When it comes to money, many people are comfortable managing everyday tasks like budgeting and paying off debt. But fewer people feel as positive about saving, investing or creating a longer-term financial plan.
No matter how you feel about your finances right now, you can take steps to build your confidence in these areas and improve your financial wellness. Building your money confidence does require a little bit of work. Creating a budget, saving for emergencies, knowing your longer-term goals and making informed financial decisions can help you get there.
1. Make a financial plan
This can act as a roadmap to your goals and help you see the holes in your financial situation and see where you could make better money decisions. Your plan should cover everything from daily budgeting and paying down debt to saving for the future and protecting what you have.
Look at both short and long-term goals and evaluate what it will take to reach them. Consider your saving strategy and how you may want to invest.
2. Save for contingencies
Having contingency is essential regardless of your personal circumstances. If you have money set aside for the unexpected, that's a huge step toward financial security. If you don’t have savings in place, consider monitoring your spending to find ways to save a little bit each time you get paid.
Think about establishing an automatic transfer to your savings account each time you get paid. That way your savings can build without any extra thought or effort on your part. Start with £1,000 and build from there.
3. Save and invest to meet your future goals
Saving and investing can be critical to your long-term financial security. Whether your goal is retirement in 10, 20 or 40 years, buying a house, getting married or helping a child through university, feeling confident about your long-term plan and the investment choices you make to get there can help you stick with your plan through up and down markets.
Now could be a good time to review your investment mix and ensure it is right for your goals. Knowing where you are in economic and market cycles may help you improve your portfolio. You also need to know your investment goals and how much risk you can take.
4. Keep making your finances a priority
Putting a financial plan in place, investing appropriately for your situation, and saving for an emergency can be vital to your financial well-being. Make it a priority to know what you own and what you owe, and to ensure that your investments are working toward your future. Everyone can benefit from taking control of their finances and making the confident choices that will bring them closer to their goals.
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The value of investments and the income from them can go down as well as up and investors may not get back the amount invested. Investors should note that the views expressed may no longer be current and may have already been acted upon. This is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to an authorised financial adviser.