￼￼Some people are good savers. Regardless of how much they earn they always seem to have money set aside for special occasions and rainy days. Others, even when they have a good income, seem to be permanently broke and waiting for the next pay cheque. You probably recognise which you are.
While December is a month of splurging, January is typically associated with cutting back – whether that’s on food, alcohol, or spending.
If one aim this year is to improve your financial situation, increasing income is just as important as reducing spending. One area often overlooked is finding ways to claim everything you’re entitled to. This is especially important if you’re one of more than 10 million people completing their self-assessment tax return ahead of the 31 January deadline.
Self-assessment is a system used by HMRC to collect tax. If you’re an employee, tax is usually collected automatically from your monthly salary and shows up on your payslip. But if you’re self employed, or have additional sources of income such as savings interest or rental income, you have to declare your income to HMRC and offset against that any expenses that attract tax relief. The more tax relievable expenses, the less tax you have to pay, which means more money in your pocket.
So when you’re completing your tax return it pays to make sure you’re claiming all the tax relief you’re entitled to.
Are you getting pulled in by all this Black Friday hype?
Ant Bullock from Do Something Different - the company inspiring millions of people to do something different one Do at a time - interviewed me to ask why we're so likely to be pulled in by Back Friday and what we can do to resist. Here's an extract of our conversation:
I've been a great fan of Pete Matthew at Meaningful Money, who shares my passion in delivering financial education to the masses and helping people build a better financial future for themselves. I often suggest his podcasts or videos to clients to listen to, and would strongly recommend taking a look around his site and, if you're interested in learning how to invest, signing up for his free 10 day email course.
This week, I was delighted to be inverviewed by Pete for his latest Meaningful Money podcast, as part of his season covering the subject of behavioural finance. In this interview I talk about the power of coaching and how we also need to address our emotional relationship with money to create a secure path towards our goals. I also share some tips and insights.
You can listen to it by clicking on the audio link above (the interview starts about 6 minutes into the recording) or via the Changing financial behaviour page on the Meaningful Money website. If you scroll down the page on the Meaningful Money website, there's also a transcribed version of the podcast and a list of resources that I mention during the interview. Please do take a look at Pete's website, as there's tons of valuable resources on there.
I was interviewed by a journalist recently who wanted to write an article about ‘financial therapy’ - a combination of financial advice and therapy for unhelpful money behaviours - that is currently popular in the US.
The article - Do you need financial therapy? – was published by The Guardian this week. While I don’t describe myself as a therapist, my work often involves helping clients address the emotions they experience surrounding the subject of money and helping shift unconscious patterns of behaviour around money.
As well as interviewing me about my work, we did some work on the journalist’s relationship with money so that she could experience what I do. She’d never before given much thought to her relationship with money.
What was revealing was that she can get herself out of trouble but can’t maintain that forward momentum once it no longer feels like a problem. We did an exercise where I got her to personify her relationship with money, and what came to her was ambivalence, disinterest and discomfort about engaging with money. We realised that her focus was on survival: getting through the month, paying off debts, but not on thriving.
The words ‘money’ and ‘worries’ go together so often they can seem inseparable. For many people, their relationship with money is fraught with anxiety. In Sheconomics we talk about ‘Money Anxiety Disorder’ (MAD) – a fixation with money worries and a persistent sensation of simply not having enough. I also come across something I call ‘net worth anxiety’ – where people assess themselves at a certain stage of life and compare themselves to friends or colleagues or to their own expectations, and feel that they’ve fallen behind.
Money worries can leave you trapped in a relentless cycle of anxiety.
We can learn a lot from other people's experiences. Here's some recent money lessons that clients have shared:
Behavioural economics explores why people sometimes make irrational decisions. Laurie's TED Talk shows how monkeys make the same mistakes as we do when it comes to money.
Read on for some other interesting TED talks on the topic of our relationship with money...
By Marianne Curphey
Published: 15 April 2014
Think about the last time you went shopping for no particular reason. Perhaps it was a sunny Saturday afternoon, maybe just after hearing some excellent news. Or maybe it was a rainy, cold day, and you had just been through a breakup. Whether you're fuelling your good disposition or aiming to make yourself feel better, your mood has more impact on your spending than you may think. But there are ways to fight the urge to splurge.
I’ve made a short video to show you a step by step approach which helped me personally save over £100 a year on my gas and electricity bills, while avoiding future price rises for another 18 months. It’s easy and effortless - I promise!
For more help, check out the services I offer or read my book, Sheconomics.
We’re all for setting realistic, achievable goals so here’s a simple springtime challenge for you.
Pick one of these 10 suggestions and decide to do it. If it helps find a friend or partner, pick a task you both need to do and do it together. Sit down one evening, open a bottle of Rioja and browse price comparison websites together. Or take turns to help sort each other’s paper mountains over a packet of chocolate biscuits.
Do whatever you need to do to make the tasks more palatable and then decide on one action - one small sweet step at a time. Never underestimate the power of doing what you say you’ll do…we guarantee it will put a spring in your step.
So, are you ready ...?
Suddenly it’s December again and Christmas is coming hurtling towards us in a blur of sparkly lights and parties and last minute shopping, making excessive demands on our budgets. That’s how it often feels – to have come suddenly at us, even though December follows November each and every year.
One of my clients, Anna, is taking Advanced Driving lessons and her instructor had said that the most common word in accident reports was ‘suddenly’: ‘suddenly the van came hurtling round the corner’; ‘the car ahead braked suddenly’. Anna was learning that Advanced driving skills are all about anticipation - looking well ahead, adjusting your behaviour to ensure a smooth ride. Things rarely happen ‘suddenly’ if you’re anticipating well. She realised that ...
Are you someone who doesn’t live up to your earning potential? Try our Sheconomics quiz to find out.
Women in particular often undervalue their worth and dread asking for pay rises or increasing their rates. We happily give away our time and skills at bargain prices because we don’t trust that we’re worth more.
If you can identify with this, here’s a trick to help you convince yourself that you’re worth whatever you want to earn:
The government’s just announced that parents who are higher rate tax payers (currently those earning more than £43,875 a year) will have their child benefit axed from 2013. The benefit will be stopped even if only one parent falls into that tax bracket. This will affect families with only one parent working the most. Hmm… I can see this affecting lots of women.
But… wait for it, there’s some good news.
After two years of fun writing, we're excited to say that Sheconomics, is finally on the bookshelves! We were lucky enough to get a double page spread in The Times about the book, written by Carol Midgley.
If you don't subscribe to The Times you won't be able to read the article in full, so here it is...