Should I Invest my money?
By taking the plunge and investing in the stock market, you can reach your financial goals sooner. Whether building up a deposit for a first home, paying school fees or saving for your retirement, for these long-term goals, the buying power of cash will typically be eroded by price inflation over time.
Research shows that those who invested in a stocks and shares Individual Savings Account (ISA) 15 years ago could have enjoyed gains of almost double those experienced by individuals leaving money in cash over the same period.
Investing money does involve risk and exposure to volatility and there is of course an important role for cash in long-term financial planning.
Working out how much of your hard-earned cash you can invest without impacting on your day-to-day lifestyle and understanding how it all works is something we can help you with.
Can I afford to live on a state pension?
We all know that living on only a state pension in later life is unlikely to result in a particularly high standard of living.
If you qualify for a full state pension, you receive an income of £8,546.20 a year. This compares to £26,676 a year for the average full-time employee in the UK, or at £21,419.36 a year after tax (around 2.5 times the level of the state pension income).
Research shows that it takes the first 101 working days of 2018 for the average full-time employee in the UK to get paid the equivalent of the full state pension for the year.
Imagine what this would mean for your standard of living if you had no other sources of retirement income. How would you pay for the other 220 days until the end of the year?
The we look after tend to be saving towards other sources of income in retirement, including private and occupational pension pots, but research found that nearly one in five working adults believe the state pension will be their main source of retirement income!
If you’re thinking about your own retirement and want to make sure you have enough, please do get in touch. We can help you calculate which sources and levels of income you can expect to receive in later life, before advising on a strategy to maximise retirement income from all sources, so that you can live comfortably when you stop working.
Should I have a will?
YES! Here’s why…
l?Despite the importance of these legal documents, research found that 60% of adults don’t have a will in place.
If you die without a valid will, you die ‘intestate’ and your financial assets are distributed in accordance to government rules, which is not necessarily in line with your own wishes. This can result in your money going to people you might not have wanted to receive it.
It is not safe to assume that your partner will inherit your wealth when you die if you don’t have a will in place, especially if you cohabit; there’s a good chance they won’t receive a penny.
You can also appoint guardians for your children in your will, so getting your will written is an opportunity to tick two important items off your death planning list in one go.
Here at Asset & Investment management we have two, in-house professional will writers and can we can help produce wills for you as well as help with your overall estate planning.
If you haven’t already sorted out your will, now is the time.
Should I downsize my house now that the kids have all left home?
Gaining empty nester status could turn thoughts to downsizing to a smaller property as you no longer need all of that space and spare bedrooms. However, strong ties to the community will often mean you have no intentions of moving out of the area. Others choose to stay put in order to release capital for living expenses in retirement.
Rather than charging headlong into a downsizing decision, or dismissing it entirely from your list of options, it can be reviewed sensibly from a financial perspective to understand what it would mean for your personal finances in later life.
For those who do decide to downsize, the financial windfall can be significant. Lloyds Bank reported that, when downsizers move from a detached three bedroom house to a flat or bungalow, the average amount of equity released from the property sale is £109,656.
Living in a smaller property is also likely to reduce ongoing costs, such as council tax and utility bills.
If you find yourself becoming an empty nester, please do give us a call to discuss your options and find out what this means for your personal finances.
There is no 'one size fits all' in financial advice and here at AIM we like to get to know you and your family well before we can offer bespoke and sound advice. The above statements are a starting point to help you to establish your needs and in no way consitutes advice.