Monday, June 14, 2010

Review your circumstances: Things to think about when your life changes

When you experience a life-changing event, speak to your financial advisor and update your financial plan.

I have started working
Start a savings plan and make sure you have enough risk cover (insurance) to protect your future income. Understand the details of your company's pension scheme if there is one.

I have changed jobs or have been promoted
Rather than spending your extra cash, increase your monthly savings by the same percentage as your salary.

I have lost my job
Understand what your options are and whether you need to draw from your pension, and what that means for your retirement. Find out if any of your policies include retrenchment cover which will cover your insurance or investment premiums.

I have just got married
Review your life cover and your will. This is also a good time to sit down with your spouse and discuss your financial priorities and what you both hope to achieve over the next five, ten and twenty years.

I have just had a child
Reassess your life and make sure that you will have a will that includes a testamentary trust. You also need to start  a savings plan for your child's education.

One of the breadwinners has stopped working to raise children
Reassess your family budget. Also make sure the stay- at- home parent has retirement provisions and risk cover.

I have just got divorced
Assess the impact the divorce has had on your income and your assets and adjust your spending accordingly. If you receive a lump sum from your ex- spouse's retirement fund, make sure you use a preservation fund to keep your retirement benefits. Update your will.

There has been death in the family
Understand the financial impact on the family. If you received death benefits, speak to your financial advisor about the best possible way to invest these. Review your risk cover and your will.

I am about to retire
Understand your financial situation and the changes you may need to make your investments and risk cover.

Source: Liberty Life

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