A financial plan and the “mid-life responsibility peak” | moneyfacts.co.uk

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Published: 17/05/2022

Article written by Kellands Hale, our preferred independent advice firm.

This article is not intended to be financial advice to any individual. The views expressed are those of the author and Moneyfacts.co.uk does not endorse the content.

In light of the ongoing cost of living crisis in the UK, it is likely that the word “affordability” is on your mind. Added to this, if you are approaching your 40s and 50s, you could be shouldering many financial responsibilities.

Indeed, research from Legal & General shows that the average person’s financial responsibility peaks between the ages of 45 and 60. This stage of life is often referred to as the “mid-life responsibility peak”.

At this age, you are in a crucial stage of wealth accumulation. You are working hard and supporting your loved ones, while also looking to retire in the next decade or so – meaning your financial actions in the coming years need to be well-informed and exact.

In your “mid-life responsibility peak”, you could be:

  • Working hard at a career you love
  • Living in a beautiful, comfortable family home
  • Providing your children or grandchildren with an education by paying school and university fees
  • Saving as much as you can into your pension
  • Taking the opportunity to travel the world when you can
  • Making long-term investments.

Although this should be an enjoyable stage in your life, becoming overwhelmed by the financial responsibilities of this time could leave you feeling stressed and uneasy.

That is why working with a Kellands financial planner to maintain and review your comprehensive financial plan could be crucial when you reach the “mid-life responsibility peak”.

Your comprehensive financial plan can help streamline your affairs

With so many plates spinning in your life, it can be tricky to take a step back and look at your financial circumstances as a “big picture”.

The following three steps are important to understand, in order to keep your financial goals on track as you approach the “mid-life responsibility peak”.

  1. Make a plan

If you don’t already have a comprehensive financial plan, your Kellands planner can work with you to combine your financial affairs into a bespoke strategy that works for you.

As you may already know, your comprehensive financial plan helps merge the different aspects of your finances – your investments, assets, and income – into one clear picture that focuses on your life goals.

  1. Stick to your plan

Of course, planning for your future is one thing, but executing the specifics of the plan can be a different story altogether.

If you and your planner decide to make changes to your saving patterns, for example, it could be difficult to break your current habits and form new ones.

If you feel concerned about sticking to your financial plan, your Kellands planner can act as a friendly guide, helping you to feel confident when striving towards a more financially prosperous future.

  1. Regularly review and update your plan

Your life is always changing, and your circumstances are never the same from one year to the next. Especially in recent years, we’ve all come to expect the unexpected.

So, reviewing and updating your financial plan as you head into the “mid-life responsibility peak” is essential. This way, you are staying up to date with what serves you best, and adapting to new circumstances as they arise with the help of a trusted professional.

Three important things your comprehensive plan can cover as you approach your “mid-life responsibility peak”

  1. Protecting your wealth from unexpected life events

Protecting your wealth from the unexpected is vital, especially when you are at the peak of your wealth accumulation, and when you have loved ones depending on you.

Your comprehensive financial plan could include a bespoke package of financial protection options that may shore up your wealth against events that prevent you from earning an income – or even you passing away.

You may not have invested in protection yet, in which case it could be constructive to explore this option now. According to Mortgage Solutions, two in five British homeowners don’t have life cover. Life insurance is just one of many critically important protection options your Kellands financial planner can explore with you.

Most importantly, your loved ones could gain peace of mind from having the relevant protection in place if the worst were to happen in the years ahead.

  1. Providing investment guidance in a volatile market

As you may have observed, over the past two years, markets have been volatile. The COVID-19 pandemic, compounded with rising inflation in the UK and US, and the recent Russian invasion of Ukraine, have all caused volatility that might be concerning to you as an investor.

Despite recent market fluctuations, overall, investing can be a fantastic way to grow your wealth, and could be instrumental in providing a supplementary income later in life.

Your Kellands financial planner can help form an investment strategy that suits your appetite for risk and helps you work towards your financial goals more easily.

  1. Maximising your allowances now and in future tax years

In your “mid-life responsibility peak”, you could be paying more tax than ever before, and might need extra support when taking on this additional liability.

Indeed, research conducted by PensionBee in 2021 found that higher- and additional-rate taxpayers missed out on £2.5 billion in pension tax relief between the 2016/17 and 2018/19 tax years inclusively.

If you are a higher- or additional-rate taxpayer, you can claim additional pension tax relief through self-assessment, allowing you to avoid unnecessary taxation on your hard-earned wealth.

This is just one example of the insights your Kellands planner can provide when you create a comprehensive financial plan with us.

Get in touch

Your financial planner can take an honest, proactive approach to your financial situation, so your “mid-life responsibility peak” doesn’t become overwhelming.

By regularly checking in with your Kellands planner and updating your comprehensive financial plan as the years go by, you can turn the “mid-life responsibility peak” into an amazing opportunity for yourself and your family.

At this time, your planner can act as a confidant, providing you with a space to air your concerns and voice your dreams and goals for the future.

Please note

The value of your investment can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.

Note that life insurance plans typically have no cash in value at any time and cover will cease at the end of the term. If premiums stop, then cover will lapse.

This article is for information only. Please do not act based on anything you might read in this article. All contents are based on our understanding of HMRC legislation, which is subject to change.

Kellands (Hale) Limited is authorised and regulated by the Financial Conduct Authority. FCA Firm Reference No. 193498

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