5 Mins
It’s probably true to say that your family is your most precious asset. If you were no longer around, you’d want to rest secure in the knowledge that they were provided for, financially. You’ve invested so much time, energy, love (and money!) into all those people – it stands to reason that you want them to have as strong a start in an uncertain world as you can possibly create.
Leaving things to chance isn’t an option. Everyone knows the old saying, “failing to plan means planning to fail.”
At Henderson Loggie Financial Planning, we’ve been helping our clients plan for financial success for over 20 years now. Here are some key things we think you should consider as you begin this journey to financial security for your family.
Put your own oxygen mask on first
The first step along the way is to put your needs first. Sounds selfish? It isn’t.
Reducing debt, including mortgages, and planning for your own retirement are vital as otherwise, these shortfalls will fall on your loved ones.
And in the current financial landscape, you probably won’t match in interest on savings what you lose in interest on debts. Here’s Ricky Clark, one of our trusted advisors, with some very sensible ideas about planning for your retirement.
Make a will
According to a YouGov survey, there is an unbelievable number of adults in Britain who don’t have a will – around two-thirds of us, in fact.
This is potentially disastrous for your loved ones as the funds they will get, and when those funds are made available, will be determined by rules beyond their control. Having a will is the way to ensure that your loved ones will be provided for in a timely, financially secure way. GOV.UK explains everything you need to know here.
Have clear financial aims
Look at your income, as well as your assets, any debt repayments you may have, along with your living expenses.
Think about where you currently are, and where, ideally, you’d like yourself and your family to be, financially, in the future.
Do you need to consider saving for school fees or university funding?
Having clarity on the numbers involved is the first step in planning for the future. Our team can advise you on the best ways to save and invest to help you make good things happen; here’s an article from our website if you’re thinking about helping with school fees, for example.
Video Series: Personal Protection
We’ve partnered with Money Alive to bring you FREE access to their interactive, impartial, educational video journey covering: the financial impact of illness, critical illness or death and how insurance can help.
Be savings savvy
Saving in a tax-efficient way maximises your money’s potential. You could open savings accounts for your children and grandchildren, for example, or your young family members might be better off with a Junior ISA, with the money in their names rather than as part of your estate.
There’s also the possibility of creating a pension for infant arrivals to your family, with great tax incentives. Shop around and consider the length of time before your children or grandchildren are likely to access the amount you’ve provided – a long-term investment will potentially reap a greater overall reward than a short-term one. Here’s one of our experts on the difference between savings and investments.
Understand your tax situation
Inheritance Tax or IHT is a complex subject. You can leave an estate worth £325,000 before IHT of 40% becomes payable. If you’re married or have a civil partner, though, you can gift the same amount to them and create a total estate of £650k, IHT-free.
You can also gift individuals up to £3,000 per tax year without any tax becoming payable. Bear in mind that, for IHT purposes, assets and cash held in trust for others don’t count as part of your estate.
IHT allowances are gradually being increased to £500,000 per person, it’s true, but while this might seem like a large amount, it’s surprisingly easy to slip slightly over the allowance and end up paying more tax than you need.
Talk to one of our friendly, expert advisors to ensure that you’re leaving everything to the people you love, rather than to the taxman.
Income, family and home protection
Very little in life is certain, it’s fair to say.
So, when you’re thinking about your family’s future financial stability, it’s important to make sure your income and your home are protected, should anything untoward occur, like illness, injury, or premature death.
You should consider how your mortgage, rent or debt would be paid if you weren’t around; income protection, life insurance and critical illness cover are all options to think about.
Let’s wrap up
Peace of mind is a thing well worth investing in, we think. Leaving your family provided for in the future isn’t something to leave to chance. Starting your planning for this sooner rather than later means that you can sleep easy at night, knowing that you’ve got everything sorted.
The good news is that here at Henderson Loggie Financial Planning, we’ve created a team of friendly, knowledgeable advisors who love nothing more than getting their teeth into your business to make sure that everything’s in order, exactly as you’d want it, should disaster occur. (And even if it doesn’t.)
We don’t cross our fingers to make sure the worst doesn’t happen – we make sure we’ve got you covered.
Want to make plans for a financially secure future? Don’t just dream about it: fill in the contact form and let’s make it real.