to achieve a potentially better outcome.
Put Simply, the ‘nudge’ approach is by definition nudging people into taking action, a good example through various mediums is the obesity problem we currently face and getting people to take action. Not only will people in general live longer by adopting a healthier lifestyle, but the financial impact on the taxation system and the NHS will be better, hence why this mind game is used.
When it comes to retirement and saving for your future, the vast amount of the population struggle with this concept, they cannot seem to understand that one’s retirement life can be as long if not longer than their working life, so modest saving into a pension scheme is just not going to cut it.
Real action is needed!
People need to understand the hard facts and choices, listen, with no money saved when entering retirement, I struggle to figure out what choices or lifestyle you would have – at least ones that are legal!
Sit down TODAY, no excuses with a piece of A4 paper and write down what you would like your retirement to be like. If you have no idea, do some research within yourself. My experience is that most people have bland objectives but the more you can picture that dream the more real it becomes and the more likely you are to achieve your dream.
Next, write down your net income that arrives in your bank account, if you are married, include both your incomes from all sources and then compile a thorough expenditure list. Trust me, 99% of people do not know what their bills are, and I am one of them, but I at least have a plan and I am delivering against my goals.
So, take the lifestyle that you would like, then look at your expenditure and you may be surprised to realise there is not much spare! We often assume our expenditure will reduce in retirement because we are no longer paying the mortgages, school fees, travel to work etc of today, but tomorrow, whilst we may not have those same bills, we will still be spending and with more free time, we will need monies for meals out, holidays, grandchildren etc.
So, on your A4 paper you should now have your objective and how much it is going to cost clearly written down. Stick it on the fridge door or some other prominent position so that it reminds you of your goal every day! I believe it is important that your partner is included in your ‘joint’ dream because if you are both engaged then you can work successfully to build a better future and each of you will encourage each other so you have a higher probability of success!
Your next step is to work out how to move from where you are today and how to achieve your goal…
Dare I say, the more prosperous you are the higher the probability of living longer, look around you and make your own judgement!
Here at SM&A we help our clients turn their dreams into reality so if you would like to see how we can help you, please get in touch.
Probably the most important number in your life is likely to be the number that you need to live the life that you want from now until you die. Reflected within this number are all the memories and experiences that you and your family can share by living the life that you dream of. Don’t forget, you only get one shot so when you leave this life, you want to do so with no regrets, knowing that you did it!
Helping you to understand and quantify this number is not easy, it takes considerable effort from the adviser and client, but by working together, we can work out your number based on the life that you want to live.
Another word for the number is money, there are some people who see living on x as a worthwhile challenge, yet others want to know how much money do I need to live the life that I want, and this is where we as advisers can help you see the big picture.
You may be one of three groups of people;
There are those who will never have enough money and therefore need to plan their working life so that they can achieve a work life balance between working and play
2.There are those who have enough but do not realise it yet and could start living their dream retirement tomorrow
3.And the luckiest of them all are those that have too much money and just need the reassurance by showing them so they have the ‘permission’ to get on and spend so they can realise more of their dreams.
If you are serious about your future then you and I need to talk.
Understanding where you are today and where you want to get to is more important than buying products.
Steven is a Fellow of the Personal Finance Society, whom is passionate about investing and getting the most from your money.
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