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Building A Nest-Egg For Your Children: How To Future-Proof Your Finances

December 21st, 2016 Posted in learning about money, Money Tips
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Scientists and technology gurus are coming up with incredible advances that are changing the face of modern medicine year on year. However, we’re all still mere mortals, and aging is inevitable. It’s healthy to live by the carpe diem mantra, and focus on the present, but that doesn’t mean that you can’t look ahead. When you’ve worked hard for years, you want to be able to protect your money and assets, and create a nest-egg for your children and grandchildren. Here are some ways you can future-proof your finances.

Making a will

There may come a time when decisions need to be made, and you’re not capable of doing this. In this case, your legal rights and choices should be respected. If you make a will, this is not just about leaving instructions for who receives what when you pass away. A living will also gives you the opportunity to give your next of kin information about what you want and how you want to be treated if you’re no longer able to make the important calls. Many people think of a will as a document that is only required by old people or those in poor health. However, it’s advisable for everyone to make a will. If you have possessions, money in the bank or business assets, this is a way of ensuring they are passed onto somebody who deserves them. If you don’t make a will, there are procedures in place, which determine who will inherit your estate, and the legal way of processing the inheritance may not match your personal preferences. If you’re thinking of making a will, click here to see what a solicitors can do for you.

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Taking out insurance

Have you got critical illness cover or life insurance? If not, it may be time to consider your options. Unfortunately, nobody knows what’s around the corner. You may be absolutely fine one day. The next week, you may find yourself with life-limiting injuries. Life is unpredictable, and it can often be cruel. It’s not possible to prevent some accidents and injuries. However, it is possible to prepare for the future and protect yourself and your loved ones from financial ruin. If you take out insurance, this provides a nest-egg for your family in the event that you pass away or you develop a serious illness, which prevents you from working. You can compare insurance providers and policies online. The process takes minutes, and it will give you peace of mind, as well as financial protection.

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Every year, we read about incredible advances, which are saving lives all over the world. However, there’s no universal cure that fights every disease, and for now, none of us are immortal. It’s sobering to think of days when we might not be here, but it’s important to plan ahead, especially if you have a family. You’re never too young to make a will if you have dependents, business or property assets or cash in your account. It’s also advisable to consider taking out life insurance and critical illness cover.

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Teach Your Children About Affording A House

December 20th, 2016 Posted in financial literacy for kids, learning about money
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image of a perfect home - teaching children about affording a house

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Your child most likely loves your house. Whether it’s been the family home ever since they were born, or a recent buy, those four walls and the memories made within them mean the absolute world to a young mind which is still learning about life, money and all the confusing things inbetween. It’s up to us to take the opportunity, whilst our children are growing, to help teach them about the boring ‘behind the scenes’ elements to owning all these luxuries we take for granted. If they want the perfect home when they’re older and have their own family, you’ve got to teach them how that works.

Financing a home may not be something your child understands right now, but as they get older, there are some steps you can teach in order to help instill financial independence and understanding in your children as they become young adults and get closer to having to make these decisions for themselves. The key is to ensure that their spending, even at expensive times of year such as the holidays, never outweighs their saving.

Talk about debt early on.

Before your child can consider buying a home, they’ll have to take a look at their finances. Young people in the current economic climate feel discouraged from buying a home, because they’re overwhelmed by all the debts and other costs of life which they feel will take too large a chunk out of their income for them to be able to afford anything else.

Of course, this isn’t true. If debt and other costs are approached early on in a young adult’s life, they’ll find that affording the bigger things and achieving that stability they seek becomes much easier. Teach your child that disposable income can be disposed on something really valuable today, so that they can have all the luxuries they want tomorrow.

If your child loves the idea of owning a home now, then help them ensure that dream becomes a reality when they’re older, rather than dwindling away when they realise they aren’t financially prepared for it and it may be a long time before they are.

Mortgages aren’t a scary thing if you have a stable job.

You might be wondering about the future for your children, considering the dire situation facing many younger people struggling to break into their industry and career of choice. However, it doesn’t have to be so bleak. Help your child prepare by teaching them about the costs of owning a home and the savings which will need to be made. Once they understand the costs, they might feel motivated to pursue a specific career or work harder at high school, or college, in the hopes of attaining a stable career and being able to cope with the financial element of having the perfect home.

image of home interior - how to teach your children about affording a house

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Houses can be expensive on the whole, but I’m sure you realise there are manageable ways to afford the right home with the right job. With a Homestead Financial Mortgage, for example, your child, as young adult purchasing a home, could be set for life with a manageable, fair way of paying for their home gradually.

Remember, teaching our children about finance is our job. If you want to ensure they’re prepared for the future and owning a home, pass on all the knowledge you can, along with the tips we’ve given here.

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Ways Around Saving Money: It’s All About Habit!

December 20th, 2016 Posted in financial literacy
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It is a very common thing to hear that there’s never “enough” money. But to spin that notion on its head, is it really the amount that we need, or our spending habits that actually need changing? Instead of buying a takeaway meal, couldn’t that money be spent on ingredients for meals that could have lasted a few nights? Saving money is a foreign language to some people, and it’s not about completely cutting something out of your life to feel the benefits a year later, it’s about cutting a little here and there, so it becomes a habit. But there are things you are entitled to also. Here are some little tidbits of info to get you started.

Spend Less Money On Different Shopping Brands

We like to buy the best brands, because named brands are synonymous with quality, but is that really true? A lot of the reasons why we are attracted to brands are mainly to do with the marketing. If you buy one brand of ketchup, it is not dissimilar in taste to a cheaper brand. And even if you need a big name brand, there are stores that offer the big name brands for cheaper prices. Or just look online to see where it is the cheapest at the moment, or buying in bulk is another option.

Age Before Beauty…

Trying to achieve financial independence at a young age is a bigger task now. But, there are many benefits you are entitled to depending on your age. It’s all about doing the research online. There are a lot less people retiring at the standard age now, and this is indicating that there is a lack of finances, but there is up to £3.5 billion of housing benefit and pension credit going unclaimed. There are the smaller concessions, such as transport concessions or discounts that you are entitled to depending on how old you are.

Money Saving Sites

Doing your research is half the battle! Sites such as moneysavingexpert.com are proving to be very popular with consumers, as it is a handy place to see what trends there are on energy suppliers, supermarkets and insurance. As well as this, sites like the CFA are a handy source of information too.

Getting Loans

If you really are in a pickle, this can be a quick way out for you. But be warned, with big interest rates and depending on the size of the loan you obtain, it can make for a long repayment process. And depending on what your credit score is, it may affect you being able to have a loan in the first place, while also making it harder for you to get one in the future. Make sure you check the MyCreditMonitor website to see what your score is.

Open Up An Independent Savings Account (ISA)

Getting an ISA which you cannot access is a great way to accrue savings, and with many ISAs can come with penalties if you do try to access the money, which is a great incentive to keep the money there!

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3 Excellent Ways To Reduce The Cost Of Moving House

December 18th, 2016 Posted in Money Tips
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Nobody wants to spend a small fortune when they relocate their family to a new property. You’ve already agreed to a large mortgage and lots of investment. So, it doesn’t make sense to get yourselves into even more debt. With that in mind, sometimes you just need some advice. The three ideas on this page are tried and tested. They are guaranteed to help you reduce your outgoings and stress levels at the same time. When all’s said and done, emptying your bank accounts just before you move is never a good idea. You need as much cash as possible left over for decoration and renovation work.

Packed boxes - cut the cost of removals image

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  • Shop around for removals specialists

Packing all your possessions into a van and moving without professional help is pointless. You’ll have to work hard, and the process will take a long time. When you use an expert company, the event can be over in a matter of hours – sometimes less. Just make sure you shop around and look for the best deals. Many of the people working in that industry will offer advice on moving house too. They have lots of experience, and so they are the best people to dispense useful tips. At the end of the day, you shouldn’t end up spending more than a few hundred pounds at most. It’s worth the investment to avoid the hassle, but you don’t way to pay over the odds. So, perform some research and obtain some quotes today!

save money - move at the weekend image

It sounds silly, but some people relocate on weekdays, and that’s a terrible idea. Not only will you have to deal with the stress, but you’ll also lose a day’s wages. The average person in the UK earns around £120 – £180 a day. That means you and your partner could lose out one around £300 if you don’t relocate at the weekend. Sure, the roads are going to be busier, and it might add half an hour onto your completion time. However, you’ll lose a small fortune if you take the day off work, and nobody wants to do that. That is especially the case now you have an increased mortgage to pay.

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  • Buy a brand new house

One of the best things about purchasing a brand new house is that you won’t have to worry about decorating. Most people move into the property and wait a while because it already looks good. The same is not true when it comes to buying homes from other families. If you do that, you’ll have to pay a team of painters to come and customise the property during the first few days. Nobody wants to live in a house decorated to someone else’s tastes. That all costs money, and it causes a disturbance. So, do yourself a favour and buy a brand new home instead. Of course, there are thousands of additional benefits people experience when buying from a developer.

For more tips and information there is a great article here

You should now have enough ideas to make a real difference. The chances are you will still have to spend a lot of cash as you move. However, reducing that amount, even by only a few hundred pounds is sensible. You never know when you’re going to encounter unexpected costs, and so it’s wise to keep some cash spare just in case.

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Before You’re 30: Steps To Real Financial Independance

December 18th, 2016 Posted in financial literacy, learning about money, Money Tips
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If you’re reading this, you’re probably somewhere in your early to mid-20s. You’re starting to make your own money and maybe even starting to see a little of it become disposable. We know that you might have all kind of costs that demand a big chunk, but that extra could help you become truly financially independent. Here are the steps you could take.

image of American coins - the importance of saving

Picture by Jeff Weese

Stop using your credit like a cookie jar

Half the country’s millennials have never checked their credit score. That’s a shocking fact, but the fact lies on those who failed to teach them about credit. When you’re young is when you’re most likely to ruin your credit. It’s time to stop using those open lines of credit unless you’re prepared and able to pay them off now. When it comes time to buy a new car or a house, you’ll be thankful.

Start dealing with debt

If you’ve already dipped your hand into that cookie jar one time too many, it’s likely you have some debt to deal with. Start learning debt elimination strategies and plan your approach to it. Stop charging things to your credit cards and cut out some of your luxuries to start paying more than the minimum.

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Building a nest egg

There are no two ways about it, you need to start saving right now. It’s easy to blow through your free money before you have the chance to save emergency funds. The trick is to put the money into savings, first. 15% of your income should be going to building those funds. They’re essential. Failing to save them could mean getting into a debt spiral or even falling bankrupt due to a financial emergency.

Get protected

Other financial emergencies can be taken care of without much heartache thanks to your insurance. By the time you’re thirty, there are some policies you need to be taking care of. If you have a car, you need auto insurance. If you have a place, you need property insurance for at least your contents. Disability insurance is an important confirmation of the fact that life is uncertain and we don’t always know how able we will be to work. Life insurance is needed because as uncertain as life is, you don’t know when it might end. You don’t want to put your loved ones into hardship because of your failure to prepare.

Retirement options - saving for the future image

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Time to start preparing for retirement

No, thinking about retirement isn’t for older people only. The sooner you get started on it, the better it’s going to be for you in later life. Talk to your employer about 401(k)s so you can start saving automatically from your income, or an IRA or Roth IRA if your employer doesn’t provide 401(k) contributions.

Start investing

Roughly 20-30% of your whole income should go into financial preparation. After you emergency savings, debt relief, retirement, and insurance payments, you’re pretty much protected. If you have any extra cash after that, it’s time to start building it. Look into learning about building easy, set-and-forget investments to begin with. As you start building a portfolio, start learning how to manage it more actively.

The clock is already running. Make sure that in ten years from now you’re not in the same financial situation you’re in now. Lay the groundwork for a truly successful future.

 

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