Timi and Laura Ann-Moore Answer Your Money Questions On Relationships, Saving And Investing

This transcript is auto-generated and lightly edited for readability, it may contain errors.

[0:00] Sammie Ellard-King (host): This is where we answer your most burning questions live on the podcast.

[0:04] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): Hello, qualified financial advisor.

[0:06] Laura Ann-Moore: I am a qualified financial coach. How many times have we all heard something from someone that we love, like a piece of advice? Yeah. Then you hear it on a podcast in a book from your favourite creator and you’re like, that’s a banging bit of info. And then your friend or your partner is like, Oh, you’ve been saying this truth for years. And you’re like, You’re like, have you?

[0:26] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): We had to print a lot of money to get people through the pandemic. And that then meant there was more money in the system, which drove up the demand for things, which pushed up prices, but then wages didn’t rise by as much. So people were going to the shops, and it was like, oh my goodness, Lurpak is literally nine pounds now.

[0:47] Laura Ann-Moore: The way that we label ourselves around being a spender, you’ve got the extreme of I’m a spender, I spend everything, I even overspend and go into debt. And then you have, I see myself as a spender because that’s my natural go-to, but I still do all of these other things. I still save and I still invest. And I think when you are in a relationship, it’s really important to like have no judgment.

[1:06] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): So there are really important reasons why women should invest if they can and build up their wealth. Because a lot of us are gonna spend a third of our lives retired. You want to start putting money away now.

[1:21] Sammie Ellard-King (host): The Money Gains Podcast. Hey guys, welcome back to another episode of Ask Me A Money Question on the Money Gains Podcast. Timi, Laura, how are you guys? Good.

[1:34] Sammie Ellard-King (diarisation split, brief backchannel): Yeah?

[1:35] Laura Ann-Moore (diarisation split, brief backchannel): Very good.

[1:36] Sammie Ellard-King (host): Ready, good? Good. Good. Yeah, yeah. Okay, for those people that haven’t tuned in to Ask Me a Money Question before, this is where we answer your most burning questions live on the podcast. The first one we did was an absolute hit. It’s flown into the top five performing, mainly because of your answers, less of my presenting. But um if those who are tuning in for the first time haven’t don’t know who you are, I’m gone to head, Timi. You’ve got 15 seconds. Who are you?

[2:05] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): I’m Timi Merriman-Johnson. I’m a qualified financial advisor, a content creator, and a big fan of both Sammie and Laura. Laura.

[2:15] Laura Ann-Moore: Hello everybody. My name is Laura Ann Moore. I am a qualified financial coach. Um financial advisor in training, um, content creator, podcast host, speaker, educator about all things money.

[2:29] Sammie Ellard-King (host): Yeah, and you guys are just awesome in total. I’m not gonna talk about myself because it we’re on episode 87. So if you if you haven’t come across me yet, then you’re probably going to hear lots of me in the coming weeks, especially if you’re subscribed on YouTube, so please do click that button. Um but guys, what we’re gonna do is we’re gonna start up with a question uh that’s been written in, and her name is Hannah.

[2:51] Laura Ann-Moore: Hannah.

[2:52] Sammie Ellard-King (host): Uh she asked me not to say her last name, but she said we could say Hannah from Yorkshire. So Hannah from Yorkshire has asked.

[2:58] Laura Ann-Moore: Can you do it in her accent, please?

[3:00] Sammie Ellard-King (host): How do you say how do you do what’s a Yorkshire going?

[3:03] Laura Ann-Moore: Actually, don’t know. Uh I’m going to pub.

[3:06] Sammie Ellard-King (host): Going to pub.

[3:07] Laura Ann-Moore: Hello, my name’s Hannah.

[3:08] Sammie Ellard-King (host): Is that Tin Tin Tin? Tin tin tin. Tin tin tin. Gips and gravy. Isn’t it? Alright, how do you get your partner aligned?

[3:19] Laura Ann-Moore: Sorry. Okay, I can’t do that either. Okay, it’s a good thing.

[3:22] Sammie Ellard-King (host): Three of three of How do you get your partner aligned with you when one is a saver and he is a spender?

[3:31] Laura Ann-Moore: Can I jump straight in? Go. I have so many things to say on this.

[3:35] Sammie Ellard-King (host): Okay.

[3:36] Laura Ann-Moore: I think that, first of all, as humans, we love to label ourselves as like saver, spender, whatever it is. Sometimes it can be helpful and sometimes it can be really hindering. And I think there’s nothing wrong with being in a relationship with someone who has different habits and behaviours and attitudes towards money than you. Um especially if you’re already in like an established relationship. And, you know, this is why it’s so important to talk about money right at the start, because you can have these questions and understand like how each other views money. But I think it’s less about both being a saver or both being a spender and more about having the same values and goals when it comes to your money. Totally. And it’s like she, if if Hannah is a saver and her partner is

[4:21] Laura Ann-Moore: a spender, um, first of all, there’s like, I’m a big believer that spending is just as important as saving in its own way. It’s not that one is better than the other. We don’t want the extremes. But it’s better to have a conversation around what are your shared financial goals. So if you are saving to go on holiday, you’re saving for a house, you’re saving to have a family, whatever it is, and you have a shared goal, then there’s a bit more buy-in, emotional buy-in from the partner to shift behaviours to start saving more. Um, but if you don’t know what you’re both working towards, the partner’s spending his money, it’s still his money and you can do what you want. But it depends how your finances are like uh joint because everybody does it differently. But I think it’s really important as a starting point to more talk about shared values, shared goals,

[5:06] Laura Ann-Moore: and understand it’s okay to have different attitudes towards money as long as you’re at least going in the same direction. Um so yeah, less about getting him to be a saver and more about how can we work towards a common goal where he’s saving, but he can still spend how he wants, without my judgment on it.

[5:23] Sammie Ellard-King (host): So do you think it’s like, you know, spend on the things that you want to spend on and let’s work towards together goals that are connected and we both save towards those?

[5:33] Laura Ann-Moore: Yeah, I think so. If if Hannah and her partner have completely separate finances, like it really depends. Do they live together? Are they married? Are they like, because everyone is so different. If you’re three months into a relationship or you’re 10 years in and you share a house and a family, very different. Um, but let’s just say they’re separate and you know, Hannah’s got her money, her partner’s got his money, and you set a common goal. We’re both working toward this. You’re gonna put away X, or we’re both gonna put away, I don’t know, £100 each towards this girl for however long. Really, it’s down to your partner to then the part the partner to do what he wants with the rest of his money. Like I’m a big believer that you can’t control someone’s choices. He might be looking at her going, I wish you’d spend more. How do I get my partner to spend more? So that’s where the open conversation part is. But I think it’s easier

[6:18] Laura Ann-Moore: if you have a shared goal that you’re working towards so that you can both get excited about it. And then, you know, maybe you could set up an automated saving plan. Maybe you could um sit down and do your budget together. Like it allows you to kind of come together and connect over money instead of it being something that’s like, oh he does this, she does this. Yeah. It’s more open and and vulnerable. Yeah, yeah, yeah. Absolutely.

[6:39] Sammie Ellard-King (host): That’s what I would say.

[6:40] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): To me. Yeah, that’s a great, great um explanation. I think the only build I’d make on that is once you’ve aligned on what your goals are, then you just do the classic saving stuff. So on or or just after payday, you you save. So rather than waiting till the end of the month and then and then saving what’s left, save as early as you can, prioritize it, save into a separate savings account. It’s up to them if they want to do a joint account together, but you can have a a pot or just a separate bank account so that money’s um gone um it’s like out of the way and you’re less likely to dip into it. And then I would say finally to to automate it as as Laura has said, because if you’re a spender, um I I think there’s nothing wrong with

[7:25] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): that. I think as long as you’re spending money in a way that you you definitely uh need or want, so you’re like you’re using the stuff, you’re enjoying the stuff, I actually think that that’s great and that’s why we work so hard for our money. Um but you wanna you want to automate your savings so that you’re you’re reducing the friction um to to saving and and then you can spend the rest. Saving is is really just not spending 100% of your money. Because if you spend 100% of your money 100% of the time, um you are beholden to the person who who’s paying you and you’re you’re gonna have to go back to them each time. Whereas if you can spend 90% of your money, 80% of your money, then you put yourself in a much better position financially.

[8:07] Sammie Ellard-King (host): Such a great point, man. Like I know I’m a spender and I just know that about me. So like having those things pre-prepped at the start of the month allows me to be completely a spender and then like tap into my spending habits.

[8:22] Laura Ann-Moore: Yeah, but that’s interesting, right? Because you call yourself a spender and yet you still save and invest. Yeah. Right? 100%. There are still those things attached to your identity that you are still doing.

[8:31] Sammie Ellard-King (diarisation split, brief backchannel): Yeah.

[8:32] Laura Ann-Moore: So the way that we label ourselves around being a spender, you’ve got the extreme of I’m a spender, I spend everything, I even overspend and go into debt. And then you have, I see myself as a spender because that’s my natural go-to, but I still do all of these other things. I still save and I still invest. And I think when you are in a relationship, it’s really important to like have no judgment because then Hannah can share a lot of the tips that she has around saving that are really helping her with her partner without it being something that makes him go, all right, bring it in.

[9:03] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): Yeah. And uh another thing that I’ve learned about relationships is that um, and unlike the changing people point, I think I read an article on the art of manliness of all of all websites about appreciating your partner. And and it says that we often try to treat our partners like um they’re a buffet. Like we want to pick and choose the um characteristics that we like about them and not like the other ones. And and the example that it gave is that if you’re with someone who is like disorganised and late all the time, it’s probably because they’re quite creative, they’re quite spontaneous. Which is all of those things. So you might be there like, oh, my partner’s like a a spender, but they could also attach

[9:48] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): to that could be the fact that they’re really generous or have a really fun attitude towards life. So brilliant. It’s not the financial point, but it’s just like appreciate the fact that this aspect of their personality is part of who they are as a person.

[10:00] Sammie Ellard-King (host): Yeah, and it may be the reason like you fell in love with them in the first place because of those characteristics. Yeah. But it just so happens that when you combine your finances or there’s things in the different season of the relationship, that those spender traits have become more apparent to you, perhaps.

[10:14] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): But just set up the standing order as well. So make it easy for yourself. Basically, same result.

[10:18] Laura Ann-Moore: Make it easy. Romeo.

[10:23] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): Um I love how we started off Yorkshire and ended Cockney. Yeah, yeah. Well, yeah.

[10:27] Laura Ann-Moore: She’s international.

[10:29] Sammie Ellard-King (host): Jack podcast producer Jack will be testament to my uh garage MCs when no one’s around. Um just I just literally pull it out of nowhere. Okay, uh all the days of the past. Um to follow on from this really nice sort of added question, really, as well. Kind of another couple here. Martin Walker wrote in uh talking about I’ve been trying to get my partner into investing. She has a very live for today and not for the future mindset. How do I get her to change this mentality? Again, a change in mentality, as I feel like later in life it’s all going to be on me. Laura?

[11:05] Laura Ann-Moore: Yeah, I think it’s interesting because what he’s saying, you know, later in life it’s all gonna be on me. That’s kind of it’s an emotional thing, right? He’s probably thinking, oh, this is quite a lot that I’m gonna have to deal with. And the light the load could be lightened if me and my partner are doing it together. So both emotionally and financially it makes sense for her to start considering it. But what I will say as a female is when what’s his name? Martin.

[11:32] Sammie Ellard-King (host): Martin Walker, yeah.

[11:33] Laura Ann-Moore: Martin. Martin obviously has an understanding, a knowledge, and a confidence around investing that allows him to understand why he’s doing it, what he’s doing it for, how much he can put away, etc. And women in general have been left out of that conversation of investing. So I think there’s like, first of all, just the education piece around why. Why? Because right now, his partner’s very like, live for the moment, enjoy your money, which there’ll be a reason why she’s like that. Like we just kind of said a minute ago about, you know, your own experiences and and whatnot. But when you show someone or give someone the awareness and the understanding around why we invest and why we plan for the future, sometimes the habits and behaviours will start to shift naturally. But then there also needs to be the confidence piece around her feeling confident

[12:18] Laura Ann-Moore: enough to invest, understanding her own risk profile. So there’s so many things involved. But if he comes at it from an attitude of like, I’m investing, you’re not, it’s all gonna be on me later in life, you’re just spending your money now, it’s gonna be like, oh buddy. Defense mechanisms come up.

[12:33] Sammie Ellard-King (host): Yeah, it’s gonna be like completely the opposite.

[12:35] Laura Ann-Moore: Yeah, and I think sometimes, unless you’re a financial educator like us, where we know that we are we repeat the basics a lot, we share things that we know really a lot of detail about, and we have to learn how to get it across in a point where it’s really easy to understand. Yeah. If that’s not your job.

[12:50] Sammie Ellard-King (host): Over and over, yeah.

[12:51] Laura Ann-Moore: Yeah, and if it’s not your job, it’s it can it’s it’s a skill. Yeah. So I think, you know, very good point, actually. And and and if he’s coming at it from a point where it’s using all the language around investing, throwing out compound interests and index funds. I know when I first learned about it, I was like, Yeah, what are you talking about, man?

[13:05] Sammie Ellard-King (host): I just want to enjoy my life. Yeah, yeah.

[13:07] Laura Ann-Moore: And you’ll switch off. So um if if he’s if Martin’s not up for the job and he’s like, you know, you can pass it over to somebody who is an expert in that area around social media, books, podcasts, where she can start to learn for herself. Because it’s all what you know, he can ignite the fire, but he doesn’t need to keep it alight.

[13:24] Sammie Ellard-King (host): Totally. Um and people like to learn from different types of people as well. That may actually like they want perhaps just to keep the relationship intimate, right? And rather than I don’t want you preaching to me, but I’m happy to go and learn from Laura or Timi or myself or whoever, right?

[13:39] Laura Ann-Moore: And it’s that it is that classic thing of when you learn how many times have we all heard something from someone that we love, like a piece of advice? Yeah. Then you hear it on a podcast in a book from your favourite creator, and you’re like, that’s a banging bit of info. And then your friend or your partner is like, Oh, I have been saying this to you for years. And you’re like, You’re like, have you? Or they said it differently. But it’s because sometimes with the people that we’re closest to and the people that we love, we don’t always want to take advice from them, or we hear it differently, or whatever it is. Totally. So it’s uh the education piece doesn’t necessarily need to come from him. It can he can lead her in the right direction, but just maybe show you know, showing love by showing sharing resources, and then she can start there on her own.

[14:20] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): Totally. I love that. Timi, anything to add? So investing is kind of this big and scary concept. And so I think when it comes to uh trying to convince someone to do something like that, you want to look for the minimum viable action that they can take to to uh to start to invest. So for Martin’s partner, I’m thinking about the investment platforms that let you invest from one pound. See if you can introduce his partner to that. There are platforms that will let you invest with fake money, with pretend money, like practice accounts. Or um by taking her by taking her on the investment journey with with his investments. So he can kind of show her his platform, what he’s investing in, and almost be like the driving instructor in the

[15:05] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): car like next to her. Just kind of so you want you want to simulate the experience and show that it’s not this big scary thing. It’s actually, as we all know, it can be quite boring if if you’re kind of investing in a in a monthly way. So that’s that’s what I would say. But then the more serious point is um, you know, as Laura said, women have been left out of the the investing um conversation. Women live longer than men do. Women live on average to age 83. Uh for men is age seventy-nine. Um four years, wow, that’s a big difference. Women and four years are pure fan. Um women live longer than men do. Women are are way more likely to take

[15:50] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): time out of work to look after children and to provide caring responsibilities. And then you have a gender investment gap, you have a gender pensions gap, which is like double the gender pay gap. So there are really important reasons why women should invest if they can and and build up their their wealth because a lot of us are gonna spend a third of our lives retired. You wanna start putting money away now to um to to so that you can use it late later on in life. And what I’ll finish off by saying is that um Warwick Warwick Business School did a study where they found that when women do invest, they actually outperform us men. Yes.

[16:35] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): Invest in a more long-term way, they invest in a more um diversified way. Yes. Whereas we are kind of idiots and we just want to yeet everything into whatever coin. Um so it’s like go for it, you know. I I understand the the caution, um, and but you you don’t want your your risk aversion to turn into complete inaction.

[16:56] Sammie Ellard-King (host): No, I completely agree with you, man. And like what I would say is as well, is that there are ways that you could say set up your budget to allow for the day-to-day live my life now vibe and also the investing side of it too. So like in my budget, I have like a 15% non-negotiable, and that’s for me to like live my best life, you know, kind of vibe. And then the rest of the, you know, I put 20 to 25% of it, depending on the month, away into my investments now. And then that way I’m just like I’m moving forward in both, I’m living my life as I want to live it, which is like uh uh, you know, everything that that obviously the this lady would like. And I’m still doing the investing thing too. This is exactly the same as that kind of savings thing if you set that up at the beginning of the month. And also show

[17:41] Sammie Ellard-King (host): her a compound interest calculator because it blows everybody’s mind.

[17:44] Laura Ann-Moore: No, it it’s it’s the thing that gets everyone, they’re like, Whoa.

[17:47] Sammie Ellard-King (host): Yeah, that’s possible with a hundred pounds? Like it’s nuts. 100 pounds at uh 30 years at 10% is like £228,000. So it’s a lot of money for a lot of people.

[17:58] Laura Ann-Moore: Yeah. And if I can as well add on the point that you were saying about like about women and investing and you know, their attitude towards it, I think that women have been taught over the years that investing isn’t for them. So when they see men doing it, be even if it’s men that they trust, their partners, their dads, their brothers, if you don’t see somebody that looks like you doing it, it still makes you be like, is that for you? And that’s happened a lot. I work with so many women, like in my in my community, in my investing course, where they say, My partner invests, he’s tried talking to me about it. So and so, this man, this man, this man. When they have other women, friends around them, or like a community of women doing it and they see me doing it and I’m teaching

[18:43] Laura Ann-Moore: it, they feel they’re less afraid to ask questions that might feel dumb.

[18:47] Sammie Ellard-King (diarisation split, brief backchannel): Yeah.

[18:47] Laura Ann-Moore: And I think that the you know, the research that shows where men have been promoted to more of invest, do this, you’re a financial financially savvy, download this app. But with women, it’s like, oh, hold on to a pennies, hold on to your pounds. Of course, naturally, you know, just the way that the world has been, his partner’s gonna feel like that. But I think it’s nice because it’s coming, he’s coming from a caring place for both her financial future and also his own wealth.

[19:13] Sammie Ellard-King (host): Yeah, and them both by the sounds of it, which is nice. Like, yeah, when we get to that age, like to even think like that is a good sign for their relationship, I think. So yeah, not that we’re relationship coach, but that’s what sort of came out of it for me. Yeah, yeah. Um, I love that guys, thank you. And so next up we’ve got Chris Kennedy who’s written in, and he’s asked what are the best saving accounts types if I want to save for a year and a half to get the best possible results.

[20:27] Laura Ann-Moore: Well, in my opinion, I think if you’re if you need the if you need money within 1.5 years, that’s not super long. So you can lock it away in like a fixed term account, yeah, which would be between, you know, one to two years. That’s probably your best option when it comes to savings. If it’s an emergency fund and you want easy access to it and you need it in cash just in case, then you obviously want it in a an account that’s gonna you’re gonna have immediate access to. But if he knows that doesn’t need to touch it for 1.5 years, there will be options out there that you can say, all right, got one and a half years, what does that look like? Might get a little bit more interest. I know that I don’t touch it, so I’m also not gonna dip into it. So that kind of helps add friction.

[21:05] Sammie Ellard-King (diarisation split, brief backchannel): Yeah.

[21:05] Laura Ann-Moore: Um yeah. But I think the amount uh when it comes to like interest and how much you’re making changes all the time. So the point this podcast comes out that might not, the the ones that are at the top might have changed. Yeah. Um I think in regards to type, yeah, you could look at a fixed term account.

[21:20] Sammie Ellard-King (host): What would you say, would you look then, Timi? Do you think is it like would you well, if you were to start today, let’s say you need to find Timi needs to find a bank account, what would you do?

[21:30] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): I would just do an an internet search for the accounts with the highest interest rates. Yeah. And um yeah, in interest rates potentially change um eight times a year. That’s how often the Bank of England meets to decide on interest rates. And they’re a bit like you want to think about it a bit like a mobile phone contract. They’re just they’re just constantly changing and like you kind of need to move your money around to make sure that you’re you’re getting the best rate. Um sometimes there’ll be banks that will offer you special savings accounts as well with bonus rates if you’ve been a customer of theirs for a while. But I completely agree with Laura. Um when it comes to savings accounts, there are broadly four types, and the more easily you

[22:15] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): can access your money, the lower the interest rates tend to be. And the more the less accessible your money is, the higher the interest rates tend to be. So on the super easy access, low interest rate side, you have easy access savings accounts, then a bit less accessible is regular savings accounts, then notice accounts, then fixed rate accounts. Um the only thing that I would say is because the amount of money that the person is saving has not been given is that you are protected up to 85,000 pounds per financial. Institution.

[22:46] Sammie Ellard-King (host): Yes.

[22:47] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): And I say institution because some banks are owned by the same parent company. So if you put um 85K into Barclays and 85K into HSBC, that’s cool. But if you put 85K into HSBC and then First Direct, they both fall under HSBC, so you wouldn’t be protected.

[23:06] Sammie Ellard-King (host): So that’s a really good point.

[23:07] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): Yep. So spread your money if you’ve got, you know, just sold a house or something. I don’t know what they’ve done. But make sure that you do 85K per financial institution. Look for the FSCS logo, financial services compensation scheme. Lock it within a fixed rate account. That should be all good.

[23:25] Sammie Ellard-King (host): Yeah, yeah, I completely agree. I suppose it just depends on access, right? This is like number one thing. There’s to me was a fantastic explanation of the account types there. You guys need to you need to make a decision on how much access you want. And then, you know, you’re gonna have to take hits on the amount of interest rate you get back from that. But being flexible, it’s pretty interesting what you said about loyalty to to banks. I’ve not come across like banks offering loyalty because like for me, I just move my money around all the time because I’m like chasing interest basically.

[23:54] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): Yeah, yeah. You can get kind of loyalty saver accounts, and then there’ll be like a bonus rate for like 12 months or something, but then after that, it’ll just ping back to the super low one. Um, so yeah, just need to shop around.

[24:09] Laura Ann-Moore: Well, yeah, but I think because you can switch accounts and make hundred to two hundred pounds every time you switch, there’s so much more incentive to jump around.

[24:18] Sammie Ellard-King (diarisation split, brief backchannel): Yeah.

[24:18] Laura Ann-Moore: So it’s like that toss-up, isn’t it, between retaining your loyal customers and giving them what they need versus bringing in new customers. And I imagine if you’ve got really good, like, be a new customer, switch your account, you can get this much, but you’re like, yo, I’ve been with you for like 18 years. Do I get anything? They probably had so many like complaints or whatever that they go, we should look after our people.

[24:41] Sammie Ellard-King (host): Yeah. Yeah. Interestingly, on the stock market, when they are public banks as well, one of the biggest metrics for them is new customers rather than retention. So if they have like a load of influx of new customers of in their financial reports, they report that like heavy up top. And the stock market will look at that as like a key metric for their growth, even though they’re not always looking at retention, which is really interesting.

[25:03] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): The assumption I’m making is that because the money’s not needed for a while, but it is a decent sum, is that um past a certain point you do have to pay um tax on interest income as well. Yes. Because of the personal savings allowance. So if you’re a basic rate taxpayer, then you can earn a thousand pounds of tax tax-free. If you’re a higher rate taxpayer, it’s 500. And then if your additional rate is zero. So with interest rates being what they are now, just make sure that if you’re earning over any of those amounts in interest that you declare it when it comes to tax season.

[25:36] Sammie Ellard-King (host): That’s such a good point. A lot of people do forget about that, and we get that a lot. It’s like in that case, you could, if you’re not, say, already having an ISA in any form open, like getting some of that money into a cash ISA environment, so you can then lower the amount of tax you’re potentially liable for in your personal savings allowance. Like that’s a really that happens that we get that question a lot on my socials. I’m like, okay, if you can limit your exposure, basically.

[26:04] Laura Ann-Moore: Yeah, I think with where current interest rates roughly are, if you’re a basic rate taxpayer, you’d need to have about it’s like 20k saved to then be even going over that amount. So if you’re below that, you’re kind of pretty safe, but it’s always worth checking.

[26:21] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): Or go an inheritance, go an inheritance or something, yeah.

[26:24] Sammie Ellard-King (host): Yeah, exactly. Exactly. So yeah, we want to try and limit the amount of so often. That’s uh a good time, if that is the case, to take financial advice for sure, because that’s uh you know gonna be where how you can limit your amount of money that you give to HMRC, which we all like doing. Um now I’m gonna move on to slightly different topics. Still on the subjects of savings, actually, and Dominic Clark has written in, he has said there is a lot of talk online about savings versus inflation and my money actually growing. Please can you guys shed some light on this? I’ll start with Timi.

[26:59] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): Yeah, so actually at the time of recording, I posted about this last last night. I saw that and I saw the question. I was like, ooh, nice, it’s gonna come in quick. Yeah, yeah. Come in hat.

[27:10] Sammie Ellard-King (host): Coming in, coming in.

[27:12] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): Um so uh inflation. Thank you for that.

[27:16] Sammie Ellard-King (host): Um I love that song.

[27:24] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): Um so inflation in simple terms is uh how we measure um the the change in the prices of goods and services over time. It’s expressed as a percentage. And uh essentially in the UK, the Office for National Statistics every month will look at a basket of over 700 items, and they’re things like train tickets and groceries and stuff, and they will measure how much those things have increased in value, and they’ll

[29:02] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): do it year on year. So just this week we found that inflation was at 2.3%. Yeah. So that’s starting with a month we’re currently in, looking back at October, prices are on average 2.3% more than they were in October 2023. What this means, practically, is that every year your money can buy slightly less stuff. And this happens year after year after year. And this is by design, we have an inflation target rate of 2%. So if you want your money to retain its purchasing power, then you need to save or invest it at a rate that is at least as much as inflation. And that’s fundamentally why we save or invest. It’s because money loses its value over time.

[29:47] Laura Ann-Moore: Yeah. Great explanation.

[29:49] Sammie Ellard-King (host): I’m like, I love it when he hits like that. I’m like, oh, so good.

[29:55] Laura Ann-Moore: So good. I think um people get confused as well when they think about inflation and savings, because when you say money held in cash or in savings is losing, you know, you’re losing money. People are like, no, I’ve got the same amount in there. If anything, I’m actually getting a bit more. There’s interest. And then that’s where you explain. It’s like it’s not the physical number, the physical amount you have. It’s like you might save today for a house, and you’re like, next year, you know, I want to buy a property, I need 20,000 pounds in the bank. You save up, you save up, you have your 20,000 pounds. By the time you get to next year, that percentage of what the house is is you’re potentially going to need a bigger deposit. So whilst you’ve reached your goal of 20,000 pounds, the house that you now want, or we’re roughly looking at, the 10% deposit

[30:40] Laura Ann-Moore: is actually higher. So it’s like it’s more about what you’re working towards and what that money means and what it can do for you than the actual number itself.

[30:49] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): Prices are constantly moving up. They’re supposed to be constantly moving up. That is what the system says the the the economy is doing well if prices are just gradually going up and up and up and wages are going up and up. And um, you know, if if we rewind to 30 years ago, uh just very um just like back in that calculation, um a hundred pounds, fift what fifty pounds could buy thirty years ago, you’d now need a hundred pounds to buy. Double. Yeah. Wow, just rough like rough, roughly. Yeah. So and that like people weren’t eating half as much stuff 30 years ago. It’s just that prices have gone up by

[31:34] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): that much.

[31:35] Laura Ann-Moore: Yeah, and I I think it’s interesting because I mean, we all live close to London, so sort of used to London prices, but I’ll go out for dinner and maybe just on average in my head, I’ll budget. If I’m going out for dinner with friends, I’m thinking between 30 to 40 pounds, like just standard. Um, but back when I was like 18, it wouldn’t be that much. And I still used to go out in London, so it’s like, but it’s normalized. So we’re so I’m so used to it being that price, then I’m like, in 20 years, I’ll just be like, okay, going out for dinner next week, it’s you know, a main meal and a drink. Oh, I’ll budget about 75 pounds and it will just become the new normal. But that is why it is important to look at the bigger things like your income and how much you’re making.

[32:17] Sammie Ellard-King (host): Yeah, totally. And um bring back burger in a beer for a tanner, by the way, please.

[32:24] Laura Ann-Moore: When I was when I lived in Melbourne, they used to do comedy, wine, and pizza for $10.

[32:30] Sammie Ellard-King (host): Yo.

[32:31] Laura Ann-Moore: Honestly, what am I doing living here? Continue.

[32:36] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): Um, yeah. Um what was I gonna say?

[32:42] Laura Ann-Moore: Um I said about things being like £75 or something.

[32:46] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): Yeah, yeah, yeah. Yeah, stuff, stuff has gone up in price a lot, and that’s what I wanted to talk about. Like the cost of living crisis, you know, coming out the end of the pandemic. It’s like we had to print a lot of money to get people through the pandemic, and that then meant there was more money in the system, which drove up the demand for things, which pushed up prices, but then wages didn’t rise by as much. So people were going to the shops, and it was like, oh my goodness, Lurpak is literally nine pounds now. Um Freddo’s man.

[33:22] Sammie Ellard-King (diarisation split, brief backchannel): Yeah, olive oil.

[33:23] Sammie Ellard-King (host): Yeah, yeah, olive oil. Olive oil oil. Yeah, yeah. Cost more than petrol. I know. It’s mad.

[33:30] Laura Ann-Moore: Let’s all just start drinking petrol things.

[33:32] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): Put olive oil in the car, yeah.

[33:34] Laura Ann-Moore: Olive oil in your car, petrol in your car.

[33:36] Sammie Ellard-King (diarisation split, brief backchannel): Let’s go.

[33:37] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): Um yeah, so we we saw, and it’s just because normally inflation is supposed to be this gradual thing, but I think the cost of living crisis kind of taught all of us that in the space of a few months prices can really run away from us. So the implication that has for our money is that we should be asking for pay rises once a year of at least as as much as inflation. We should be saving, if we can, at a rate above inflation. So inflation is two, so try and get a rate above two. And then for your really long-term money, investing it. Because when we look at the stock market average, conservative and your return is like 7%. And that’s how you both retain your wealth but grow it over time.

[34:20] Laura Ann-Moore: Yeah. And to add to that as well, I get asked a lot, I’m saving, I’m making five, six percent interest. Why would I invest? And I always say it’s not an it’s not an either or. You don’t save or invest, you save and invest. They have different purposes. Yeah. So I think when you understand that and you go, my money just grows differently in a savings account as it does to an investment account. Sometimes my savings rate will be inflation and my money is still technically growing, but that’s the bit that changes, you know, massively. Obviously, so does money on the stock market and money and assets. But it’s just different when it’s held in cash. So it’s just like becoming aware of the purpose for it and the impact the inflation has.

[35:02] Sammie Ellard-King (host): I completely agree with you both. I think it’s just such a like it a really easy way of looking at it is like inflation is this, interest is this, like minus the difference, and that’s your actual growth. And it’s that what you’re getting from investing. Or you can factor into investing like inflation-adjusted figures, which usually sits around like somewhere between the 6.5 and 7.5%, basically, if you’re basing it off like S&P 500, for example, or something like that. So, like, that’s all you need to do in terms of like working out, and as Timmy says, as long as you’re over it, you’re growing. And that’s really where it ends. But like, obviously, there is the other factor of the fact that like CPIs like average across so many different things, which might not be reflected

[35:47] Sammie Ellard-King (host): in your own life. And I know we spoke about that last week. So do go back and listen to the second episode of Ask Me a Money question. It might have been the first. In fact, listen to both. You’re not doing anything this Christmas. We know you’re not.

[36:00] Laura Ann-Moore: Even if you are.

[36:01] Sammie Ellard-King (host): Even if you are, make it make time. Um thanks, Dominic. Uh love that question actually. It’s opened uh Pandora’s box for sure, and I love it. Um, Julie Wellbourne has said, I want to open a Stocks and Shares ISA, but I don’t want to manage it. What are my options in this case? Timmy, um, what do you would think about this question? So I want to open a stocks and shares ISA, but she doesn’t want to manage it.

[36:27] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): The simplest option would be to research robo advisor platforms. And those are investment platforms where you don’t select your investments. You normally fill out a quiz or you pick from a set number of plans that they’re typically called, you know, cautious, balanced, or or risky. Um, you open your stocks and shares ISA and then you can help myself. And then you uh choose from one of those plans, and then the the platform will manage it for you.

[36:58] Laura Ann-Moore: I would say as well, I think it’s really important to understand the difference when it comes to investing of wanting to have a hands-off approach because perhaps you don’t have the time or not that interested, but then knowing enough to know what’s going on with your money and not completely going, I’ve heard somewhere on the internet I’m meant to be investing, um, I don’t want to do it myself. I don’t even want to know about a tip or what impact it’s gonna have. I just because then when Just take my money and do it.

[37:24] Sammie Ellard-King (host): Just take my money and do it.

[37:25] Laura Ann-Moore: Because and it’s not about getting the most percentage or doing the riskiest thing. I think it’s about having a connection to your money and to investing to go, I know what this is doing for me. I know what this is doing for my life. If you choose, after gaining some knowledge and understanding why it’s important to go, I’m gonna go with a robo advisor and I’m gonna have somebody manage it, or you know, other end, I’m gonna pay an IFA to do it.

[37:46] Sammie Ellard-King (diarisation split, brief backchannel): Yeah.

[37:46] Laura Ann-Moore: Um, totally okay. It’s not that that that’s the issue. I think it’s more just making sure that you have a good understanding of investing, compound interest, and at least what you’re working towards, so that you can then make more educated decisions around your financial plan.

[37:59] Sammie Ellard-King (host): I completely agree. Like the robo advisor, amazing option for people. Like there is that in play, but you know, upskilling yourself two, three hours is gonna save you on the fees because you’re paying more fees usually for a robo advisor. Um, InvestEngine, who, you know, are fantastic. I I happily say this option because I think it’s brilliant, have that expert managed option as part of their thing, which is actually super cheap.

[38:23] Sammie Ellard-King (diarisation split, brief backchannel): Yeah.

[38:23] Sammie Ellard-King (host): Um, and that’s when you’re actually dealing with a real life human being and having that conversation and then putting a plan in place for you there. I think that’s a great option. Like you have robo advisors, but then there are other platforms just like Invest Engine that also do that. And you can speak to a real human, have that kind of hand holding first approach, and then get yourself going and then just, you know, dollar cost average or pound cost average into that every single month, which basically means just putting money in every month. Um anything to add to that at all?

[38:50] Laura Ann-Moore: No. I don’t think so.

[38:52] Sammie Ellard-King (host): Yeah, I think there’s some the beautiful thing about it is that there’s options for different people at different times and different knowledge levels and how much hand holding you want and how much hand holding and how much you’re willing to do it on your own, which I love. Um, just kind of technology has changed the game, and especially for the last four, four or five years. It’s been brilliant. Um, Timi, you touched on this earlier, which was it’s a question from Martin Huggett. Uh, my investment account has reached that £85,000, and I’m now worried about FSCS protection. Um, he’s asking, should I open a brand new stocks and shares ISA account, or is it nothing to worry about, in your opinion?

[39:31] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): Okay, so the rules around this are similar to bank accounts where you’re protected up to £85,000 per financial institution. If you’re investing with a large and reputable investment platform, it’s very unlikely that they will fail. But you can spread your money to other providers so that you’re spreading um your money between different financial institutions. And this is actually a great time to have asked that question because for the first time, you can invest into multiple investment platforms within the same tax year as long as contributions don’t exist uh don’t um exceed 20,000 20,000 pounds.

[40:11] Sammie Ellard-King (host): Yeah.

[40:12] Laura Ann-Moore: Big up him for having 85k.

[40:13] Sammie Ellard-King (host): Yeah, it’s a good it’s a good effort. Um I it’s something that I thought about a lot, and then I just made the decision that the financial um institution that I was with was reputable enough that I didn’t feel comfortable wanting to manage multiple ISAs. And so that was a decision that I made. And, you know, if it comes back to to bite me in the backside, then then that’s a decision that I made. And uh it is something certainly for me to you know think about, but it comes down to that whole like how we spoke about this actually last week. It’s like how asked can you be to have multiple accounts?

[40:49] Laura Ann-Moore: Yeah.

[40:49] Sammie Ellard-King (host): And if you can’t be asked, like keep one. And if you can, then have two.

[40:54] Laura Ann-Moore: Yeah. And I think this raises a good point as well around diversification. If all of your investments, like every bit of wealth that you have, is all just in the stocks and shares that I say, even if that’s diversified across stocks and funds, which is great, you can also consider holding other types of investments, like working towards having property, investing in precious metals. It might not be something that you want a huge portion of your portfolio in, but it’s that adds that extra layer of like where else can I be putting and investing my money? Um, it just makes you start to think about that as you know, start to build your own wealth.

[41:26] Sammie Ellard-King (host): That’s a great point. That’s a great point. You don’t have to be totally that doesn’t have to be your number one strategy. There’s a lot of people it is because they’re just uh they just actually want to do the other thing and then but they still want to be involved in the stock market. But like, yeah, adding in.

[41:39] Laura Ann-Moore: It’s like adding. It’s not like, oh, this isn’t working for me anymore. 100% of my portfolio is this, I need to have you know 90% elsewhere. It’s like, okay, I’ve reached this nice amount and maybe I’ll carry on adding to it. But maybe I’ll take 10% or 20% of what I’m currently funneling over here and I’ll funnel it into X, Y, and Z. Maybe something that’s more alternative and it’s a bit higher risk, or like property, for example, which is, you know, takes a bit longer to build up to, but it’s something that that you can diversify with.

[42:06] Sammie Ellard-King (host): Totally. And it it does any even in this case, you know, 85,000 pounds is a vast majority up north. You can get houses for you know 100, 150,000 pounds. You can be started with a much smaller amount, which is actually really hurts me because of a deposit here. It’s literally down on a bloody house in London these days. But you know, it is what it is, it’s different in for different things. But I you know, it’s something it’s a decision that this guy has to make himself based on what he feels most comfortable with. And if he wants that protection in place, your option, only option, is a second and stocks and shares ISA.

[42:43] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): Just needs to make sure that the type of investment that he wants is actually available on the platform he’s moving to. You don’t want to be in stocks and then move to a funds-only platform.

[42:56] Sammie Ellard-King (host): Or a SIPP with somebody else as well. That could be an option as well.

[43:00] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): So it’s but with the SIPP, you can’t access the money until you’re 55.

[43:04] Sammie Ellard-King (host): True. So there’s access again on that as well. So you do need to think about that too. Really good uh question, that one actually, because you know, there’s not one answer. And often there isn’t in personal finance, which is really interesting. At least personal. Uh okay, well, we’re we’re coming to the end now, and I’ve just got one last question. Um, I’m a higher rate taxpayer, and I want to know is there a better option for me to invest than my pension, or should I just stick with that? That comes from Tony Kay.

[43:34] Laura Ann-Moore: Well, kind of like what we were just saying. Um I think some of the things to think about are accessibility when it comes to investing, like when do you want to be able to access your money? How easily do you want to be able to access it? Liquidity, so how easy is it to then literally turn that asset back into cash? Like, and what your goals are around investing. Obviously, it’s so hard because it’s such a short question. With I’ve I’d have a lot of questions for him.

[44:01] Sammie Ellard-King (host): Me too. But where are you at with everything else and your finances, basically? Yeah.

[44:05] Laura Ann-Moore: Yeah, because a pension is one part of your investment portfolio. And there’s so many other things that you can add in depending on um all those factors.

[44:22] Sammie Ellard-King (host): Um and that should affect like the savings outcomes. Uh anything to add to that to me?

[44:28] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): So if they are a higher rate taxpayer and they’re paying into a pension, when you’re a basic rate taxpayer and you save into your pension, you get tax relief on the money that’s paid in and that’s done automatically. But when you’re a higher rate taxpayer, you need to do that yourself via self-assessment tax return. So that’s the one thing I would say to them that they make sure that they do that.

[44:48] Sammie Ellard-King (host): Free money, man, it’s crazy. Like you just do a self-assessment and they pay it through in your account in cash, and you can backdate it as well if you’ve been a higher tax rate payer as well, which is pretty crazy. So a friend of mine did it and he got four years back, and it was a really nice chunk of change. Which he actually used for to pay for his wedding ring.

[45:06] Laura Ann-Moore: Huh?

[45:06] Sammie Ellard-King (host): For his wife or engagement ring.

[45:08] Laura Ann-Moore: That’s nice.

[45:08] Sammie Ellard-King (host): Yeah, it’s nice. Yeah, really nice. I know. Yeah, guys, I’ve loved this. Thank you so much. And um, you know, if anyone listening to this wants to get their question answered by me, Timmy, or Laura, um, then you can send in. We’ve left the email in the description below. Please do send them in. If you have any wicked money stories or anything that’s uh fun that’s happened to you, or any sort of things you want to divulge, please do let us know. And uh we’ll see you guys on the next one. Thank you very much, guys.

[45:36] Sammie Ellard-King (diarisation split, brief backchannel): Thank you.

[45:37] Rotimi “Timi” Merriman-Johnson (Mr MoneyJar): Thanks for having us.