Family financial planning

Family financial planning

Financial planning for your family might sound daunting, a big task, and costly, but it doesn’t have to be. 

Knowing some critical milestones and planning effectively at each stage is key. 

That’s why, at Mortgage Assistant, we help to guide you through the minefield of mortgages, simplifying situations, removing jargon, and enabling you to secure the property of your dreams, all by finding the right mortgage broker in Greater Manchester for you. 

Freeing up time allow you to focus on the more enjoyable things in life. From securing your mortgage in principle, finding the right property, exchanging contracts, and completing, let our mortgage brokers help with it all. 

Family financial planning 

To help with your family planning, the main areas to focus on can include: 

Making a Will – as soon as you become a parent and start a family, it’s important to update your Will to protect your children in the event of your death. Regularly updating your Will helps to keep everything in order and include those close to you that it needs to include. 

Children’s savings accounts – often recommended is a Junior ISA for children to be taken out for your child as soon as possible. Paying into a high-interest rate savings account over the years can help build up a tidy sum by the time you’re ready to hand it over. Available as cash and stocks and shares, with Junior ISAs, you have options, and it’s important to speak to your independent financial advisor for the best option for you. 

Save for schools – school can be an expensive time for parents. From uniforms to school trips, to eventually college and university – the sooner you start saving, the less you have to find as a lump sum when you need it most. Setting up investments can be an excellent way to manage this, delivering growth and profitability within a fixed time frame. 

Upsizing/expanding – if you’re thinking about extending your family, it’s important to think about how much space you will need – long-term planning in this respect is vital. For example, you may want to think about location, i.e., where do you want to live in the future, the property values in this area, mortgage rates, deals, offers, etc. Or do you love your current home, and you would rather extend than move? Speak to a professional mortgage broker in Greater Manchester today to help secure the right mortgage for your situation. Or, if you’re looking at remortgaging, freeing up the funds, you need to let you change and extend your property as you require. A professional mortgage advisor can often help you source a deal that lowers repayments or keeps them the same. 

Financing students – for children heading off to university, rather than providing one lump sum of cash or investments, you could look to invest in student accommodation, renting out the rooms to pay the mortgage while also helping to save significantly on your own children’s living costs. The property can then become a lucrative investment for the future.  

Your mortgage broker will advise you further and let you know if this option would work for you. 

Help get their first foot on the property ladder – helping your child secure their very first home is a significant milestone. You can help them secure a mortgage by providing the deposit for the house, checking in on investments, and more. Your independent financial advisor can give more information and solutions in this area. 

Life insurance – if you have a mortgage, then it’s essential that you have the right life insurance in place to pay off the loan if one of the mortgage holders dies. 

Mortgage planning 

When planning your finances and mortgage planning, different areas you can investigate further include: 

Extending your mortgage term – you can extend the term of your mortgage, reducing your monthly payments, helping to keep your monthly outgoings affordable. This can be highly beneficial if you’re on maternity leave or looking to return to work part-time for some time.  

What’s more, you can always reduce your mortgage term later on. 

In addition, if you do opt to extend your term, you can make overpayments of up to 10% of the mortgage balance. This means you can extend your term, still overpay like it’s a shorter term, but have the flexibility to stop the overpayments at any time. 

We also recommend that you try not to drop onto and stay on the lender’s standard rate, as this will almost always be higher than the deals you can secure over a fixed term. Even if you’re not eligible for some top deals on the market, a rate with your current lender will still be better than the lender’s standard. 

Maternity income is considered – every lender will ask about future childcare costs, maternity pay, proposed return to work, etc.  

Why?  

Because these deductions will come off your total income and hence reduce your capacity to borrow. 

Different lenders will have different requirements before considering lending against income. 

To find out more about applying for a mortgage while on maternity leave, make sure to check out our latest post HERE. 

If you’re looking for mortgage advisors in Greater Manchester who can talk you through all your options and provide you with a range of solutions to support your family planning, use our Find an Advisor tool today. 

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