How to get your finances in great shape for 2008

A little planning now will hold you in good stead for the future, says James Daley

It's not too late to make a few extra new year's resolutions. While you might have already promised yourself that you'll give up smoking, lose weight or make a career change why not also make 2008 the year when you get your finances in order? If you're stuck for ideas, try casting an eye over our list of 10 financial necessities. As well as giving you peace of mind, in the long-run, each of them will also help you and your family save money.

Make a will

According to the National Consumer Council, more than 27 million people in England and Wales the majority of the adult population do not have a will. Furthermore, it is often those who are most exposed who have not bothered to lay out what will happen to their assets and dependents should they die. For example, more than four out of five co-habiting non-married couples have not made a will, meaning that the survivor would be legally entitled to none of their partner's assets were they to die.

According to UK law, if you die "intestate" (without a will), your estate will be divided amongst certain individuals within your family. If you are not married and have no living children, the estate will pass on to (in order of priority) your grandchildren, parents, siblings (or their children if they too have died), grandparents, uncles and aunts.

If you do have children, it is crucial to make a will, setting out who will take care of them. Without a will, if both parents were to die unexpectedly, the courts could be left to decide who would be the children's guardian.

Making a will is relatively simple. Although it is advisable to seek advice from a solicitor, it is possible to write your own, by buying a pre-printed form from shops such as WH Smith. For more information on making a will, visit

Start a pension

According to the Pensions Policy Institute, only 45 per cent of men, and 37 per cent of women contribute to a private pension in the UK. Amongst young adults, the statistics are even more alarming, with only 22 per cent of people between the ages of 18 and 29 saving into a pension.

Given that the state will currently only guarantee you an income of around 120 a week in retirement (equivalent to approximately 6,200 a year), there are lots of people who are either going to be forced to work till they drop, or get accustomed to a much more meagre standard of living when they retire.

The earlier you start saving, the less you need to put away each month to ensure you're left with a decent pot in retirement. As a rule of thumb, you can work out how much of your monthly wage you should be saving by halving your age at the time you take out your pension. Hence, if you're 40, you'll need to be putting away 20 per cent a month, whereas at 20, you'll need just half of that.

Get your taxes in order

If you haven't yet filed your tax return for the 2006/07 tax year, you've only got another 26 days to go after which, you'll be fined 100. Around 150,000 people leave it to the last minute, filing on the 31 January deadline day. But getting your affairs in order earlier will save you a lot of stress, and will give you more time to plan for any additional bill you may be hit with. (Or if you've paid too much tax over the past year, you'll get your hands on the rebate that bit sooner.)

Filing your return online is the easiest and quickest way to get things done. And if you find it all a bit daunting, why not take a look at the HM Revenue & Customs' podcast, which gives you a step by step guide: If all else fails, get an accountant. And remember that if you live in London or the South-east, you may find a cheaper adviser located elsewhere. You should be able to do all your paperwork by post, and over the phone. To find a financial adviser in your area, visit

Get protection

If you've got children or other people who depend on you, it's well worth considering taking out some form of protection, to ensure the financial needs of your dependents can be met should you die. But according to Sainsbury's Finance, almost 30 per cent of people who have children under the age of 18 have no life insurance.

Anyone with a mortgage or serious debts should also consider taking out some form of cover, such as Income Protection Insurance, which ensures you can meet your loan repayments if you are out of a job or unable to work through ill health. If you own a property, it's also worth considering taking out life insurance, to ensure your mortgage will be paid off if you were to die, taking the strain off your partner or family.

Although the number of young first-time buyers has increased rapidly over the past few years, only 35 per cent of people between the ages of 18 and 29 have taken out life insurance, according to the protection broker, Lifesearch.

Find a better deal

Spending an afternoon spring-cleaning your finances could save you thousands of pounds a year. Use websites such as and to check that you're getting the best deal on your home utilities (gas, electric, telephone, broadband), credit cards and home and motor insurance.

These sites allow you to compare your current deal with others on the market and help you to switch if you want to.

You might also want to check you're getting the best deal from your current account, and the best available rates of interest on your savings. And make sure you've not lapsed over on to the standard variable rate on your mortgage. Sites such as and are good for these jobs.

Check your credit rating

It's now possible to get your hands on your credit file in a matter of minutes, by paying a small fee to one of the credit agencies over the internet. Sites such as, and allow you to download your complete credit file for as little as 10, and you can get your hands on more basic versions for even less.

The sites will let you know your credit score, and give you a chance to understand why you may be turned down for credit, or not receive the best rates. Not registering on the electoral roll at your current address, or failing to inform the credit agencies that you're no longer financially affiliated to an ex-partner are just two things which could be bringing your score down.

By taking just a few small and easy steps, you could help increase your credit score significantly.

Track down any unclaimed assets

An estimated 15bn is sitting in dormant bank accounts, pensions, premium bonds and unclaimed life insurance policies so it pays to scour your records (and your memory) to check whether any of it belongs to you. All too often, people lose track of old accounts when they move house, so if you think you may have some unclaimed money lying around, visit the Unclaimed Assets Register at For 18, they'll carry out a search on your behalf.

Check you're adequately insured

Check that you've got the right level of cover on your home and motor insurance policies as it's all too common for home and car owners to leave themselves underinsured. While companies such as More Than offer a standard limit of 75,000 on your home contents, others offer limits as low as 12,500. Try making an inventory of everything in your house, along with its replacement value the total is likely to be greater than you think.

Similarly, comparison site warns that if you've made any upgrades or changes to your car, you'll need to tell your insurer, as this could invalidate your existing policy.

Benefits and tax credits

If you're working more than 30 hours a week or more than 16 hours a week if you have children but are on a low income, you could be entitled to working tax credits. These can be worth several thousand pounds a year, and are even greater for single parents, or people over 50 who are returning to work after a period of time on benefits. To find out whether you qualify, visit

If you're returning to work after having children, you may also be able to get help with childcare costs. Ask your employer if they are signed up to the childcare voucher scheme, and visit childcare for more details.

If you're unable to work because of ill health, you should be able to claim incapacity benefit, while if you're in need of personal or nursing care, many of the costs should be picked up your local authority or local primary care trust. To find out more, visit

Invest your child's trust fund

If you've had a child in the past few years, you should have been sent a voucher for either 250 or 500 (depending on your income) to help get them started on the savings ladder. However, some 25 per cent of parents are failing to invest their child's money within the first year of receiving it, meaning it is allocated randomly to an investment provider rather than one of their choosing and also misses out on 12 months of investment growth.

The gap between the best and the worst performing funds is significant. According to BestInvest, the top performing equity child trust funds have returned over 10 more than the worst which means making the right choice is crucial. Even parents who have invested their child's money in cash could find themselves receiving very different rates of interest to their neighbours. The gap between the best and worst savings accounts is now almost 3 percentage points.

Although the small sums of money involved with CTFs mean that it's hard to get financial advice, The Share Centre offers a free advice service for its customers. There are also a range of tools and tips to help parents on its website ( For more basic information about CTFs, visit the Government's website

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at

Britain's opposition Labour Party leader Ed Miliband (R) and Boris Johnson, mayor of London, talk on the Andrew Marr show in London April 26
General electionAndrew Marr forced to intervene as Boris and Miliband clash on TV
peoplePair enliven the Emirates bore-draw
Arts and Entertainment
tvPoldark episode 8, review
Finacial products from our partners
Property search
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Ashdown Group: Treasury Assistant - Accounts Assistant - London, Old Street

    £24000 - £26000 per annum + benefits : Ashdown Group: A highly successful, glo...

    Ashdown Group: Business Analyst - Financial Services - City, London

    £50000 - £55000 per annum: Ashdown Group: Business Analyst - Financial Service...

    SThree: Trainee Recruitment Consultant

    £18000 - £23000 per annum + OTE £45K: SThree: At SThree, we like to be differe...

    SThree: Trainee Recruitment Consultant

    £20000 - £25000 per annum + competitive: SThree: Did you know? SThree is the o...

    Day In a Page

    General Election 2015: Chuka Umunna on the benefits of immigration, humility – and his leader Ed Miliband

    Chuka Umunna: A virus of racism runs through Ukip

    The shadow business secretary on the benefits of immigration, humility – and his leader Ed Miliband
    Yemen crisis: This exotic war will soon become Europe's problem

    Yemen's exotic war will soon affect Europe

    Terrorism and boatloads of desperate migrants will be the outcome of the Saudi air campaign, says Patrick Cockburn
    Marginal Streets project aims to document voters in the run-up to the General Election

    Marginal Streets project documents voters

    Independent photographers Joseph Fox and Orlando Gili are uploading two portraits of constituents to their website for each day of the campaign
    Game of Thrones: Visit the real-life kingdom of Westeros to see where violent history ends and telly tourism begins

    The real-life kingdom of Westeros

    Is there something a little uncomfortable about Game of Thrones shooting in Northern Ireland?
    How to survive a social-media mauling, by the tough women of Twitter

    How to survive a Twitter mauling

    Mary Beard, Caroline Criado-Perez, Louise Mensch, Bunny La Roche and Courtney Barrasford reveal how to trounce the trolls
    Gallipoli centenary: At dawn, the young remember the young who perished in one of the First World War's bloodiest battles

    At dawn, the young remember the young

    A century ago, soldiers of the Empire – many no more than boys – spilt on to Gallipoli’s beaches. On this 100th Anzac Day, there are personal, poetic tributes to their sacrifice
    Dissent is slowly building against the billions spent on presidential campaigns – even among politicians themselves

    Follow the money as never before

    Dissent is slowly building against the billions spent on presidential campaigns – even among politicians themselves, reports Rupert Cornwell
    Samuel West interview: The actor and director on austerity, unionisation, and not mentioning his famous parents

    Samuel West interview

    The actor and director on austerity, unionisation, and not mentioning his famous parents
    General Election 2015: Imagine if the leading political parties were fashion labels

    Imagine if the leading political parties were fashion labels

    Fashion editor, Alexander Fury, on what the leaders' appearances tell us about them
    Phumzile Mlambo-Ngcuka: Home can be the unsafest place for women

    Phumzile Mlambo-Ngcuka: Home can be the unsafest place for women

    The architect of the HeForShe movement and head of UN Women on the world's failure to combat domestic violence
    Public relations as 'art'? Surely not

    Confessions of a former PR man

    The 'art' of public relations is being celebrated by the V&A museum, triggering some happy memories for DJ Taylor
    Bill Granger recipes: Our chef succumbs to his sugar cravings with super-luxurious sweet treats

    Bill Granger's luxurious sweet treats

    Our chef loves to stop for 30 minutes to catch up on the day's gossip, while nibbling on something sweet
    London Marathon 2015: Paula Radcliffe and the mother of all goodbyes

    The mother of all goodbyes

    Paula Radcliffe's farewell to the London Marathon will be a family affair
    Everton vs Manchester United: Steven Naismith demands 'better' if Toffees are to upset the odds against United

    Steven Naismith: 'We know we must do better'

    The Everton forward explains the reasons behind club's decline this season
    Arsenal vs Chelsea: Praise to Arsene Wenger for having the courage of his convictions

    Michael Calvin's Last Word

    Praise to Wenger for having the courage of his convictions