Financial planning for a brighter future

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Financial planning for a brighter future

If we all had a penny for every person that said “if I knew then what I know now” we would all be a lot better off than we are now. However if you examine that statement it makes no sense, because situations change, especially over the course of a lifetime.

How could anyone ten, fifteen or twenty years ago have foreseen how our lives would evolve, The developments in medical research, in communications technology among others which will make for a brighter future for mankind, as long as we manage to curtail some of the negative side effects that mankind has succeeded in developing at the same time.

The simple fact is that someone in their mid to late twenties, today regarded as beginning their adult life has to already begin to plan for their future, both short and long term. If in the year 2008 life expectancy has been increased by ten years in relation to what it was even ten or fifteen years ago, how long will life expectancy be for a person who is due to reach retiral age in thirty five to forty years time. And who can predict what the retiral age will be in 2050?

However it would be unwise to place too many factors within the range of uncertainty, and any young person staring out on their career and possibly married life will be well advised to begin seriously considering a pension scheme. While financial pundits are advising, due to the current global financial situation, to keep as much cash fluid as possible, it would be a shame not to begin to take advantage of the tax benefits involved in a pension scheme as early as possible. Take into account that pensions are long term, and by entering at the bottom of a trough, the situation can only improve!

The equation applies to owning property. Property ownership is for the long term, yet the earlier that a person enters into the property market the better off they will be.
Whilst property prices are low at the moment, they are expected to fall even more over the next eighteen months to a year. Many people labour under the misconception that if they buy a property they need to live in it. Over the years, property has been the most stable investment of them all. Many retirement nest eggs have been built up through building a property investment portfolio carefully and steadily over the years.

Investing in the stock market has always been a good way of setting aside money for the future. Whilst blue chip stocks are always a safe investment, in these days it might be sounder advice to invest in bricks and mortar.

Eventually everyone should aspire to live in a property that they own. In the beginning, rental costs will basically keep on par with mortgage repayments, and there is no need to find and tie up that nasty equity payment that the banks insist on asking for. However, in the long term, the property will have become an appreciated asset, with the equity intact, the mortgage paid off and all profits earned on the sale of the property, if you choose to do so, heading straight for your retirement fund.

When retirement age comes around, having the ability to be totally financial dependent is something to be valued. There are those who put the sum to be able to be in this position at around one million pounds in 2050. Might be an exaggeration, but who wouldn’t like the opportunity to be around to find out.