Financial wellbeing tips for working in a crisis

Financial wellbeing tips for working in a crisis

Financial wellbeing tips for working in a crisis

 

84.2% of adults in Great Britain say that they are ‘worried’ or ‘very worried’ about the effect Covid-19 is having on their life, and just over half said that it was affecting their wellbeing.

You might be struggling with your wellbeing during Covid-19. Managing everyday life and engaging with your work might have become challenging, and you might also be finding it harder to keep up your regular exercise routine. Perhaps you’ve encountered an impact on your finances which is causing you stress?

All of this is understandable at this unprecedented time. While there are many traditional resources available to help you, during a time of crisis, the usual advice and rules might not apply. This guide will cover how to notice difficulties and improve your mental, physical, and financial wellbeing.

Many of us are going through a change in our employment situation right now, which might be leading to financial worries.

That’s why Bippit, the app which provides you with a dedicated financial expert, has put together the following guide to help you look after your financial wellbeing during a crisis.

 

Reducing your outgoings
  • Take a look at your current financial commitments and see whether there are any services that could be frozen or cancelled.
  • Subscriptions to services such as music streaming platforms or Amazon Prime often offer the ability to freeze your membership, so you can come back to them once your finances are more predictable.
  • Review your utilities and other bills to make sure you are getting the best deal. Bill switching can save you hundreds of pounds a year, so why not give it a try on comparison websites like this one?
  • Did you make any holiday plans before Covid-19? If you’ve had to cancel them, you might be entitled to a refund. Contact the companies you booked with (bear in mind that many people are in your situation, so you might have to wait to receive your money).
  • If you have any other expenses for activities you can’t do remotely, check whether you can get a partial refund. These might include after-school clubs and sports clubs.
  • You might be going out less – try putting the money you’d normally spend towards savings or paying off a debt that’s been hanging over you.

 

Check what you are entitled to

Many of us are facing real lifestyle changes as a result of the pandemic – and we’re not just talking about keeping our distance in the supermarket. With schools closed and some family members vulnerable, you might find that you have more people depending on you.

You don’t have to go through it by yourself: the Government might be able to help you. In fact, millions of pounds of benefits go unclaimed each year. Visit www.gov.uk to find information on benefits, support, and other services.

Keep lines of communication open with your employer

Many of you are facing difficulties and anxiety during this scary time as shown in the graph below:

Concerns about household finance

Perhaps you’re worried about:

  • Decreased working hours
  • Work and childcare commitments
  • Workplace closures
  • Being asked to work from home

Now, more than ever, it’s important for everyone to be on the same page. Talk to your manager or HR department if you’re concerned – finding a solution that works for everyone means you’re supported, and business goes on.

Help is available: 83% of employers have already put support in place, and some workplaces are offering services like Bippit to provide expert guidance during this time.

 

Get professional financial guidance / Ask for help

If making big financial decisions right now seems daunting to you, know that you are not alone. Looking after your financial wellbeing often requires expert support, especially in these very uncertain times. To get professional support, there are few options available to you. You could use crisis helplines such as Money Advice Service, Turn2Us or Step Change or choose to speak to an Independent Financial advisor directly.

There are a huge number of benefits to using a financial advisor, and a recent report by Royal London suggested that getting expert help could increase your wealth by up to £50k over 10 years.

The great thing about discussing your finances with a professional is that they can explain complex topics in a way that makes sense. They can help with a range of issues, whether that’s investing in the stock market, organising your pension, getting on the property ladder, or simply guiding you through the support that might be available to you. So whatever’s on your mind, with apps like Bippit, an expert can provide you with professional financial guidance that’s tailored to your needs.

For more details on how to improve your overall financial wellbeing, please check our guide on how making small, smart changes can boost your bank balance, health and productivity.

A financial guide to the 7 stages of your working life

A financial guide to the 7 stages of your working life

A financial guide to the 7 stages of your working life

 

Throughout our working lives, it’s essential we look after our financial wellbeing. As an employee or a business owner, being financially well is as important as our mental or physical wellbeing, but it’s less to do with our income, and more to do with our attitude towards money in the long-term.

With that in mind, we’ve written a guide of how you can plan your finances better at various stages in your life.

Stage 1: Starting out into the world of work

So here the story begins.

You’ve just finished your education, and now you have the freedom to build the life you’ve always dreamed of. It can feel daunting at first, and you may not even know yet what kind of career you really want to go for, but you’ve taken your first job, and you’re now starting to earn your living. Right about now is a good time to start developing better financial habits!

As surprising as it sounds, 21% of us don’t save, and as many of 11 million of us in the UK have less than £100 in savings. Break the cycle and put money away in your savings account, because the earlier you invest in your future, the better.

As a matter of fact, when you save is far more important than what you save, because the longer you leave savings or investments untouched, compound interest will do more of the heavy lifting, to make your money work for you, year on year.

So how would compound interest work? If you save £5 a day in an account with a 10 percent annual return, you’ll have around £30,000 in 10 years, £330,000 in 30 years and £2.3 million in 50 years. NB: The average annual rate of return over the last 90 or so years has been around 10 percent. After adjusting for inflation, it’s closer to 8 percent, however.

While you’re tucking money away, be sure to understand your income, and learn not to spend more than you earn. A great method that can help you keep a lid on it is the 50/20/30 rule. The idea is that you spend:

  1. 50% on your essentials (bills, rent, etc.)

  2. 20% on your financial goals (savings, house deposit, paying off debt)

  3. 30% on what you love!

With a little help from apps like Bippit you can visualise your finances in a snapshot, because having a grip of your day-to-day choices is the first, and most important step to building your future.

Stage 2: Progressing in your career

Now that you’ve played the field a bit, and you’ve got a better idea of your ideal career path, it’s time to start working your way up the ladder.

A great way to begin is to find out what your skills and experience are valued at. Adzuna provides a free service, which scans your CV and works out what you could be worth. It’s important that you feel valued in your job, for both your financial and mental wellbeing. If you feel you’re being underpaid for your work, maybe it’s time to look at professional training or adding extra qualifications under your belt that will give you more legitimacy when pressing for a promotion or asking for a raise.

Getting a raise will allow you to start thinking about how to apply your extra cash to your financial goals, whilst making sure that your lifestyle doesn’t eat into it too much.

A sneaky way of doing this is to direct that extra salary into a savings or investment account on payday, without you even seeing it. Automating savings will allow you to discipline yourself to grow your wealth, so make sure you set up a direct debit with how much you want to save on payday.

Stage 3: Congrats, you’ve taken your relationship to the next level!

If you’ve decided to settle down and take your relationship to the next level, now is a good time to start discussing your finances with your partner, and an even better time to talk to an advisor. They can help you reap the tax benefits and mortgage allowances when the two of you start thinking about getting a house.

While there are benefits, it’s also important to consider the serious stuff. It’s a good time to start looking at protecting your family and any assets that you may have. With the help of an advisor, you can find a good set of options for home, health, and life insurance just in case the worst happens. We know it’s not nice to think about this, but having that protection can help us feel secure regardless of what happens in the future.

Also, start writing a will. It’s not just for the elderly, so be sure to decide on your power of attorney (the person who will take care of things if you can’t) and beneficiaries in case of an emergency.

Stage 4: Getting onto the property ladder
When you start saving for a home, it’s important to make a plan that takes into account all the ongoing costs of owning a home – property taxes, repair & maintenance, interest, and all the other bits and bobs – so it may be worth speaking to a mortgage advisor who can help you on the finer details of the house you want to purchase.

There are plenty of online mortgage advisors who make it easy to find out how much you can borrow. House prices can fluctuate, so, with your advisor’s guidance, decide on a target price you’re aiming for, and figure out some lower or upper bounds to stick to. Of course, it would be great if we could all own our dream home, but it’s better to be realistic and ensure it doesn’t put stress on our assets.

Stage 5: Starting a family

Kids are very expensive…

Firstly you may want to consider a savings or investment account specifically for university and school fees. The most recent Cost of a Child report from Child Poverty Action Group reveals that the basic cost of raising a child until the age of 18 (including rent and childcare) is £74,333 for a couple and £102,620 for a lone-parent family. The cost of education has been increasing over recent years, and so it’s important to plan years ahead to make sure as many options as possible are available for your children’s future.

If and when you do start a family, the number one rule here is to expect the unexpected (just like everything else in life), so it’s the most important time to be thinking about protection for your family and your assets. If you’re expecting your first child, then certainly start looking for life and health insurance coverage, and write your newborns into your will to give you peace of mind.

Stage 6: Reaching your peak earnings

If you’ve read this blog post all the way to stage 6, then you should be proud of yourself for being a truly long-term thinker. It’s natural to value what we have right now more than what we may have in the future, so it’s not surprising that 61% of us don’t think about the long term, and at least 1 in 3 of us aren’t confident about retirement. By the time you reach your 40s, it’s common to be earning the most income that you ever will, but it’s also a time when you’re under a lot of pressure. You really don’t want to burn out, so be sure to take care of yourself, and also take control of your finances, as it will really make a difference to your stress levels.

If you can, find some time to start thinking seriously about your retirement, and how to start building your wealth further if you haven’t already.

The first place to start is by putting as much into your retirement pot as you can. Many of us don’t actually put enough money away for retirement and this could be due to the fact that we don’t always know how much we will need. You can use a pension calculator like PensionBee to find out exactly how much you should save towards your retirement fund on a monthly basis.

You may also have moved jobs many times over the years and may have multiple pensions pots. Now might be the right time to consolidate your different pension pots into one, which could save you money on fees and help you better manage your retirement goals.

It’s also a great time to speak to your advisor to assess your investments and make sure they align with your retirement goals… is Friday night bingo in the budget? Financial advisors can also work out the best tax deductions so you can save as much as you can and make it last for the rest of your life.

Stage 7: You’re getting ready to retire

You’ve spent years working your whole life, so it’s time to sit back, relax and enjoy your retirement.

Having a waterproof plan for this can help you live life to the fullest in your later years, because you’ll be secure both in the present and for the future.

The best time to get this properly organised is in your early 50s, as you’ll have plenty of time to start planning your retirement income. If you’ve used an app like Bippit for all of your working life, there’s probably no need to sit down and work this all out. You’ll be able to see clearly how much you’ve saved for your retirement goals.

Budgeting is an essential aspect of retirement, so try and think of how you can cut costs on things you don’t need while living the life that you truly value. Remember, we’re all living much longer now, so hopefully, this money will have to last you a significant amount of time.

Perhaps you could be just as happy in a smaller place and own a cheaper car? The earlier you consider this, the more time you’ll have to make sure everything works out.

A general rule of thumb is that if you’re unsure you have enough cash to get you through retirement, you should have 25 times what you plan to spend each year. So, if you want to spend £10,000 a year, you should have at least £250,000 in your retirement fund earning interest or growing with the market.

So, how can you start?

We know that’s a lot to think about. After all, it is your entire life story…

Remember that life planning is all about thinking about the long-term, and we all have to take it one step at a time. It may seem overwhelming at first, but there are a lot of tools that can help you. Why not have a chat with one of our advisors? They can help you take the first steps in planning for a secure and stress-free working life!

What should I ask a financial advisor?

What should I ask a financial advisor?

What Should I ask a financial advisor?

 

According to a recent study, the value of using a financial advisor is a staggering £47K in average additional wealth per person; encompassing an extra £31K of pension uplift, and over £16K in non-pension wealth, so there can be no doubt that a financial advisor can positively change your overall financial situation and increase your income for retirement.
 
Whether you’ve worked with a financial advisor before, or it’s your first time, knowing the most constructive and worthwhile questions to ask them can seem daunting. However, it’s a valuable opportunity to receive meaningful guidance to help you achieve financial objectives. If you’re nervous about asking a “silly” question (by the way: there are no silly questions) or unsure how to maximise the value of a financial advisor, you’re not alone.
 
As the experts, advisors will usually facilitate the conversation, so you don’t need to worry about knowing exactly what questions to ask; you only need to get the conversation started. So, we’ve set out some ideas of the questions you should be asking depending on where you are in your financial journey, as a helpful place to get going…
 
If you’re at the start of your financial journey
At this point, you might have only just started to make waves in your career or perhaps beginning to build notable savings for a deposit to buy your first property or to set up an emergency fund.
 
  • How much should I be saving each month?”
  • “How do I start saving?”
  • “Should I start investing?”
  • “How much do I need for a house deposit?”
  • “How do I decide what my financial goals are?”
Knowing where to begin when it comes to investing in your future can be complicated. You might even feel that approaching a financial advisor for counsel when you’re not even sure what you need guidance on is preventing you from making decisions about your financial future.
 
However, approaching an advisor doesn’t need to be intimidating! Practically speaking, being in your twenties and thirties means that a lot of future financial projections apply to you as much, if not more than, an age group that presently has more financial considerations. Housing markets, Brexit uncertainty, student loan debts, budgeting and planning are just a few of the considerations about your future that the earlier you pay attention to, the better.
 
If you’re in the middle of your financial journey
as you approach this stage in your life, your priorities are changing – as should your financial planning.
 
  • “Should I get a joint account with my partner?”
  • “Can I afford to take a career break?”
Maybe you’re thinking about starting a family, remortgaging a house or changing career paths and you’re not sure what to prioritise – your pension, mortgage or your ISA. Maybe you’re worried about the financial responsibility of a child, and where those six – or was it seven? – pension pots from previous jobs are sitting now.
 
  • “What should I be considering when I remortgage?”
  • “How much should I be paying into my pension?”
  • “Should I combine my pensions into one?”
  • “How much will a child cost?”
At this point, guidance from an advisor will help you assess your finances and find the correct balance you need between spending and saving, as your earnings and expenditures usually peak and retirement planning grows in importance. With a financial advisor, you can navigate those tricky questions around appropriate trade-offs between mortgage payments and pension contributions, savings and investments, and assess whether your current arrangements are the right mix to support your financial goals.
 
If you’re at the end of your financial journey
the golden years – hopefully, quite literally.
 
  • “How should I approach estate planning?”
  • “How long will my pension last?”
  • “Is my Will up-to-date?”
  • “How do I financially look after my grandchildren?”
 Sound familiar? You’ve likely already been thinking about your retirement for some time, or you might already be retired. Either way, you’ll probably be assessing the funds you need now and in the future, and the decisions you need to make may affect your standard of living for the rest of your life.
 
Not only can a financial advisor guide you through the options around taking your pension, but also everything from inheritance tax and protecting your estate from the taxman to will planning and protecting your assets for those you leave them to; whether that’s your children or an alpaca sanctuary.
 
At Bippit, we’re dedicated to supporting financial peace of mind throughout your lifetime by making it affordable and straightforward to access expert financial guidance. Before now, speaking to a financial advisor could cost you hundreds (even thousands) of pounds per hour, and you’d usually not even be able to meet with one unless you already had £50K in personal wealth. We’re democratising the financial advice landscape by reducing the cost by more than 10x (compared to traditional services).
 
So, wherever you are in your financial journey, and whatever your current financial goals are, you can receive expert guidance delivered by financial advisors and tailored to your unique financial situation. You don’t even need to leave your home; message advisors directly from your phone via our app!