3 Ways to Help Secure Your Financial Future
Regardless of age, considering your future finances is very important. You may be young and think you have all the time in the world to worry about it. You may be reaching middle age and starting to consider whether you will have the means to maintain a decent lifestyle when you retire. Whatever your age or situation, you should have some kind of plan in place. Here are 3 ways to help secure your financial future.
Removing the mortgage burden
Many people think of a mortgage as a financial noose around their necks which seems impossible to get rid of and so, no longer being burdened by it is a financial priority. There are several ways you can become mortgage-free sooner than you may think. Re-mortgaging may result in a better interest rate and if you reduce your outstanding term you can pay your mortgage off quicker. Granted, your monthly payments may be higher in the short term but you could save thousands in the long run. Overpaying your mortgage is another good strategy to paying it off quicker. Most lenders will allow you to overpay up to 10% of your outstanding balance each year. The base rate is extremely low at the moment and so plowing your money into your mortgage makes far more financial sense than having it sitting in a savings account earning very little interest.
Protect your future and your family
If you are the main earner in the family, it’s important to have a back-up plan in place should anything unexpected happen to your health or your career. If you lose your job or become chronically ill, how will your bills be paid and provide for your family? Whilst it is not something that any of us particularly want to think about, it’s important to be realistic. There are many different insurance policies available for every eventuality so it’s worth looking into. Paying a small amount a month will provide you with a financial safety net should you need it.
Save and invest
If your mortgage is already taken care of, saving as much money as you can is another step towards a healthy financial future. Look around for the best deals and don’t buy things you don’t need. Many people, regardless of income, are taking part in ‘No buy’ pledges. Whether it’s over a month or a year, you task yourself with only buying essentials. Many profess to have saved thousands and say that their spending priorities have completely changed.
If you have a lump sum in the bank earning very little interest, consider investing it in a fixed-term bond or notice account. These typically offer far higher interest rates and so if you don’t need instant access to your funds it’s a good idea to switch.
Having a healthy pension fund is something that many people strive for. If you haven’t already got one, speak to a pensions advisor and find out what your options are.