Trying to be a Stay at Home Mother/ Dynamic Internet Entrepreneur all at the same time has done for my finances the same as it has my personal energy levels: left them on the floor.
Luckily, this site has had a great first year and can look forward to an even better 2017.
But here at home, as I stare at childcare bills hoping that the money to pay them will materialise if I just look at them long enough; tax bills that by the way, when you’re self-employed, are a total nightmare, and shopping bills that for a family of four, are just insane, it can feel like it’s all a bit much.
#workthatworks? I’ll be careful not to sound ungrateful for the opportunity to try to make work work, but it is “challenging” (corporate-speak euphemism for f’ing impossible but hey, we’ve got to get on with it). And one of the reasons for this, is money. Or a relative lack of it.
Dealing with earning (much) less than I was used to before children, through being part-time and also starting a business, is had to accept. It is also genuinely difficult to manage, when outgoings in the form of childcare and household bills are higher than they used to be back in the days of lazy breakfasts and newspaper reading (that’s BC, Before Children).
Yes, we spend less on dining out and holidays. But we spend an absolute tanker-full on stuff we never anticipated before having kids. Football kits, power rangers, chupa chups, presents for a million friends’ birthdays, shoes, shoes, shoes, calpol, plasters, bedside lights, small dinosaurs…. I don’t even think mine are spoiled.
Before this becomes a mammoth rant about all-the-things-I-wish-I-had-been-told-about-the-cost-of-children, let me say I think it’s all worth it and I wouldn’t change a thing. Look at the little tikes.
But there are a few things I’d like to change about my personal finances.
Last year, I declared my new year’s resolutions on this blog. I kept 2 of them – sorting out the boys’ junior ISAs – they now get £50 a month each in sustainability-themed funds such as WHEB Sustainable – and going through old savings accounts and vouchers – I managed to find about £160 worth through closing old accounts and using up old vouchers that had been shoved in corners.
The rest of my resolutions such as moving my pension to a SIPP, switching current accounts and buying an electric vehicle were sadly not met. The first was unfulfilled for the good reason that there are some guarantees attached to my old work pension that I would lose if I moved it, which I only found out about when I started the process.
The second was unfulfilled because I am holding out for Triodos to open a current account instead of moving to Nationwide. The responsible bank says it will happen in 2017.
And the electric vehicle didn’t happen simply because researching and finding a new car to buy is a massive undertaking that in the end, neither me or my partner James were willing to spend time on at weekends.
But I did some good things that weren’t on my New Year’s resolutions list in the last 12 months, such as:
- I switched to Bulb Energy, the cheapest 100% renewable energy tariff provider in the UK (you can too and we all get £50 using this link). I have not looked back.
- I signed up for the Moneybox App, which is one of the best things to happen to the investment industry so far this century. In three months’ of using it, I had saved nearly £240 just through the app rounding-up my spending to the nearest £1 and putting the difference in an investment account. Moneybox is genius and a great way to invest at low cost without even noticing. My Moneybox account has become my Christmas savings account. If you fancy trying it too, use the referral code 66GY5 when you sign up and if you are in the first 10 to do so, we both get £10 credit!
- I invested small amounts in some crowdfunds I believe in: Tandem, a new digital bank, and The People’s Trust, an investment trust that is due to launch in April this year, in time for the new Lifetime ISA, which invests long term and responsibly on behalf of its investors.
- I switched to a cheaper mortgage deal – we are now paying 1.79 per cent on a variable rate from Coventry Building Society that has no switching penalties should we decide to move to a fixed rate. Good With Money readers can get 50% off fees from Trinity Financial Mortgages if you email this dedicated email address.
Managing money for a family of four is never going to be easy. But I think keeping your eye on the ball, being proactive and making small improvements where you see an opportunity is all most of us can expect to achieve.
In 2017, I’m aiming to curb small spends that add up to a lot, like coffees and my Birchbox subscription (hard to say goodbye to that one – the products are amazing).
I am going to invest more in things I believe in and stress less about money.
But my first big resolution is to simplify our family finances and keep them simple.
I have already started checking through all of our direct debits and standing orders to see where changes can be made. Netflix will have to go. We have NowTV – that’s enough.
It’s possible I no longer need to pay as much as I currently do for income protection cover – that’s a phone call to my insurer at some point in January and if you set up income protection ages ago I would urge you to do the same – it is unlikely that it will cost you more as a result.
I am going to use one investment platform for my ISA and the boys’ junior ISAs so I can see them all together, probably switching from Alliance Trust Savings to Hargreaves Lansdown (which despite having some issues, is relatively transparent and easy to use). Although I like EQ Investors – a B Corp – a lot too AND it offers positive impact portfolios to boot. And Moneyfarm and Nutmeg are undeniably simple for novice or time-poor investors too.
One problem: there’s a ridiculous £100 exit penalty for moving the boys junior ISAs from the Alliance Trust Savings platform, which also charges me £3.33 a month for each, despite the deposits being tiny and the platform itself being clunky as hell. I’ve already complained about the exit charge but will cover in a separate blog as investment platform charges, if you are planning on getting into investing this year, are something to be ultra vigilant about. Take it from me.
I have cleaned up pre-approved payments on Paypal. If you use Paypal a lot, particularly for things like entertainment subscriptions or online services such as Dropbox or eBay, you might find one or two active pre-approved payments lurking around in your PayPal account that you didn’t know about. I just cancelled two annual recurring payments – one to Spotify and one for Flickr – that I no longer use. They were small, but still.
This year, as soon as we are out of our ridiculous contract, I resolve to ditch BT. Our BT bill is ridiculous. The last one was £74 and I’m blown if I know why. Being trapped into a rip-off home phone and broadband provider contract for two years winds me up, big time.
We can’t have Sky for various geographical reasons; we can’t get Virgin because we don’t have those cables you need, and I’m yet to come across a company that has as much scorn for its own customers as Tiscali.
The cartel-like behaviour of home phone and internet providers and the monopoly of BT on phone lines is one consumer rights scandal that needs to blow up. There is not enough choice and the providers exploit this with high charges. I’ll do my best to stick a rocket up it this year if you will, although I haven’t worked out how yet. I can’t be alone if this story is anything to go by.
Another resolution is to invest more in things I believe in for my own retirement savings.
I am going to open a Lifetime ISA and switch my £100 a month payments to my stocks and shares ISA into the Lifetime option, which, like all ISAs, is tax-free and attracts a further 20% payment from the Government. I will only receive the Government top up if I don’t access the funds until I am 60, however, as the purpose of the Lifetime ISA is to help people save more for retirement (or buy a house, if they haven’t done that), there are restrictions on access if you want the 20% bonus. Watch out for the Good With Money Lifetime ISA guide later this Spring.
I am also going to open an Innovative Finance ISA, with either Abundance Investments or Crowd2fund as they both have great visibility on where your money is going, and stick £100 a month in it. Money in IFISAs is lent to businesses or individual borrowers via peer-to-peer platforms for a better return than you get on savings, but with less risk than stocks and shares investing (in theory anyway). Look out for the Good IFISA guide, which we will publish in January.
…. And of course, I’ll keep you posted on anything else that comes up in the year that we really all should be doing with our money.
Happy New Year from me. May 2017 be the greatest ever for this surprising planet and the people on it.