Doing your financial health check
The ten steps which follow are in order of priority.
~ Reducing borrowing
Are you borrowing money, except against your home? If so, consider paying it off as soon as possible.
~ Establishing a cash reserve
Have you got a cash reserve to fall back on -at least one month's normal expenditure and preferably two or three, in a deposit account?*
~ Avoiding financial disaster
Is your income protected by insurance against the death, sickness or permanent disability of the breadwinner? Do you have adequate home and car insurance?
~ Retirement planning
Are you paying towards a pension? It is never too early nor too late to start.
~ Getting tax and social security advantages
Are you getting all the income tax allowances, reliefs and credits, and social security benefits you are entitled to?
~ Paying for education
If you have young children, are you saving up to pay for private education and/or university?
~ Saving for special events
Do you need to save up for your next holiday, a new car or a wedding? Putting aside just a small amount regularly is the best way.
~ Reducing your mortgage
It is worth considering a reduction before investing surplus income.
~ Investment planning
Do you have surplus income which can be channelled into a savings scheme or do you have a lump sum to invest?
~ Estate planning
Will your heirs have to pay inheritance tax? If so, consider how to avoid it or pay for it yourself.
Back To Money Maters Home Page