Here at UNIQ, our most enduring philosophy has always been ‘A Life Well Lived’. We strongly believe that it is important to balance enjoyment of the here and now with a robust plan for how to cascade your wealth after you’re gone. After all, what is the money for if not to fund the life you want?
That said, balancing your lifestyle and legacy can appear a little daunting. You may wonder, ‘how can I possibly do both?’ Luckily, it is not as difficult as it might seem.
What do you picture for yourself?
Money is meant to be saved but at the same time it is meant to be spent: these are not mutually exclusive. It’s perfectly possible to find a happy middle ground that lets you live the quality of life you deserve whilst ensuring there is something more than cobwebs left in the vault when you pass on the keys.
Simply put, ask yourself how you want your lifestyle and legacy to look. Have a quick read of our pieces on Planning for a Richer Life and Passing on Wealth to give you an idea of how to approach this.
Once you have a detailed picture, you can start making those plans for how to keep both things achievable. You will most likely want to focus on the following key questions, a little uncomfortable though some of them might be to think about:
- Do you know how much you need to maintain your desired lifestyle throughout your lifetime(s)?
- Have you worked out what happens if a loved one dies and how a surviving partner will manage financially?
- What if care is needed? Have you factored that into your calculations?
Take it step-by-step
Firstly, take a little time to think about the day-to-day costs involved in maintaining your desired lifestyle. This can include: any outstanding mortgage payments, your food bill, your husband’s wine subscription, your annual theatre pass, energy bills, pool maintenance, a cleaner, and so on.
Then, move onto the big spends – big holidays, house purchases, gifting money, and so forth. Getting this all down in writing, even loosely, will help to make it feel more tangible.
Once you have a broad idea of how much you need to cover the above, you’ll have a clearer image of what you have left to work with when thinking about passing on wealth. For this part, you will of course want to understand how to do so in a tax-efficient manner. Have a look at our recent blog post about the 7-Year Rule for some useful tips on this matter, or get in touch to chat through it in more detail.
Looking to the future
An important part of planning for the future is acknowledging there will be certain things we simply cannot predict. However, that does not mean we cannot plan for them.
If you’re a client of ours, you’ll be familiar with Cashflow Projections. One of our UNIQ mainstays, it is an exceptionally useful way to assess your current wealth and forecast how it may change in the years ahead. It has two key benefits:
- visualising the results of different inflation and investment outcomes, and
- earmarking and setting aside funds for likely future life events.
Employing these and other aspects of your own personal cash flow will give you a much clearer picture of your long-term wealth. In turn, this will help you adjust your lifestyle and legacy plans accordingly. A qualified financial planner can help you with this.
Planning for both a life well lived and a solid legacy can get you a bit bogged down in details. Luckily, they’re details that are easily worked out and that our advisors are happy to talk through with you. In the end, a life well lived will mean the legacy you are leaving to your loved ones includes some wonderful memories, too.
As ever, we are only a phone call away if you would like any support with reviewing your financial plan or making changes to your arrangements. You can contact us on 02920 782330 from 9am-5pm from Monday to Thursday, or by email at firstname.lastname@example.org at any time.