Your Financial Roadmap
We all have different lives with pressures and demands from all manner of things.
While it is tempting to bury your head in the sand or adopt a ‘mañana’ approach to your finances, even the smallest of starts can begin to have a great affect later in your life.
Below is a simple roadmap I have put together for where you should be aiming to be at on your life journey. If you aren’t there yet – don’t panic, the important thing is that at least you are reading this and you at know you should be doing ‘something’.
52% of women in their late 20’s say they do not understand enough to make decisions about retirement savings.
Only 8% of women rated contributing to a pension as their highest priority when they first started work.
Among young people in debt only 37% have a repayment plan in place.
After years of being told what to do this is the most exciting stage of your life, with so many choices and your first taste of independence. You will be possibly starting, or finishing university, doing an apprenticeship, further education, or entering the workplace to gain the skills needed for your chosen career.
You start to save for your retirement by joining your employers pension scheme.
You may have started to acquire your first debts such as student loans, car purchase or credit cards.
Surplus income tends to go on holidays, going out, shopping and beauty.
You may be starting to save for major “life events” such as buying your first home, getting married or having children.
You start to accrue National Insurance contributions to go towards your state pension entitlement.
Following the introduction of child benefit tax in 2017 – ½ million women opted out of remaining in the National Insurance system therefore losing out on contributions towards their state pension. Many women are missing out by not registering at all.
55% of women age 30-49 have not thought about how they will pay for their long term care.
Women in their 30’s have an average of £1,000 in savings reducing dependent on the amount of children to £100-£200 for a women with 3-4 children.
60% of women don’t know they should update their pension records after a relationship ends.
71% of divorced people did not discuss their pensions during divorce proceedings.
As you start to gain further independence you may choose to rent a home, house share or embark on sharing your life with that special person. Life choices seem rational and any perils or pitfalls of your choices are dismissed in favour of what seems right at the time.
You may decide to make one of the biggest financial decisions of your life, to buy your own home and for some to start a family.
Juggling being a Mum becomes hard work with little time for anything else.
The family budget can be harder to manage with less available surplus income for luxuries, especially if there is just one income coming into the family home.
Contributions into your pension may reduce, or stop if you cease work.
Sadly, you may experience a relationship break up with major financial impacts.
70% of women say they have no idea what pension savings they have.
75% of women say they don’t plan to see a professional financial adviser about retirement because they don’t think they will have enough money saved.
1 in 3 women in their late 50’s are caring for an elderly relative.
Where did the time go? After what for most of us has been a lifetime of day to day juggling with very little time to deal with anything else except family and work.
Children will hopefully left home but not before raiding the bank of “Mum and Dad” on their way out of the door.
You now start to look towards your retirement and start to plan when you will retire and what provisions you have to meet this.
Elderly relative’s health starts to fail and time given to care for your children turns to caring for the older generation.
You may have had health problems, or they start to appear and “it won’t happen to me” becomes a little less certain.
Sadly, long term relationships may end as “silver splitters” go their separate ways. Pensions, assets, and savings are split and the comfortable retirement you were hoping for suddenly disappears. You realise you are on your own, for some managing your own finances for the first time in your life.
Only 10% of women are ‘very familiar’ with the pensions freedoms.
20% of women have not heard of pension freedoms at all.
1 in 10 of Women can expect to pay on average £113,000 to care for themselves during retirement.
You’ve made it! This is hopefully a time to look forward to and you get to enjoy the things you want to do.
You may choose to phase your retirement or fully retire.
Whether you decide to have a gap year, spend time with the family and grandchildren, or take up some new hobbies, your standard of living will be reflected by the amount of pension provision you have, including receiving your state pension.
Thoughts of your own mortality and your ability to cope with ageing start to creep in. Who will care for you? How much will it cost? Will I get to stay in my own home?
Are you interested in finding out more? The information used above comes from an excellent publication by Jane Portas on the Insuring Women’s Futures website.
I regularly host events for women who want to know more about becoming financially secure.
Are you ready to start taking care of your money? Click below to book a session with me.
Tracy Simpson Financial Consultancy Limited
2303 Bridgewater Place,
Water Lane,
Leeds,
LS11 5QB
Call: 0113 243 2266
Tracy Simpson Financial Consultancy Limited is an appointed representative of 2plan wealth management Ltd. 2plan wealth management Ltd is authorised and regulated by the Financial Conduct Authority. It is entered on the Financial Services Register (www.fca.org.uk) under reference 461598.
Registered address: 3rd floor, Bridgewater Place, Water Lane, Leeds, LS11 5BZ. Telephone: 0113 302 1360. Registered in England Number: 05998270.
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