Tenet & You

Committing to New Year, New You

By Peter Pearson, Independent Financial Adviser, Tenet&You

After a turbulent two years as a result of the pandemic, we look to what 2022 will have in store for us. With the New Year traditionally signalling the time to make a change, there’s no better time to prioritise your financial wellbeing so that you’ll be prepared for life’s unexpected events.

However, with research indicating that less than one in five (18%)1 say they plan to set a finance-related New Year’s resolution, here’s why you should be looking to put your finances at the top of your New Year agenda. The impact of the pandemic on our finances

The pandemic has clearly laid bare our fragility and vulnerabilities, presenting us with huge challenges on many different levels. It has also reinforced a number of key financial lessons, from the importance of budgeting and building up an emergency savings pot, to investment diversification and holding appropriate protection policies, acting almost like a personal furlough scheme for when you need it most.

In a nutshell, the pandemic has demonstrated the value of having sound financial planning strategies in place and the peace of mind such principles can give us. By getting into good financial habits, it is possible to ensure you are cushioned from the shock of any unforeseen event. Getting organised – don’t put it off

The best way to keep on top of your finances is to deal with them before you ‘need’ to. It can be all too easy to put things off and distract yourself with something else, however getting yourself financially organised in good time, can significantly benefit you later down the line. For instance, research from Aviva reveals that people in the UK are almost as likely to know the value of the contents of their wardrobe (34%) as they are to know the value of their pensions (38%)2, but given the importance of preparing for retirement, no matter your age, it’s best to take control and seek the support of an adviser who can build a financial plan for now and years to come.

What’s more, with the end of the 2021-22 tax year not that far away, now is the perfect time to review your ISA and JISA contributions thus far, in addition to any other tax-related issues. Whilst you could also benefit from taking a look at your pension arrangements and check you are adequately protected against any potential financial shocks. Here are some numbers worth knowing to help you get organised: • The Inheritance Tax nil-rate band and the residence nil-rate band remain frozen at £325,000 and £175,000, respectively, until April 2026 • The Capital Gains Tax annual exemption remains at £12,300 for individuals and £6,150 for most trusts • The pension Lifetime Allowance remains frozen at £1,073,100 until April 2026, and the Annual Allowance remains at £40,000 • The ISA (Individual Savings Account) allowance remains at £20,000 for the 2021-22 tax year • The JISA (Junior Individual Savings Account) allowance and the Child Trust Fund annual subscription limit remain at £9,000 for the 2021-22 tax year Financial and emotional wellbeing

Another key point to take from last year has been the close connection between financial and emotional wellbeing; while a lack of financial stability typically leads to stress and anxiety, stable finances can provide mental calm.

Expert financial advice has also been highlighted to play a critical part in improving emotional wellbeing by increasing your financial confidence and resilience. This is according to research by insurer Royal London, which also found that clients who have an ongoing relationship with their adviser were nearly twice as likely to feel in control of their finances as those who didn’t. Help at hand

New Year is a time to take stock of our finances and consider how to plan for the year ahead and achieve a better financial future. Seeking professional advice with a company like Tenet&You is a vital step in achieving those objectives. So, get in touch and we can help you to develop sound plans to ensure you hit your short and long-term financial goals and ultimately provide a boost to both your financial and emotional wellbeing.

To get in touch with us if you have queries or would like to discuss any aspect of your finances with one of our experienced advisers, please do get in touch on 01772 787011 or come and visit us in person at Tenet&You, 327 Garstang Road, Fulwood, PR2 9UP. You can also find out more about Tenet&You on our website, www.tenetandyou.co.uk