In today’s rapidly evolving financial environment, flexibility is key. Whether you’re responding to market volatility, personal circumstances, or an evolving economic landscape, adapting your financial strategy is essential. This guide will help you understand the steps you can take to ensure your investment plans remain robust and aligned with your long-term goals.
Life doesn’t pause for your plans. When circumstances change, your financial strategy should too. Whether you’ve been planning for years or haven’t started yet, life’s unexpected turns often demand a fresh look at your financial future. For example:
- The arrival of children or grandchildren might be one of the happiest pieces of news you ever receive. No doubt you’ll start thinking about how you can help to give them the brightest future possible.
- Separating, divorcing, or deciding to marry or cohabit, all raise questions about what to do with money. Whether it’s because the wealth is now yours alone or is now a shared asset. There may be questions about how you can buy or keep your property, or perhaps how you can use the money to secure your retirement.
- When someone passes away, or you want to be ready for the time that you or a loved one does, you will want to be sure that loved ones are provided for. It may also be important to you that wealth makes it through generations intact.
Here are a few ways that you may want to adapt your financial plans to changing circumstances.
Evaluate Your Current Financial Plan
Before making any adjustments, it’s important to take a step back and assess where you stand. Start by reviewing your portfolio, looking at your current investments, and analysing their performance, risk profile, and how they align with your future needs.
Assess financial goals to determine if your initial financial goals still match your lifestyle and long-term plans. Changes in your life may require a fresh approach.
Lastly, look for any gaps in your income streams, savings, or protection that might be exacerbated by economic changes.
Should I adjust my financial strategy?
If you’ve come into a lump sum, whether from an inheritance, property sale, or business exit, it’s worth reassessing your investment approach. Here’s how you might consider handling the new funds:
- Boost your current portfolio: You can use the money to increase investments in your existing assets, potentially adding to funds that are performing well.
- Diversify your investments: Explore new sectors or asset classes with your additional funds, reducing risk by spreading investments across different types.
Of course, any decision should align with your overall financial goals and long-term plans. You will also need to assess whether you are taking the correct level of risk to enable you to achieve your financial objectives.
On the other hand, a new arrival, or marriage break-up could mean that you face higher-than-expected outgoings. In these circumstances, it may be time to reduce your investment commitments or choose financial products that allow easier access to your funds. This ensures flexibility to handle immediate financial needs while protecting your long-term goals.
An independent financial adviser can help tailor strategies to your changing circumstances. Make sure you work with someone responsive and accessible, it’s crucial to get timely professional advice when making key financial decisions.
How do I make sure my wealth gets passed on successfully?
The arrival of a child or grandchild might get you thinking about the legacy you want to leave. For many, it’s about making sure as much wealth as possible reaches your loved ones. Possible considerations are:
- Products such as Junior ISAs
- A strategy for gifting
- Arranging assets to minimise exposure to inheritance tax
- Trusts
Your independent financial adviser will have extensive experience helping people maximise the wealth they can pass on, while still enjoying a comfortable life and retirement. Make sure you get advice from someone who can design bespoke strategies for your lifestyle and your aspirations.
How should I adjust my pension strategy?
A big life change might prompt a rethink of your pensions strategy. A lot of people take a passive approach to their pensions, and that’s understandable. Not many people have the time or expertise to treat their pensions like the investments they are, and simply make the ‘default’ contributions that their employer sets.
However, you can make a material difference to your life, your retirement, and the lives of your family by making strategic decisions about your pension. That’s where advice from an independent financial adviser can be extremely useful.
You may wish to contribute more to your pension:
- To bring your income down below a certain threshold for certain tax allowances
- To enable you to retire sooner rather than later
- As a strategy for reducing inheritance tax
You may wish to contribute less to your pension:
- If you decide to adopt an alternative investment and retirement strategy, such as acquiring a property portfolio
- When you need more cash immediately available
You might want to adapt your investment strategy for retirement because you plan to start a business or go self-employed for the last years of your working life or during retirement. Pensions and pension planning can be deeply complex, with many moving parts, but the right independent financial adviser can help you plan a comfortable retirement that protects the lifestyle you enjoy now.
Speak to a financial specialist today
The decisions you make in your financial planning can have a substantial effect on your lifestyle, and the lives of those you wish to pass your wealth on to. An independent financial adviser is not only a full-time expert, dedicated to staying abreast of the latest financial products, developments, laws, and incentives. They are also an objective third party, who can:
- offer a clear picture of your circumstances
- give you the realistic likely outcome of various decisions
- help you make the best choices for your goals, when you may not have the headspace to do so.
Flying Colours is a team of talented advisers, dedicated to adding exceptional value as we advise you on your finances and personal goals. We care deeply about the life you are seeking to build and offer independent financial advice that responds to your needs. See the services we offer for more information. If you have £250,000 or more in assets (excluding property) get in touch with your local office, and one of our talented team members will discuss how we can help you enjoy today while planning for tomorrow (whatever tomorrow may bring).
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Please note: This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.
The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance. Investments should be considered over the longer term (minimum of 5 years) and should fit in with your overall risk profile and financial circumstances.
A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance and you may get back less than you originally invested.
