January is a time when many people reflect on the previous 12 months and look ahead to what the coming year will bring. You may set goals for the year, such as exercising or planning a dream holiday. When it comes to financial planning, however, focusing on just one year is not nearly enough, you need to plan ahead for the future.
While you should always consider current developments that could impact your finances, good wealth management is all about establishing your goals, both short and long-term, then setting up a strategic plan to achieve them.
Planning for a financially secure retirement
For many of us, the ultimate goal is to be able to enjoy our dream retirement.
Many retirees favour low-risk, ‘safer’ investments like bank deposits, but if you have a long retirement ahead of you, this is risky. Slowly but surely the cost of living increases every year and can erode your spending power over the longer term. Your savings need to earn enough to keep pace with inflation, which is a struggle with today’s low interest rates.
Start by establishing what your aims are and obtain an objective analysis of your risk profile. Working with an experienced and regulated adviser, then build a portfolio, with a careful spread of investments across asset classes, regions, companies, currencies etc, designed to achieve your goals within your risk tolerance.
Planning to protect your wealth from tax
When considering your income needs you also need to factor in taxation. It is important to review your tax planning to make sure it is up to date and takes account of any tax reforms in Spain, UK and anywhere else that affect you.
Planning for the inevitable
Don’t risk leaving your estate planning too late.
Again, what are your goals? Who you want to inherit your estate, in what amounts, when and how? Take advice on how to achieve your wishes for your heirs, based on the inheritance laws and taxes of Spain and UK, and to make the process as straightforward and tax-efficient as possible for them.
Planning for Brexit
We cannot talk about planning for 2019 without mentioning Brexit. This is a good time to consider if you need to adjust your financial planning.
If you are living in Spain your financial planning should be set up for Spain. Do you own too many UK investments? Are all your savings in Sterling, putting you at mercy of exchange rate swings? Are you hoping to transfer your pension out of the UK? Be aware that many speculate the UK could widen the 25% ‘overseas transfer charge’ after Brexit to tax transfers within the EU.
Whether it is investments, tax or pension planning, seek professional advice to ensure you do what works best for your personal situation. Use a specialist adviser who can provide holistic solutions to give you peace of mind that your financial affairs are in order, for today and the future.
Keep up to date on the financial issues that may affect you on the Blevins Franks news page at www.blevinsfranks.com
