What are your Big Savings Goals in life?
Do you have one those scarily big savings goals of something huge that you know you will need to pay for in years to come? Maybe you want to buy a Lamborghini (ha-ha if only!), maybe you want to put your children through university or perhaps you want a loft extension? There are so many big things that are either essentials or just life-enhancing ‘nice-to-haves’ that require many years of saving.
UBS SmartWealth carried out some research* among couples last year, showing the top saving goals in priority order:
- Comfortable retirement
- Home improvements
- Travel experiences
- Your children’s higher education
- Supporting your children onto the property ladder
- Your next step up the property ladder
- Your children’s secondary education
- Big ticket purchases (e.g. a boat, a car, art, a luxury item of jewellery)
- A second home
- Your children’s wedding fund
- Moving abroad
- Supporting elderly parents financially.
Personally, I think these are such interesting findings particularly because they compare exactly to what our household’s priorities are, or indeed what we would like them to be. I’m interested to hear how your priority list compares but first, I wanted to discuss those relevant to our family.
This is a work in progress. I have a fund built up with contributions from around 7 years of employment. I rather regretfully didn’t start investing in a pension scheme until the age of 31. This fund has been paused for the past three years since becoming self-employed and the plan to commence reinvestment commences during 2018. It’s quite scary when you look at what you have invested and how much that money is worth to your retirement. I have £45k in my pension pot which is worth at least £4,800 per year upon retirement. This is nowhere near enough. This is totally us in retirement!!
We live in a 4-bedroom house with plenty of space for our three young boys. Our eldest has his own room and the next two boys share a room with bunk beds. Our fourth bedroom is a small room currently used for the office/dumping ground. At some point the boys are going to want their privacy we don’t have a lot of space for this. Our plan is to convert our loft. We have a huge amount of loft space sitting empty, so this makes a lot of sense and will create an extra-large room. We probably need around £25k saved up to do this. Yes this is how our loft looks at the moment, with a few boxes of rubbish (we should probably throw away) stored up there!
I would include our children’s education as the next priority – or indeed saving a chunk of money for whatever they choose to do at the age of 18. University was a key part of my life and I would love for them to experience it, but I am ever so nervous about the cost. I left university with £8k of debt and that was paid off within five years. My children could potentially leave university with £45k of debt, most likely more in years to come. Is it still worth it? A debate for another blog post maybe. Whatever they choose to do we want to have a fund built up for them to give them a start in life. Secretly, I am ever so hopeful that one of the boys makes it as a professional footballer!
These are all big life events costing large amounts so it’s important to make your money work for you and choose places and products where your money is going ’earn its own salary’ and generate a return. I would love to know in the comments what big ticket things you are saving for and if they rank highly in the research mentioned. Or maybe you have something different that you are saving for?
Saving for that Big Life Event: Where to begin
When looking around for options, you might want to check out UBS SmartWealth, a digital investment service launched by the world’s biggest wealth manager** offering a range of options to help you save for that Big Goal. From Stocks and Shares ISA to General Investment Accounts, they have a range of five investment strategies from lower risk fixed income plans to higher risk equity plans. Each plan comes with its own details of fees and potential returns based on previous performance. For example, if I went for the growth plan (classed as medium risk) and invested £15k the fee would be £185 or 1.23% of my investment if I went for the passively invested fund.
All of the UBS SmartWealth funds are managed funds as opposed to a robo-funds, so your money will be managed by real life fund managers. The minimum investment levels are £15k – ideal if you have lower performing cash ISAs to transfer in.
The platform also includes a visual goal planner, which incorporates your existing investments and savings from elsewhere to get a complete picture of your life situation, helping you take control of your financial journey.
Important Information – The price and value of your investments and income derived from them can go down as well as up. You might not get back the amount you originally invested. ISA rules apply.
This post was written in collaboration with UBS SmartWealth.
*UBS SmartWealth’s research was conducted in conjunction with Censuswide in March 2017 with a research panel of 2,000 respondents with combined (household) investable assets of £15,000+ and who live with their partner.
**Scorpio Partnership, 2017