What now.....

As David Cameron settles in to Number 10 and the shape of the coalition government between the Conservatives and Liberal Democrates emerges, here is an overview of the areas expected to feature in the oncoming Emergency Budget.

- The planned rise in national insurance is unlikely to go ahead

- The proposed £6 billion of cuts to non-front line services to go ahead

- Capital gains tax (CGT) is likely to rise on 'non-business' assets.

- The Lib Democrats's 'mansion tax' on houses that are over £2 million is likely to be scrapped.

- Plans to increase the inheritance tax threshold to be put on hold

- The introduction of Liberal Democrats' proposed cut to income tax for lower paid workers on the first £10,000 of earnings.

- Marriage could be recognised in the tax system. The Liberal Democrats have agreed not to block the Tories' proposed tax break for married couples, but do not support the policy.

More comment……..

As we wake up to a new coalition government – at last – it looks as though we may be able to look forward to a reasonable future, perhaps the best of all possible worlds.

Lower income families can look forward to an extra £700 in their pockets as one of the main planks of the new coalition is that the Conservatives will support the Lib Dem’s proposals to raise personal income tax allowances to £10,000. We don’t yet know when it will happen but it is something to look forward to. There might, however, be clawback of the higher tax allowance - as currently exists with the higher personal allowances given to the elderly which progressively brings their allowances back down to the same level as the under 65s as their income rises.

We won’t be seeing the inheritance tax starting point going up to £1 million any time soon – but that was never really on the cards anyway. With a transferable allowance of £325,000 per person, very few families pay IHT anyway and numbers will fall. As a quid pro quo we almost certainly won’t see the introduction of the ludicrous ‘mansion tax’ of 1% a year on the value of properties worth more than £2 million proposed by the Lib Dems.

We might see the abolition of the much disliked Home Information Packs (although it is an EU requirement to produce an Energy Efficiency Certificate and that will remain). This costs nothing and the abolition of HIPs would be a help to get the housing market moving again. This is not likely to be a priority however.

But don’t start celebrating. A £10,000 personal tax allowance costs around £12 billion to implement if there is no clawback – coincidentally almost exactly what a rise in VAT to 20% from its current level of 17.5% would raise. Neither the Conservatives nor the Lib Dems ruled out such an increase in their respective manifestos.

Reforming Stamp Duty, due to rise to 5% on property valued at £1 million and above, won’t be a priority either although there might be a suspension of the 5% rate, due to be introduced in 2011. In the March Budget, Alistair Darling said that he would use the extra revenue from a permanent increase in the top rate of Stamp Duty from 4% to 5% to fund a two-year suspension of the 1% rate on homes bought by first-time buyers that are worth between £125,000 and £250,000.

It will be interesting to see how quickly the new coalition moves to produce a Budget. Cameron committed the Conservatives to producing one within 50 days but it might come sooner. Depending on how soon public spending cuts are introduced – which incidentally don’t need new legislation and could have been introduced by a minority Conservative government without support from the Lib Dems – we might also see tax rises in VAT and Capital Gains Tax, which is likely to rise from the current 18% closer to 40%.

The abolition of higher rate tax relief on pension contributions – a Lib Dem Proposal which raises a very useful £5.5 billion to replenish the Treasury coffers – is a very real possibility and redresses a very unfair situation where most of the tax relief goes to wealthier individuals who pay higher rate tax. This could be tempered with a promise to introduce more incentives for lower income families to save at a later date - such as an increase in Child Trust Fund vouchers paid to families on benefits or a new saving scheme – which has been piloted by Gordon Brown’s government – of matching savings, pound for pound.

One thing is certain we are in for interesting times ahead as not only a new government but a new style of government hits the UK.

Top financial goals !

Here follows five top financial goals everyone should have

1. Pay off your debts:

If you have any outstanding debts paying this off should be one of your main goals. While saving is great, any interest rate you earn will be less than the interest you will have to pay on any loans you've got so the golden rule is to pay off debt before saving.

2. Sort out a rainy day pot:

While it is tempting to spend all the money you've got on specific goals such as going on holiday or sprucing up your home, it's important to build up a savings buffer to cover for any unexpected events.As a minimum, this should be equivalent of three months' salary but ideally it should tie you over for at least six months.

3. Start a pension to ensure you can retire:

Even though this might be far away for some of you, when it comes to saving for your retirement the earlier you start the better. If possible you should start as soon as you start work as long as you haven't got debts to pay off. The longer you leave it the more you will have to pay in each month to be able to enjoy your retirement.

4. Get onto the property ladder:

While we've seen the property market drop over the last couple of years, buying a property is still an investment so long as you consider it a long-term one, and you get to live in it too.

5. Protect your finances:

While buying insurance is not the most exciting financial goal to have, it could be one of the most important decisions you ever make.If you have dependants make sure you've got life insurance, should something happen to you and if you are relying on your income to make ends meet it could be worth taking out income protection insurance that will cover you in the event of getting ill or injured and unable to work.

The most common reasons we fail to meet our goals:

1. The more grandiose your goal, the less likely you are to achieve it. At the end of the day, we're unlikely all to become millionaires by the age of 30. But we might be able to pay off our mortgage by the age of 45.

2. Our goals don't reflect the 'real' us. Sometimes you don't need much money to achieve a particular goal. For example, one adviser found that his clients' long-desired goal was to attend the Chelsea Flower Show, which only cost a train ticket, a night in a London hotel and a few pounds for admission.

3. We don't plan thoroughly enough. It is possible that you will never face redundancy. But experience suggests it makes sense to factor potential job loss into your goals, as they determine how much you may want to spend of your income right now and how much more you set aside for a rainy day.

4. We fail to review our goals regularly. Circumstances change, what was important five years ago may not be today. Stockmarkets can fall sharply, or mortgage rates may have gone up, or an annuity - the annual income paid from a pension lump sum - may be worth less now than it was.

5. We don't take expert advice. Good independent financial advisers can be worth their weight in gold. They can find the cheapest mortgage, the best pension, the most appropriate insurance policy and help choose the best investments - all allowing you to meet your goals more quickly and more easily.