There’s a lot of misinformation about personal finance and unhelpful, random advice that people think is the right course of action. So, we thought we would dispel some common myths about financial planning to give you a more accurate view to help you make decisions.
Myth 1: I’m not rich enough for financial planning advice
Some people think financial planning is only for the rich and wealthy – CEOs, billionaire businesspeople, celebrities, and lottery winners. But that’s not always the case. In fact, thousands of people on middle incomes have financial plans to help them work towards achieving greater wealth. Investing a small amount of money each month could reap good returns in the long run. It’s all about mapping your finances and lifestyle to your aspirations.
When you create a financial plan, you can set goals for achieving your desired lifestyle and future. For example, when you allow us to manage your investment portfolio, our fixed fees ensure your costs do not increase as your investments rise. And the quality of our advice is also not influenced by our fees, which means you’ll always benefit from our expertise, no matter how much you pay us. Scroll down to read more about our fixed fees…
Myth 2: I need to keep my money in a savings account
High inflation, interest rate volatility, and many savings products offered by high street banks and building societies can seem unattractive for savers. By ‘savings’, you need to consider how to make your money work harder for you. When inflation is higher than the returns, you could simply be swapping these returns for the idea that your money is safer.
Risk-related investment strategies with a diverse portfolio are one way of utilising your savings rather than money eroding in a standard bank account. A Stocks and Shares ISA could also help you achieve better returns on your money. Talk to our financial planners.
Myth 3: A retirement plan is pointless before I reach 40
Who says you won’t retire before you’re 40? Some people achieve this due to hard work and serious financial planning. And if not 40, then you could be one of many people who manage to retire or semi-retire in their mid-fifties. But in order to do this, you need to make a plan sooner in life, and the sooner you start saving, the more impact you can have on your life.
The term “retirement” can be misleading in financial planning; it’s not just about the future but what you can do to achieve a better lifestyle today. So, whether you want to upsize, buy a new car, go on that luxury holiday, and so on, your plan can help you achieve these things.
Myth 4: I need a lot of money to be able to invest
Anyone can invest in stocks and shares or bonds. There are also other ways to invest, some less secure than others. A small amount regularly invested each month over a few years could result in good returns over time, but only if you have a sound investment strategy.
It’s important to always understand what you are investing in and the risk involved before you commit. Be careful: there are many dubious investment schemes where people promise high returns. If it sounds too good to be true, then it probably is. Please speak to our team instead.
Myth 5: Financial planners are too expensive
Any investment into growing your personal finances is exactly that – an investment. And you might be surprised to find that financial planning does not cost as much as you think. This is because our financial planning team believes financial advice should be charged fairly and ethically.
We offer fixed fees rather than a percentage of your hard-earned money. So, it doesn’t matter if you have invested £50,000 or £500,000; you will be offered a similar service that suits your needs. We will adjust our fee to match your personal requirements, which could be as little as £125 per month or up to £833 per month for highly complex situations. You choose your preferred service level, and together we will work on your financial plan.
Myth 6: I can produce my own financial plan
Anyone can have a go at producing their own financial plan, and of course, many people handle their own planning. Regardless of whether you use a financial planning firm like ours or do it yourself, you will always be in control of your finances. But you might not have the expertise or time to react quickly to market volatility or legislation changes, which could put your finances at risk. We use our expertise to make your money work harder for you.
There is often a lack of understanding regarding what financial planners do. However, financial planners are professional people with qualifications, expertise, and skills. And as we offer full transparency with no hidden fees, you are always in charge; any big decisions are yours to make. So, if you want a financial plan that will achieve your aspirations, use an expert.
Let us dispel any myths you might have about financial planning by providing you with a review. Then, get in touch to speak to our financial planners.
Common Myths about Financial Planning – Milestone Financial Planning (milestonefp.co.uk)
9 Financial Planning Myths You Need to Stop Believing – Savology