New Year is a time of fresh starts and opportunities, and it’s the perfect time to focus on getting your finances in order. As you set your goals for the year ahead, why not make financial planning a priority? Here are our top 5 New Year’s financial resolutions to help you get started.
Set Long-Term Financial Goals:
Take the time to think about where you want to be in the future. Whether it’s planning for retirement, buying a dream home, or taking the trip of a lifetime, setting specific, long-term financial goals can help you stay focused and motivated. Consider what your ideal lifestyle will look like, and estimate how much it will cost to achieve it. Remember to factor in things like the State Pension, and any other costs that may change as you age.
When it comes to retirement, it’s important to think about more than just the amount of money you’ll need. Consider how you want to spend your time, what kind of lifestyle you want to lead, and where you want to live. Will you travel the world, or stay close to home? Will you take up new hobbies or continue with your existing ones? Will you downsize your home or buy a bigger one? All of these factors will impact the amount of money you’ll need to save.
When it comes to other goals, like buying a dream home, it’s important to be realistic about what you can afford. Consider the size and location of the home, as well as any additional costs like renovations or repairs. Be sure to factor in the cost of utility cost, insurance, and maintenance.
Lastly, when it comes to taking the trip of a lifetime, think about your destination, the duration of your trip, and what kind of experience you want to have. Will you stay in a luxury hotel or a budget-friendly hostel? Will you dine in fancy restaurants or street vendors? Will you take guided tours or explore on your own? All of these factors will impact the cost of your trip, and the amount of money you’ll need to save.
- As a mortgage broker, we can help you plan and prepare for your future home purchase, whether it’s your first home or your dream home.
We can also assist you in finding mortgage options that align with your long-term goals, such as fixed-rate or adjustable-rate mortgages, the most suitable term and help you understand the pros and cons of each.
Create a Budget:
Having a budget in place will help you stay on top of your expenses. Take the time to sit down and review your income and expenses, and create a budget that works for you. Be sure to keep track of your spending throughout the year, and make adjustments as needed.
When creating your budget, be sure to include all of your fixed expenses, like rent or mortgage, utilities, and insurance. Also, don’t forget to include variable expenses, like food, transportation, and entertainment. It’s important to be realistic about your spending habits and to set limits for yourself, to avoid overspending.
Also, consider setting aside a certain percentage of your income for savings and investments. This will help you reach your long-term financial goals and provide a safety net in case of unexpected expenses.
- As a mortgage broker, we can help you understand how much home you can afford and what your monthly mortgage payments will be, based on your income and expenses.
Review and Reduce Debt:
High levels of debt can prevent you from reaching your financial goals, so it’s important to take a close look at your debt and take steps to reduce it. Start by creating a list of all of your outstanding debts, including credit card balances and car loans. Then, prioritise them by interest rate, with the highest-interest debts at the top of the list.
Next, consider consolidation of your debts, if it makes sense for you. This can help you reduce the number of payments you need to make and could lower your overall interest rate. If you’re struggling to make your payments, consider reaching out to your creditors to see if they can offer any assistance.
- We can help you understand the impact of your debt on your mortgage options.
- We can also provide you with information on debt consolidation options that may be available at remortgage
Build an Emergency Fund:
Emergencies happen, and it’s important to be prepared for them financially. Start by setting a goal for the amount you want to have in your emergency fund and then create a plan for how you will save for it. Consider setting up automatic transfers from your current account to your savings account, or finding ways to cut expenses so you can save more.
Your emergency fund should have enough money to cover three to six months’ worth of living expenses. This will provide a safety net in case of unexpected events such as job loss or property repairs.
- We can help you secure an income protection policy, which can protect your income and prevent you needing to use an emergency fund if you end up out of work unwell.
Review and Update Your Insurance:
Review your insurance coverage to make sure it still meets your needs. Consider your life changes, such as marriage, having children, or buying a new home, and make sure your insurance policies are updated accordingly.
It’s also a good idea to review your beneficiaries on your life insurance policies, to make sure they are up-to-date. This will ensure that the right people are taken care of in the event of your passing.
Don’t wait until it’s too late, schedule a review with us today and ensure that you and your loved ones are fully protected against life’s unexpected events.
In conclusion, the new year is a great time to take a fresh look at your finances and set yourself up for success. By setting financial goals, creating a budget, reducing debt, building an emergency fund, and reviewing your insurance, you can make sure that you are on track to achieve your financial objectives.
Remember to be patient and persistent, and to seek professional advice when needed.