What does it take to be a smart investor? It’s not a difficult thing to achieve, and should be something we all strive to be if we take our financial futures seriously.
And who doesn’t want to ensure that they and their family are well provided for, not only right now, but in the future as well?
You don’t need to have a lot of technical knowledge about funds and stock markets, or even know much about asset classes and all the other jargon that can make the financial world seem daunting and overwhelming.
What you do need are sound principles and goals about what you would like to achieve, and to take advice on the actions required to help you achieve them. Deciding to work with a financial planner is one of the first key decisions to take. Ideally this should be a long-term relationship, with regular annual reviews and frequent communication in between, not just a couple of meetings to get things up and running.
So what are these sound principles ? They are really quite straightforward:
1. Spend less than you earn – might sound obvious, but avoiding unsecured debt such as loans and credit cards is the first step
2. Save and invest more – prioritise the medium to long term, don’t just satisfy your short-term needs
3. Make retirement planning a priority – don’t stick your fingers in your ears whenever the words pension or retirement are mentioned ! The earlier you start to save adequately, the less it will cost you each month, and the more choices you will eventually have. Its also likely that you will achieve ‘financial freedom’ earlier, that is, having enough income provision from your pension and other sources to continue working if you want to rather than because you have to. A good rule of thumb is to be investing 15% of your gross earnings each year into a pension scheme.
4. Actively invest for income and growth – recognise the need to spread your investments
5. Take planning and financial advice seriously – a good financial planner will guide you with clear advice on your investment strategy, help with the more technical aspects of fund and product choices, and ensure you remain on track against your objectives.
To receive a complimentary guide covering Wealth Management, Retirement Planning or Inheritance Tax Planning, please contact Amanda Redman on 07801 045587, email [email protected] or visit www.amandaredmanfp.co.uk