Month: January 2017

Start the New Year with a Financial Health Check

New Year is a perfect time for a complete review of your finances. Run through all your financial arrangements, like investments, pension, insurance plans and bank accounts. The following checklist may help.

Setting Goals and Budgeting

Finances are a popular area where people make (and fail to fulfil) New Year’s resolutions. “Spend less” and “save more” are particularly common ones – and particularly bad ones. When setting goals, you are more likely to achieve them if they are specific and measurable. “Deposit £500 to my savings account every month” is obviously much better than “save more”.

That said, even a well-defined and accurate objective won’t work if it’s either too soft or unrealistic. Make your goals ambitious, but keep them within reach with respect to your current lifestyle and habits. Keep in mind that besides spending cuts there are other ways to improve your bottom line, especially in the long run. They are often less painful and easier to stick with, but can have enormous effect. For example, optimising your taxes or pension contributions, taking advantage of various allowances, changing the way you save and invest or choosing a better insurance plan.


Pensions are among the most valuable assets for most people, but they often do not receive as much attention as they deserve. Moreover, pensions legislation has undergone substantial changes in the last few years. If you haven’t reviewed your pension for a while, do it now. The following are some of the questions to ask:

  • Are you contributing the right amounts? Make sure you don’t contribute too little (you may have too little to live off in retirement)) or too much (you might create a problem with the reduced Lifetime Allowance).
  • Does the investment strategy still fit your changing situation, risk attitude and time horizon?
  • Will your current pensions allow you to take advantage of the new pension freedoms? Many older schemes don’t.
  • How does your pension fit in your retirement and estate planning?
  • If you have a Final Salary Pension, have you recently requested a transfer value? These have recently gone up quite a bit and this could provide a good opportunity for you to restructure.


Pay particular attention to ISAs. If you are not using them, you are again leaving money on the table. The annual ISA allowance is £15,240 for the 2016/17 tax year and it goes up to £20,000 for the next. These are significant amounts of money you can invest tax-free. Remember to use this year’s allowance by 5 April and don’t leave it to the last moment, as some providers take several working days to process a new deposit.


Do you have a proper investment strategy which is intended to achieve specified goals held by you? Do not confuse speculation with disciplined investment. The former is for fun and the thrill. The latter is what you need to do to achieve your financial goals. If you hold mutual funds, look at their latest reports and check where your money is actually invested. Is the risk exposure in line with your preference? When assessing investment risk, remember to always consider all your investments (including your pension, ISAs, funds and stocks) together, even when the money is technically in several different accounts and investment vehicles.


Risk management is an essential part of sound financial planning. At the same time, insurance is an area where you can waste a lot of money if you choose the wrong product.

Go through all your insurance plans. Check how much each costs, what exactly it covers and what it doesn’t. Changes in your circumstances (e.g. your health, family situation or driving experience) may not only require a different plan, but may also qualify you for a lower premium.

Wills and LPAs

Numerous studies have shown that more than half of adults living in the UK don’t have a Will, including many in their 50’s and 60’s. If you are one of those people, writing a Will is a good New Year’s resolution to make – and one that is not that hard to arrange or anything like as expensive as you would think. We have connections with a number of law firms and can refer you to appropriate specialists.

If you already have a Will, this might be a good time to review it. Check whether it still accurately reflects your wishes and make updates if needed.

The same applies to Lasting Power of Attorney (LPA). Incapacity can strike at any time, not only in old age. If you get it sorted before it’s too late, you will save your family considerable costs and lengthy dealings with the courts. If you already have an LPA in place, check that it’s still up to date.

Contact Us for Help

If you would like help with getting your financial affairs in order and keeping them that way, we would be happy to help. Contact us. We also offer specialist pensions advisory services.

Further Details

If you live in the UK visit UK pensions advisory service. If not, visit expatriate pensions advisory service.