Sometimes we put an irrational amount of pressure on ourselves to achieve our financial goals. When we aren’t feeling at our best, we beat ourselves up, especially when we unconsciously compare ourselves to our ‘age mates’ which at times can feel like they are winning this invisible race society has created.
Make no mistake, I don’t question the happiness of those people who have posted their version of success on social media (which at times could be glitter not gold) however, what I question is our ability to asses whether we are allowing said news to contribute to the ridiculous amounts of pressure we put on ourselves, all because:
“I’m almost *insert age here* and I’m not married”
“I’ve been working my butt off, but can’t seem to save”
“I Should be further ahead in my career at my age”
“I should be buying my 1st home by now”
“I *insert negative self talk*
Social media has amongst other things created urgency to achieve things simply because everyone on our feeds are sharing their wins all at the same time.
Once upon a time in what we now call the dark ages (before facebook) we didn’t really have exposure to so many other ‘lanes’. Of course we would hear about other people’s successes, but it wouldn’t be so in your face.
What’s your point Joseph?! In short I’m pretty certain we as a society have become impatient. We are a generation that thrives of INSTANT gratification.
This is by no means a message to bash social media or encourage you to go off grid, but actually the key message I want you to take away from this is to stop. Take a breather. Stop putting yourself under the wrong kind of pressure. I guess it is a longer way of saying trust the process, and stay in your lane.
Task: Think about the thing that is distracting you from your lane, realign yourself and go at your pace.
P.S. the more time you spend worrying and beating yourself up the less time you are spending on achieving your dreams. You’ve got this!
Today we are going to be discussing something that is very close to home for me – the big commute!
It’s no secret that London is the place to be in order to receive a quality salary. This tends to be because salaries incorporate the extortionate costs of zone 1-3 travel and the general cost of living. Let’s not forget that London is the heart of the UK. London is home to the Bank of England, the worldwide beloved Big Ben and the Houses of Parliament to name a few!
Throughout my career from retail right through to the financial sector I have always met people that lived in areas I had never heard of either on the outskirts or far out of London. They’d always express how affordable it was to maintain a high quality of life, whilst commuting to London and still having a considerable amount of disposable cash.
I have had the experience of renting in London for around 6 years and the most I have spent on rent is £1,200 per calendar month for a 1 bed apartment and then an additional £500 on bills & groceries. That’s a whopping £1,700 to have a roof over my head and food in my stomach. Let’s not forget that we haven’t even discussed the cost of travel, luxuries and unexpected miscellaneous expenses. I’d say my monthly expenses were not too shy of £2,500 – crazy!
Living outside London I have realised that I am able to keep the same quality salary, whilst reducing my outgoings, in turn being able to save more and invest elsewhere. Not to mention that the house prices are extremely affordable. I went from paying £1,200PCM on rent, to under £500 on my monthly Mortgage.
Thinking about making the big move?
Here’s some tips and things to consider…
5 Steps to making it outside London:
Drive. Get your driving licence so that you don’t have to depend on your partner, taxi’s or public transport. Honestly, public transport is shocking! You can expect a bus every 30mins.
Commute. Live somewhere that is within walking/cycle distance of the train station. If you live far from the train station, you will have to drive, pay for parking or a taxi and this is counterproductive.
Flexible working. The current climate has meant that the hands of many employers have been forced to be more flexible with their employees. Not commuting in to the office everyday can take some pressure off both financially and physically, this also allows you to recharge your batteries, in turn making you a lot more productive.
Opt for a bigger space. Outside London the pound goes a lot further. If you can, opt for a house/apartment with a spare room. Make this your office. Try to avoid working on your bed hunched over on your laptop. And if you can stretch a bit further, go for somewhere that has a garden or a lovely communal outdoor space.
New Normal. Have an open mind. Things are going to be different, try new things. You can’t expect that London ambiance, because after all, it’s not London.
This is a very popular topic and one that comes with a lot of questions requiring clarity.
Joint Accounts
A couple with a Joint Bank account will both be responsible for the behaviour and management of that account.
Because a joint account tends to play second fiddle to someones main sole account it is easy to go in to an unarranged overdraft without noticing.
Once the account goes in to an unarranged overdraft of say £7, months and then years pass and you are paying interest on interest with being none the wiser. This account balance in the *minus without an arranged overdraft will appear on both of your credit files. The same for any joint utility bills that are not managed well and fall under “missed payments” or the “returned direct debit” bracket.
*Solution= Check your accounts bi-weekly. All of them. Analyse your payments, be aware of when direct debits are due and make sure you have enough funds. Transfer funds between accounts if you need to.
Debt & your Credit Score Joint loan accounts, Mortgages and the like.
Any unpaid debt, missed payments or defaults will affect the both of you. Even if the payments for the commitment had a direct debit set up from a sole account (Mr), if a payment is missed, this will be attached to both parties as the account is in joint names and both are responsible for the upkeep of it. This will bring down both of your credit scores. Credit agencies like Experian also have a feature where it has an area that lists “linked/associated” accounts. This will bring up your husband, wife, partner etc that you currently or previously had a credit account with or simply have a marital connection to.
When is the right time to open a joint account?
Everyones situation and set up is different, however we found that the right time for us to open a joint account and merge our finances was when we got engaged. We knew that we were committed for the long run and were in the process of planning a wedding, buying a property and supporting one another where necessary so it was crucial that the finances were clear, accessible and shared.
If it wasn’t for marriage or saving for a property I wouldn’t be too keen on having a joint account or intertwining my credit.
Similarly, I know some married people that keep their finances separate. No joint account, no joint mortgage. One pays for the residential home, bills etc and it’s all in his name. One pays for and manages the buy to let property and it’s all in her name.
Do whatever works for you.
Expenses & Savings Goals
The key to staying on top of joint expenses, commitments and saving goals is a spreadsheet! I love me a good spreadsheet, especially one available in a shared Google drive as both you and your partner can edit, access it wherever and whenever you want. The latest version is also always being updated and saved.
We edit the spreadsheet on a monthly basis and are both able to see how much savings we have, the “free” income we have to play with and the bills that need to be paid.
We’re both very visual people so we colour code most of what we do and have regular breakdowns for as much as possible.
A key to us making this work is sharing the load, setting up standing orders and constantly updating the spreadsheet.
Since having this spreadsheet, we have saved more in 6 months than we were able to save in 1 year due to being disciplined and making sure every penny is accounted for.
We have no debts (except a Mortgage) and are enjoying the fruits of our hardwork.
Side Note: We use our credit cards for large purchases like holidays, electronics etc, but clear them within 24 hours. This is so that we can make use of purchase protection, fraud, returns, points and ultimately credit cards act as a level of insurance. I will dissect this topic further another day.
An example of a similar style of spreadsheet my husband and I use to stay on top of our finances can be found below:
I hope this helps.
If you have any questions, please feel free to get in touch via the “Contact Me” tab.
Everyone is different and so is the size of debt. One thing we can all agree on, is that having debt, is not a nice feeling. Although we know it has to be cleared, at times we can’t think of anything we’d rather do less!
Clearing debt for me use to feel like throwing money in to a black hole.
However, I had to come to terms with the fact that I owed money to the bank and it wasn’t going to go away. I could have all the savings in the world, but until I’ve cleared that debt, my savings are compromised.
THE ACTION PLAN
For ease of the example lets say your net income every month is £2,000
We divide it up in to 3 sections.
10% – Gifts, Tithe, Charity Donations, Emergency fund etc. Whatever your chosen lifestyle supports.
40% – All essential bills including travel & food (This also includes luxuries like eating out and clothes shopping)
50% – Debt. Debt. Debt. Clear that debt!
OR
10% – Gifts, Tithe, Charity Donations, Emergency fund etc. Whatever your chosen lifestyle supports.
60% – All essential bills including travel & food (This also includes luxuries like eating out and clothes shopping)
30% – Debt. Debt. Debt. Clear that debt!
The above is just an example and you can adjust the percentages to suit you.
Disclaimer: This worked for me as I was married and able to divide all household bills and essentials between 2 people. Due to this, I cleared my debt within 3 months. I do understand that this may not be the case for everyone and it may take longer to clear debt as a single person as your outgoings may be a lot higher. If you still live at home with parents or family, you have no excuse! Contribute, but save!
Something we can all do is cut back on the luxuries and use every spare cent to clear that debt.
Now that many of us are working remotely, we are saving a lot of money on travel, lunch and after work socials so no excuses!
When I was younger, something I’d avoid with all of my heart was checking my account balance.
I’d spend and spend until the card didn’t work anymore. My card being declined was the indicator that I had no more money. It was that simple. This went on for about 9months to a year before I got a handle of it.
I’m not sure what it was, but ultimately it was fear. I knew that the funds in my account would always be decreasing and didn’t believe that checking my balance was worth the heartache.
Fast forward to today, I can’t help but constantly check my accounts. I have a good old nose across all of my accounts to keep an eye on my spending, move money around if necessary to do so and be in the know of how much expendable cash I have.
It is essential to be aware of your Account balance at all times to ensure that you don’t go in to an unwarranted overdraft, you have enough money for your upcoming direct debits, you haven’t paid for a service you didn’t receive, you wasn’t overcharged for something and many more.
If managing your essential direct debits and overspending on luxuries is something you find difficult, then break the two up.
I have an account for all of my Direct Debits. I put money in to it every month and I don’t touch it. The role of that account is simply to pay all of my direct debits and standing orders.
My second account is what I call my expenses account, with this I pay for petrol, food shopping, unexpected life woes (house maintenance) etc.
Finally I have my luxury account. This is the account I use for all of my online shopping dreams and desires. I have a budget and once it’s up, no more shopping for me!
This way of working has really helped me to save aggressively and never miss a payment or come up short at the end of the month.
Did you know that most people who have a “missed” or “late” payment as a negative marker on their credit file have no idea that this behaviour is effecting them badly?
Next week we will dive in to this further.
If you have any other tips for someone that doesn’t like to check their Account balance, feel free to leave your comment below.
Work life balance is ever so important. We tend to spend the most time at work, more than we do with our family. Hating your job, manager or assigned tasks isn’t good for you or your general well-being.
Today’s post is slightly different. It comes in the form of a video.
I have a special guest talking about his real life decisions and how he quit the job that he didn’t like without having a new perspective employer lined up.
PERSEVERE
In short, Joseph went from working in a Corporate Bank as a Business Portfolio Manager to the Learning and Development space. He initially took a pay cut, but over the course of a few years, his salary sky rocketed, as did his morale and joy at work.
If you have any questions or find yourself in a similar position to Joseph and would like to discuss things further, please feel free to reach out to either of us on LinkedIn and we’d be more than happy to help.
At the beginning of 2020 my husband and I decided to house hunt. We bought our apartment 4 years ago, renovated and thought it was a good time to upsize.
We had a budget, we knew the area we wanted to settle down in and knew that our next move would be for the long term.
Ideally we wanted a project. Something that was nice enough to move in to straight away, however somewhere that had room for a back extension and loft conversion.
Deal breaker. He needs his space – games room and I need mine, an office.
We made 3 offers on 3 separate properties. 2 Offers were accepted and then BAM Covid-19 triggers a lockdown.
This was a bitter sweet situation as we were given time to truly analyse and think about what we were spearheading in to.
We are living in uncertain times and it is said that it will be a while before life is truly back to normal and in many ways, we’re going to have to accept a new normal.
Why I gave up my 4 Bedroom Detached House hunt and decided to stay in my 2 Bedroom Apartment a few more years…
After a self analysis of our finances and various eventualities we decided to remain put.
In our current state we knew that if one of us were to lose our jobs, the other could pay the bills 3x over before it became a strain.
We knew that if both of us lost our jobs, we had enough savings to carry us over for a few months paying the bills whilst we hunted for new jobs.
If we were to upsize and take on a project this wouldn’t necessary be the case.
We’d essentially be taking on much higher outgoings because I wanted a shiny new house and project to get my paws in to – a want, not a need.
The take away from this experience is to stay where you are until you outgrow your home and are bursting out of the seams. Or until you can financially make the move without any strain, taking all eventualities in to consideration. No one knows what tomorrow holds.
Keep those outgoings low.
Save. Save. Save.
Save. Save. Save and when it is time to upsize, you can do so effortlessly.
There’s a time to save, time to build and a time to enjoy what you’ve built.
Tip: You should have enough savings to carry you through 3 months of a rough period. These savings will pay your Mortgage, utility bills and basic essential costs of living (travel, food etc.)
Why? Theres an average of about a 3 month period from being made redundant to securing a new job and receiving your first “normal” pay cheque.
At the end of 2019, my husband and I sat together to draw up our plan for 2020. We divided the year in to 4 quarters. January – March being Q1, April – June being Q2 etc. You get the gist. I’m sure your company works in a similar way when setting financial targets for the financial year.
Q1 has drawn to a close and we sat down, reviewed the targets we had set and were overwhelmed with how much we were able to achieve. Some goals we surpassed and some goals we will have to take in to Q2 as they were incomplete.
The country is currently on lockdown and we’re about to go in to an inevitable recession given the financial strain this epidemic has had across the board. Weddings have had to be cancelled, companies have gone in to administration and let’s not forget the thousands in the UK and across the world that have unfortunately lost their lives.
Taking the above in to consideration what have you had to make redundant in your life? What luxury/ habit have you had to put on pause or downgraded a little?
Treat your personal finances like a business. Cut back, make sure you have a crisis fund, but most importantly, hit those targets!
The best piece of advice I received growing up was, “If you can’t buy it twice over, you can’t afford it”.
Of course the above doesn’t apply to the acquisition of a property as this is a life changing purchase and something many save years for. However, if you want to be a home owner, you have to be disciplined, you have to save!
I love me a bit of online shopping and I also went through a phase where I loved brands! I moved out of home when I was 18 and lived in one of my dads properties. I covered the electric, gas, shopping, council tax etc. This move was primarily to teach me the cost of life, responsibility and most importantly discipline!
There came a time where I became disheartened because I couldn’t shop as freely as I use to when I lived at home, or would often find myself in a spot of bother towards the end of the month and have to ask my mum to save me. That’s when she delivered this gem, she sat me down and amongst many things, the word that stood out for me is when she said, “If you can’t buy it twice over, you can’t afford it”.
Since then, I have lived by this word and have never found myself in a spot of financial trouble. I live within my means and if I do buy a luxury item, I have enough free cash to buy it two, even three times over.
I never wanted to be that person that bought a Louis Vuitton bag on pay day, but had to walk to work and eat buttered bread for the remainder of the month because I lived way above my means.
Lesson:
Don’t be afraid to be fugal – tight! Weigh up your needs vs. your wants.
If you can’t buy it twice and have surplus funds in your account, then you can’t afford it!
The most daunting thing is the creation of life and the responsibility to lead, teach and grow the little human you’ve brought in to the world.
They never chose to be here. That was down to us and our significant other. Now that they are here, we have to ensure that we set them up for success and entrench some core values.
Many people are broken and make warped adult decisions due to a fragile childhood, non existent good examples and lack of nurturing.
Financial Hack: Turn £100 in to £21,600
As 2 parents, you can both individually set aside £50 a month for your child – Or £100 as a single parent.
Over 12 months this £100 equates to £1,200
Over 18 years this £100 a month totals to £21,600
Once your child hits their 18th birthday they’ve already been given a head start. You can give them these funds, but also teach them financial intelligence. They can continue what you started 18 years ago and build on the funds (£100 per month), purchase a car or invest in their education.
The options are limitless, but the important thing is that you’ve led the way, given them a booster and your dependent will most definitely thank you for this!
