How can I work out a financial plan for the future?

Many coins are stacked in a graph shape with growing tree for financial planning concepts.

Ask the expert at Smith & Pinching about financial planning in Norfolk - Credit: Getty Images/iStockphoto

I hit my fortieth birthday during lockdown earlier this year and, to be honest, I’m beginning to get quite anxious about my financial future. I am saving into a pension scheme which is worth about £100,000 so far and I do earn quite a decent salary, but we have a big mortgage and our two children will probably go to university soon. I’ve tried to save into ISAs each year and have about £120,000 saved so far but I don’t think that’s going to be enough for our long-term family needs. How can I work out what I need to do in order to be sure that we have enough?

Financial adviser sitting at desk smiling

Matthew Beck is an Independent FInancial Adviser with Smith & Pinching - Credit: Smith & Pinching

Matthew Beck of Smith & Pinching responds:

Your dilemma is mirrored in families across the country: it’s very difficult to know exactly what your needs will be in the future. Balancing spending and saving is a challenge as you want to enjoy life now without compromising your future security.

Financial planning is all about turning that kind of confusion into a clear picture. None of us has a crystal ball. We can’t say for definite how markets will perform, what interest rates will be on offer and what the cost of living is going to be. However, a financial planner can help you.

First, we explore everything about you and your circumstances in detail. This entails setting down the actual figures so you have an accurate picture. It also involves a careful assessment of your investment risk profile to ensure that no strategy takes you outside your comfort zone.

We next look at what you want to achieve – your goals – at different points in time. This might include specific expenditure, retirement dates, your desired lifestyle at each stage of your life and your plans to help your children.

Having established both the starting point and a number of milestone goals, we can then plot your course and recommend the right savings and investments for you, both inside and outside your pension wrapper. We use lifetime cashflow planning tools to explore different scenarios so you can see the impact of changing your strategy. It’s a process that deals in real numbers: the outcome is a flexible but achievable plan that gives you the certainty you seek. However, you will need to review and adjust that plan on a regular basis, year on year, to ensure changing conditions and circumstances don’t compromise your position.

Do get independent financial advice to help you see your financial picture clearly. It will give you the peace of mind that you want.

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Any opinions expressed in this article do not constitute advice. The value of an investment and the income from it could go down as well as up. The return at the end of the investment period is not guaranteed and you may get back less than you originally invested.

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