The 12 steps to financial peace of mind in 2024

how to simplify your financial life in 2024

Taking some time to organise your personal finances can save thousands every year. Thomas Dickson provides a month-by-month guide to making the most of your money and simplifying your financial life in 2024.

January – request your NHS Total Rewards Statement

This is the first step for dentists in the NHS pension scheme to understanding their retirement benefits. To request the statement, call NHS pensions on 03003 301 346. You can read more about what this statement will and won’t tell you here.

February – check all your direct debits

With the cost of living crisis, it’s never been so important to carefully comb through your bank statements. You can then review the services you pay for and cancel as many direct debits as possible. You can save hundreds of pounds a year by allocating enough time to run a comparison (at least two weeks before the renewal) of your car or home insurance and energy contracts.

It’s also relatively easy to check what apps you no longer use, but are still paying for every year. On the iPhone, it’s in settings, media and purchases, view account, purchase history.

March – maximise your tax reliefs

As the tax year end approaches (on 5 April), this is the month to make sure you’ve made the most of all the government allowances. These include ISAs, pensions and capital gains tax allowances. You can read more details on these seven ideas to help dentists save thousands this tax year.

April – simplify your banking

As many dentists earn a variable amount each month, it can be hard to know exactly where you are financially. One way to solve this is to have a separate account where your income is paid. You then set up regular standing orders into other accounts. These could be your current account for monthly living costs, a tax account for your annual tax liabilities and short-term savings accounts for other significant expenses such as cars and holidays.

This helps create a structure, so you know what you can afford to live on each month and ensure you live within your means. This, by the way, is the key to financial independence.

May – make the most of your savings

The Bank of England raised rates in June 2023, to 5.25% – the highest in 15 years. So, if you have any savings languishing in accounts that are paying you 1-2%, or worse nothing at all, now’s the time to look at some alternatives. You can generate over 5% interest on instant access accounts, which even for £5,000 would be equivalent to £250 a year, so worth the effort of opening an account.

If you’d prefer to access all the top savings accounts with only one account you might prefer using a cash platform – you can read more about these here.

June – create an investment strategy

If you’re keen to save for the future, you need to make your money work well for you. Here are some key steps to creating an investment strategy:

  • Decide on the amount you want to invest
  • Establish what level of investment risk you’re prepared to take
  • Diversify your funds globally and
  • Keep your costs low.

To learn more about creating an investment strategy watch this video.

July – create a personal balance sheet

To find out what you’re currently worth, add up your assets and subtract your loans and mortgages. You can then update this every year. Provided you do this for at least a few years, you’ll hopefully see an encouraging pattern emerge. This will give you some reassurance that all your hard work throughout the years is paying off.

August – review your mortgage

Mortgage interest rates are higher than they’ve been for 15 years. Standard variable rates can be as high as 9%. Make sure you’ve set a reminder to get in touch with your lender and mortgage broker in the six months leading up to the end of any fixed rate periods.

September – review your insurances

Dentists have a unique set of requirements with regards to insurance. It’s important to make sure these have been set up correctly. Crucially, to ensure any claims are accepted, check for the ‘own occupation’ small print on your income protection or critical illness plans. Although you certainly want enough insurance to cover you for any unforeseen events, you don’t want to pay for too much insurance either.

October – find a financial planner you trust

If your finances are getting complicated, consider working with an independent financial planner. Former practice owner, Jo Wirdnam, explains how having a good relationship with an adviser who has your best interests at heart can be ‘life changing’ – watch her powerful interview here. To find out how else a specialist financial planner can help you if you haven’t got the time yourself click here.

November – organise your will

Many dentists assume their spouse inherits everything if they die without a will. However, without a will, if you’re married with children, your spouse would only inherit £270,000 plus personal possessions and half of the remainder – your children inherit the rest. Arranging a will doesn’t take that long and typically costs between £150-£300. If that doesn’t convince you to make sure your will is valid and up-to-date you should read this.

If you haven’t created a will, find a local probate solicitor or you can organise one through Will Aid 2024 this coming November and make a donation to a charity of your choice.

December – review

It’s now time to make sure you’ve completed all the tasks you wanted, and create a new list for 2025. Feel free to complete these ideas at your own pace and add your own ideas.

If you’d like to learn more ways to manage your money effectively or if you want some more ideas to add to the above ones (or you’ve got some extra ones for us), please contact Wealthwide here or by email at [email protected] or arrange a call with a specialist financial planner now.

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