Why did the chicken cross the road?
Insert your preferred humorous response here.
Whatever the reason, something made the chicken change its direction and, just like any conscious decision that we make as individuals, the reason can be put under the heading of ‘fear’ or ‘desire’.
Financial planning is no different, and there have been many events this year, (and since 2020 indeed), that have caused all of us to consider our financial position much more carefully. For example, ‘fear’ of increased energy costs or higher mortgage payments has led to discussions with our clients around a need to understand their cashflow better, or consider whether to repay debt earlier than planned. Some people may feel a bit like a headless chicken, not knowing where to turn for the best. On the flip side, however, opportunities have been presented, such as the ‘desire’ to get better interest rates on cash deposits for the first time in a decade, or the ability to deploy longer-term savings into an ever-growing range of sustainable and responsible investment options.
In order to establish what your own drivers are, a financial planner will spend time helping you to understand your personal or family objectives & priorities, the range of which will be different to anyone else’s. What are your desires for the short & long term? What road do you need your finances to travel along to get to where you want to be? What does your journey look like?
Financial planning then asks the question ‘WHAT IF…?’ What do you fear that might mean you can’t get to your ideal destination? This could be something truly personal, like redundancy or bereavement, or it could be the broader impact of Government policy such as higher taxes on income and pension savings, or the Bank of England taking an aggressive stance to control inflation with higher interest rates.
From my 30+ years’ experience in financial planning, fears are always present, and they always relate to events or circumstance that you cannot control. However, you can plan for them, and a qualified financial planner will work with you to identify which events are likely to impact your journey along the road most.
They will then help you to construct a robust, yet flexible financial plan; a route-map if you like. As with any long journey, sometimes you need to divert, or take a break to refresh yourself and review progress. Do you carry on along the same road, or perhaps adopt a slightly different strategy due to an expected turn of events? Think of your financial planning partner as your financial satnav.
The magnitude of events in financial markets and UK and global politics this year will not have been experienced previously by most of the population (and we are a fair distance away from stability), so now is the time to pause and review what matters to you. What can you change to combat higher inflation and interest rates on mortgage borrowing, for example, or should you review where you’re holding your cash?
We can discuss these topics with you, review how to plan your income requirements, and consider our Insignis Cash Solutions service to help maximise interest returns.
Revisiting your plans doesn’t mean changing your end goals or financial and personal objectives, but it may mean a slight change of focus or short-term strategic diversion. The journey along your road is a personal one. Work with your financial planning professionals to understand your choices and keep on track.
So, why did the chicken cross the road? Because it could! Same road, same direction of travel. Not ‘headless’, not ‘flapping’, just a planned choice to get to the other side for a while until things calmed down.
To find out more about how 7IM can help you with your financial plans, get in touch with us today – email firstname.lastname@example.org or call 020 7760 8777