Why You Should Have a Financial Plan

by | Aug 25, 2021 | Financial Tips

Financial Planning isn’t just about budgeting, saving, or investing. It is about putting all the aspects of your life together to create a plan that suits you perfectly. Having a Financial Plan is essential to get the most out of your money and prepare you for your future.

A good plan will educate you and prepare you for each stage of your life. Financial Planning is different for everyone, and your priorities will depend on your goals and circumstances. There are many reasons to have a Financial Plan, but the following are some of the key areas to focus on.


Accumulate Wealth & Secure Financial Freedom

With Banks and Credit Unions having almost negative interest rates, having a savings and investments plan is essential if you want to get a return on your money long-term and accumulate wealth.

Keeping money on deposit is fine for short-term needs, but for long-term savings goals, you really should invest to get the most from your savings. Whether you are saving for your children’s education, a wedding, or even a holiday home, you will find it very difficult to reach these goals without a savings and investments plan.

Another factor to consider is inflation. Inflation can cause the value of your money to decrease over time, so investing will allow you to keep up with or ideally beat inflation over the long-term.


Protection Against Unforeseen Circumstances

Nobody wants to think about the worst-case scenario, but planning for it is essential to protect your family financially. If you have a mortgage, you will need life insurance and mortgage protection. But this doesn’t mean you should stick with the same policies forever. You should shop around for the best deals so that you never pay more than you need to.

Income protection is another thing to consider. If you had to stop working tomorrow due to an injury or an illness, could you get by financially? If not, then you should consider income protection insurance. Critical Illness cover is another thing to consider.

You should also have an emergency fund for unexpected expenses. These include things like car troubles, medical expenses, home repairs, etc. Having separate emergency funds will stop you from dipping into your savings for essential things like annual car tax and insurance.


Live The Life You Want In Retirement

It is never too early or too late to start planning for your retirement. Having a pension is one of the best investments you can make and the earlier you start the better. Retirement goals are different for everyone, but your goals may change the closer you get to retirement age, so don’t leave it too late. Paying into a pension is the most tax-efficient way of saving money. You can obtain 20% to 40% tax relief on pension contributions.

A 2020 survey showed that many Irish people wildly underestimate what is needed to save for just a modest retirement income. Around half of Irish workers also said they will rely on the state pension in retirement. The number of people over 65 is projected to grow rapidly over the next few decades which will put a lot of pressure on the state pension. Don’t leave your retirement plan to chance. Take control of your pension now to live the life you want in retirement.


If you want to develop your own personal financial plan, book a chat with an advisor, or call us on 025-30588. We can take you through the entire process and be with you every step of the journey.




Oaktree Financial Services Ltd is regulated by the Central Bank of Ireland.

All content provided in these blog posts is intended for information purposes only and should not be interpreted as financial advice. You should always engage the services of a fully qualified financial adviser before entering any financial contract. Oaktree Financial Services Ltd will not be held responsible for any actions taken as a result of reading these blog posts.

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