What are 10 things to consider when planning my financial future?

Thinking about financial planning can be overwhelming. Life can be fast-paced and putting serious thought into how you manage your wealth may not be top of your priority list. If this sounds familiar, then breaking financial planning down into some digestible chunks may be the answer. Making small steps in the right direction can help improve your long-term financial security and the overall financial wellbeing of you and your family.

A useful way to look at the separate parts of a financial planning strategy is through a framework known as the SMART model. Effective financial goals should be Specific, Measurable, Achievable, Relevant and Time-bound. When it comes to setting time-bound goals, splitting your aims into short-term, medium-term and long-term categories can also be effective.

Here are ten things you may want to consider when planning your financial future:

01 Budgeting and Saving

Budgeting and saving tend to come as a package. Anyone that takes the time to plan out their spending is likely to cut down on unnecessary outgoings and boost their savings pot. A good wealth manager will be able to provide you with tools such as consolidated reporting and cashflow modelling to assist you in this process.

02 Investing Wisely

Creating and maintaining an investment portfolio can help ensure your wealth is working hard for you behind the scenes. Enlisting the help of a professional investment manager will ensure you get the right advice and that your portfolio is matched to your risk appetite. Diversification and long-term thinking are key pillars of successful investing. A balanced portfolio tends to consist of a good mixture of cash, equities and fixed income assets. And for those with a slightly higher appetite for risk, alternative investments such as hedge funds and private equity can also be considered.

03 Managing Debt

Staying aware of your debts is always a wise move when planning out your financial future. If it is possible to consolidate your debt, it may be worth discussing this with your wealth manager. If you have a variety of different debt piles, these are likely to carry varying levels of interest. Taking a responsible approach to debt with high interest rates by ensuring those costs don’t spiral in the long term will always prove sensible.

04 Expense Tracking

Expenses are often a fluid thing. Anyone’s outgoings can change quickly and without proper monitoring, they can bring some nasty surprises. Expense tracking is a good habit to get into even if it can seem a bit onerous at the start. Once you become used to tracking your expenses, you can ensure that they are kept under control and you have a firmer insight on whether your wealth is increasing or reducing.

05 Automatic Bank Transfers

Sometimes a good wealth management strategy comes down to embracing convenience. Making sure that some things are done automatically means that you need to spend less time worrying about your finances. Automatic bank transfers are a good example of a simple banking function that can have an outsized impact. Making sure funds are transferred regularly to destinations such as tax savings accounts or investment accounts can provide significant benefits for the prudent financial planner.

06 Protecting your assets with insurance

Insurance is an often overlooked but vital part of wealth management and planning for your financial future. Ensuring that you have adequate health, life, disability and property insurance means you can put your mind at rest by securing added protections to your assets.

 07 Wills

Writing a will is not something most people want to think about, but it is essential in making sure your wealth is distributed in line with your wishes after your death. Something all wealthy people should think about with wills is how much transparency you want around the will while you are still alive. Ensuring that you manage expectations before your death could help maintain family harmony once you have passed away.

 08 Trust

Trusts are a common tool in the world of financial planning and wealth management. A typical trust involves placing assets under the control of a trustee who manages them for a third party for a certain purpose. Trusts offer a strong level of protection for assets and can often be tax efficient.

 09 Power Of Attorney

Setting up a power of attorney is a good move for anyone, especially those with a significant amount of wealth. There may come a time when you are unable to communicate your wishes and a power of attorney appoints someone to make decisions on your behalf. It is important to make sure you have this aspect of financial planning covered.

 10 Reviewing and Adjusting

Finally, financial planning should never be viewed as static. Making sure you regularly review and adjust your plans is advisable so you can stay on top of your affairs. Your financial situation will be constantly changing so it is vital that your financial plans change along with it.

At London & Capital, we believe following these 10 tips to help plan your financial future will enable you to do just that. Financial planning is fundamental in enabling you to create and leave a legacy behind you, and we are here to make that happen.