Financial planning is vital for a number of reasons. For one, without a sensible plan in place, your retirement years could be wrought with financial difficulty, it’s all well and good earning a decent wage throughout your working years, but without a decent pension plan in place you may find that even a strong reserve of cash could dwindle, but this will not happen if you have a regular pension income set up.
Of course, perhaps even more important than establishing financial security for yourself is establishing financial security for your family and loved ones. There’s no reason to shirk away from the obvious facts of mortality, and the last thing you’d want to do in the future, no matter how far away that may be, is to leave the people you care about in an unfavourable position.
This is why establishing goals, and planning towards them, is a must for everyone.
With a clear set of financial goals you can start to build towards a comfortable and stress free existence.
Future goals encompass a wide area of financial planning, there are many factors to consider, hand in hand with those outlined above is the subject of tax. Setting aside funds for your family is one thing, but what of Inheritance Tax and other taxes? What about finalising exactly who gets what? Only through an established plan can you ensure that everything happens the way you want it to.
The first step to your goals set is by figuring out exactly what you want. Retirement is the main point- how much money will you need when you retire? Think about the lifestyle you lead, and the lifestyle you will ideally lead come retirement, and put a number on the yearly income you’ll need to achieve it.
Once you’ve worked out the amount you feel you’ll need to get by on, you then need to think about how to reach this goal. Are you interested in building up an investment portfolio? Or do you simply want to find a great pension plan? When dealing with such important financial decisions it is recommended that you discuss your situation with a recommended financial adviser. An independent financial adviser’s role will be to discuss in detail your unique financial situation and then work with you to help reach your goals, they will have extensive knowledge with regards to financial products and together you will be able to work out a tailor-made financial plan.
Through discussions with an IFA you will also be able to work out a plan for your estate.
Without adequate plans in place many problems can arise when you pass away, inheritance tax being just one of the potential problems. An IFA will be able to help, there may be certain trusts and other financial schemes available in your jurisdiction that may shield your beneficiaries from heavy IHT and government red tape. Indeed, certain offshore pension plans, such the QROPS, are known to have a number of benefits for expatriates, with a lessening of inheritance tax being just one of the benefits.
With a good mix of sensible planning and hard work, you should be able to achieve your goals and create a stable future for yourself and those around you.