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What To Consider When Creating A Financial Roadmap
Planning your financial future can be a daunting prospect, but with the help of a financial roadmap to navigate the way, the journey becomes a far less overwhelming experience.
But what exactly is a financial roadmap and how does it benefit you now and into the future?
In this article, we consider everything you need to know to get started.
What is a financial roadmap?
A financial roadmap is a guide that helps you to stay on the path towards achieving your financial goals while ensuring your ability to continue providing for yourself and your family throughout – and beyond – your lifetime. Every individual will have a different roadmap that is tailored to suit their objectives and financial circumstances.
Why is it important to create one?
When you’re in the thick of family life during a cost of living crisis, encountering expenses and outgoings at every turn, it can be difficult to see beyond the week, let alone far into the future.
However, with the average life expectancy in this country now creeping up towards the mid-eighties, the prospect of a lengthy retirement is forcing people to consider how they will afford to maintain their current quality of life after their working years are behind them. This, paired with the fact that Ireland is waiting on a pension time bomb to detonate any day now, is the jolt many of us need to begin planning our financial future.
The most effective and concise way to do this is to create a financial roadmap.
What to consider when forming your financial roadmap
There are several crucial factors to keep in mind when planning for your financial future.
1. What is the all-important figure you want to aim towards?
The first course of action when creating your roadmap is to calculate a figure that will cover any big expenses you have planned for the future, as well as your post-retirement nest egg. Once you have your number, you can work backwards from this.
To calculate this all-important sum, you will need to take the following into account:
- How much you earn versus how much you spend
- What valuable assets (car, house, and so on) that you currently own
- Any outstanding debts and what they amount to
- Any savings and investments
- What insurance policies you might have, such as life insurance, illness insurance and income protection
- What provisions are outlined in your will (if you have one)
2. What are the goals you wish to achieve between now and retirement?
A financial roadmap is like any other – it’s designed to get you to your destination by using the most convenient route for you.
But a roadmap that spans many decades is bound to have stops along the way, and these will come in the form of any large expenses you have envisioned for the future. Such expenses include buying a house, paying for holidays, kids’ college fees, and more.
While it won’t be possible to foresee every big expense that will crop up over your lifetime, it’s important to factor in as many of these milestones as possible when drafting your roadmap to ensure more clarity when planning for your retirement phase.
3. Where can you make savings?
We’re all guilty of making the odd unnecessary splurge in the form of daily takeaway coffees and an evening of wining and dining, but cutting back on certain outgoings in the name of maintaining a certain quality of life for longer will be hugely worthwhile.
Creating a financial roadmap forces you to put a magnifying glass over your spending habits and will make it easier to locate areas where you can cut back with little disruption to your everyday life.
4. How will you re-route your financial roadmap following a change in direction?
Very little in life is a sure bet, so it’s vital to continuously review your financial roadmap to counteract any sudden changes in direction. These changes may come in the form of redundancy or an illness that leaves you unable to work, or perhaps the breakdown of a relationship that has resulted in significant financial repercussions.
For this reason, a yearly review of your financial roadmap will be a critical exercise, enabling you to re-route when necessary and opt for an alternate path that will get you as close to your end goal as possible.
5. How will you maximise your earning potential?
A surefire way to increase your retirement pot is to maximise your earnings throughout your working life. This can be done with the help of a financial advisor, who has the inside scoop on tax exemptions, pension options, investment strategies and more.
Working with a financial advisor from the get-go when creating your roadmap will not only help you achieve financial success but will ensure the journey features as few speed bumps as possible.
Your financial roadmap starts with an experienced financial advisor
With a team that boasts 80-plus years of experience in the financial industry, Symmetry Financial Management is perfectly placed to help you form the ideal financial roadmap to suit your circumstances.
We can provide all the financial advice and resources you need to achieve your financial goals, staying the course with you throughout each stage of your life, as your objectives and financial priorities change. Contact us today to start on your journey to financial success, and make sure to also check out our blog and resources to answer your most pressing financial questions.
If you’d like a free, no-obligation consultation for your mortgage, pension or financial needs, get in touch here, call us on 01 6831673 or email us directly on info@symmetryfinancial.ie.
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