Holding the key to your future – Financial Milestones with FH Manning
Advice and guidance for your 20s, 30s, 40s, 50s and 60s
You won’t work forever. At some point, whether you like it or not, you will have to retire and depend on what you have saved for the years you have been working. Sadly, some people have nothing to show by the time they reach retirement age.
But what can you actually do to ensure that you are ready to give up working by the time you reach retirement age? You don’t have to work forever to live a happy life if you follow our financial plan throughout your life. Read on to learn more!
Financial milestones throughout your life
In your 20s
You are still young, and it is easy to think you have a lot of time before you hit retirement age — but the earlier you start saving, the better. That way, you will know what is coming, what you can spend to maintain a certain lifestyle, and what to save. Remember, saving opens up more opportunities for you as you get older. Furthermore, it stops you from borrowing later. Which in turn allows you to spend the money you would have paid in interest on enjoying your twilight years…
In your 30s
In your 30s, you are probably thinking of getting a mortgage. If you started saving in your 20s, you shouldn’t have any issues getting a good mortgage deal with a favourable interest rate, which is a very good thing. Just make sure to research before getting the mortgage as it can be quite a minefield. In my opinion a recommended (independent) mortgage adviser is a worthwhile person to talk to before potentially making the biggest purchase of your life.
This is also time to pay off your student loan, once and for all. It is also time to pay off your credit card and be on control of your future finances. By managing your credit card debts at this time, you will have achieved a huge milestone that very few ever do.
In your 40s
Didn’t manage to pay off your student loan in your 30s? Plan to do that as soon as possible. Don’t let it roll further, as it will continue to cut down your future cash flow.
It is also time to syphon as much of your disposable income as possible and put it towards your retirement contributions. So, if you get a wage rise or bonus, think about using a proportion towards your retirement. That said, ensure you also have an emergency easy – access fund which can call upon; some allocation for your holiday, and special events. You need some cash to enjoy life!
It’s also the right time to start thinking about savings bonds and reviewing your pension contribution. If you are not on track, make the necessary adjustments. Experts recommend saving 12 – 15% of your earnings to build up enough funds for your retirement.
In your 50s
This is the best time to get your state pension statement. This will help you plan better for your retirement finances. If you have a little cash to contribute toward your pension, this is the right time.
If you are fortunate enough to find yourself with a lump sum or substantial disposable income this is also an opportune time to consider placing investments inside an ISA wrapper which provide three tax advantages:
- No tax on profits. You don’t have to pay any capital gains tax on profits made from share price increases
- No tax on interest earned on bonds. You get to keep it all
- No tax on dividend income. Inside an ISA, you don’t pay tax on dividends
At FH Manning we have been advising our clients for many years on which ISA’s to invest in and how to set them up. Don’t hesitate to contact us if this is something you would like help with so you can reap the benefits too…
In your 60s
Soon you will be giving up working. So, it is high time you have an idea of what your general bills and commitments will be like in the future to know how to access and spend your pension and investment savings.
If there is any pending debt, do your best to have it cleared as soon as possible. This is also the right time to engage your financial adviser for financial advice as their incite at this time can be invaluable.
Saving money throughout your life is not easy but necessary and very possible because you are in control. If you make the right choices (at the right times) and have a defined plan that is unique to your future, you will likely attain the financial freedom you desire throughout your life.
Struggling to define your financial milestones or in a quandary about where to turn next? Feel free to contact Claire at firstname.lastname@example.org for professional support.