The economic climate has done its best to stretch the nation’s finances to breaking point – which means immediate monetary concerns can take precedence over preparing financially for the future.
But it doesn’t have to be that way.
It’s easier than you may think to get your finances in shape, with the added benefit of unrivalled peace of mind that your family are well provided for should you be unable to work or pass away unexpectedly.
Most importantly, though, you needn’t be born with a silver spoon in your mouth to enjoy secure pecuniary prospects – and our five secrets to a rosy financial future offer the perfect start to help you look forward with a smile…
Create a budget
Preparing for a healthier financial future means you need to conduct an audit of your current financial state – and that inevitably leads to a budget. Make a list of your incoming and outgoing cash to ascertain where you are overspending, which will allow you to make moves to slash your expenditure accordingly.
Prepare for your death
Preparing for the future should involve making financial provisions for your death. Admittedly, it can be unnerving to imagine planning your own demise, but by making arrangements now – whether it’s a small sum squirrelled away each week or a probate plan – it ensures you get the send-off you deserve and your family aren’t left trying to fill an emotional and financial black hole.
Wipe out credit card debt
Quite simply, credit card debt is one of the biggest hurdles to overcome when attempting to win the financial race. Given its inherent convenience, and our good intentions to pay the balance off immediately, many of us will pay over the odds for goods. Consequently, if you don’t have the cash in your pocket, avoid using your credit card like the plague.
It may sound unnecessarily tedious, but being organised and ensuring all of your important documents – bank details, pension particulars, insurance policies, birth certificates – are in one place, it makes them far easier to retrieve when conducting business linked to your future. This folder can be added to over time and offers easy access for your family if there is an accident or unexpected death.
Have an emergency fund
Typically, an emergency fund should be around three times your monthly expenses if you’re a lone wolf and six times your monthly expenses if you’re married or have kids. If you stash some cash into a rainy day fund, it can help cushion the blow if, for example, you run into fiscal turbulence or are made redundant, and it reduces the temptation to take on more debt during a lean period.