Financial planning in your 30s and 40s

Financial planning has long been seen as the preserve of those nearing retirement. Recent data corroborates this: 73% of advised clients in the UK are over 50, just 14% are in their 40s and less than 5% are in their 30s[1]. Younger professionals are vastly under-represented even though it could be argued this is precisely when smart financial decisions compound most effectively. Often, it is also when life changes fast.  In 5 years’ time, a 30 year old may be married, a homeowner, a parent, advancing in their career – but they may also face unexpected setbacks, such as health issues or changes in family circumstances. That younger cohort shouldn’t wait; they should protect what they have earned, invest with intention and build long term security while time is on their side.

Protection

As a financial adviser, the most common thing I hear from younger people is, “I don’t have enough to need financial planning”. Re-framing the question – “do you have enough that you want to protect?” – often starts a different conversation.

If your income stopped tomorrow, how long could you manage? 1 in 3 of us will suffer a serious health condition during our lifetime, yet only 13% of UK adults have any critical illness cover and just 6% have income protection[2]. Statutory sick pay (currently £118.75 a week) rarely covers the essentials and the 4.4 million self-employed in the UK receive none at all, meaning that 94% of adults risk being unable to support themselves financially if they become unwell.

Even if you are perfectly healthy, with 34.48 million school days lost to sickness or injury last year, many parents must take unpaid time off work and families of seriously ill children can face hundreds of pounds in extra monthly costs.[3] Indeed, research by the charity Young Lives shows that the families of children with cancer face almost £700 a month in additional expenses during their treatment, excluding the financial impact of parents missing work[4].

The right advice ensures you have the protection you need – no more, no less. Income protection, life cover and child critical illness insurance create a safety net that shields your family and your future. Starting while you’re young and healthy means broader options and lower premiums.

Good advisers also keep cover up to date as your life changes, removing the guesswork and giving you confidence that your family’s future is secure. Insurance doesn’t just prepare you for the worst – it allows you to live with greater confidence, knowing that you have safeguarded the future you are working so hard to create. You can also find out more about income protection in our article here: What is income protection insurance? : Do you need it and how it might benefit you… | Saltus

Maximising allowances and investing for children

Investing for your children early is one of the most powerful gifts you can give. Even small, regular contributions can grow into something significant through the power of compounding, helping with university costs, a home deposit or long term financial security.

Children’s pensions, for example, are an often-overlooked planning tool. Contributions of £2,880 each year (topped up to £3,600 with tax relief) from birth to age 18 and invested in a 100% equities portfolio mean that a child’s self-invested personal pension could be worth around £115,000 by the time they are 18. Leave it invested with no further contributions and by the time they are 57, that pot is worth roughly £1.24 million. Not bad for just £51,840 of contributions[5]. Making the most of government support (Child Benefit, Free Childcare for Working Parents etc) can amplify these efforts.

Please remember investment values are projections and are not guaranteed.

Beyond the numbers, financially planning for (and perhaps with) children sends a powerful message about the value of saving and thinking ahead. Research suggests that children have formed core money habits by the age of 7 – including them early in the discussion can shape healthy financial habits for life.[6]

Sticking to the plan

With work, family and life admin competing for attention, a financial plan can feel like another task. In reality, a clear plan built around your objectives can give you direction, confidence and control – knowing what to spend, what to save and how to prepare for the unexpected.

A good financial plan isn’t restrictive; it frees you to spend. Research suggests that just 14% of UK adults would spend a bonus on themselves or loved ones, while the majority prioritise saving for the future or paying off existing debt.[7] With a clear plan, you can do both: ensure your long-term goals are being met while also confidently spending on what brings you joy – whether that’s holidays, hobbies, experiences, or time with family – because you know it fits within your objectives.

Importantly, a financial plan isn’t static. Life changes, and so should your plan. Annual reviews can help you stay on track and adapt to new circumstances ensuring your goals still reflect what matters most to you.

In short, a financial plan isn’t another demand on your time instead it is a way to make the time and money you already have work harder for you and your family, liberating you to focus on what really matters.

The inheritors

Most of my clients plan for what happens to their wealth when they die but few involve the next generation early on. Research by Octopus investments found that the average person waits till 74 to discuss their will and two-fifths of potential beneficiaries haven’t yet had a conversation with their parents about their will.[8] Even fewer “inheritors” properly plan what to do with any windfall. Planning with parents makes a huge difference to how effectively inherited wealth supports your goals and your family’s future.

Open conversations about inheritance are about more than money – they are about values, family goals and making sure wealth does good across generations. Early planning helps you and your parents manage inheritance efficiently, using allowances, trusts and smart investment structures to reduce unnecessary tax and stress.

It can even lead to happier outcomes. In my experience, many advised clients feel empowered to spend more during retirement knowing that their children want them to enjoy themselves now, rather than save everything to pass on later.

Time is on your side

The biggest advantage younger clients have is time. Start now, and compounding does the heavy lifting for you. Financial advice today can make a remarkable difference to what’s possible tomorrow.