Life and Work - Developing Good Spending Habits
We don't give this sort of advice. But we can make you think about it for yourself.
Here's a fantasy. Reflect on it.
You like a coffee before work and pop in to Starbucks every day for a flat white and an occasional Danish. You spend £5 each day.
You are 20 years old. You expect to work for 50 years. You work 5 days a week, 50 weeks a year (to make the maths easy).
You resolve to consciously deny yourself this pleasure and to save the £5.
- If you save it in a bank you will have £62,500 when you retire.
- If you invest it at 3% per annum after fees you will have £145,000 when you retire.
- If, additionally, you set yourself on a career path that allows an increase in standard of living (and of saving) of 3% per annum you will have £275,000 when you retire.
- If, additionally, you find a way of avoiding fees of 1% per annum you will have £355,000 when you retire.
Ignore the maths for now. Trust us.
The lessons are....
1) Maybe control of spending habits is as important as mastering the gobbledigook of 'successful' investing?
2) Maybe developing your earning power (i.e. career) is as important as spending control?
3) Maybe your attitude to saving should extend to the costs of your service providers?
Here are some useful links
We offer a separate page on Government Advice. Remember that no government service is going to upset an industry that contributes 15% of national tax revenues, but with that proviso they do their best.
The Citizens Advice Bureau has a good reputation for handling basic money problems, particularly debt management.
It's hard to ignore tax when trying to decide what to do. It is also hard to distinguish reliable facts from marketing hype around the word tax. Google on your question and pick the link to GOV.UK, which is the HMRC site.
Martin Lewis founded and led an independent website MoneySavingExpert. He has since sold out to the price-comparison group Moneysupermarket on terms that attempt to preserve its ethos. Hard to judge if that has been successful.
For general readers there's an extremely good and practical book, privately published, written by Brian Butcher, a partner in a small financial advice firm based in Doncaster. Find it here.
For Millenials and Gen Z, for whom the future is much more important than to the rest of us, there is Iona Bain, FT columnist specialising in financial guidance for the young. Currently(2021) unique in her field.
For a simple dip into robo-advice try Holly Mackay's Boring Short Cut
That's the end of the Foundation module. Your next move may be to return to each one of the nine steps that are relevant to your situation and where you need help. Or you may want to move on to:...........