Simon Read: Time to take a firm grip of your finances in a changing world

 

At the start of last year, I predicted in this column that the eurozone would not collapse, China's stuttering economy would not implode and Chelsea would not finally win the Champions League.

I was only incorrect about one of them and – as a Chelsea fan – was more than glad that my prediction was proved wrong one night in Munich in May 2012.

But I am sad that concerns about the eurozone continue as we start the new year. For investors, the uncertainty means we are likely to see many more months of confused and fluctuating stock markets in 2013.

In a New Year's Day message, Tony Dolphin, the chief economist at the think-tank IPPR, warned that the outlook for the UK economy was for another year of sluggish growth, with uncertainty over recovery and the eurozone crisis still dominating.

His view was that 2012 was the year when "time stood still". With this year shaping up to be much like the last, Mr Dolphin dubbed 2013 "a potential groundhog year". There was a risk, he said, that "talk of years of austerity at home and continuing crisis in Europe creates a huge amount of uncertainty, which will dampen spirits to such an extent that the economy fails to grow again".

He criticised the Office for Budget Responsibility's "cautiously optimistic predictions", which are based on an "unlikely" reversal in the trend for households to reduce their debt and predicted consumer spending would undershoot its forecasts.

He also had a pop at the Government, accusing it of counting on "something just turning up" to lift the economy, like tragic Mr Micawber does in David Copperfield. From what I understand of the Government's plans, I tend to agree with Mr Dolphin's claim that it "still does not have a path back to growth".

But where does that continuing uncertainty leave anyone trying to make decisions about their investments? Decisions made now that could affect finances for years to come. I'm not one for making investment predictions because I know from experience that markets can do exactly the opposite to what you expect, or hope.

But every investor ultimately has to take a view when deciding where to stick their cash. For much of last year, the trend was towards the perceived safety of bonds. But for months now, many experts have predicted the bursting of the bond bubble.

Meanwhile, those who avoided shares missed out on some fantastic performers during the year. To help you avoid making investment mistakes this year, Rob Griffin rounds up some of the best and worst potential performers of 2013 (see right).

Over the page we look at what's in store for house prices, while Andrew Hagger looks at what may happen in the mortgage and savings market.

I hope you find the features interesting but, frankly, it's time to take more interest in your financial affairs if you want to end the year in a better position. Taking a regular snapshot of your investments, savings and borrowing is essential if you want to ensure they are still on track.

Bear in mind that much may have changed since you chose that emerging markets fund or ultra-high special tracker deposit account.

You need to step back and rethink your hopes and plans, which should have governed your financial decisions in the first place. If there's anything major that's changed in your life – children, career or whatever – you almost certainly need to pick apart your financial plans and rebuild them to be a better fit.

But even if nothing has changed since you last gave yourself a financial makeover, world events may have had an impact on your plans. Political changes sweeping the globe could mean making changes to your plans.

In short, take control of your finances this year: don't let them get out of control.

s.read@independent.co.uk

Twitter: @simonnread

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

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
and  

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

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Recruitment Genius: Financial Adviser

    £20000 - £60000 per annum: Recruitment Genius: Are you recently QCA Level 4 qu...

    SThree: Graduate Recruitment Resourcer

    £20000 - £22500 per annum + OTE £30K: SThree: SThree Group have been well esta...

    Guru Careers: Application Support Analyst / 1st Line Support

    £25 - 30k: Guru Careers: We are seeking an Application Support Analyst / 1st L...

    Guru Careers: .NET Developer / Web Developer

    £45K - £55K (DOE) + Benefits: Guru Careers: We are seeking a full stack .NET D...

    Day In a Page

    Not even the 'putrid throat' could stop the Ross Poldark swoon-fest'

    Not even the 'putrid throat' could stop the Ross Poldark swoon-fest'

    How a costume drama became a Sunday night staple
    Miliband promises no stamp duty for first-time buyers as he pushes Tories on housing

    Miliband promises no stamp duty for first-time buyers

    Labour leader pushes Tories on housing
    Aviation history is littered with grand failures - from the the Bristol Brabazon to Concorde - but what went wrong with the SuperJumbo?

    Aviation history is littered with grand failures

    But what went wrong with the SuperJumbo?
    Fear of Putin, Islamists and immigration is giving rise to a new generation of Soviet-style 'iron curtains' right across Europe

    Fortress Europe?

    Fear of Putin, Islamists and immigration is giving rise to a new generation of 'iron curtains'
    Never mind what you're wearing, it's what you're reclining on

    Never mind what you're wearing

    It's what you're reclining on that matters
    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