Reviewing your finances
A successful future must be based on careful financial planning. It is vital to review your income and expenditure as your circumstances change.
Calculate the difference in outgoings when you leave work - less tax, possibly no National Insurance, no pension contributions, work expenses, travel costs etc. Are there other things you can cut out without feeling their loss?
What will be your net income when you leave your job (before any new investments) after all these items are considered.
Adjust your spending to meet your new income level and make all the adjustments to routine spending that you feel are reasonable?
Allow a settling down period, then look to see if there is a shortfall, how much it is. If there is, will it remain at that level and for how long?
If you need income, how much do you need? Will your need for income change in the next 10 years. Why and by how much? (For instance, a State Pension becoming payable, your mortgage finishing, a partner finishing work and receiving a pension, insurances maturing).
Everyday expenditures will change, some increasing and some decreasing. Income, however, will nearly always be less. It is important, therefore, to exercise some control. The budget forms which follow help compare the main areas of income and expenditure before and after leaving to identify areas where adjustments can be made.
Source While working After leaving Earnings Occupational Pension income State Benefits Interest (Building Societies, Bank etc) Investment income Other
Comparing your expenditure before and after leaving work
Outgoings While working After leaving Income Tax National Insurance contributions Pension payments, union subs etc. Health insurance scheme Mortgage repayments or rent Council Tax House Insurance Contents Insurance Life assurance Electricity Gas Other fuels Water Telephone / mobile Food Clothing TV/Radio, rental, licences Credit payments Car (service, fuel, licence, insurance) Replacements, repairs, decorating Holidays Family visits and other travel Presents Personal expenditure (toiletries etc) Smoking and drinking Newspapers and magazines Entertainment Regular savings Hobbies and interests Other expenses