“Financial advice” and “financial planning” might be similar terms, but they are far from interchangeable.
While an adviser might ask you about your money, a planner will ask about your goals. And that’s exactly what the team here at Hartsfield Planning do.
Setting up specific pension and investment products is important, but only if they are aligned to a long-term financial plan. The plan we build for you will help to get you from where you are now, to where you want to be in the future.
Financial wellbeing is an important part of this. Your financial plan needs to be a delicate balance between saving versus spending – saving toward a dream future without neglecting to enjoy the present.
It’s about having a good relationship with money and a sense that you are in control.
So, if you are currently saving toward your dream future, you might wonder at what points it’s ok to spend along the way.
Keep reading to find out.
Have a clear idea of your end goal and your timescales
Before you can put a long-term financial plan in place, you’ll need to be clear on your goals.
One of these is likely to be your retirement. You’ll need to think carefully and ask yourself several important questions:
- When do I want to retire?
- What do I plan to do in retirement?
- How much will that cost?
Once you have the answers to these questions, we can help you to take a holistic look at your finances now.
A closer look at your income and outgoings, simple cashflow modelling, and a breakdown of your current and potential income streams can help us to decide how much you need to be putting away.
With a goal in mind and investments in place, you’ll be on track, and regular reviews will ensure you stay there.
You might have other goals along the way – buying a first home, helping your kids onto the property ladder, or through higher education.
We can factor these goals into your plan too, giving you confidence and a sense of control over your finances.
Spending along the way can have unexpected benefits
While you’re working hard to secure this dream future for you and your loved ones, it can be difficult to take a step back. With a robust plan in place, though, there’s still room to enjoy yourself along the way, and it’s vital that you do.
Spending can have unexpected long-term benefits, depending on what you’re spending your money on.
1. Protecting yourself and your family
If you have dependents reliant on you and your income to meet household bills or pay the mortgage, protecting yourself is key.
Upgrading your workplace healthcare plan, joining a gym, or spending a little extra on organic, local produce could all be ways to look after your physical health.
You’ll also want to plan for the unexpected.
If you have a mortgage, life cover is crucial to ensuring that your loved ones can keep a roof over their heads should the worst happen. But you might also consider critical illness cover or income protection to cover you if an accident or illness cuts off your income stream.
These steps might also help you to keep on top of your mental health, as they’ll give you confidence, control, and peace of mind.
2. Saving toward your dream purchase
You shouldn’t punish yourself for spending a little on the things you enjoy. Treating yourself – without jeopardising your long-term plans or living outside of your means – can give you a pick-me-up.
Remember that being financially responsible and saving for your future doesn’t mean depriving yourself in the present.
If you want a new car, or to take the family on an expensive holiday, if you’ve saved for it, you’ve earned it.
Saving might be a balancing act, but one that can be easily achieved if you keep your long-term goals in mind.
3. To build a nest egg for loved ones
As you’re building your wealth, and growing pensions and investments, remember that it’s never too early to start doing the same for your loved ones.
A Junior ISA (JISA) is a tax-efficient way to save up to £9,000 a year for your child. Interest on a Cash JISA is tax-free, while any gains on investments in a Stocks and Shares JISA are free of Income Tax and Capital Gains Tax (CGT).
Your child can manage their account from age 16. At 18, they can either withdraw it or transfer it into an adult ISA.
You can also begin paying into a pension on a child’s behalf.
Both are great ways to teach your children about financial security. Helping to give your loved ones a stable start in life will always be money well spent.
Get in touch
Hartsfield Planning can help you build a long-term retirement plan that works for you. It will allow you to have confidence and a sense of control over your future while making the most of the present in good physical and mental health.
And when you have saved enough and the time comes to retire, we can help you to pick the best options for you and your family.
If you would like to discuss any aspect of your long-term financial or retirement plans, please get in touch and find out how our team of expert planners can help.
Please note
The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance. Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.