According to the recent ‘Financial Lives Survey’ by the Financial Conduct Authority, more than half of us are beset by money worries. The City regulator found around 25.6 million people are financially vulnerable, and face financial worries of one sort or another. In fact, many Britons report financial worries from their teens to retirement.
We look at ways to help deal with those concerns, and help make finances something to feel positive about again.
Worries when we are young
More than half of young people aged 18 to 24 are classed as vulnerable. They face low incomes and high levels of debt from student loans. Some, of course have few financial responsibilities, and are still living with parents. But this may because of the high cost of housing rather than choice.
Worries when we find our feet
Once young people finally do fly the parental nest, debt can be a problem with the average unsecured debt for those aged 25-34 now more than £11,480. A growing number are forced to borrow to take care of ordinary living costs, while those who have managed to get on the property ladder fear interest rate increases.
Worries in our middle years
According to the survey, worries ease a little for people in their middle years. They can expect their highest rates of earning, they may have paid off the mortgage, and their children may have become independent. Debt may have been paid down – but many worry about the future and about unexpected bills.
Worries in retirement
The study also shows that not enough people are saving long-term for their retirement. Almost 38% of all adults have no pension scheme, and those who do may have pension pots that are too small. Debt may no longer be such an issue, but standards of living may fall without an adequate income.
Dealing with the worries
Obviously, we can’t enjoy life to the full if we are in a constant state of anxiety about money. But there are some simple steps to take to keep the worries at bay.
A realistic approach to budgeting is the first step, because if we can see where the money is really going we can start to see how to hold on to it. Keeping a clear view of cash coming in and going out is a good habit, and being able to plan for big bills can help make them less daunting.
Some debt is inevitable, especially in our younger years. A monthly budget shows how we are managing debt. Paying debt off can be simpler if we have a plan to pay off a set figure each month.
Unexpected costs are another major worry. An emergency bill or the sudden loss of a job can trigger a crisis for many people. Building up an emergency fund can be difficult, but having cash in reserve can help turn a crisis into a nuisance.
Once we have a strategy for debt and an emergency fund, we may be able to start thinking about savings, which can be the best way of all to deal with financial stress.
But perhaps the most important thing to remember about avoiding financial worry – and hardship – is to ensure that we have a proper plan for retirement in place. The FCA survey showed that most people simply don’t save enough for retirement. The sooner we start saving, the more comfortable our retirement can be.
Getting some help
Making the most of our money – and avoiding the financial worries – can be a lot easier with expert help.
Whatever stage of life you have reached, and whether you want help with planning for the short term, the long term or for retirement, the chances are that at Continuum we can help. If you have worries, simply call the Continuum team for the answers.
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