Forward planning

By THIS IS MONEY
Updated:

 

I have a house valued at £130,000, mortgage free, in my name. I am married to a teacher and have two children. I work as a senior secretary but am just about to be made redundant, and I have about £10,000 in various financial bits and pieces. I know absolutely nothing about money except how to spend it, but at 42 I'm starting to worry that I have not prepared for the future. What sort of things should I be thinking about and how can I avoid consulting a financial adviser that is not totally independent? NJ, Nottingham.

Martyn Laverick from independent financial adviser Chartwell Investment Management says: You are right to be thinking about managing your money for the future. But first you must cope with the possible financial effects of redundancy.

If you are not getting a decent redundancy payment make sure your £10,000 savings are easily available in case you need them to pay bills. Put them in the best-paying deposit account you can find, eg, Egg (paying 5.75% at present but now you can only invest over the internet.) or Standard Life Bank. If you are getting a redundancy payment you could use that as your emergency fund in case you need it.

Once you are prepared for that, your first priority should be to secure yourself a pension so check if you already have one and what it will pay you when you retire. You may well wish to make more provision.

You are wise to consider taking independent financial advice. You have a choice of using an adviser who is paid from commissions on the products you buy or one to whom you have to pay a fee. Some people feel commission payments mean advisers who take them are not fully independent because some companies pay more in commissions than others. However the advice from independent financial advisers paid by commission is free to you, the client. Some people think advisers who work for a fee, and so cannot be influenced by commissions, are more likely to give genuinely independent advice.

You can get a list of three independent financial advisers in your area, plus a voucher for 30 minutes free advice, from the IFA Promotions, tel 0117 971 1177 or on its web site.

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