FINANCIAL MATTERS WITH MITCH HOPKINSON: Make sure you have a financial plan for 2014

Our new personal finance columnist, Mitch Hopkinson, sets out a series of financial resolutions to help you become more financially secure in 2014.

By Mitch Hopkinson
Saturday, 15th February 2014, 8:58 am

Mitch, a recipient of the ‘Financial Times Independent Financial Adviser of the Year Award’, is Head of East Midlands at deVere United Kingdom, the UK division of deVere Group, one of the world’s largest independent financial advisory organisations.

What better way to start 2014 than to have a financial plan to motivate you into taking action in order to help you achieve your money goals? And, with it being 2014, let’s look at ways of securing savings of 14 per cent, or more.

So here goes. Oh and by the way, I’m presenting you with 14 to choose from.

1. Pay down your credit card debt. Most credit cards have interest rates that cost more than 14 per cent so this really is an easy way to begin saving additional money.

2. Try and avoid pay-day loans. These short-term loans, typically, are extremely expensive to repay. It might be worth considering asking a friend or family member to help if the amount is small and it’s only to ‘tide you over’ for a few days.

3. Save money into a pension. You are guaranteed to get at least 20 per cent tax relief on most pension contribution levels.

4. When you make a charitable donation always apply for gift aid. This popular scheme enables your chosen charity to get your tax back.

5. Make a will. For most people this will ensure certainty in terms of who inherits your estate. A properly drafted will could also save your beneficiaries from inheritance tax, which could help save them 40 per cent in tax.

6. Review how much you pay on insurance policies, including life, car and home. Doing this could well give you a saving that frees up more than 14 per cent, particularly if you manage to reduce all of them simultaneously.

7. Check to see if your employer allows you to participate in schemes that use salary sacrifice to help with the cost of your bike to help you travel to work. Both the benefit in tax relief and the saving on fuel will be a sure fire way of saving 14 per cent on your outgoings.

8. Consider investing in an Enterprise Investment Scheme. The income tax relief is 30 per cent – however, it is crucial that you seek professional advice and ensure you understand all of the risks first.

9. Start a Friendly Society savings plan. The returns are tax free, meaning it’s yet another way of ensuring your savings don’t get taxed.

10. Find a good independent financial adviser (IFA) and challenge them to help put you into a position where you are 14 per cent better off within a certain amount of time. Ask them to find a way I have not covered yet.

11. You could also invest in a Venture Capital Trust. This is an investment that should allow you to claim tax relief of 30 per cent. Please remember to seek professional advice.

12. Don’t take the monthly payment option on your car insurance. This will cost you interest on the whole amount for the whole year. Even if you put it on your credit card and pay it off monthly it would, typically, be cheaper.

13. Give yourself a financial audit and look at all of your direct debits and make sure they are all still for things you need. Make sure you shop around for your energy bills and the fuel for your car.

14. Finally, consider using a cash back website for major purchases as these will give you money back when you buy items.

I wish you an amazing 2014 and hope that you take up one, at least, of the resolutions. Just think what you could achieve this year…