Christmas to do list

Christmas to do list

Photo by Denise Johnson on Unsplash

It might seem like the kids have only just gone back to school after the summer break but…  it’s coming up to the Christmas holidays already.  Hopefully, you’ll have some time off work – after you’ve managed to get a full month’s work done in three weeks, and survived all the other end of year activities that all seem to come at once (I’m talking about all the kids’ Christmas activities and the office party)!

Assuming you’ve sorted out what everyone is doing over the festive period, which relatives are visiting and/or which you’re travelling to, you might find yourself with some time to actually think about things other than presents, turkey and the to-do list you left at work that you didn’t quite manage to finish.  Maybe to escape the relatives for a bit you can grab some personal admin time. 

As I suggested in the summer, if you do manage to get some time, it’s a good opportunity to tackle the list of jobs that never seem to get done.  Given that the Christmas break is usually shorter than the summer one and has more family things going on, the list of tasks you could do (or at least think about) is slightly different from my previous suggestions.  As a reminder, I’m not saying that any of them is a fun way to spend your time but they are all probably worthwhile.

The dreaded tax return

Definitely not the most fun thing to do, but it needs doing before 31st January if you have not already submitted it.  You might not think that you need to submit a return under self-assessment but even if you’re paid via PAYE there are reasons to complete one, for example:

  • If you or your partner receives child benefit and either of you earns over £50,000pa, you may need to do so to pay the child benefit tax charge that might be due.
  • If you pay pension contributions into a personal pension or group personal pension and are a higher rate taxpayer, you might need to use self-assessment to claim the higher rate relief on your contributions or disclose if you have exceeded the pension annual allowance.


Why not get it done now when you have some time rather than leave it nagging at you until right before the deadline?  If you have an accountant or tax adviser who does this for you, they have probably already asked for all the data they need from you but you could collate all this information and send it to them in early January.  They usually have a very busy January period, so the sooner you do this the better.

The money talk

Rather than relaxing in front of the usual Christmas TV programmes and re-runs that we’ve all seen before, why not turn the TV off and talk to your partner about money!  Sounds like fun doesn’t it?

I’m not suggesting you give each other a lecture about overspending, but rather that you talk about each of your goals in life that are money-related (most are).  When did you last talk about what is important about money for each of you and what you want to do in later life?  Have you ever had this type of conversation? 

It’s important for both financial planning and for a stronger relationship to talk about these things.  It might be that one of you has an ambition to do something and has never discussed it before because they are concerned about the costs.  You might have different ideas about when you want to stop working and what a ‘good future’ looks like.

Getting these things in the open can be difficult but also rewarding and only by discussing these issues can any meaningful and joint planning be done.

If you find this conversation very difficult, then it may be easier to engage with a financial planner who will try to help you have this discussion.

Expenditure check

I’ve mentioned this before but the end of the calendar year could be another good time and opportunity to work out an idea of what your current lifestyle actually costs.  This allows your financial plan (if you have one) to be constructed based on some degree of reality and what you spend now can be used as an indication of the cost implications of what you might like your lifestyle to look like in the future.

I have previously written a blog, on how to calculate your expenditure and there aren’t many short cuts.  Downloading bank account transactions to a spreadsheet is usually the most accurate but pay attention to funds that are just moving around between accounts to avoid double counting.

Investment portfolio rebalance

If you currently manage your own investments, now is a good time to look at the overall asset allocation and decide if you need to rebalance your portfolio.  The asset allocation is the split between growth assets (equities and property) and defensive assets (cash and fixed income securities).  Again, this is not necessarily a straightforward task; however, it’s essential for any good investment process and it is good discipline.  

Rebalancing your portfolio periodically ensures that the level of risk of the portfolio is in line with that which you are happy to take.  It’s very easy for a portfolio to get out of kilter and you don’t want to realise after the next market correction that your portfolio had drifted to a level of risk you are uncomfortable taking and incurred a greater fall than it would have if the asset allocation you intended had been maintained.

Wills

When did you and your partner last review your existing wills to see if they still reflect your wishes?  If you don’t have wills, then this is a great time to discuss what you might like to include in them.  You can then contact a solicitor, in the New Year, to get them drafted.

A will is an essential document that ensures your financial affairs are left well organised on your death and that your wishes are carried out.

Tidy up the paperwork

Like most people, you may have accumulated a file, files or drawer full of statements and correspondence from financial product providers that just keeps getting bigger.  Most of this can probably be shredded and scanned if you think you will need access to it again.

Sorting out your paperwork also provides an opportunity to list, by hand or in a spreadsheet, everything you have and owe.  Again, a good financial planning firm will do this for you but it makes your life and those of your advisers easier if your financial information and policies are summarised in one place.

The process of sorting out all your paperwork and collating your assets and policies can be very rewarding and you might find a policy or asset you’ve forgotten about.

Contact a financial planner or other adviser

Agree to make a New Year’s resolution to make initial contact with a solicitor, tax adviser or financial planner, so that you can deal with updating your wills or starting the process to create a financial plan.

Most of the things in this list and the summer ‘to do’ list would be discussed and dealt with by a good financial planning firm, giving you more time in the future to do what you really want to do.

Whatever you manage to do with any downtime you get over Christmas, remember to make sure you spend the majority of it with your friends and family, get some rest and don’t eat too many mince pies! 

Seasons Greetings

Charles