Are You in Financial Agony? Three Money Tips to improve your Financial Well Being

Is Money Coaching the new toothpaste for Financial Well-being?

We in Britain are in pain. Financial pain. Money worries have recently topped a poll among Millennial's as our biggest worry. 

Money worries top a poll as the biggest cause of stress and worry today.
25 million people in the UK are stressed and worried about money (according to the Office of National Statistics).

Imagine there was a time when you weren’t in constant financial agony? As if there was a solution on the horizon. That you didn’t feel like you were always going round and round the payday circle of life, never having enough money to start savings let alone building up enough cash for a deposit to buy a house.

Then this article is for you.

Think for a moment what Britain must have like before toothpaste. We Brits aren’t best known for our teeth. We are often the butt of many a tooth-related Simpson’s jokes. Today most people take good dental health for granted. However, less than a century ago tooth decay was a widespread public epidemic. Many people then did not have all of their teeth as adults. In Britain, the climax of tooth decay occurred in the 1950s, where most of the population suffered from some kind of tooth decay. However, during World War II an improvement of the dental health situation took place, which could be linked to the limited availability of sugar (sucrose) in Sweden. It had been known for a long time that sugar is directly related to tooth decay.

Tooth decay was also a widespread epidemic abroad. In the United States, one of the most common reasons why young men could not enlist for the First and Second World Wars was that they did not have enough teeth. Imagine a soldier storming the beaches of Normandy only to have to stop to pick up their false teeth from the mud.

That was, until the invention of toothpaste (or fluoride toothpaste to be more accurate). This meant that people didn’t have to change their habits away from eating cakes and chocolates if they only brushed their teeth and ate the delicious sugary treats in moderation. This important step towards improved dental health was started by Swedish dentist and university professor Yngve Ericsson (1912-1990) in the late 1950s by invented one of the first truly effective fluoride toothpaste. This new invention has contributed to improved dental health for a long time. Reducing the need for painful drilling of teeth today.

Today we Millennial's have never had so many options and choices available for us. We can walk into any supermarket and decide from a vast selection of ingredients to make one of the hundreds of different recipes from around the world to make up the food that is served on your dinner table. The oldest Millennial today is 40 years old next year and although my instant gratification loving self would love to eat chocolate for dinner every night, my future (fatter and with fewer teeth) self would not be so grateful. Homer Simpson said it best when describing instant gratification (right before he drank his concoction of a mayonnaise and vodka cocktail and failing to the floor) ‘That’s a problem for future Homer. Man, I don’t envy that guy.’

Like teaching a child to brush their teeth for the first time. We need to change our behaviours by promising that our future selves will benefit from today’s positive action. This can only be achieved by helping set good habits every day. It’s a bit like setting our money habits.

If you’ve ever had Toothache you know how painful it can be. Not being able to eat anything or sleep at night. What’s the first thing we do with a toothache? Call the dentist to get a solution for the pain. The professional dentist can look at your individual teeth and quickly can see the problem and give you advice how to resolve the pain by implementing either pulling out your tooth often at great pain and expense to you or advising you cut out the sugar and brush your teeth with a new whizzy toothbrush.

Most toothaches is caused by years of neglecting your teeth not brushing or flossing properly or perhaps too many sugary sweets have caused tooth decay. 

We all know we should that brushing twice a day should reduce the need to get our teeth pulled out by a dentist in the future as it’s been drilled into us (see what I did there) for many years.

People who feel in control of their money are more likely to be content with life.
A new survey has revealed that having control over your money can bring other benefits like feeling more in control in other aspects of your life.
This government-backed survey of more than 10,000 people across the UK found nearly a third (31%) have low financial well-being.

With finances, we have the option of seeing a professional financial adviser to numb our pains around money by looking at our long term aims and objectives and provides products that will suit your individual needs. The main benefit financial advisers offer is they will implement our personal plan and give us peace of mind we are on track with our finances; however, this does come at a cost.

Expensive financial adviser fees can cost £100,000s (according to a Times report). The Financial Conduct Authority's Financial Lives 2020 survey found that there are 38 million adults in the UK not receiving any formal support with their finance.

Like any profession in the UK Financial Advisers follow the rules of demand and supply, there has been a greater demand for advisers in the UK whilst having a reduced supply of professional advisers available. The Pension market has recently had two massive shakeups within a generation.

Firstly and the largest changes to the law has been ‘The Pension Freedoms’ act in 2015. This has meant pensions have become sexy, (well okay not quite yet) but Pension freedoms have however increased the flexibility of options in retirement for the Baby Boomer generation.

The second major change has been the introduction of Auto-enrollment pensions. This means that our employer now has to enroll you in their pension scheme by law. The auto enrollment minimum is currently 5% of qualifying earnings, which at least 2% must be paid by our employer. This will mean the next generation (Gen Z people born between 1990's to 2000's) will have enough time to build up a sufficient pension pot for retirement. Giving Gen Z a safety net by nudging them into a pension scheme and receiving all the tax benefits of a pension (this is good news).

It often feels like millennials are suffering from middle child syndrome, where all the attention goes to the older and younger generation. We often feel like we have been forgotten about. We are getting next to nothing from our savings due to low-interest rates, often we are scared to invest after seeing the financial crash first-hand or we simply don’t have the time or desire to learn how to invest. As well as the dream of an affordable house in London now being a distant memory. This was until the announcement in last year’s Queen’s speech about the merger of three financial bodies to form one financial guidance body. This puts us Millennial's back into the spotlight. The UK government has merged the money advice service, the pension advisory service and pension wise, which should hopefully bring some clarity to the over-complicated world of pensions, investing and taxes . Financial guidance will be separate from financial advice and Financial guidance main aim will be to improve Financial well-being in the UK.

This should be good news for the consumer as we desperately need simple good quality information about all the options available to us so we can make an informed grown-up decision about what to do with our money. Today we are bombarded with so much different information, especially about our money. It’s difficult to know what is correct and what is long in the tooth (last pun I promise). 

Money Tipps offer a new and unique solution to the problem of money worries

As the investor Warren Buffett said ‘investing is simple but not easy.’ Simple in that doing a few simple tasks regularly at the right time will give you the best chance of meeting your financial goals. Not easy as we humans are emotional creatures and are gut instinct tell us exactly the opposite of what would benefit us in the long term. Being greedy when others are fearful and fearful when others are greedy has been a successful strategy of Warren Buffett by greedily buying assets when others are fearfully selling during a financial crash and not getting caught up in speculative bubbles (from the 1990's Dot Com boom and bust to the recent frenzy and popping of the speculative Bitcoin bubble). Despite having a great money mindset Warren Buffett’s real secret is his asset allocation. Meaning the proportion of his investments in different asset classes. Having a mix of both good quality timeless companies and small growth companies that will be worth more in the future has meant he is one of the richest people in the world. 

Today we have to make grown-up decisions. Our finances like our teeth we can benefit from simple actions that benefit us in the long term. Brushing and flossing daily and avoiding sugary food is good long term guidance for our teeth. With money 3 simple actions will improve your financial well-being.

1)  Paying ourselves first every month, saving for our future selves before spending for the moment. Set this up automatically so you don’t even need to think about saving. A good starting point is saving 10% of your income every month.

2)   Build up three months worth of expenses in a cash account. Separate from your main spending account. If this sounds like too much then start by saving £1000 in a different account. This is your buffer for anything unexpected happening like losing your job or for a rent deposit. Don’t touch it and it will bring you a tremendous sense of relief that the worst things can happen in life and you’ll be alright.

3)   Stay away from credit. Credit is bad for your health and is addictive. It gets harder and harder to get your finances back to where you want to be, especially when all the fees build on the interest payments owed. Like sugar that can rot your teeth, having credit card debt can seriously ruining your long term financial plans.

In summary financial advice is a bit like a Surgeon or a doctor who will prescribe the best product that’s right for you using the current industry practices. There will be a continued demand for this service especially as time is the most precious commodity these days. However, if you have a dull ache in your mouth it might be worth popping into a Boots or Superdrug to understand the different options of products available on the market and making the decision yourself. Similar to what my company Money Tipps will now provide.

Money Tipps partners with Financial Conduct Authority (FCA) regulated investing platform and help you make a better decision with your money We reduce the investing pain and help you feeling good again so you can live your life to the fullest

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