Introduction

At different stages of life your needs for financial security and plans for the future are likely to change. Here is a simple introduction to common financial needs as they relate to different lifestyles and life stages.

At Aviva Life Insurance, we have divided life into 7 financial planning stages. Take a look at where you are and the current health of your finances.

First Job

For the first time you've got a reasonable amount of cash coming in, but there often seems to be more going out. Hard though it is at this stage, think about what you want in the future, because by starting to save a little now you'll avoid having to save a lot later on, and moreover, you can save on tax.

It's amazing what a difference saving a little over a long period will make. Especially if you consider your pension requirements for retirement.

You may also want to think about protection for your income in case you can't work, especially if you are self-employed

Childhood

A child's own financial concerns are likely to centre around the question "Why don't I get as much pocket money as EVERYONE ELSE in my class?" and how to save up for the latest shoes, cricket bat, computer game, CD.... it starts there, and then never stops.

As parents and grandparents, we can help by starting to save for those bigger things that will be important later, like school or college fees, a deposit for their first home, first car, a wedding. In these cases investment policies that will generate a lump sum in the future may be required.

Young Married

Settling down, maybe with a little more cash from your shared income. This is the time many people decide to buy their first house and take their first step into the world of financial planning by arranging a mortgage.

Depending on your own situation, for example if one of you relies on the other's income, or if you are concerned about losing your income if you are unable to work due to illness, you should consider life insurance and protection policies.

If a pension is the right way for you to save for your retirement, then the sooner you start saving the better. Also, consider investments if you plan to build up your savings for the future.

Mid-life Crisis or Security

It's swings and roundabouts at this stage - your income may be higher, especially if one partner stopped work when the children were young and is back at work now. On the other hand, older children could be costing more, whether they are at home or away at University.

Your aim now is probably going to be to ensure that you are making the maximum saving for your retirement, so it would be a good time to consider pensions and investments. Even if you started saving when you were young, check how your investment is growing and whether it is worth increasing the amount you are saving. By this stage your parents may be becoming less independent, and you could become involved in arranging investments to care for their financial needs. At some stage you could also receive an inheritance which you want to invest.

Married with Young Children

Before you had children you thought you were busy, you thought you had responsibilities. Now you know what responsibility really means. You want to be sure that if your income is lost your children will be provided for. So you should think about policies that provide financial support, should there be a death or should you be unable to work because of a specified critical illness. It is also important to make a will.

Look at the Childhood section to think about other ways to provide for your children's future, and at the Young Married section to ensure you have provided for your own needs.

Pre-Retirement

Hopefully you will be in a secure financial position and probably more comfortably placed than before. Now is the time to confirm that your provision for retirement will be satisfactory so it would be a good time to check pensions and investments.

Retirement

Several people say they are busier than they've ever been post-retirement. Well, if you're busy doing the things you want to do it's a great position to be in. At this stage you may want to ensure your investments are giving you satisfactory growth or income.

If you plan to leave an inheritance to your children or grandchildren it is essential to make a will, and to consider the tax implications of the same