Top Financial Resolutions for 2006

January is the perfect month for developing new priorities and goals for the year ahead, but this financial plan will work anytime you need to put your finances in order. We have put a top-ten list together of important, but often neglected, tips and tasks that will help increase the wealth of you and your family over the years ahead.

(PRWEB) January 5, 2006 -- January is the perfect month for developing new priorities and goals for the year ahead, but this financial plan will work anytime you need to put your finances in order. QCK.com has put a top-ten list together of important, but often neglected, tips that will help increase your wealth over the years ahead.

1. Deal with your debts

You can't go wrong by tackling any debts you have first. It's all too easy to build up debts on store/credit cards. Unauthorised overdrafts can quickly spiral out of control. Get on top by planning ahead. If you can, pay off your cards before you get hit by interest charges. Transfer any remaining debt to a cheaper card. Work out your monthly expenses and give yourself a strict cash-only spending budget until your debts are cleared.

While you're at it, get rid of any expensive store cards you may have.

Even if you do nothing else, if you have debts, taking action to reduce your debt costs will make a major difference. You can compare credit cards at www.credit-cards.qck.com

2. Reduce mortgage payments

Why not resolve to review your mortgage every 5 years, starting this year? You don't necessarily have to switch lender - if your current lender can offer you the best deal, stick with them, but otherwise switch to the better deal. There is often a fee to move mortgages, so factor this in and make sure you understand all the conditions: particularly redemption charges for repaying early and any expensive linked insurance deals. Compare mortgages at http://www.mortgages.qck.com

3. Review your home insurance

Now you've tackled your debts, it's time to look at reducing your expenses and insurance can devour cash.

The easiest and most common way to arrange home insurance is through your mortgage lender - but this is usually the costliest way to buy insurance.

Every year, thousands of people blindly renew their home insurance with their current insurer, not realising that they could probably benefit from a superior level of cover for no extra cost (see http://www.home-insurance.qck.com).

4. Switch utility companies

According to Allan Asher, chief executive of independent watchdog Energywatch, millions of people are seeing their energy bills skyrocket this winter. "It has never been so important for consumers to make sure they cut their energy bills." You could wipe hundred of pounds off your annual expenditure in just a few minutes - that's not a bad rate of pay, is it? Compare gas/electricity providers at www.cut-energy-bills.qck.com

5. Switch savings accounts

Now you've cut down your expenses, it's time to look at making any money you do have work harder.

There is a huge difference between savings rates offered by banks and building societies right now. Don't even think of leaving your money where the rates are less than 4.5% gross. Try using a comparison table such as www.savings-accounts.qck.com.

6. Start an ISA

If you've got plenty of spare cash you need to make it work even harder by choosing a tax-free investment. Start putting some savings into an ISA. Any dividends, interest or capital are tax-free. The maximum that can be invested in any tax year in equities under a 'maxi' ISA is £7,000. You can invest up to £3000 a year in a 'cash' ISA, though your total combined annual limit for investing in ISAs is £7000. We like the look of FTSE tracking ISAs, as we forecast the stockmarket to do quite well this year, certainly out-performing property. Read more about ISAs at www.qck.com/isa.html.

7. Start a pension

Have you started saving for your pension yet? Or are you one of the 9-12 million people that the Pensions Commission has warned will face retirement with little or no savings in place? Don't rely on the state pension - if you have no other savings you'll currently get £105.45 as a single person and £160.95 as a couple per week. Not much is it? Start by checking out the information at www.pensions.qck.com

8. Take out Critical Illness Cover

Protect your income. The reality is that 1 in 3 of us will be diagnosed with cancer in our lifetime. Those prudent enough to have CI cover will benefit from a lump sum payment plus an ongoing income for the duration of the illness. Most CI insurers will cover around 15 serious conditions including cancer, heart attack or stroke. More information at www.illness-insurance.qck.com

9. Reduce Inheritance Tax

While you can't take it with you, there's no point forcing your family to give it to the taxman. On your death, the government will tax your assets, including your home, at a whopping 40% (apart from the first £275,000) unless you leave the lot to charity.

However, for those in the know, there are plenty of legitimate ways to cut this tax. There is the annual £3000 exemption, exemptions for certain marriage gifts and a useful one known as "normal expenditure out of income".

It is also possible to think in terms of giving sums away, surviving seven years and getting it out of the taxman's "reach".

More information at http://www.inheritance-tax.qck.com.

10. Make a Will

Figures from the voluntary organisation Will Aid reveal that around 50% of people die without a valid will. Many of us dither about making a will. But if you don't want the taxman to take your money after you're gone, don't dither about. More information at http://www.qck.com/make-a-will.html

11. One More for Risk-Takers only. Invest in Property

Our top picks are: (1) residential property in Central London which has shown slow growth over the last few years; (2) commercial property in London's West End, particularly Mayfair and St James, where rents are expected to grow 7% over the next year; (3) holiday property in Turkey, which is inexpensive and rising in value; (4) property in Japan is hiking as stagflation slows.

Now you've overhauled your major personal financial areas, you really will have something to celebrate for 2006.

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