Top 10 wealth management resolutions you'll be able to keep in 2019
‘New Year's resolutions work like this’, says humourist, critic and screenwriter Charlie Brooker who is always on point: ‘you think of something you enjoy doing and then resolve to stop doing it.’ Which is probably why we’re all so bad at keeping them. So, this year I’ve decided to plump for resolutions that a) actually stand a chance of happening and b) I might enjoy doing.
I don’t see why we shouldn’t all approach our wealth management resolutions with the same idealism. Resolving to get your finances (rather than just your post-Christmas paunch) into shape should ultimately be about feeling in control so you can make your money easier to manage and structured to best support your life ambitions.
Personally, I’m quite looking forward to getting stuck in...
1. Determine your goals
Before you get started, just take a step back and dream for a moment. There’s no better time than January to ask yourself the big questions. What are my goals for this year?
Perhaps you’re ready to take on a new mortgage? In which case it might be worth getting a fresh credit check and seeing what can be done to improve your credit rating. Or if the trip of a lifetime still hasn’t happened, could you fix on a price and date, and work backwards to create a manageable savings plan? Now’s the time to think, ‘Yes!’
If you want to plan beyond 2019 then read this piece I wrote back in October ‘Seven Tips To Prepare for Financial Freedom in Retirement.
2. Prepare a budget
There’s absolutely zero point in preparing a budget unless you’re going to be ruthlessly honest with yourself. Don’t price your grocery shop to live on lentils if you can’t resist organic steak. Having said that, taking a brutal look at last-year’s biggest little indulgences and seeing how quickly they might have added up to a mini-break can be a refreshing slap in the face.
A budget is all about being empowered by knowledge. Because once you know what’s left over from the essentials, you can get creative about steering the rest towards your ambitions.
3. Fix the leaks
Some leaks are obvious, like eating out and impulse buys, while in a digital world lots of little leaks can go unnoticed. Recurring app fees or (ahem) gym memberships you never actually use, for example. Go through your bank accounts with a fine toothcomb and whittle out the petty thieves.
Take more responsibility for the hidden wastage that is costing us personally, and environmentally. If you haven’t yet got a smart meter set up it’s a good way to see how your domestic energy use can be reduced. There are always investments to be made that result in longer-term savings, like installing insulation or switching to a hybrid car. But you can start as simple as scheduling a weekly meal plan to cut down on those out-of-date fridge items.
4. Automate everything
There’s so much digital help out there for automating your bills and budgets – whether it be through your own banking provider or nifty apps that round up your spare change and pop it automatically into a designated investment fund. They’re all designed to help turn your good intentions into easy habits.
Take control of any debts – from credit cards to long-term loans – by scheduling to pay off just a bit more than you need to every month (keep an eye on any overpayment penalties). You won’t even notice it’s happening. And before you do one more thing this year, set up those standing orders for your savings goals.
5. Make the most of the perks
How many of us actually make use of all our employee benefits, I wonder? When was the last time you even checked what they all were? If you’re not making the most of your health or life insurance, or at least matching your pensions contributions, it’s time.
And everyone under the sun wants to reward loyalty these days, which means if you can face carrying around all the store cards there are daily savings to be had on everything from grocery shopping to the credit cards that bank you air miles.
6. Refresh your investment plans
You’ll have different investment needs depending on what stage of life you’re at but now’s the time to re-establish your long-term plans, so you can check they’re still matching your ambitions. If your target is relatively far off you may want to up the risk, or if you’re near to reaching a long-term savings plan it may be time to move the investment somewhere safer, so you know it’ll be intact when you’re ready to use it.
Schedule a meeting with your financial advisor and come armed with your plans so you can both keep your eyes on the prize.
7. Start planning for your family’s future
We’re not very good at talking money with family in Britain, but hey, new years resolutions are for challenging the status quo. Whether it’s saving for a child’s education, or planning to leave a tax-efficient inheritance, there are substantial savings to be made by sharing the discussions with those concerned.
If you have young children, make a promise to get them saving too this year. Helping them grow up financially literate is one of the best gifts you could give them.
If you are interested in this subject you can read more about it here in ‘The Generation Game’ a research report Sanlam published in July 2018.
8. Give differently
If there’s a time to feel energised about spending less on gifting, it’s after Christmas, when we’ve all splurged on panic buys. But it’s good to think about giving differently from a generous space, rather than merely a frugal one, and be honest with ourselves about why it feels more daunting to give our time or creative efforts than to pick up another well-wrapped orchid.
Plan how you can save on charitable giving too, by giving more of your time and energy rather than simply cash. Commit to an organisation you care about through regular volunteering, holding a fundraising event, or finally doing that sponsored run.
Read about Sanlam’s ‘donate a day’ scheme here for further inspiration.
9. Keep learning
Make even a teeny resolution to expand your investment knowledge and you’ll thank yourself later, because you will find yourself using it.
The laziest way is to subscribe to a finance podcast or magazine or choose a book that you might realistically finish. Remember, this list is all about achievable goals.
Our team at Sanlam made some good reading recommendations for 2019 here
10. Challenge yourself to regular ‘No spend days’
Cycle or share transport to work, hunt out a free exhibition, and use up those cans at the back of the cupboard... It sounds simple, but can you live for a day on precisely ￡0?
Okay, this last one is a bit Charlie Brooker, but I have it on good advice that regular ‘spend nothing’ days can actually be fun!
Please note past performance is not necessarily a guide to future performance. The value of investments and any income from them can fall and you may get back less than you invested. For information only and not to be considered financial advice. If you want help with your investment choices, we suggest you take financial advice, such as from a Sanlam financial adviser.