One resolution you should stick to
At last we’re ensconced in our new offices, the snow finally seems to be abating and we’re getting back to normal. My abstinence from chocolate for the month of January is going well and I find it’s one new year rule I do tend to stick to!
Though, for the most part, new year’s resolutions to me are simply made to be broken, but there’s one that should be on the top of your list and once you’ve committed to sorting your finances you’ll find it’s not the onerous undertaking you would have thought.
Friends ask what their priority should be and I think it is important to actually understand the investments that you already own. This seems so simple, but it’s amazing how many people fail at the first hurdle. There are so many different types of investments and products out there that it is often impossible for the lay person to get to grips with their finances so I have listed some questions below that help to give you some focus on what you should actually be looking for:
• Have my investments performed well?
• Are my investments tax efficient?
• Are you paying excessive ongoing charges without receiving any benefit?
• Do these investments fit my objectives?
Most people don’t know the answers to the majority (sometimes all) of these questions, and it can be daunting knowing where to start. Through a process of elimination a gas engineer can pin point a boiler problem (an apt example since I had two burst pipes at the weekend) and any good financial planner can work through a plethora of paper work and small print pretty quickly to hone in on unjustifiable charges.
If you really don’t have a clue where to start or are simply too busy to do the necessary paperwork then a good financial planner can add real value to your situation. I’m currently in the process of drafting a guide on how to choose a financial adviser and it is something I have often talked about in my blog but just to recap briefly, bear in mind the following:
- Use an independent financial adviser. Check they are not tied to an insurance company as their advice will be biased and commission led.
- Use a professional with chartered financial planning accreditation.
- Use a fee based adviser. You can agree fees in advance and be confident their advice adds value to your investments.
- Think carefully about how much risk you are prepared to take. A good financial planner will carry out a risk profile so they advise on the right products for your personal circumstances.
- Ask questions. If you don’t feel confident in making financial decisions ask a trusted friend or relative to be present. It’s useful to have a second opinion.
- Don’t feel pressurised. A genuinely independent financial practitioner will not ‘hard sell’ a financial product.
I will post the guide on the blog when it is finished.
Posted in: General Information