Financial planning

Happy 2018: new year, new start

Colin Dyer

Whether it was the Babylonians resolving to return borrowed farming tools, or the Romans promising good conduct to Janus, the god of beginnings and January’s namesake, New Year’s resolutions have been popular for generations.

Get organised

Whilst, often, we might make this resolution and apply it to our work schedules or busy social and family lives, it is equally relevant to our finances. January is a good time to sit down and consider your financial situation; do you know where all your investments are and how they’re doing? Do they all still make sense in light of your overall goals and current financial situation?

Have you recently revisited your existing financial goals? Do you have a subset of smaller, more specific goals, for example to pay off a mortgage, help get a younger member of the family on the property ladder, or save for an around-the-world trip in retirement?

Speaking to your financial planner can help you to iron out the answers to questions such as these, and they will be well placed to help get you organised and on the right financial path for 2018.

Get fitter

This is a classic new year’s resolution, with 41% of people aiming to do more exercise in 2018 according to a recent YouGov poll. This will often involve a lot of hard work pounding the pavements, in the gym or on the pitch, which got me thinking about another resolution: getting financially fit. If you’re working hard physically to achieve results, shouldn’t you work your money hard as well?

One way I can see to get more out of your money is to invest it. With inflation having risen to a near six-year high of 3.1% in November, the risk of losing money in real terms is now high. Despite the base rate increase from 0.25% to 0.5%, also in November, 2018 will still see savings having to work harder than ever to keep pace with inflation.

January is a good time, in my book, to review your current investments, or to consider diversifying your approach. Revising your approach to risk is also important when thinking about the year ahead; for example, if you are saving to help out a child or grandchild, you may be more willing to take risks investing in volatile funds than with a sum you plan to use yourself in the much more immediate future.

It’s important to remember that successful investing is a marathon, not a sprint, and that patience is key in achieving strong investment returns. It is worth stating, of course, that investing does carry inherent risks with it. Investments can go down as well as up in value, and it’s possible that you may get back less than you paid in.

Our 1825 financial planners are involved at every stage of the investment cycle; they will be able to manage and monitor your investments as you progress through 2018 and beyond.

Save more money

Here is a goal which actually is financial. One of my golden rules for saving money efficiently is to make sure that you aren’t sacrificing more to the tax man than you need to. First and foremost, there are tax-free allowances to consider, such as the ISA allowance of £20,000 per year, your capital gains tax allowance of £11,300 and marital allowances to name a few.

In fact, taking into consideration every one of the various existing reliefs and tax allowances, it will be possible to have taken home a tax-free income of up to £33,800 before the end of this tax year on 5th April. Of course, the amount of tax you pay is always linked to your individual circumstances, and this figure won’t be attainable for everyone.

Ensuring that you don’t waste valuable tax relief can be a complex matter, yet getting it right really can boost your savings and help them last longer in retirement.

So, what are your resolutions for 2018? Or are you among those who aren’t planning to make any at all? Either way, our financial planners will be able to discuss your options for the year ahead, taking into account 2018’s economic climate and what you’d like to achieve.

If you’re thinking about financial planning, but haven’t yet found an adviser, why not start the year by booking a free consultation? This first meeting is a no-obligation discussion about your needs and how we might help you. It is offered at our own cost, to help you decide if you’d like to work with us to help build your wealth.


The information in this blog should not be regarded as financial advice. Please remember that the value of your investment can go down as well as up, and may be worth less than you paid in. Laws and tax rules may change in the future and your tax treatment is based on your individual circumstances. The information here is based on our understanding in January 2018.