3 valuable reasons your financial reviews are important

Creating a financial plan is an important first step towards achieving your goals. But your circumstances, priorities and the wider financial environment can change over time.

That’s why regular financial reviews are an important part of financial planning. They provide an opportunity to check whether your plan remains suitable for your circumstances and objectives, understand what may have changed, and consider whether any adjustments could help you stay on track.

We will review your financial plan at least annually, but you shouldn’t necessarily wait for your scheduled review if there is a significant change in your circumstances or financial goals.

Here are three reasons why financial reviews can be valuable.

1. A review can help you check whether your plan is still on track

Even the most carefully considered financial plan can be affected by changes in your circumstances or the wider financial environment.

Interest rates, investment markets, inflation, changes to legislation and unexpected financial events can all affect your plans and the assumptions they were based on.

A financial review gives you an opportunity to look at your current position and consider whether your plan remains appropriate for your goals and circumstances.

This might include reviewing:

• Your progress towards your financial goals
• Your income, expenditure, assets and liabilities
• How your investments have performed and whether your investment strategy remains appropriate
• Your retirement plans and expected income
• Your attitude to investment risk and capacity for loss
• Changes in your circumstances that could affect your financial priorities
• Whether your existing arrangements continue to provide the outcomes you are looking for.

The aim isn’t simply to change things for the sake of it. Sometimes, a review may confirm that your existing plan remains appropriate. In other circumstances, it may highlight an issue or change that needs to be considered.

Identifying potential problems early can give you more time to understand your options and make informed decisions.

2. Your circumstances and goals may have changed

Your financial plan should reflect what matters to you. But your priorities can change as your life develops.

A review is an opportunity to discuss any changes in your circumstances, objectives or financial needs and consider whether your plan continues to be suitable.

For example, since your last review you may have decided that you want to:

• Receive a higher income in retirement because your lifestyle or financial commitments have changed
• Take time away from work to raise children or care for a relative
• Retire earlier
• Gift a lump sum to your child to help them reach their goals
• Start your own business
• Change your plans for your property or other assets.

Changes like these can have both immediate and longer-term consequences.

For instance, if you decide to take time away from work, you may reduce or pause pension contributions. This could affect your future retirement income.

Discussing these changes as part of your financial plan can help you understand the potential impact and consider whether there are ways to keep your wider objectives on track.

It is also important to let us know if your circumstances change significantly between reviews. You don’t have to wait until your next scheduled meeting to get in touch.

3. A review gives you an opportunity to ask questions and understand your options

Financial decisions can sometimes feel complicated, particularly when markets are volatile or your circumstances change.

Perhaps you’re concerned about investment market movements and what they could mean for your future income? Or maybe changes to your retirement plans have left you unsure about what to do next?

Your review is an opportunity to raise questions, discuss concerns and make sure you understand the options available to you.

Having a clear understanding of your financial plan can help you make informed decisions that are appropriate for your circumstances and objectives.

And if something is worrying you, you don’t need to wait until your next review. You can contact us when you need to discuss a change in your circumstances or a question about your financial plan.

Keeping your financial plan aligned with your needs

A financial plan isn’t something you should necessarily set once and leave unchanged.

Regular reviews can help you and your financial planner consider whether your plan continues to reflect your circumstances, objectives and financial needs, and whether any changes may be appropriate.

Our aim is to provide ongoing support that helps you understand your financial position, make informed decisions and work towards the outcomes that matter to you.

Do you have questions about your financial plan or your next review?

If you’d like to discuss your existing financial plan, changes in your circumstances or any concerns you have about your finances, please get in touch with our team.

Next month, we’ll look at two key reasons why you might want to make changes to your financial plan following a review.