What’s your number?

This article was first published in our Direct Investor Magazine on 3 August

Having a goal is important, but the idea of a single ‘number’ can be a bit misleading. Two people with similar savings could have completely different ideas of what is ‘enough’. For one person, it might mean retiring early and enjoying life. For another, it might be about feeling secure and having a steady income. So, the right number really depends on yourlifestyle, your comfort with risk and what matters most to you.

A moving target

It’s easy to think that your number is fixed, but in reality, it changes over time. Factors such as inflation, tax rules, and government policy can all affect what your money is worth. Recent changes, such as the continued freeze of tax thresholds and the reduced allowances for dividends and capital gains, mean it’s more important than ever to focus on what you keep after tax – not just the headline figures. What really matters is the income your money can provide and how far that income will go. 

It’s not just about the finish line

Financial independence isn’t something that suddenly happens overnight. It’s usually the result of years of steady progress and good habits. Most people build their wealth gradually and there will be ups and downs along the way. That’s why having a solid, flexible plan is just as important as the end goal itself. 

There’s more than one way to get there

There’s no single path to financial independence. Most people use a mix of different accounts and investments, for example:

• Pensions: great for long-term growth and tax efficiency
• ISAs: flexible and tax-free income when you need it
• Investment bonds: can help with tax planning and managing income
• General investment accounts: offer accessibility and flexibility 

How you structure these matters more than ever, especially when it comes to drawing an income later on. Having the right mix can give you more control over how and when you take money and help you manage your tax position more effectively.

It’s about more than a number

In the end, this isn’t just about hitting a target figure. It’s about creating freedom and peace of mind. You could find it more helpful to think in terms of the income you will need, rather than focusing solely on a pot size. 

What matters most is having a plan that works for you, adapts as things change, and keeps you moving in the right direction. So, as you take stock, the real question isn’t just “what’s my number?” It’s “do I have a plan that will help me reach it?”. Financial independence isn’t something that suddenly happens overnight. It’s usually the result of years of steady progress and good habits. Most people build their wealth gradually and there will be ups and downs along the way.