Life stages

This period of our life tends to find us getting married, buying or renting a home, changing jobs and starting a family. All these milestones have financial implications, including mortgage payments, but if you have started good saving habits, you are in a better position to finance these without slipping into debt. You might find yourself better off in terms of salary and this is the time to seriously start looking at investing for longer term goals such as your own children’s education and special events such as family holidays and even your children’s weddings. This is also the time to start looking at protection for your family and lifestyle, putting policies and a will in place to provide peace of mind and security in the event of illness, an injury through accident or death.

TIP: Much like a house needs to be built on solid foundations, so do your finances. Start planning early and refine regularly.

At this stage of your life, you may find yourself being promoted, giving you a higher salary and more disposable income. This is, therefore, the opportune time to make sure you have the right pensions in place and ramp up your investments to give you the life you want in retirement. At this life stage, you may also be making the leap and setting up your own business, which has many financial implications of its own. You may need a business mortgage, pensions and benefits for employees, as well as continuity and succession planning should key employees who are vital to the running of the business are not able to work and ensure your business stays a success after you are gone. You may want to set up protection for redundancy, just in case.

TIP: Review and refine your existing plans and ensure you are utilising all tools in the toolbox, particularly as your wealth grows. You work hard for your money, so get your money working hard for you.

Retirement is close and you can almost feel the wind in your hair aboard that yacht. However, if you do not review your financial plans and dot the Is and cross the Ts at this juncture, you may not be fully prepared when the day you can hang up your work hat finally comes. Expert financial advice is absolutely vital at this life stage, ensuring your lifestyle is what you want it to be in retirement, that you have protection and security in your twilight years. Making the right choices here is crucial. Things to consider include your residential status, are you still paying your mortgage or are mortgage-free, do you have any debt, how much is in your pension pot and how much state pension will you get. The answers to these questions may influence whether you decide to delay retirement or change tactics in terms of your investments. Remember, waiting for retirement to plan your retirement may be too late.

TIP: If you have not done so already, think about the lifestyle you would want when you retire. How much will income will you need to fund those dreams. Plan and prepare a retirement budget and maximise your pension provisions while you still can.

Finally, what you have been waiting for. The time for you to retire is here! If your finances are in great shape, you can do so much more with this stage of your life, explore new challenges, start new hobbies, achieve longstanding life goals. Or maybe, you do not wish to fully retire. You may simply want to reduce the number of hours worked and supplement this lost income with your pension. So, where do you start? For many, the traditional option was to simply select an annuity. This, however, is not always the best or most tax efficient option. With so many options available now, choosing the right plan can be mind boggling and it is vital to ensure you select the most appropriate one to ensure you can fully enjoy your retirement, however long it may be.

Tip: At retirement, it is not simply about choosing the right option to get you on your way. Subject to your circumstances, this may need continuous monitoring and refining to ensure your chosen plan continues to meet your needs throughout retirement.
Want to know more about financial planning for your life stages?

You have worked hard all your life and you find yourself in the fortunate position of having more than enough to live the life you desire. Just as important to you is to ensure that your legacy is passed on to your loved ones in the most tax efficient way possible. However, as with all other aspects of financial planning, proper estate and inheritance tax planning take time. So do not make the mistake of leaving planning to the last minute otherwise running the risk of losing 40% to the government.

Inheritance tax and Estate Planning are not regulated by the Financial Conduct Authority.