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Financial goals are, by and large, personal matters. However, some are common to everyone. These common goals, saving for retirement and managing the financial risk of living, need to be addressed as a first priority.
Retirement funds will be built up over a (hopefully) long period of time and are relatively straightforward. It is simply a matter of accumulating sufficient wealth for your needs post-work. Our retirement calculation process will help you arrive at a ball-park figure for this.
Managing the financial risk of being alive is another matter. There are a plethora of different sorts of insurances, including self-insurance, to provide cover for life's little mishaps. Many overlap and to purchase all the available cover would cost a fortune. So you will need some personal judgement here as to which 'conditions' pose the greatest threat to you and what you might do about them. It is worthwhile considering welfare provision - if only to realise how useless it is. For the vast majority of people it doesn't exist. By understanding the limitations of the welfare system the need for self-reliance becomes apparent.
Emergency funds (self-insurance) provide you (eventually) with a resource totally under your control that can be used for unexpected events. However, they take time to accumulate. Consequently you will also need to judge what balance of your available funds will be split between this fund and any insurances. The balance can be a moving one as the emergency fund grows and possibly removes the need for certain insurances. So, this financial requirement is one only the individual can decide on; a balance of risk against available resources.
That brings us to the crucial issue - all this takes money. If the calculations done in Stage 1 and Stage 2 (networth and cashflow) show no available funds none of this is possible,
Use those stages to determine where you can increase your disposable income. This may be by consolidation of existing debt, reducing expenditure or disposing of assets to reduce debt.
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