How You Can Build a Robust Financial Plan

Monday 17 November, 2025

Why planning your finances matters

Taking control of your finances today helps you face life’s milestones, whether that’s buying a home, starting a family, or preparing for retirement, with confidence.

A well-constructed financial plan offers clarity on your income, your obligations, and how to direct spare resources toward your goals. It also helps you weather unexpected costs without derailing your progress.

What exactly is a financial plan?

A financial plan is essentially a tailored roadmap for your money. It maps out how you will allocate your earnings, manage expenditures, reduce debt, and invest or insure with foresight.

Its ultimate aim is to help you achieve your life objectives, such as funding retirement, purchasing property, or meeting family needs, while maintaining everyday stability.

A thorough financial plan considers:

All sources of income: salary, self-employment, interest, dividends
Regular outgoings: housing, bills, groceries, transport
Outstanding liabilities: credit cards, loans
Savings, investments, pensions
Tax, insurance and estate considerations

By seeing all these pieces together, you can make more informed decisions about trade-offs and priorities.

The benefits of proactive financial planning

Direction and structure: You gain a clearer vision of what you want to achieve, by when and what steps will get you there.
Reduced stress: Knowing what’s coming in and going out helps you avoid surprises and lets you sleep easier.
Debt control: By identifying high-cost debts, you can allocate resources to pay them down, rather than letting interest drag you down.
Resilience to shocks: Whether it’s a boiler breakdown or an unexpected medical bill, you’re better prepared if you’ve set aside contingency funds.
Efficient use of capital: Rather than letting money sit idle, you can decide when to invest, when to hold cash, and when to insure appropriately.

Speaking with a regulated financial adviser from the outset can help clarify your goals and ensure your plan is tailored to your circumstances. At the same time, advisers like Lonsdale adhere to the FCA’s Consumer Duty, acting in your best interests and maintaining transparency at every stage.

When should you start a financial plan?

There’s no perfect moment to begin. But some life events make planning especially crucial:

Approaching or entering retirement

Whether you're in your 20s or nearing retirement, having a target for how much income you’d like, and estimating how much capital that requires, allows you to set realistic pension or investment goals well in advance.

Starting earlier usually means smaller monthly contributions are needed.

Marriage or expanding your household

Weddings and growing families introduce new financial pressures, childcare, schooling, increased housing costs or life cover.

For reference, recent surveys place the average cost of a UK wedding (excluding honeymoon) at around £20,822 in 2025. Budgeting ahead helps absorb these costs more smoothly.

Career transitions or income changes

Moving jobs, going freelance, or reducing hours can all impact your cash flow. A refreshed financial plan helps you adapt so you continue meeting goals and avoid undue borrowing.

Unexpected life events

Sadly, life sometimes throws curveballs. Illness, divorce or death of a partner can cause financial strain. A well-designed plan includes safeguards like insurance and contingency reserves to reduce your vulnerability.

A step-by-step process to create your plan

You don’t have to tackle this all at once. Lonsdale recommends these key stages:

1. Clarify your financial goals

List both short-term aims (e.g. clearing a credit card, building a home deposit, taking a holiday) and long-term goals (e.g. retirement income target, paying off a mortgage, funding children’s education). Assign each a time horizon and relative priority.

While you can outline your goals independently, discussing them with a financial adviser can provide clarity on feasibility and prioritisation. They can identify potential pitfalls or opportunities you might overlook and help align your aspirations with realistic financial strategies.

2. Construct a budget

You need to know exactly what money flows in and out:

Income: salary, side hustles, interest, dividends
Essential outgoings: housing, utilities, council tax, food, transport, insurance
Discretionary spending: eating out, streaming subscriptions, non-essential shopping

Examine your discretionary expenditure for potential savings, unused subscriptions, premium brands you could downgrade, or treats that add up.

Addressing debt

Focus first on reducing high-interest, unsecured debt (credit cards, personal loans). The interest on these typically exceeds what you might earn from savings or low-risk investments.

If debt is significant, you could consider restructuring with longer terms or seeking reputable debt advice (for example via Citizens Advice).

Automating discipline

You may ask your bank to automatically sweep surplus funds (after essentials and debt payments) into a separate savings account. This “pay yourself first” approach helps curb impulse spending.

A guide: 50/30/20 rule

A commonly used guideline divides net income into three buckets:

50 % toward essentials
30 % for discretionary (lifestyle)
20 % toward savings, investments, and debt reduction

It is just a guide, your personal mix may differ.

Emergency fund

Set aside roughly three months’ worth of essential living costs as a safety cushion. Above that, consider income protection insurance, which may replace some income if illness or injury prevents you from working.

3. Design a savings and investment strategy

Near-term goals

For objectives within a few years, you’ll want easy access to your funds. Use cash or short-term savings vehicles. Compare interest rates and consider cash ISAs, which can help shelter interest from tax.

Medium to long term

For goals further ahead (5+ years), you may wish to consider investments (equities, bonds, funds) or tax-efficient wrappers like stocks & shares ISAs or contributions to pensions.

However, remember: The value of investments can go down as well as up, and you might not get back the full amount you invest.

Lonsdale can help you assess the appropriate level of risk for your time horizon and goals.

4. Review and adapt

Your plan should not be static. Life changes, income shifts, new priorities, market shocks, all demand a refresh. A good habit is to revisit your plan at least annually or when major life events occur.

Neil Homer, Financial Adviser in Stafford said:

“Regular meetings with a financial adviser can make this process smoother, offering professional insight on adapting investments, managing risk, and responding to regulatory or market changes. This ongoing dialogue helps ensure your plan remains aligned with your evolving life circumstances.”

As with all financial advice in the UK, your adviser must disclose whether they are independent or restricted, how they’re remunerated, and any relevant risks. The process should comply with the FCA’s advice and guidance boundary rules, which set the line between general guidance and regulated personal recommendation.

For example, for clients with investible assets of £300,000 or more, Lonsdale may offer deeper support and more tailored investment solutions. Please contact our team to discuss your particular needs.

Please note: The information contained within this article is based on our understanding of legislation, whether proposed or in force, and market practice at the time of writing. Levels, bases and reliefs from taxation may be subject to change. This is for information only and does not constitute advice. A pension is a long-term investment not normally accessible until age 55 (57 from April 2028 unless the plan has a protected pension age). The value of your investments (and any income from them) can go down as well as up which would have an impact on the level of pension benefits available. The Financial Conduct Authority does not regulate estate planning, tax advice or cash flow modelling. Your home may be repossessed if you do not keep up repayments on your mortgage.

Sources: hitched.co.uk, bridebook.com, moneyhelper.org.uk, fca.org.uk, citizensadvice.org.uk

Need financial planning advice?

If you would like a free initial financial planning review, complete the form below, or contact our St Albans, Barnet, Harpenden, Leeds & Bradford, Stafford, Ringwood, Ware, Wimbledon or Chippenham office.