Planuary: Making plans for YOUR future

Posted on Jan 22 2019 - 9:00am by Samantha Clark

Advertorial post with Aviva

Regular readers of our website will know, we won’t apologise for striving to empower other women to achieve their goals and objectives, whatever they may be. And our subject matters, for that reason, are diverse. One area of interest is to help you become more financially savvy, to make your money work harder and give you greater independence.

Let’s talk about future planning for a moment. What provisions are you making for when you’re older? What kind of lifestyle do you want to have when you reach retirement? Would you like to ensure you’re not worrying about rent and to be able to live comfortably? That’s the dream, right? Why work so hard in your formative years if you’re left with little to nothing to help you enjoy your time.

Do you know what your future prospects currently look like?

Did you know the average woman is set to experience a shortfall of £223,000 in earnings and £106,000 in pensions over her lifetime compared to her male counterparts?  That’s just one significant finding in the latest research into the gender-gap. It means that by 65, women on average only have £35,700 in a pension and just £13,400 in savings. Perhaps even more scarily, 45% of women in their 40s have no savings or investments in their name at all. For too long, finance is seen as a man’s world and if we don’t start saving more for our futures, we could end up in quite a vulnerable position.

There is no better time than the present to think about your future; the sooner you act, the longer you will feel the benefit of the positive decisions you have made.

There are plenty of opportunities available to help you address some of the issues associated with savings, pensions and investments to ensure you are thinking about and preparing for your future that will have an immediate impact. Let’s make January our Plan-uary and make some changes to our financial standing.

Here are simple ways you can become more aware of your financial position and steps you can take today to improve your future.

Workplace pensions

Many organisations will enrol you automatically into a workplace pension and help prepare you to be financially secure through retirement.  The best part about it is that your organisation may well match some of your contributions; meaning you’re immediately benefitting from the money you’re paying in.

If you’re not aware of your workplace pension options, speak to your employer or look at the plethora of workplace pension information on the UK government website.

Clearing debt

Finance

Debt, can both good and bad, but no one likes it hanging around for longer than necessary.

Review the debts that are costing you the most in outgoings and ensure you are clearing those first, you can also consider switching your debts to cheaper interest options or consolidating; but be sure you are clear on the implications of doing so.

Even making marginal increases on credit card minimum payments for example on a debt of £5000 can make a significant difference. Paying £50 per month would take over 10 years to repay but paying £100 per month would nearly halve the time needed to pay off the debt and save nearly £1000 in unnecessary interest payments.

Once cleared, use the money you allocated for repayment and invest it. You’re already used to spending it so continue to do so in a way that could help you money increase and help with your future planning.

Small contributions

Similar to clearing debts, where a small increase in repayments can have big long-term consequences, when it comes to saving, small contributions can have big long-term effects.

Look at the various investment opportunities available to you; you’re likely to gain a higher rate of return by investing your money than simply putting it into a Cash ISA account which have inherently low interest benefits. This is simply about balancing your appetite for savings and the amount you want to grow.  Make your money work for you by talking to a fund manager about investment options; they can talk to you about the various risk factors and help you make informed decisions on making the most from your money.

Financial independence

In many households, just one partner is responsible for the finances and that can leave the other out in the cold in terms of understanding their responsibilities or feeling like they have little control over their future. In the latest figure produced, 24% of men have both savings and investments, compared to only 16% of women.

There is nothing wrong with working with your partner cohesively on your finances as long as you’re both clear on your financial status; this goes for life insurance policies, wills, debts, investments and of course pensions. It is important for you both to be on the same page when it comes to your financial future so be sure to have frequent and open conversations about it and take any necessary action to ensure you’re both protected, well informed and getting the most out of your investments.

We’d love you to pledge to change one thing to improve your finances this year. Join the conversation by sharing your ideas on Social Media using the hashtag #Planuary and tell us what you plan to do.  We all have plans for the future and investing in that future now will help make those goals a reality.

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