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Time for a financial review #finance

Last week I described my investment portfolio as a ‘train wreck’ and it hasn’t improved since then. Things haven’t got much worse though. I have decided it is time for a personal financial review. I have looked back over the past year at the larger bills that I have had to pay and that has given me some idea of the bills I’ll have to pay in the next year. Of course, prices go up and I have noted that insurance premiums have gone up on average of 10%. My car insurance premium is due next month and has increased 25% and so it is time to change my provider.

financial review

Financial review

I can now review my car insurance, breakdown cover and home insurance as they are all with the same provider. My energy supplier contract will be up soon so that will be the next one to be reviewed probably later this month. As other contracts come up for renewal I can review them and decide whether to change. It isn’t always a good idea to switch to the cheapest provider, we should look for value for money. As an investor, I also know some companies are at risk of going out of business entirely. That can mean your motor insurance is void and you have to buy insurance a second time with another insurer.

Accounts

I keep accounts so I know exactly what my income is and what the outgoings are but as part of a financial review, I also estimate what my future outgoings will be, taking into account inflation. My insurance premiums have been quoted with a 25% increase and my telephone and broadband have seen big increases too. Energy prices have dropped over the past couple of years but I expect a big rise on my energy bill as well. Forward planning can help me manage my expenditure in the future.

Investments

The investments aren’t performing anywhere near as well as I expected. To add to the carnage we now have a lot of political uncertainty at a global level with a bit of sabre rattling from both the United States and North Korea. There is no need to panic, however. I see most of my investments as providing a return in the long term. I just need good financial management in the short term and a financial review can help me achieve that. It is a good idea to do a financial review every year anyway.

Diversify

It is important to diversify when we are investing and even though my portfolio is diverse, I admit it isn’t diverse enough. I sold some investments when I saw uncertainty because of Brexit. That has given me cash to invest at the right time. Many overseas investors take the same view and when they start investing in the UK again we will see the value of the pound rise and the stock market rally too. So it is worth watching the value of the pound against the US dollar.

Brokers

I don’t pay too much attention to brokers tips but they have tipped both of the pharma shares I hold. Both Immupharma and Verona Pharma have been tipped as speculative buys, so has Solo Oil. Premier Foods was given a target price of 46p this week by a broker which suggests some upside and I have been waiting a long time for PFD to take off. Even Lloyds Banking Group is falling despite being tipped by several brokers but I expect the share price to appreciate when the political uncertainty abates. That is one share price that could soar if we get good trade deals with the EU and US.

That’s it for this week. Not very exciting news but sometimes the financial waters get a bit choppy and we just have to batten down the hatches and take a few precautions!

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