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A Post-University Finance Guide


After 3 years of receiving student loans and funds from your parents, it’s easy to forget the importance of money management. However, soon enough you’ll need to fund a property of your own or perhaps a car to help with the daily commute. Personal pension provider, True Potential Investor, share their tips for managing your financial goals.

Everyone’s investment goals will be unique, but whatever they are, appropriate financial planning can help you meet them.

Deciding on your goals

Depending on your current situation, financial goals can vary from person to person. Common goals include setting money aside for physical items or experiences, such as a home, car or holiday.
Although it may seem too far away, you may also want to start putting money aside for your pension. This may seem odd, but planning early is crucial to ensure your comfort in later life.

The most important tip for deciding on your goal is ensuring that it is manageable and achievable. Categorising your goals based on a timescale might be helpful – for example a short-term goal could be buying a car, while a long-term goal could be putting money towards your pension.

Ensuring your goals are quantified

To quantify your goals, you’ll need to establish how much you need to achieve in the timescale you want to achieve it by. It’s important to be realistic when choosing your timescales – choosing a large amount over a short period of time could be unachievable and lead to unnecessary strain on your current resources. Once you have quantified your goals, you’ll need to consider budgeting.

Budgeting

It is important to evaluate your current financial situation through looking at your income and outgoings. Create a list of your current monthly income and work out your monthly expenses. Categorising your outgoings together —such as housing, utilities, transportation, food, and entertainment — will make it easier to make sense of your current situation.

Ensure that you cover all of your expenses to make sure you are painting a true picture of your financial situation. Don’t forget about irregular expenses, such as one-off insurance payments or maintenance costs. Out of sight, out of mind’ does not apply here; be truthful about your expenses to create a budget that will work for you.

Try to make further savings wherever possible. Could you replace your daily coffee with a homemade one instead? Work out how much you can afford to put aside each month, without stretching your finances too far.

Investing in the right places

To support the growth of your funds, the right saving option or investment is key. Cash Individual Savings Accounts (ISAs) are a popular choice, as they offer a tax-free way to put money away. This means you won’t pay any tax on the interest your account generates. However, choosing to save may mean that it takes longer for you to reach your goals, as there is a low level of risk involved. You will, however, receive a small percentage as interest.

If you’re comfortable with greater risk, you may prefer to invest your money in a stocks and shares ISA. Through adding your funds to an investment vehicle, like stocks or shares for example, you could reach your goals faster, providing your investment is successful.

Don’t forget about other long-term investments either, such as your pension. It may seem like a long way off, but setting money aside now can ensure financial comfort in later life.
Based on your desired goals, your chosen timeframe and the level of risk you’re comfortable with, always chose the most suitable investment option for you.

*With investing, your capital is at risk. Investments can fluctuate in value and you may get back less than you invest. Tax rules can change at any time.

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