8 Simple Things You Can Do To Achieve Financial Freedom

At Carlile Alexander Private Wealth we provide high quality advice for the most complex of financial situations. But here are eight simple things you can do yourself to achieve financial freedom.

Save 20% …. and become a millionaire!

Committing to saving a percentage of your post tax salary before you spend it can produce impressive results long term.

Here’s an example: Imagine someone who earns £25,000 in their 20s, £35,000 in their 30s, £45,000 in their 40s, and £55,000 in their 50s-60s. Saving 20% of their post tax salary from age 21-68, with a 5% return, would produce £1 million over the years.

Invest in a diversified portfolio to harness the power of compound interest

Amazing but true: Investing small amounts over a longer period produces higher returns than high amounts over a shorter period thanks to the almost magical effect of compound interest. And investing in a diversified investment portfolio is a very good way to do this.

Shelter your income from tax

ISAs and pension allowances can multiply the power of your money by legally sheltering it from the ravages of tax. Using your ISA allowance (currently £20,000) every year could even provide you with a retirement income that is totally tax free.

Keep investment costs to a minimum

The cost of financial advice and management fees can really eat into your returns. So check what you’re paying and ask for a breakdown of charges every year. Bear in mind that investment management, ongoing financial advice and a five star service with Carlile Alexander Private Wealth could cost as little as 1.15% per annum, inclusive of ALL fees and charges – great value for money.

Think long term – and short term – saving

Short term saving to buy something (like a holiday) isn’t the same as saving for your future. By all means save to buy something you want, but do it on top of your long term savings pot.

Monitor your spending …. and be amazed with the results !

Is that purchase really necessary? Did you realise that cutting your spending by £20 a month over your working life could add over £50,000 to your retirement pot? Or that buying a car on finance for £150 a month rather than £300 would give you an extra £380,000? (Both examples assume the money saved is invested at a 5% return from age 21-68).

Make credit cards work for you

Credit cards are a useful tool, but make them work for you not against you by paying them off every month. And don’t let reward schemes tempt you to overspend.

Insure your financial future

When it comes to insurance, income protection insurance and life insurance are probably the most valuable types to have. They keep an income coming in for you and your family no matter what happens in future.

If you would like to find out more about the financial planning service we offer – or just find out more about Carlile Alexander Private Wealth please contact us.

Important information

5% has been used as the rate of return in above examples but this is not guaranteed. The value of your investment can go down as well as up, and you can get back less than you originally invested. Tax rates used above are based on the 18/19 tax year and are subject to change.