The financial crisis of 2007 has left a lasting impact on the financial world, from how large institutions do business to the way ordinary individuals manage their money on a daily basis.
Gone are the high interest rates savers used to enjoy. Getting on the property ladder has become almost impossible without schemes like ‘help to buy’, and regulations surrounding the finance industry have gone through a major overhaul to prevent a repeat of the conditions leading to the collapse 10 years ago.
Equipping the finance industry for the future
But it’s not just financial regulations that professionals such as independent financial advisers need to prepare for. One such example is the https://ico.org.uk/for-organisations/data-protection-reform/overview-of-the-gdpr/ General Data Protection Reform, due to come into effect in 2018. While not directly financial in nature, it will still have a significant impact on how customer data is held in their systems.
Like many regulations, GDPR is designed with customer protection in mind, and IFA software developers like Intelliflo are hard at work ensuring that financial advisers are provided with the best tools of the trade. That leaves advisers to do what they do best – advising their clients on how best to navigate the financial uncertainties on the horizon emerging from Brexit, whether it’s inflation, interest rate rises, or growing consumer debt.
Independent financial advice helps individuals improve their resilience from any future economic shock. These include getting the best from investments and savings – building up a ‘rainy day’ fund that will keep you going for a few months should income be disrupted, for example. Minimising outgoings doesn’t just mean looking at your weekly or monthly budget but can extend to getting the best deal on investments, reducing interest payments, and switching utility providers for better rates.
With interest rates having nowhere to go but upwards, preparation for what will be an inevitable increase in mortgage and other loan repayments is essential. This brings us to the possible correction in house prices. For many first time buyers, a property value drop of 10% could find them with negative equity, where they owe more than the property is worth.
It’s essential, then, to ensure we keep up to date with what’s going on in the financial world and find the right financial advice to stay smart and ahead of the game.