It’s the time of year when we take stock of our achievements from the last 12 months and set new goals for the year ahead. Whilst most New Year’s Resolutions are set with the best intentions, just 8% of January pledges succeed¹.
Consider a financial New Year’s Resolution
Most people try to improve their health and well-being with common New Year’s Resolutions including losing weight, getting fit, eating healthier and learning a new hobby. Money goals are often neglected at this time of year, despite the festive period notoriously stretching the purse strings.
Brits often line themselves up for failure by setting goals that force them to completely transform their old lifestyle and habits. When the going gets tough, it can be easy to resort back to old ways.
Instead, small changes to your money habits can help improve your financial wellness over the long-term and get you closer to achieving your goals.
You must prioritise paying off expensive debt and saving up three months of outgoings before you look to make your money work harder for you.
Whatever your goals, these five tips can help you realise them.
Offset inflation on the financial markets
Inflation is the enemy of savers, as it erodes the purchasing power of your money over time. With the returns on cash savings accounts still low, many savers are looking to the financial markets to help offset the impact of inflation on their money.
Invest a little and often
Go through your budget and know how much you can put away each month for the future you. A little and often approach can help you can smooth out the price you pay for an asset over time. Once you’ve set your budget, try to keep to it – even when other priorities might make this difficult.
Investing is personal
Your goals are personal, so the way you invest should be too. What you’re investing for, when you’ll want your money and your financial understanding will influence what you invest in and the proportional make-up of your portfolio. This can be difficult to decide yourself, especially when you’re investing for your family’s future. Moneyfarm does this for you, matching you to an investor profile and portfolio that’s built and managed to help you achieve your goals.
Diversification
By spreading your money across investments, asset classes and geographies, you can manage the risk in your portfolio. If you experience some losses in your portfolio, you hope to offset these with gains made elsewhere. It can take a lot of money, skill and time to ensure you get the right diversification in your portfolio. You can get an expert to do it for you, so you can focus on the important things in life.
Stocks and shares ISA
When you’ve seen your money grow, the last thing you want is to hand over more than you need to to the tax man. By protecting your investments in a tax-free wrapper, you can keep more of your money and hopefully reach your goals more quickly. You can invest up to £20,000 in an ISA and any growth in the value of your money, and any income, is tax free.
Whatever your goals for 2018, we hope you have a prosperous year ahead.
¹Forbes
The post How will you keep to your New Year’s Resolutions in 2018? appeared first on MoneyFarm Insights.