Significant life changes may impact your long-term financial goals and priorities. For example, if you have had a child, you may need to save money for education, or budget for one parent to be earning less for a while. If you have experienced a divorce you may need to adjust your retirement plans. There are many situations that require a review of your finances. When circumstances change you need to ensure your financial plan aligns with your new reality.
Other examples of a change in circumstance include the death of a partner, receiving an inheritance, buying a business, or receiving a significant pay rise. Re-marrying later in life can also impact your retirement and estate planning. Re-jigging your financial plan will ensure you maximise your new circumstances and can prevent costly losses or tax bills.
Here are some important considerations to discuss with your financial planner:
Review your budget
Make sure your budget reflects your new situation. If you have received a significant pay rise you may want to increase your savings. An inheritance can be an opportunity to pay off debts or make a new investment. On the other hand, if you have experienced a loss of income you may need to cut back on expenses.
Revise your financial goals
Changes in personal circumstances can impact your long-term financial goals. For example, if you have purchased a business you will need to consider your expenses, debts, and tax implications. If you have experienced a divorce you may need to adjust your retirement expectations and planning.
Review your tax situation
If you have received a windfall, you may find yourself with a larger tax bill than you are used to. Seek advice on the best ways to minimise this and ensure that you remain compliant.
Update your estate planning
If you experience a significant change in income, loss of a partner or re-marry it is wise to re-evaluate your estate plan to ensure your beneficiaries are protected.
Look at your insurances
If you have had a child, it is prudent to review your insurances to ensure your dependents are taken care of you in an unforeseen event. You may also want to review your Total & Permanent Disability, Trauma and Income Protection to ensure your family would be protected if you were sick or injured. Your Financial Adviser can help you work out what amounts of cover you need.
Regularly reviewing your financial plan is always good practice and even more so if your circumstances change. We are here to help and provide you with peace of mind. Get in touch.
General Advice Warning: The information provided in this article is general in nature and does not consider your particular investment objectives, financial situation, or insurance needs; we therefore recommend you seek advice tailored to your individual circumstances before making any specific decisions.
Dobbrick Financial Services (Gympie) Pty Ltd ABN 48 931 205 109 and Dobbrick Financial Services (Ipswich) ABN 86 100 184 521 & DFS Oakland ABN 64 340 527 395 and their advisers are authorised representatives of Fortnum Private Wealth Ltd ABN 54 139 889 535 AFSL 357306.
