You do not know what lies ahead in your life, and it is important to consider the risks and be prepared if things go awry. This means you have to think what is important to you, such as your family, your home and your lifestyle, and make sure they will be in a safe place. To work things out, you have to do some wealth management and planning to protect what you must, but you have to look at the whole picture.
Your plans would depend on your stage in life and personal circumstances, e.g. age, health, marital status, employment status, etc. So, from saving as much as you can to planning your superannuation, self-managed super fund (SMSF) and other retirement arrangements, here are good ways to securing your financial future:
- Try to have more savings.
Apart from saving for important events and purchases, it is also wise to set aside money in case you lose your job or unable to work. Basically, you need to have enough money saved up to cover essential outgoings for at least 3 months, so you will have an emergency fund that can keep you afloat in a short term if something went wrong. However, it is not always easy to save such amount of money, and it can take a lot of time to only be used up very quickly. With this in mind, you should have some emergency money and combine it with a form of protection insurance.
- Get the right insurance.
Depending on your situation, there are various types of insurance you can take out. A life insurance policy will pay your dependents regular payments or a lump sum if you die unexpectedly to reassure them financially without your existence, while income protection insurance can financially support you if you can no longer work due to a serious injury or illness. There is also the short-term income protection insurance, which will pay out a monthly sum for a set period of time if you lose your source of income due to injury, illness or redundancy. In case you get a specific type of life-changing condition, then you can take out critical illness cover. Aside from these, there are more types of policies you can get to protect you for a lifetime.
- Pay off your debts.
Many people have debts, and most probably you do as well. For example, you might have incurred secured debts, such as a mortgage, or those unsecured, such as bank loans and credit card debts. Now, remember that if something untoward happens to you and your earnings drop, you still have to pay them out. This means it is wise to keep them under control by prioritising to pay them off.
- Plan for a richer retirement.
As life expectancy is rising, many people can expect 45 years in employment, which could be followed by 30 years of retirement, possibly living on until they are in their nineties. So, for you to ensure you are not left out of pocket for these entire 3 decades, you should plan effectively. This means you should start planning your superannuation, SMSF or any other retirement arrangement that is available for you. Remember that these arrangements can vary according to how far you have journeyed in life, but you can safely find the right solution with the help of professionals.
With all these tips in mind, you can secure a brighter financial future for yourself and even your family.