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The Future Of Your Finances Is No Sci-Fi Story

There’s a real concern that we are currently living in an age of short-sightedness. There are a lot of future plans that, essential as they are, half or more-than-half of the population are currently ignoring. The future isn’t a far-off thing, it’s not a science fiction story. It’s a reality that gets a bit closer with every day. Let’s make sure your finances are prepared for that reality.

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The immediate dangers

We will be looking into the slightly further flung parts of the future in some of the tips below. But it’s important to realise that there are potential risks waiting around the corner that could strike a lot sooner. There are sudden costs that can jump out at you and impact your financial future for years to come. For instance, need for unexpected repairs to your home or vehicle that won’t be covered by your insurance. It’s a good idea to always have a contingency fund set up for those emergencies. That fund should even cover you in cases like temporary unemployment, so build it up until it’s about the equivalent of how much you would make in three-to-five months.

Prepare for when you need money

A contingency fund is a good way to ensure that you don’t have to rely on getting loans when danger strikes. However, that doesn’t mean that borrowing money can’t be a good strategy to deal with hardship. It’s also important for further plans to get a mortgage or a motor loan. For that reason, it’s a good idea to follow advice like telegraph.co.uk/finance/personalfinance/11120400/Martin-Lewis-20-things-you-must-know-to-boost-your-credit-score.html and work on your credit score as much as possible. Simple practices like using your credit card responsibly while you have the money to ensure you pay it off can steadily raise your credit score for when you really need it.

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Is there such a thing as too much protection?

When talking about the future, you might think that you would be hearing about nothing but insurance non-stop. Insurance is important, but you should recognise when you might not need the kind of coverage you have used in the past. For instance, if you have a car you’re considering getting rid of soon, you might not need such a comprehensive set of clauses on your motor insurance. What you should protect, however, is your ability to keep earning. Income protection insurance, for instance, is the kind of protection you should consider prioritising.

Don’t work all your life

Now we’re looking into the slightly more distant future. However, if you’re smart about it, then retirement might not be all that further off than you expect. There’s one major rule for retiring early as express.co.uk/finance/personalfinance/658982/Retire-Early-at-55-How-to-Afford-Early-Retirement-Tips-Advice will tell you. It’s all about getting started early, too. Using a personal pension, for instance, will get a certain amount of contribution from the taxman. Similarly, if your workplace offers a pension, then take it and contribute as much as you can while the offer stands. Find out how much your employer is willing to contribute as a match and max it out.

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Instead, get your money to work for you

The truth is that, if you really want to effectively build the kind of wealth you can live more than comfortably off, then you need to consider more than retirement. Most successfully wealthy people will tell you that it’s not enough to work to really improve your lifestyle. You also have to be willing to learn how to invest. You don’t necessarily have to learn how to work stocks and bonds, either. Investing in assets like property can be just as reliable, if not slower paced. It requires learning a new set of skills, but that’s where the real wealth-building strategies lay.

Leaving lessons

Now, we’re going to look outside your own future for a moment. The chances are that most people reading this don’t just care about their own future but the future of their family and loved ones as well. If you have children, it’s important to get them thinking about finance early, as well. This isn’t suggesting you start talking about credit at five year’s old. However, as moneyadviceservice.org.uk/en/corporate/you-your-kids-and-money it’s a good idea to get them understanding money from a young age. Offering pocket money for chores, having them contribute to savings (with your help) for certain purchases and even talking about budgeting and financial hardship can prepare kids for the reality of the world outside their home. And yes, as they get older, talk to them about debt, credit, and borrowing. They’re not going to learn it at school unless the education system undergoes some big changes.

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What you leave behind

We all need to think about the inevitable. That is, of course, the fact that we’re not immortal and destined to enjoy our wealth forever. Instead, what we can do is make sure it goes to the people we care about. As soon as you have a substantial amount of assets to worry about, such as a home, you should consider getting the legal ball in motion with services like www.tbw.uk.com/probate-law/will-lawyers-solicitors-bexleyheath.html. The sooner you start getting executors to carry out arrangements after your death and the sooner you start organising all the essential paperwork, the easier that the matter of your will and estate can be carried out.

Keep your family trouble free

Beyond helping them learn a bit of wisdom, you can have a much more visible impact on the finances of your loved ones. One of the biggest ways is how they deal with financial hardship that might arise when you’re no longer with them. Life insurance is something we should all start thinking about earlier, much like retirement. Don’t let funeral costs and the like cut into the estate you would like to leave to your family. Make life insurance a lot easier to pay for and a lot more beneficial for your family by starting a plan early when you have fewer health issues that could increase the price.

Thinking about the future might be worrying for some and a bit morbid for others. But it’s the first step of putting the plans in place that are going to get you financially healthy and keep your family safe. That doesn’t sound like something you can put off.