Financial Planning Trends in 2021

As we enter a new financial year, how are investors and businesses adopting new financial planning trends in 2021 into their portfolios?

April marks the start of a new business year, bringing with it a new perspective on investment opportunities and financial planning trends. Individuals and businesses will often reflect on the previous year to re-evaluate their goals and to establish the most effective routes to achieving these.

However, the global pandemic left both society and the economy in a position like no other. Not only has Covid-19 emphasised the importance of planning for the unexpected, but it has also reinforced the value of health and the wider environment. With this in mind, the financial planning trends we’ll see in 2021 will inevitably reflect this shift in priorities.

Retirement Investing


With more ‘Boomers’ reaching retirement age, investing for a comfortable retirement and a sense of financial security will rise in 2021. As living costs continue to increase, there are growing concerns about whether or not existing retirement plans will be adequate. 

This new wave of investors considering retirement investing throughout the year will see financial advisors inundated with queries regarding retirement options, many of which will go beyond projections and planning. Instead, guidance on tax, long-term opportunities and withdrawal strategies will be at the forefront of people’s minds. 

Covid-19 has only intensified the pressures surrounding retirement, especially for those who are growing closer to the state pension age. While 680,000 Britons should be retiring this year, the increased redundancy rates throughout 2020 have left many mature workers questioning whether they can afford to stop working.

With research suggesting that one in five workers between 60-65 believe they will have to delay their retirement, it is no surprise that retirement investing will become a key financial planning trend in 2021. There are many opportunities when embarking on this journey, but establishing your retirement number and planning accordingly is often the easiest place to start. 

For those incorporating retirement investment in their 2021 financial plan, the Time to Invest guide discusses your options for preparing for retirement and achieving financial freedom.  

Investment in Automation & Artificial Intelligence


For many industries, the office is a distant memory and shows little sign of returning. In the finance sector specifically, working from home is now the norm for many workers. This  change to home working has advanced technology accordingly, with applicable software solutions now increasingly more important. 

As more financial institutions look to automate their processes where possible, this area of investment is set to become a notable financial planning trend in the new business year. While the key will be to advance technological processes, cost efficiency will remain at the centre of all developments, especially after the economic challenges in 2020. 

A similar focus is expected to be placed on artificial intelligence, with these stocks currently in an upward trajectory. According to Omdia, an emerging-technology research and consulting firm, the overall market is forecasting significant growth in the coming years. What once stood as a $10.1 billion market in 2018, it is now set to exceed $126 billion by 2025.

Artificial intelligence is also set to become intertwined throughout investment strategies. Venture Capitalists and individuals are taking the opportunities to maximise the use of AI throughout their approaches, in order to become more innovative and efficient in their investments. 

Have You Thought About Investment Yet?

Still starting your investment plan? Looking to scale a portfolio for retirement? Download your free investment guide ‘Time to Invest’ today and see how you can start your financial planning for 2021. Inside you’ll find:

Are You Retirement Ready? – How do you measure up to the average UK investment habits and what does the future hold for those building for retirement?

What’s Your Retirement Number? – We examine the average amount needed for retirement and help you discover your ‘magic retirement number’.

How are People Investing for Retirement? – With investing so important for supplementing a retirement fund, what assets are people using in their journey?

Download the Guide

Property Investment


Arguably the most stable investment asset throughout the global pandemic, property will likely remain a constant in 2021 financial plans. The UK property market has been growing for over ten years, with the average property price now surpassing £300,000

Arising from a combination of pent-up demand and government incentives, Covid-19 propelled UK property throughout 2020, and is continuing to benefit from this momentum. While the economic challenges were detrimental for some investment assets, such as cryptocurrency and ISAs, the subsequent falls in interest rates have been making property investment more accessible for many. 

As investors have been entering the market over the past 12 months, 2021 market forecasts have become increasingly more positive. While initial outlooks were predicting a plateau in property prices, Savills is now anticipating 4% growth this year, along with a strong rental market. 

With the past performance of UK property in mind, alongside 2021 forecasts, it is unsurprising that property investment will form an integral financial planning trend this year. Buy-to-Let property is versatile, offering a wealth of opportunities on both a short- and long-term basis. Not only can investors expect a consistent passive income, but the asset will likely grow in value for when the property is eventually sold.

Sustainable & Responsible Investing


While interest in sustainable investing has been growing in recent years, in the wake of the pandemic, the majority of society has acknowledged the value of responsible practices. Individuals and institutions will likely search for sustainable ways of investing in the new financial year, including considering environmental, social and governance (ESG) factors

Investors will integrate this throughout their financial plan, choosing to invest in businesses that address – or rank favourably for – topics surrounding climate change and renewable energy. However, the notion of ESG goes beyond environmental concerns and includes social factors, ensuring ethical practices from employee treatment to consumer-related subjects.

Elements of corporate governance are also expected to play a key role in sustainable investing, with thorough research of executive compensation issues, the processes behind critical decisions and the makeup of the board of directors. 

As well as aligning investment processes with personal morals, considering ESG factors throughout will reduce the risk of a portfolio. Companies that adopt ethical practices will be less susceptible to lawsuits and scandals based on these issues. Whereas businesses that are repeatedly found liable for pollution will negatively impact the company, and subsequently, will negatively impact investors’ shares.  

International Financial Planning Trends


For the vast majority of people around the world, a comfortable retirement is a far cry from the reality many of us face. Financial planning, especially for retirement, isn’t at the forefront of everyone’s mind. That’s why we’re publishing the results from our International Investing Habits: Financial Planning Trends research which highlights some key global trends in planning for retirement. According to a poll of 400 UAE residents, 69% of respondents are lacking awareness of financial planning, particularly for later life.

Similarly, in a survey by Fidelity International for Hong Kong residents in the post-80s generation, they found that while 94% of respondents have some form of savings, it’s mostly for short-term goals with no objective of saving for retirement. Nearly half of the post-80s generation would rather save for travel or more expensive personal items.

The thing this, there’s never been a better time to start investing for your future. For overseas investors looking to invest abroad, regions such as the UK are forecasting incredible opportunities to create a passive income stream for retirement.

For some of you, you may already be considering your future, paying into a pension or a savings pot for later life. However, the Fidelity survey shows that typically, only 15% of the money earned is saved for investment while the rest is spent on the short-term. This lack of preparation mirrors our own research into the UK market, which looked at 1,200 UK respondents and found that a huge 41.6% have zero investments whatsoever.

Similarly, long-term financial planning trends amongst UAE residents is relatively weak. More than a third of UAE residents (37%) surveyed by HSBC have never even spoken about their potential long-term financial security with anyone – including financial experts.

“Hong Kong’s post-80s generation appear to be pretty optimistic about their chances of achieving their life goals, with 77% feeling they are somewhat likely to own a property and 72% expecting a stable retirement life…

“Yet their expectations are out of line with their priorities, and they make little effort to achieve their objectives. All income bands need to pay more serious attention to the trade-offs between short-term enjoyment and long-term returns, and start to think more clearly and honestly about their priorities”

Although our research showed that nearly 18.8% of women and 23.7% of men are utilising savings accounts, the question for people around the globe paying into pensions or savings is, will it be enough, soon enough?

Saving for retirement is very different from living a comfortable retirement. For people that want to live well during their retirement, their future is in their own hands. Creating an investment portfolio is no longer an alternative for a comfortable retirement – it’s a must.

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