Improving your Financial Fitness
Improving your financial fitness is pretty similar to improving your physical fitness and it’s easy to make progress if you put your mind to it.
The problem is that both are very easy to put off until tomorrow. Days become weeks, then months and years and the problem gets bigger and harder to fix.
For many, the thought of going out jogging at 8pm, on a cold, wet winter’s evening after a tough day at the office is hardly appealing. Even so, I bet most people would rather do that than study their latest pension statement or double check what mortgage interest rate they are on.
Physical and financial fitness both take place in your valuable free time and both involve a fair amount of pain. Pushing yourself to keep going for another mile is tough. It’s really tough the first time then marginally easier the next and once you get started, set yourself some goals and can feel that you are making progress towards these, exercise can become strangely addictive. Before you know it, you’ve already achieved the original goals – to lose a stone or run 5 miles without stopping perhaps – and can set yourself new targets.
Personal finance is no different. What everyone needs is a Financial Plan. How are you going to get from A to B? You don’t necessarily need to employ a financial adviser for this, just as you don’t need to pay a gym membership to get fit, but a Financial Adviser can help inspire you, motivate you and take some of the boring bits away.
If you don’t even know what B looks like, how will you ever know whether you are making progress towards it? It’s like starting a running race without knowing what distance the race is over. B might simply be “maintain my current standard of living whilst working and retire at 65 with £30,000 p.a. of net income”. Then look at A. What are your assets, liabilities, income and expenditure? How can these be used more efficiently so as to make that journey from A to B as easy as possible? Is B realistic?
In a nutshell, that’s what a good adviser does. He or she will help you to get from A to B by steering you through the maze of pensions and ISA’s and mortgages and so on.
Your financial future is in your control. The hardest part is getting started. There’s no time like the present!