A Question of Finance: 2009 – a new year and a new start? (From The Northern Echo)

A Question of Finance: 2009 – a new year and a new start?

8:36am Friday 9th January 2009 in

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FIRSTLY, a very happy New Year to you all. I hope you had a fantastic festive period and I presume that, like me, you have now come back down to earth with a bump as we return to work.

Now this bump will be harder for some than others, especially when the realisation sets in of festive overspending when the bills start dropping through the letterbox later this month.

Last year will be remembered as one of the worst in financial history, and I don’t think anybody could have predicted how bad it was actually going to be.

However, in 2009, we surely have no excuses for not planning for the year ahead knowing what we know now.

There has therefore never been a more important time to get your finances in shape for a new year.

Most banks, building societies and finance houses promote free financial reviews at this time, and we at Active Financial Services are no different. There is a good reason for this, as not only are the bills mounting, but this is the time for new year resolutions.

Recent research carried out by Halifax confirms this, but it also highlights some very worrying trends.

Last year, one in two consumers chose a friend or family member for financial advice, rather than visiting their high street bank or a financial advisor.

Although the need for financial advice is widely acknowledged and more than half of the population believe that seeing an advisor would benefit their current finances, only 16 per cent have actually visited one in the past 12 months.

Pensions are also a key concern and almost half of the population wish to seek advice in this area, over and with Carl Pemberton A Question of Finance above any other financial product. Fifty-two per cent of the UK population don’t even pay into a pension and furthermore, 70 per cent overestimate the state pension they will receive – on average, people think it is double the actual amount of £4,700 per annum. Eightyfive per cent also overestimate their achievable desired retirement income, even though they are already overestimating what they are entitled to from the state.

As a nation, these figures are frightening. However, it is you, and only you that can determine whether you wish to be one of these statistics.

Make sure that this January you make at least one new year resolution that you can stick to. Take up the opportunity of reviewing your finances with your bank or advisor, as it may well turn out to be the most important hour of your time you will spend all year.

Putting it another way, can you afford not to?

As a finance company’s motto could state: late payment charges on your bills, £25. Getting your finances in shape for 2009, Priceless.

● Karl Pemberton is director of Guisborough-based Active Financial Services. He can be contacted on 01287-632367 or through activefinancial services.co.uk and will be answering readers’ financial questions in a bi-weekly column.

Any topics you would like to see featured in his column should be sent to echobusiness@nne.co.uk The information contained in this response should not be relied upon as general advice and is for general information only. We always recommend you seek independent financial advice before embarking on any financial decisions.