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As 2024 draws to a close, you might already be reflecting on the year behind you and setting resolutions for the 12 months ahead.
Whether that’s a commitment to your health, personal growth, or improving your financial situation, resolutions could offer the chance to start fresh and work towards meaningful objectives.
According to a survey from Finder, an estimated 66% of Brits planned to set themselves new year resolutions in 2024, equating to roughly 35 million people. While health-based resolutions were the most common, nearly 29% of respondents said they would set financial goals.
This year, incorporating financial resolutions into your plans could help you take control of your wealth and boost your long-term security, so continue reading to discover five worth considering.
1. Keep your will updated after significant life events
Once written, it’s easy to forget about your will as other financial matters take precedence. Though, as your life continues to change, keeping your will up to date is essential to ensure your wishes are followed and your loved ones are cared for.
Major life events, such as purchasing property, divorce, or welcoming a new child into the family, can significantly affect how you want your estate to be distributed after you pass away.
As such, an outdated will might not reflect your current intentions, which could lead to unnecessary disputes during an already difficult time for your family.
So, as the new year begins, it might be prudent to make a resolution to regularly review your will. You could start by assessing its current accuracy and then committing to update it after any major changes during 2025, or at least every two years.
Keeping your will current could be an effective way to mitigate the risks of disputes taking place. Make sure to read our previous article which details more ways to ensure a seamless transfer of wealth.
2. Commit to contributing more to your pension
Saving for retirement should ideally always be a high priority. So, if you find yourself with surplus income in 2025, consider increasing your pension contributions.
Doing so could significantly boost the overall value of your retirement fund, potentially helping you to achieve your dream lifestyle when you stop working.
One of the more compelling reasons to prioritise pension contributions is the tax relief provided by the government.
In 2024/25, the Annual Allowance allows you to contribute up to £60,000 a year into your pension (or 100% of your earnings, whichever is lower), while still benefiting from tax relief.
This means that the government will essentially top up your pension when you contribute, meaning £100 would only “cost” you:
· £80 for basic-rate taxpayers
· £60 for higher-rate taxpayers
· £55 for additional-rate taxpayers.
Just note that if you’re a higher- or additional-rate taxpayer, you need to claim relief above the basic rate through a self-assessment tax return.
Contributing more to your pension could help you save your wealth tax-efficiently, all while bolstering your fund to support your retirement lifestyle.
In 2025, you could aim to allocate more of your income to your pension, as this could offer you some much-needed peace of mind knowing you’re taking active steps to prepare for the future.
3. Regularly review your protection needs
Life is inherently unpredictable, and certain events – such as illness, injury, redundancy, or even death – could have considerable financial and emotional repercussions for you and your loved ones.
As such, reviewing your protection needs throughout the year is crucial.
Appropriate levels of protection, namely life cover, critical illness cover, and income protection, could ensure that you and your family are shielded from unforeseen events. Even if you already have cover in place, it’s still important to regularly check that it aligns with your current needs and circumstances.
So, by committing to reviewing your protection on a regular basis, you could secure greater peace of mind and help ensure your family’s financial security.
4. Check that your emergency fund is sufficient
Your emergency fund acts as an invaluable safety net, allowing you to manage unexpected costs without using funds ringfenced for other purposes or having to access the value in your investment portfolio.
If you don’t already have one in place, 2025 could be the ideal time to build a robust emergency fund.
It’s worth saving between three and six months’ worth of essential household expenses in an easy access savings account. You may want to save even more – as much as 12 months of expenses – if you’re self-employed, have many dependants, or are retired.
Even if you already have an emergency fund, the start of the year could be the time to assess its worth. If you can afford to bolster its value, doing so could boost your financial security for the year ahead.
5. Set realistic investment goals and stick to them
Establishing clear and realistic investment goals could help you remain focused on the horizon, potentially delivering competitive returns for your portfolio.
A planner could help you develop a bespoke strategy that aligns with your aspirations, time frame, and appetite for risk. Then, when your plan is in place, they can ensure that you stick to this strategy and aren’t tempted by emotional biases.
They could also check whether your portfolio is adequately diversified. This involves investing across various asset classes, sectors, and geographical areas, and could also help to protect your portfolio from significant market fluctuations, which our previous article covers in great detail.
As a result, the start of the new year could be your chance to re-assess your investments and make a commitment to do so throughout the year. This could ultimately ensure that your portfolio remains well-suited to your evolving needs.
Get in touch
As 2025 approaches, our commitment to supporting you with managing your wealth remains as strong as ever.
Email info@athertonyork.co.uk or call us on 0208 882 2979 to find out how we can help.
Please note
This article is for general information only and does not constitute advice. The information is aimed at retail clients only.
A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance.
The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates, and tax legislation may change in subsequent Finance Acts.
The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.
Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.
The Financial Conduct Authority does not regulate estate planning, tax planning, or will writing.
Note that financial protection plans typically have no cash in value at any time and cover will cease at the end of the term. If premiums stop, then cover will lapse.
Cover is subject to terms and conditions and may have exclusions. Definitions of illnesses vary from product providers and will be explained within the policy documentation.
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