Have your finances changed since Covid arrived?

Covid has led to a lot of vets re-evaluating their finances. As the BVA’s appointed Independent Financial Advisers, Lloyd & Whyte are happy to provide the answers to your money questions.

Income Issues?

1. I’m furloughed and continue to lose 20% of my income, how can I recover from this? Although the Coronavirus Job Retention Scheme has been of huge benefit we understand how 20% drop in income can sting. Our primary piece of advice is to re-evaluate your expenditure. Can you cancel or postpone subscriptions to apps for example? Look at your direct debits, are all of them essential? Re-visiting your budget is something we recommend during normal times as well as in the current turbulent times. The old adage ‘need vs want’ can be useful whilst considering which costs to temporarily cut from your outgoings.
2. I feel so overworked and stressed and I feel like I’m running on empty, it could just be a matter of time before I’m off sick. How can I prepare myself financially if I’m unwell? We always recommend that you have an emergency fund in an accessible savings fund for times when the unexpected happens. However, it may also be worth investing in an income protection plan. Veterinary work is renowned for long days and anti-social hours so having a plan B up your sleeve may give you the peace of mind for which you are searching.

Retirement Ideas?

1. Life is short, I’ve re-evaluated what I want from life and I’m thinking about retiring early. What do I need to consider? There are many things to consider before making a premature leap to retirement. Making sure you have the money to do the things you want when you retire is the first step, so look at your budget, where do you spend your money now and what will change when you retire?  What debts do you have and can you clear them now? What does retirement mean to you, consider the costs, both day to day and one-offs. Build a plan and be realistic!
2. I wanted to retire early but my pension and investments have plummeted in value. What can I do? Pension schemes invest in the stock market, and with so many peaks and troughs in the recent market activity there could have been an impact to your pension pot. Whether you want to retire tomorrow or in 5 years time, it’s important to understand where you are invested and the risks you are taking, afterall you don’t want your pension to fall in value the day before you retire.  In the same way you recommend a pet has an annual check up, you should show the same TLC to your pension, give it a check up and make sure it is fit and  ready for when you need it.

Savings & Investments?

1. During lockdown my disposable income remained unspent and I managed to save some money each month. With interest rates being so low, what should I do with these savings?  How you save your money is dependant on a variety of factors, when do you need it and what is it for? If you don’t have any immediate plans for your cash then you can consider investing it to try and get a better return. With a world of investments out there, it is important to understand the risk you are willing and able to take, then you can build a plan to meet your needs. When you chat to your IFA you will be able to assess the current market together and consider the different options available suiting your age, risk level and accessibility to the money.
2. My Investment values have plummeted since Covid… what should I do? The key here is: don’t panic! Most people’s first reaction when stocks plummet is to sell sell sell which can only result in cashing in your hard-earned funds at a loss. Speaking to your IFA will help to assess your options, whether to stay as you are, move to something different or cash in, this involves understanding risk tolerance and prepare you for any volatility within your portfolio. A key tip to future investing is to consider diversification.

Pensions?

1. I’m recently qualified. I know it is savvy to save into a pension as soon as possible but I don’t think I can spare the cash? Starting a pension at a younger age is always a bonus because you can make the most of long term growth. However, when you’ve just qualified you may find your funds are stretched if you are also trying to save for a house, a wedding or holidays. The main thing to remember is anything saved is better than nothing, plus with the workplace pension scheme in place, you are missing out on ‘free’ money if you choose to opt out.
2. I’m 45 and the size of my pension pot is really small. Have I missed the boat? If your pension pot is looking a little empty in your 40’s then now is the time to see if you can start filling up those coffers! It is not too late to plan for retirement but it may involve a re-jig of your expenses and diversification of your investments. The benefit of having an Independent Financial Adviser is that they can assess your personal situation and help you make educated decisions to maximise the most out of your current income and help you plan for the future you deserve.

Financial Advice?

1. I would love to have someone to help me plan my finances but I don’t think I can afford a financial adviser, how much does it cost? As a member of the BVA you are entitled to a complimentary financial review. Money talks, and so can we! Let’s get together and make your money work for you too.