Most people will admit to being a little uncomfortable talking about money to close family, other relatives and friends. Depending on circumstances, it could be due to a fear of boasting, feeling that they haven’t achieved enough or simply that it is just “not done!” While some reticence is understandable, there are some conversations that are vital for ongoing financial health.
Not everyone shares the same financial journey; people’s attitudes to money are often set by their parents and their experiences. A number of studies suggest that money worries are the biggest single cause for divorce, so structuring some form of money conversation could do a lot more than just save a few Pounds Sterling.
Key to most of us is having a personal budget that allows for the essential things, gives you an element of discretionary spending and puts money aside for retirement and the potential “rainy day”.
While saving into Pensions and other investments (like ISAs or Unit Trusts) is an important part of your financial plan, working out how much your monthly living costs are today helps you understand how much you ‘could’ be saving into pensions and other investments after your day-to-day expenses have been met, which can bring a certain peace of mind.
As a place to start when thinking out your monthly budget, check through your bank statements for a few months and query every entry you are not certain about. Many people pay for gym subscriptions, expensive mobile phone contracts or have spending habits that make their money mysteriously disappear. Check that your income and expenditure is, at least, in equilibrium, as regular shortfalls can lead to a debt problem.
The Money Advice Service have a page about money and a guide you can print off and the guide even includes a few starting phrases to get some communications going.
So when ‘talking about money’; what should you discuss?
Firstly, shared expenses that keep a roof over your head; a mortgage or your rent.
Next, expenses that keep life ticking over; food, mobile phone, Internet, TV licence, house and contents insurance.
Consider protection insurance (life cover, critical illness cover and income protection) for people who have entwined lives, financially dependent children, finances and loans or mortgages.
Short, medium and long term plans, both personal and mutual; perhaps paying for a holiday, car and a house?
How and when are you going to retire? What income will you need from your pensions, savings and investments?
An Independent Financial Adviser will be able to develop and focus your thoughts on at least the last three of those bullet points, but you can expect your Adviser to be able to go further than that. As a neutral party, your Adviser can ask questions without the baggage and the emotion that money can generate; for me I want the best outcome for my clients and that may need some hard choices to help them reach their goals.
Arrange an initial meeting with us
Please contact Sarah Austin at sja@martin-redmanpartners.co.uk or call on 01223 792 196 to arrange an initial appointment, at no cost to yourself.
About Martin-Redman Partners
We are a team of experienced Independent Financial Advisers who can advise on your personal or business financial arrangements. We have been building trusted relationships with clients for many years by articulating clear and tailored recommendations in areas ranging from investments to retirement planning, to complex estate planning advice.
We offer expert independent financial advice throughout Cambridgeshire, Leicestershire, Suffolk, East Anglia and the South East. Many of our clients are within, or are in the surrounding areas of Cambridge, Grantham, Stamford, Bury St Edmunds, Frinton on Sea, Ely, Peterborough, Huntingdon, Cambourne, Newmarket, Soham and Oundle.
The information contained is for guidance only and does not constitute financial advice. It is based on our understanding of UK legislation, whether proposed or in force, and market practice at the time of writing. Levels, bases and reliefs from taxation may be subject to change. Accordingly, no responsibility can be assumed by Martin-Redman Partners its officers or employees, for any loss in connection with the content hereof and any such action or inaction.