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invested INTEREST; With Mark Welsh, Financial Planner.

Byline: Mark Welsh

IT'S easy to assume that all the major changes in life like finding a job, marriage, a family take place in the early years. In fact there are just as many major changes in later life and the need to keep on top of your financial planning is, if anything, even greater.

Along with your forties, your fifties are the age when your earnings are at their peak and by now there's a good chance that your children will no longer be dependant.

Your fifties are the time to maximise your savings ready for retirement, and to make sure they are invested as tax efficiently as possible. The right action now could make a lot of difference when you retire, whether it is in maximising your pension contributions, or opting for the flexibility and tax efficiency of Individual Savings Accounts.

If your income allows it, your fifties are also a good time to reduce debt, be it long term debt like a mortgage or shorter term debt like credit cards. Conventional wisdom dictates you should almost always pay off the debt with the highest interest rate first which would normally mean paying off your credit cards before your mortgage. But for many people the allure of being mortgage free is a very powerful motivating factor.

If you're planning to retire in your mid-sixties or later, then the early part of the decade should simply be a repeat of your fifties: continue to save, reduce debt and work with your financial adviser to keep your plans on course.

However, at some time in our sixties the vast majority of us will retire. The options around taking your pension can be many, whether it is deciding how to take your income or deciding how to invest any tax-free lump sum you receive. The options at retirement are outside the scope of this article, but retirement is a time when working with your financial adviser is crucial: the decisions you take now could well affect your standard of living for the rest of your life.

Your sixties may also be a decade where you start to think about your long term health and any care you may need in later life. There are very few of us that reach our sixties without some health worries along the way and it may be that private medical insurance or long term care planning are all subjects that you now start to think about.

To a great extent financial planning in your seventies will be dictated by your health. Hopefully your income for the rest of your life is now secure and, if you are wealthy, you may also be able to look at giving away some of your income and/ or wealth to reduce an eventual inheritance tax bill. Essentially, your seventies are a decade in which to relax and reap the rewards of a lifetime of sensible financial planning. Continue to have regular meetings with your financial adviser and continue to take all the prudent steps with regard to tax efficient investment and savings.

The above article is for information purposes and should not be treated as advice. For further information contact Sanlam Private Wealth at spw@sanlam.co.uk/0800 328 2638
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Title Annotation:Features
Publication:Daily Post (Conwy, Wales)
Date:May 27, 2013
Words:542
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