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The festive season has come and gone and a new year stretches out in front of us. But how can we hope to make the most of it if we are held back by the weight of poor financial organisation? As with most things, the best results can be achieved through proper preparation.

Athletes hand on the track

Below are a few tips on how to clear the cobwebs and get your portfolio into great shape for the year ahead.

1.  Compare your credit cards

Get rid of credit cards that don’t give you anything back. If your cards don’t offer you extras, like cashback or reward points, then you should consider better alternatives.

There are some great options out there. A few of our favourites include Santander’s 123 card, which offers different levels of cashback depending on where you shop; Lloyds Bank Avios Rewards credit cards, which earns reward points that can be exchanged for flights with British Airways, journeys on Eurostar and hotels; and American Express’s Platinum cashback card, which pays out a set amount of 1.25% of anything you spend.

Remember to always set your card to be paid automatically each month from your current account so you don’t pay interest or inadvertently damage your credit rating.

2. Sort through your bank statements

Spend some time looking through your bank statements and work out where your money goes each month. The numbers will speak for themselves and you will be able to calculate where cuts need to be made. Think about what spending will add the most to your long-term happiness.

3. Peruse your pension

Pensions are one of the most tax efficient ways to save and are an essential saving anyway. If you want an income of £10,000 per annum in retirement you’re going to need around £250,000 in your pension. Most people regularly check their investment accounts but ignore their pensions. Speak to a financial adviser if you’re not sure if you’re maximising your investment performance.

4. Be on the ball with your bank

Many banks rely on your complacency to keep you as a customer. Get up-to-date with what your bank is offering compared to the competition and don’t accept consistently bad service.

You want a bank that offers a great current account option and a personalised service. A good bank will help transfer your accounts with little or no fuss.  If you do decide to change banks, keep an eye out for hidden charges and benefits.

5. Get intimate with your investments

Much of the stress I see in peoples’ eyes as an adviser stems from the leap of faith needed to trust someone with your finances. The more knowledge you have about your investments, and the more involved you are, the less of this stress you will feel.

The internet has a huge amount of information that allows you to become more familiar with investment concepts. Don’t go it alone as it takes many years to become an effective investor but this knowledge will help you work more effectively with your adviser.

6. Clean up your credit rating 

Many of us make the mistake of assuming that because we haven’t defaulted on a payment or been turned down for a loan we have a perfect credit rating. The truth is that more than a third of people who do check find that their records aren’t as clean they expected.

It costs around £2 to run a check with Equifax and £9.95 will get you a comprehensive report, which will give you some guidelines on getting your rating as high as possible so that you get the best possible rates when applying for loans or credit.

7. Manage your mortgage

Millions of UK homeowners are on standard variable rates with their lenders. Almost all of these mortgage holders could improve their mortgage by moving to a new bank. If you are on a standard variable rate you should get a mortgage broker to check if you could save money by moving to a different bank.

8. Write out your will

Your will is an invaluable opportunity to let your family know how you want your estate to be distributed. If you die without one you are considered to have died intestate and your assets will be subject to division by the crown in accordance with the Administration of Estates Act 1925. While the state attempts to do this as fairly as possible, distribution under intestacy rules often results in a less than satisfactory division of assets.

Take the time now to get a will written up and safeguard your family’s future. Step one should be to create a list of personal assets and choose who will be given power of attorney.  Even if you already have a will, don’t forget to check and update it at least every five years.


For more information on the topics covered in this post, or for any other wealth-related queries, you can contact us on +44 (0) 20 7759 7519 or email our wealth team.

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