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Reviewing your needs and goals – take time to think about what you really want from your investments?

You need to consider what you really want from your investments. Knowing yourself, your needs and financial and lifestyle goals, and your appetite for risk is a good start.

Consider your reasons for investing. It is important to know why you are investing. The first step is to consider your financial situation and your reasons for investing.

For example, you might be:

• looking for a way to achieve higher returns than on your cash savings

• putting money aside to help pay for a specific goal, such as your children’s or grandchildren’s education or their future wedding

• planning for your retirement

Determining your reasons for investing now will help you work out your investment objectives and influence how your investments are managed in future.

Decide on how long to invest. If you are investing with a specific financial and lifestyle goal in mind, you have probably got a date in mind too. If you have got a few goals, some may be further away in time than others, so you’ll need to have different strategies for your different investments.

Investments rise and fall in value, so it is sensible to use cash savings for your short-term goals and invest for your longer-term goals.

Short-term. Most investments need at least a five-year commitment, but there are other options if you do not want to invest for this long, such as cash savings.

Medium-term. Committing your money for at least five years opens up a selection of investments that might suit you. Your investments make up your ‘portfolio’ and if appropriate should contain a mix of funds investing in shares, bonds and other assets, or a mixture of these, which are carefully selected and monitored for performance.

Long-term. Let us say you start investing for your retirement when you’re fairly young. You might have 25 or 35 years before you need to start drawing money from your investments. With time on your side, you might consider riskier funds that can offer the chance of bigger returns in exchange for an increased risk of losing your money.

As you approach retirement, you might sell off some of these riskier investments and move to safer options with the aim of protecting your investments and their returns.

How much time you have will make a big impact on creating your investment portfolio. As a general rule, the longer you hold investments, the better the chance they will outperform cash – but there can never be a guarantee of this.

Establish an investment plan

Once you are happy and have set your financial and lifestyle goals, the next step is to get your investment portfolio in place. We will help you identify the right type of investment options suitable for you.

Build a diversified portfolio

Holding a balanced, diversified portfolio with a mix of investments will help protect it from the ups and downs of the markets. Different types of investments perform well under different economic conditions. By diversifying your portfolio, you can aim to make these differences in performance work for you.

Diversifying your portfolio in a few different ways through funds that invest across:

• different types of investments

• different countries and markets

• different types of industries and companies

A diversified portfolio is likely to include a wide mix of investment types, markets and industries. How much you invest in each is called your ‘asset allocation’.

Make the most of tax allowances

As well as deciding what to invest in, think about how you will hold your investments. Some types of tax-efficient accounts normally allow you to keep more of the returns you make. It is always worth thinking about whether you’re making the most of your tax allowances too.

You also need to bear in mind that these tax rules can change at any time, and the value of any particular tax treatment to you will depend on your individual circumstances.

Review your portfolio periodically

Periodically checking to see if your portfolio aligns with your goals is an important aspect of investing.

These are some aspects of your portfolio you may want to check up on annually:

Changes to your financial goals.

Has something happened in your life that calls for a fundamental change to your financial life plan? Maybe a change in circumstances has changed your time horizon or the amount of risk you are willing to handle. If so, it is important to take a hard look at your portfolio to determine whether it aligns with your revised financial goals.

Asset allocation. An important part of investment planning is setting an asset allocation that you feel comfortable with. Although your portfolio may have been in line with your desired asset allocation at the beginning of the year, depending on the performance of your portfolio, your asset allocation may have changed over the period in question.

If your actual allocations are outside of your targets, then perhaps it is time to readjust your portfolio to get it back in line with your original targets.

Diversification. Along with a portfolio with a proper asset class balance, you will want to ensure that you are properly diversified inside each asset class.

Performance. Look at whether there are certain aspects of your portfolio that need rebalancing. You may also want to consider selling to help offset capital gains you might take throughout the year.

ONCE YOU’RE HAPPY AND HAVE SET YOUR FINANCIAL AND LIFESTYLE GOALS, THE NEXT STEP IS TO GET YOUR INVESTMENT PORTFOLIO IN PLACE. WE’LL HELP YOU IDENTIFY THE RIGHT TYPE OF INVESTMENT OPTIONS SUITABLE FOR YOU.

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FESTIVE FINANCIAL GIFTS DECIDING ON THE RIGHT INVESTMENTS FOR THE CHILDREN IN YOUR LIFE

As the festive season approaches, have you thought about gifting your children or grandchildren something different this Christmas? Giving them a good start in life by making investments into their future can make all the difference in today’s more complex world.

Many parents and grandparents want to help younger members of the family financially – whether to help fund an education, a wedding or a deposit for a first home. Christmas is a time for giving so what better gift to make to your children or grandchildren than a gift that has the potential to grow into a really useful sum of money.

There are a number of different ways to get started with investing for children that could also help you benefit from tax incentives to reduce the amount of tax paid, both now and in the future. Don’t forget that tax rules can change over time so it is important to obtain professional financial advice before making financial decisions.

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Making a Will

We spend our lives working to provide for ourselves and our loved ones. You may have a house or flat (in the UK or overseas), shares, savings and investments as well as your personal possessions. All of these assets are your ‘estate’. Making a Will ensures that when you die, your estate is shared according to your wishes.

Law will decide
If you die with no valid Will in England or Wales, the law will decide who gets what. If you have no living family members, all your property and possessions will go to the Crown. If you make a Will, you can also make sure you don’t pay more Inheritance Tax than you legally need to. It’s an essential part of your financial planning. Not only does it set out your wishes, but die without a Will and your estate will generally be divided according to the rules of intestacy, which may not reflect your wishes. Without one, the state directs who inherits, so your loved ones, relatives, friends and favourite charities may get nothing.

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