A New Year Resolution For Your Finances

5 January 2022

This time of year millions of people resolve to give things up, take things up, or just to do some things differently to improve their life or health. According to a recent survey however, less than 8% of us manage to maintain our New Year’s resolutions beyond a few weeks, sometimes even days!

Part of the reason for this really low number is the fact that many of the resolutions involve major changes and difficult ongoing commitments, such as giving up the booze or training for a marathon. There is however one very easy and quick resolution you can make that can have a long lasting effect on you and your family’s life. That is to lift the phone or drop an email to a Qualified Financial Advisor and arrange a review or health-check of your finances.

A good Financial Advisor will sit with you and conduct a proper factfind, taking into account details of your personal financial situation to ensure that any existing arrangements you may have in place are still appropriate for you. Some people may have taken out life cover or started a pension or savings plan some time ago and have not looked at them since. Some others may have no plans in place whatsoever and have been meaning to do something about that.

If you are in the first camp, many factors may have changed in your life. You may need more or less protection for your family against death or serious illness. Your existing protection plans may be available at a lower premium or with better features. If you have never had a review before, your Advisor will explain how protection is the most important aspect of financial planning as it underpins all other financial goals. Without adequate protection, your family could face severe hardship in the event of premature death or serious illness, which in turn will impact all other financial aspirations and plans.

Retirement planning may also have been placed on the “long finger” by many. As people are living longer and the state retirement age is increasing, more and more people are getting around to setting up pensions to ensure that they are financially secure in retirement. You may already have started saving for retirement; however, setting up a pension is one thing but reviewing it is just as important. Charging structures may have improved since you took it out, or more appropriate investment options could be available than before.

Your Advisor will also be able to discuss how to get the best out of your savings if you have any, or how to get started if you do not. Some people think they are excellent savers as they have funds built up in their bank accounts; however, interest rates are at historic lows, even potentially negative. Alternative options may need to be looked at in order to make your savings work harder, even if it is just to combat the effect of inflation.

Most people find that reviewing their finances is an easy enough process, certainly compared to other resolutions they have made, so maybe it is one you should consider as this New Year kicks off.

Sean Sweeney, QFA RPA is a Qualified Financial Advisor and Retirement Planning Advisor.You can contact him through John F. Loughrey Financial Services by telephone on 074-9124002 or by email on sean@jfl.ie

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