20:20 vision – your New Year action plan

January is creeping up on us, and with it the desire to have a fresh start in areas of our lives we’re not completely happy with.

Most of us focus on personal health – go to the gym, cut back on the alcohol intake, eat heathier - but too many people forget about the financial health.

This New Year, why don’t you put that at the top of your priorities? Make your resolution to get closer to your money goals. Here’s how with our five step action plan:

This is not advice, if you’re not sure if an investment is right for you, please seek personal advice.

1. Take stock

The first thing to do is review your plans. If you don’t have a plan, write one. It’s crucial to your financial future.

Work out where you are now, know your goals and how you’re going to get there.

Every year revisit your plan. Are you still on track? Or has a recent life event or shift in your circumstances meant you need to take action?

Don’t dismiss the simplicity of a plan. It could help you avoid any nasty surprises further down the line. As the saying goes, if you fail to plan, you're planning to fail.

2. Mix it up

One of the golden rules to investing is not having all your eggs in one basket.

That means spreading your money across different types of investments –shares, funds, bonds or so called alternatives such as gold or property.

As well as a good mix of investment types, it’s also important to spread your money globally too.

The performance of different countries’ stock markets can (and will) vary. In fact, the best performing stock market changes almost every year. So not investing overseas could mean you miss out on sizeable returns.

Don’t worry, you don’t have to micro-analyse all your holdings. We’ve got a handy online tool that does it for you.

To view an analysis of your own portfolio log in to your account online and, from your Portfolio Overview, select the Portfolio Analysis tab. You’ll be able to see exactly where your money is invested. It can help you spot if you’ve got too much invested in one region, sector or asset type.

Unfortunately there’s no hard and fast rule on what the perfect portfolio looks like. It boils down to your personal circumstances – your risk appetite, age, income requirements and whether you’re in or approaching retirement.

Remember unlike cash, investments can fall as well as rise in value so you may not get back what you invest.

3. Wrap it up

If you can, it makes sense to fully use your ISA and SIPP allowances. It doesn’t always mean adding new money. If you have investments held outside of an ISA or SIPP, consider getting them wrapped up and sheltered from future tax. This process is called a Bed & ISA, or Bed & SIPP.

Please note tax rules can change and their benefits depend on your circumstances. Once in a SIPP, you can’t take your money out until you’re 55 (57 from 2028).

4. Get it together

Too many people still run their investments and savings from an overstuffed drawer full of paper.

Why not get rid of the paperwork and go electronic?

For most people, it’s also worth holding all your savings and investments in one place. It will make them a lot easier to look after.

Transferring to HL is easy. We’ll do most of the hard work for you. And once you’ve done it you can see all your investments and savings at the click of a button. You can then use that drawer for something else.

Before transferring please make sure you won’t lose any valuable guarantees or be charged high exit fees.

5. Don’t forget your cash

Having the right amount of cash can mean less sleepless nights about your investments. Most people should have around three to six months’ worth of expenses in cash, and the risk averse are likely to have more.

But with such low interest rates many of us overlook our cash. It’s not worth the hassle hunting better returns. That’s a mistake.

Most cash savings are facing miserable interest rates, with no light at the end of the tunnel. So, in reality, you’re losing money once you consider inflation.

Take action today to boost the power of your cash with the only savings account you'll ever need.