Your finances have just about recovered from the double-whammy of Christmas and a never-ending January, and now it’s time to look ahead.
Have you got a good level of savings squirrelled away? To you want to trade in the hustle and bustle of full-time work and live life at your own pace?
If financial independence is within your reach, here are five steps that you can take towards grabbing it this year.
Set a clear goal
Financial independence means different things to different people, but it is clear that maintaining your quality of life after leaving work behind should be paramount. Unfortunately, that is not the case for all.
More than four fifths (83%) of British women expect to experience a drop in their standard of living post-retirement, as do 70% of men surveyed.
You may want to spend your retirement touring the world, or even living abroad, or having enough to leave to your family as inheritance may be a priority.
Whatever your ambition, you will need to set targets for levels of wealth, and a timeframe in which to attain it.
Ensure tax efficiency
Simply funnelling your money into traditional savers’ accounts may not be the best way to ensure returns later down the line, and it’s well worth looking at what else is out there.
ISAs are a great way to save money while controlling your commitments as the interest you earn is not subject to income tax.
Salary sacrifice schemes can also put more in your pocket, while you may want to look at cutting back on hours in the build-up to retirement – if your professional circumstances allow it, which can move you into a different tax band.
Make your money work for you
You might be able to supercharge your retirement fund by using it to invest.
Immediate annuities, bonds and retirement income funds can all offer you a return on your investments, while investing in rental properties can also provide ongoing streams of income.
If you have a sufficient risk profile, you may also look to currency and stock trades as a way to bolster your reserves of cash for a happy retirement.
Bite the bullet
As mentioned earlier, people may expect their standard of living to drop post-retirement, but it doesn’t have to be like that.
Making subtle changes to your lifestyle as you approach the end of your working life can ensure that your savings outweigh your outgoings, while you still have ample income rolling in.
You may not have to give up all the luxuries and treats of you day-to-day life, and can also raise the chances of enjoying them much longer into your retirement.