There will always be inescapable financial decisions to make in our lifetime; however hard we try to put them off. We’re not talking about whether you can afford to spend Saturday evening out with friends, but truly big decisions that can affect us, and our families, for years to come. Here are the most important financial decisions you will ever have to make.
Everyone wants to take that first step onto the property ladder, and most of the UK will have bought their first house by the time they’re 35. However, it is one of the biggest financial decisions any of us will make in our lifetime. Even those who have rented property before will not be fully prepared for the implications of buying that first home. A mortgage is not only a big step, but a legally binding contract. Make sure you plan for all eventualities when entering into a mortgage agreement, including losing your job or splitting up with a partner. We hope these things never happen, but there is no harm in being fully prepared.
Deciding to get married is an exciting prospect, but it is also a huge financial decision. The average wedding in the UK costs around £25,000 – a lot of money for most of us! Planning the day can be exciting, but many married couples start their new life in debt. If you do want to get married then look up some money saving tips in order to bring those costs down. You should also ensure you have enough money saved up to cover most, if not all, of the wedding. This will help you start your new married life without huge credit card bills and debt. Although some people see it as untraditional, many couples now ask their guests for a financial gift, instead of receiving 150 toasters. You don’t necessarily have to ask everyone for cash; how about asking for supermarket vouchers to cover the cost of your grocery shopping for the next few months?
Did you know it costs the average family £148,000 to raise a child from birth until they turn 18. Even after they leave home there are costs that will continue to rack up, such as university fees, birthdays and Christmas, perhaps even helping them with their first home. Having children is a wonderful gift, but an expensive one. No one will ever be fully prepared for their first child mentally; however, they can be prepared financially. Ensure you have a financial plan in mind, even if the child is unexpected. Those who are planning on starting a family should put together savings for all of the initial costs; nursery furniture, clothes, food and nappies, to name a few.
This is a financial decision that nobody wants to think about, but it does have to be done. Writing a will ensures that your finances, assets and everything else, is given to the people you love the most. You’re best off looking for advice on wills and estate administration in case the unfortunate happens, at several points in your lifetime. Getting married doesn’t automatically make your spouse the beneficiary of your assets, and having children doesn’t necessarily include them in the will either. If you want to ensure your family are well looked after when you are gone, then this is the biggest financial decision you will ever make.
It doesn’t matter which order you make these financial decisions, or whether you make all of them at all. What does matter is that you carefully plan and consider each one, so that you are fully ready for any eventuality. Write a budget, scribble costs down and have a backup plan for any situation, if you want your financial decisions to be successful.