In the first article in our Will Wednesday series, we look at the self care that comes from having one’s personal finances in order, especially in the case of wills and probate.
Millennials and Generation Z are increasingly subscribing to the notion of ‘self-care’ and mindfulness. Self-care is a range of activities that a person deliberately carries out in order to take care of their mental, emotional and physical health. The goal of self-care is to reach a state of bliss created from the knowledge you are completely in control of your life. However, self-care should not just be constricted to pumpkin spice lattes, hot yoga and meditation audiobooks, it is deeper than that. Sadly, financial self-care is often overlooked in favour of yoga poses and green juices that frankly look better on your Instagram newsfeed than a finance spreadsheet.
In giving yourself the time to reflect and understand your financial habits and needs you are practicing healthy financial self -care. By assessing your financial goals, you can figure out a detailed plan on how to reach them. By ensuring that your financial position and affairs are in order you will create a peace of mind for yourself. For example, if your goal is to save a housing deposit for your first home, a financial adviser can provide you with guidance and advice to help you reach this goal quicker than if you were to attempt to on your own. Having direction and control over your financial affairs will decrease your anxiety and stress and bring you peace of mind.
Below are four tips to begin your financial self-care journey:
Make a list of all of your monthly outgoings and income, this may sound very simple but by understanding your income and expenditure you will grow your financial awareness. One you have your list subdivide it into two categories; essential expenses such a rent, travel, food, bills; and non-essential expenses such a socialising, nights out and daily takeaway latte’s (a lot of us are guilty of this one!).
Your completed list will do one or two things – it may shock you, but it will educate you. The list will show you exactly where every penny of your hard-earned income is spent and also highlight any areas where you can cut down on spending. It may not feel like much going to the pub for a glass of wine with colleagues or friends a few times a week. But several £5-8.00 glasses of wine a week can stack up to hundreds of pounds of excess spending a month. The goal of your budget is not about being unrealistic or having no social fun, but rather a way of getting to know your spending habits so that you can get smart with your money.
- Build A 5 Year Plan
Sit down with a piece of paper and think what financial goals and personal goals you want to achieve within the next five years, it could be saving a house deposit, paying off a credit card, buying a new car or starting a family. The goals do not have to be extraordinary but something that will make you feel good if you were to achieve. Then assess your current financial situation and whether in its current state it will permit you or prohibit you from achieving your goals.
Once you have a clear idea of where you are vs where you want to be you can begin to draw up a step by step five-year plan. A good financial planner or accountant will be able to assist you with this and will also be able to recommend other investments to help you grow your portfolio.
You should carry out a review of this five year plan every year to ensure that you are on track to meet your target. Do not get overwhelmed by the task- remember the speedier you get serious about your finances and planning the quicker you will reap the benefits.
- Take Care of The Assets You Already Have
Do a sweep of all your assets that you believe to have financial value then check that they are all properly and fully insured. One of the most common insurance faux pas is an incorrect rebuild value for property home insurance. If anything, catastrophic were to happen to your assets and they were not insured or inadequately insured then you could end up paying out of your own pocket to mitigate your loss.
Make a list of when the insurance policies are due for renewal. Quite often you will end up with a cheaper policy if you forward plan and shop around for insurance quotations a few weeks prior to the policy expiring. This level of organisation will pay off as you will not be scrabbling around different providers the day before your policy expires, instead you will have a list of cheaper quotes to choose from at your leisure.
- Make a Will
Do not put off making a Will. Taking care of what happens to your assets and liabilities post death can be as important as what occurs when you are alive.
A professionally drafted Will safeguards your family and loved ones by guaranteeing that your assets and possession’s go to the people you want to benefit. A Will can make it easier for those nearest and dearest to you to settle bills, deal with bank accounts and resolve other financial and business affairs.
Else Solicitors is a company with vast experience in drawing up Wills. Our fully qualified Solicitors offer a cost-effective, fixed fee service and we will store your signed and witnessed Will free of charge. We can also offer help and advice with updating your Will, inheritance disputes, inheritance tax planning and setting up trusts, or a lasting power of attorney in case you are ever unable to manage your own professional and financial affairs.