Our finances underpin most areas of our lives and there can be an intrinsic link between our financial wellbeing and the other pillars of wellbeing, notably our mental health. The New Year is a good reminder that we should consider taking the same approach to our finances as any other area of our lives; creating positive behaviours that will hopefully benefit our lives.
Creating your own financial plan
Schroders Personal Wealth have developed our “Guide To Creating Your Own Financial Plan’ which outlines the four steps that we believe are essential for creating a good plan and provides templates for people to be able to do this themselves or with their loved ones, helping to normalise the conversation of finances at home.
1 Create a life plan
Start by plotting out your key potential life events. This could be things such as education costs, property purchases and the age at which you hope to retire. The aim is to then try to estimate the potential cost of each, creating goals to work towards.
2 Understand where you are today
Completing an income and expenditure form could help you recognise all of your financial assets (such as salary, pension income and benefits) as well as key outgoings (such as a mortgage, loan repayments and general expenses). This can then prompt discussions around disposable income and options to aim to make your money work harder for you.
3 Complete the financial action plan
Our action plan is a great tool to start the conversation around core financial planning including:
Individual and family protection
Savings, investments and pensions
Estate planning and inheritance
4 Review your plan each year
Once you have a financial plan in place it is important that you review it regularly to ensure it remains aligned with your goals.
48% of people regularly or occasionally worry about their finances (1).
Remember that you’re not alone if you’re feeling the financial pressure this month and seeking the support of a financial adviser could help you kick start the process of creating your own financial plan. To book in for your free financial health check with an adviser please visit: www.spw.com/referral/cambridge-network
1 Schroders Personal Wealth, ‘Money And Mind Report’, April 2021.