With the downtime that we have at present, it seems that the UK has gone fitness mad: walking, running and cycling have become daily events for many. But this could also be a time to work on another area of wellbeing. How about a financial workout? Read on to find some ideas on getting your financial affairs into shape.
1. Household Budget
Where better place to start than at home. Using either pen and paper, a spreadsheet or an online banking programme, this warmup exercise will remind you of your fixed costs and basic lifestyle expenses (essential costs), the level of discretionary spending (lifestyle costs) and the amount you spend on luxuries. You could also create a statement of assets and liabilities, which will include values for investments, shares, and valuables, to give a complete financial picture.
2. Cost Savings
In this workout, you will hone in on expenditure items, which could bring about some instant savings. Take a look at the following:
(i) Energy costs
You can find an abundance of good websites to help with this exercise. My personal favourite is Martin Lewis’ site, Moneysavingexpert.com. It’s an easy process: enter your current gas and electric usage and the cheapest suppliers will be revealed. Many of these sites will send reminders every year, which means that one area of lifelong planning is sorted.
(ii) Insurance policies
Another great workout is to visit a selection of comparison websites, where you could save a decent sum on your buildings and contents, car and travel insurance and, whilst you’re at it, check whether you’re insured for holiday cancellations.
Interest rates are at their lowest ever. This means that if you have a fixed-rate mortgage and your renewal is due within the next six months, there is no time like the present to check the market and you can apply to switch to a new rate immediately. For those of you on a variable rate, consider fixing, as rates will only go one way from here.
Start with the State Pension: if you have 35 years of NI contributions, you should be eligible to receive the maximum State Pension. You can find your entire record on this site: https://www.gov.uk/check-state-pension. To gain access, register for Government Gateway or go through Government Verify. It only takes a few weeks to receive the log-on details.
A weightier workout is to track down all your previous pension schemes. This exercise entails collating a list of all previous employers to see if you can match a pension statement to each. Then, for each scheme, register for online access and get an up-to-date statement. If you have final salary schemes, you may need to write to the administrators to get the statement, as most do not have an online portal.
Getting organised is the first step to financial wellbeing. The next step is to incorporate this information into a structured game plan but to do this, you may need some professional guidance. If you’d like a chat about how a Financial Planner can help you in your workout, we’d be very happy to join you for a virtual coffee over skype, zoom or the phone, just fill out our contact form here.