Do you need a Financial Plan?

We make plans for most parts of our lives, professionally we draft a business plan and work hard to achieve it, as a family we plan the type of holiday we want and book accordingly, and we even plan beforehand what we want from the supermarket and fill our trolley based on that plan.

Just as walking into a Travel Agent without knowing where you want to go on holiday could well see you flying to the Alps with a snorkel in your suitcase, not planning your finances could well leave you taking unnecessary risks resulting in unwanted financial losses.

For many, the myriad of questions posed when you think about your finances can squeeze you into a form of paralysis?

  • Am I putting enough money into my pension? Am I putting too much into my pension? Do I even know what a pension is!
  • Do I have enough life insurance, and what will happen if I get sick and can’t work? Who will run my business if something happens to me?
  • Should I buy some of the shares being offered at work?
  • Why is the value of my investments so different from one week to the next?
  • How much do I need to sell my business for to live comfortably?
  • Could I afford to help my Grandson with his University fees?
  • Can I afford to retire early?

Often, with so many questions, and so many answers to choose from, we struggle to work out what is best for us. This can lead to bad spending decisions, bad investment decisions, time wasted and potentially unnecessary suffering.

What if when these questions arose, you were able to remind yourself of your financial goals, the steps you are taking to reach them and your progress towards them? You would be reaching for your Financial Plan.

A good Financial Plan will inform you and empower you to make clear financial decisions based on what you want to achieve. It will assist you in budgeting for important life events, and with the support of your Financial Planner highlight to you the risks you are taking, and which risks will need to be mitigated.

Your Financial Plan will make you aware of the investment opportunities available to you, and with suitable advice from your Financial Planner you can be comfortable making long-term investments as part of a diverse portfolio.

Do not be afraid if you fear being bound into a rigid structure; Your Financial Plan should evolve as your life changes. Would you expect to budget for school fees after your children have finished their education? As your circumstances change, so to do your objectives and so your plan should reflect this.

What will you do with all this time freed up from worrying about your finances? Raise your family, run your business, enjoy your retirement, oh and plan your holiday, you don’t want to end up in the snow in your bathing suit!

Look out for my next blog where I will explain some of the important features that will form your Financial Plan.

If you would like to discuss this blog in more detail, please email Ian Aldred, or call 01772 821021.

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