Financial Planning Priorities in your thirties

Financial Planning Advice

A carefree decade as earnings rise and career prospects blossom? Get the right financial planning advice from a financial advisor.

For others it is the time they take their first steps onto the property ladder, as well as settling down to having children.

Both are likely to be a serious drain on your financial resources so it makes sense to put money aside well in advance. For example, you could need the best part of £40,000 to put down as a deposit on a property worth £150,000, taking into account a 25 per cent deposit and the costs of solicitor’s fees, stamp duty, Land Registry costs and assorted search fees. Of course, it could be substantially higher as the average house in the UK is still around the £238,000 mark despite recent price falls.

Being a parent doesn’t come cheap either. Insurance and investment group LV= estimates parents could spend £193,772 raising a child from birth to 21. This is equivalent to £9,227 a year, £769 a month or £25 a day. So what should you be doing?

Generally speaking, your salary is likely to have increased after around a decade in employment, while any outstanding university debts have usually been paid off. Hopefully, you will also have more disposable income. It is still important to save, so consider Isas (don’t forget you can start a new one each tax year and both you and your partner can have one) and other savings accounts. Once again, it’s vital to have as much flexibility as possible in order to cope with unforeseen costs. Try to keep at least six months’ salary in an easy access bank account for a rainy day.

If you haven’t started a pension that should be a key consideration. Joining an employer’s pension scheme is usually a good idea especially if the employer will also contribute. Otherwise take advice on setting up a private plan.

It might also be worth putting some longer-term investments in place, perhaps starting to building up a risk-balanced investment portfolio. Financial advice is a must.

If you have a home and a family now might be the time to think again about taking out some form of personal insurances if you haven’t already started these earlier. If you have children, top of the list should be life assurance which will help care for your dependents. And again it is time to consider critical illness and income protection to avoid a disastrous drop in living standards if you were unable to work.

This is also the time to make sure you have written a will – or updated an existing one – to make sure your assets will be distributed as you wish in the event of your death.

Once again, having flexibility is the key to financial success. Your children, for example, could be heading off to private school or university – and you are likely to foot at least some of the bill. Some companies offer schemes to pre-fund private school fees and these can be worth exploring as they help to spread the cost.

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