One of the likely consequences of the coronavirus pandemic is that many people will want to change the way they do things. Perhaps you’re going to work from home more? Retire to the country? Or maybe you have completely changed your outlook on life?
As we enter a post-lockdown world, millions of people will either be making changes – or had changes forced on them. And, these changes are likely to have one thing in common: the financial impact.
Financial planning can play a huge role in helping you to achieve the life you want with the money you have. Here are just a few reasons that taking advice could benefit you as we exit lockdown.
Changing retirement plans
Research from Aegon has suggested that the coronavirus pandemic has forced 18% of people to rethink their retirement plans.
On the one hand, some workers are now planning to delay their retirement as a result. With pensions possibly worth less than they were a few months ago, it may seem like a prudent step.
On the flip side, some pension savers are choosing to access their pension earlier than expected. With wages potentially decreased due to furlough, or halted altogether, dipping into a pension can seem like an attractive option.
One in eight (12%) of those aged 55 and over, who before the coronavirus pandemic hadn’t accessed their pension, have now done so. A further 8% have considered this option.
The events of 2020 could have led you to rethink your plans. Whether you are thinking of working longer or retiring earlier, seeking advice on the financial implications is crucial. With more retirement choices than ever, and huge potential tax and income consequences for making poor decisions, good advice is crucial.
Research has found that people who don’t seek professional advice before drawing down their pension are more likely to run out of cash in retirement. Another study found that clients who had taken advice were twice as confident about being able to retire how and when they would like to.
It’s clear: whatever your revised plans after lockdown, seeking advice adds value.
Dealing with redundancy
Despite the efforts of the governments around the world to support businesses through the crisis, millions of people will have lost their jobs as a result of the pandemic. As the furlough scheme in the UK winds down, this number is likely to rise sharply.
As the pandemic has affected almost all industry sectors, the economic casualties of coronavirus range from temporary part-time staff to highly experienced workers. Whether you’re a pilot or a senior executive at a major retailer, the consequence of the pandemic could very well be redundancy.
Dealing with a loss of earnings – or certainly preparing yourself for this eventuality – is a key reason to seek financial planning advice. A financial planner can help you to:
- Manage your finances now and in the future, and negotiate you through a difficult time
- Help you to plan your retirement (if you’ve decided to retire early) or a career change
- Make the most of a large redundancy payout, including managing the tax implications.
Changing your lifestyle
Coronavirus has changed the way many of us think about how we live and work. One of the consequences of this period in lockdown could be significant changes to lifestyle and we’ve previously looked at how lockdown might have changed your perspective on your lifestyle or retirement.
Research by Lloyds Bank has found that 57% of Brits who have worked from home during lockdown now think there is less need to live in a city. This figure increases to 62% among those who currently live in London. The same survey found that seven in ten people wanted to work from home more often.
Alternatively, perhaps the pandemic has led you to accelerate plans to move overseas? Now that air travel is returning, maybe you want to move forward your plans to either head back home or start your new life abroad?
With estate agents reporting a surge in demand for rural and country properties, it’s clear that lockdown has led many people to think carefully about their career, lifestyle and retirement. Of course, the common factor if you want to move home, change your career, or perhaps move to part-time working is: money.
That’s where financial planning comes in. Your financial planner can work closely with you to plan your future, to establish whether you have the resources to make significant changes, and to give you the financial confidence to move forward in the way you want to, safe in the knowledge you can afford it.
Rethinking your protection
For months, the news has featured tragic stories of the millions of people who have been affected by coronavirus. During lockdown, it’s forced us to reflect on our own lives, our families, and our financial arrangements. You have probably found yourself wondering whether your loved ones would be secure if anything happened to you.
At a fundamental level, this is where financial planning begins. Working with a planner can give you the peace of mind that your family will be financially stable. From ensuring they have sufficient financial resources to protecting them from a huge tax bill, your planner will take care of the details.
Get in touch
In a post-lockdown world, it’s likely you will want to make some changes to your lifestyle. Our planners can help you with the financial aspects of these changes, giving you the freedom to live your life as you want. Please get in touch if you would benefit from advice, or call (01372) 724 249.