The start of the year is a great time to make changes and to commit to self-improvement in the year ahead.
According to recent research by YouGov, health dominates the top three resolutions that Brits have for 2023, with 43% saying they plan to lose weight and the same proportion resolving to improve their diet.
Just behind these health-related commitments is a pledge to save more money. January is a good opportunity to put yourself in a strong position for the year ahead so, to help you get off on the right foot, here are five aspects of your finances you should review in 2023.
1. Review your mortgage
According to figures published by Financial Reporter, around 1.8 million fixed-rate mortgage deals are scheduled to end in 2023.
Many of these will have been taken out during a period of record-low interest rates, meaning borrowers are likely to face a hike in their monthly repayment when their deal ends.
Your mortgage is likely to be your largest financial commitment, so you should start 2023 by reviewing where you stand – especially if your deal is set to end this year. Many lenders will honour mortgage offers for several months, so it’s worth getting in touch with us now to review all your options ahead of potentially further interest rate rises in 2023.
If your deal has already ended and you have reverted to your lender’s standard variable rate (SVR), you may be able to generate even larger savings by switching to a new deal. We can help you to find the most appropriate rate for your circumstances.
2. Review your protection
You recently read about why the risk of ill health or worse is more likely than you might think. If you were to have to take an extended period off work or, worse, to pass away prematurely, would your family be able to maintain their standard of living?
You may have some existing protection, such as life insurance, critical illness cover, or income protection that you took out alongside your mortgage. You may even have made further arrangements yourself.
If your circumstances have changed, your protection may no longer be suitable for your needs. It may also not provide the level of cover you would need if the worst were to happen.
Make 2023 the year you review your protection to ensure it remains fit for purpose and gives you the peace of mind you need.
There may even be cost savings to be made if you took out your protection through your bank or building society – we can scour the market for you to establish whether there may be cheaper or more appropriate cover available.
3. Write or review your will and Lasting Power of Attorney
Your will
According to Unbiased, nearly 6 out of 10 adults in the UK haven’t made a will. Even among people aged over 55, more than 3 in 10 have no will.
Without a will, your assets may not go to your chosen beneficiaries when you pass away. This could be a particular problem if you and your partner are neither married nor in a civil partnership, or you have stepchildren.
If you haven’t yet written a will, make 2023 the year you put this important document in place. If you have, make sure that you review it to ensure it still reflects your wishes.
Your Lasting Power of Attorney (LPA)
A Lasting Power of Attorney (LPA) allows you to nominate a trusted person (or people) who can make decisions for you in the event you become incapacitated. You can choose someone to manage your finances on your behalf or make important decisions concerning your care and welfare.
Importantly, you can only make an LPA while you have mental capacity. So, if you’ve not yet taken this step, make sure you put this valuable protection in place now.
4. Shop around for a better deal on your banking, savings, and insurance
If you’re dissatisfied with your bank, you’re not alone. 2022 Ipsos research revealed that fewer than 60% of NatWest, Santander, TSB, Virgin Money, and HSBC customers would recommend their provider to friends and family. Other major banks scored little better.
Many banks offer incentives to encourage you to switch, and the “current account switch guarantee” means your new bank will switch your payments and transfer your balance, and your old bank will take care of closing your old account.
When it comes to your savings account, it’s also important to shop around. As interest rates rise, make sure your provider is also increasing the rates on your account – even just a 1% better rate will mean £200 more interest a year on a balance of £20,000.
Finally, make sure you shop around when it comes to renewing your car, home, or other insurance. While 2022 rules mean insurance providers can no longer charge existing customers a higher premium than new customers, there can still be significant savings to be made by shopping around at renewal.
5. Engage a financial planner
When you work with a financial planner, you’ll develop a long-term relationship designed to help you achieve all your life goals. These might include:
- Retiring early
- Helping your children or grandchildren financially
- Ensuring you have a comfortable retirement
- Leaving a legacy to loved ones
- Minimising your tax liability.
Crucially, you and your financial planner will normally meet on at least an annual basis to review your progress towards your ambitions.
Our partners at Black Swan Financial Planning work with clients to help them reach their financial goals. So, if the time is right for you to review your financial position and benefit from high-quality advice, the team at Black Swan are ideally placed to assist.
Get in touch
If you want to start 2023 on a strong footing by reviewing your mortgage, protection, or other aspects of your finances, please get in touch. Email [email protected] or call us on +44 (0) 20 3411 0079.
Please note
Your home may be repossessed if you do not keep up repayments on a mortgage or other loans secured on it.
The Financial Conduct Authority does not regulate estate planning, tax planning or will writing.
Note that life insurance plans typically have no cash in value at any time and cover will cease at the end of the term. If premiums stop, then cover will lapse.
