Proud parents of a financial bombshell!

Following on from Jessica’s lovely blog post, and also from a Consumer Finance Education Body seminar I went to last week, I thought I’d bring family finance to the fore this Friday (what a lot of F’s!).

Like it or not, sometime in your life a big financial bombshell is likely to come your way. 

One of the biggest of these is a baby. Yes, I know babies are actually quite tiny things but, boy, they can wreak some huge havoc!

Aaaah! I think she's got your nose. And my savings.

So I was dead impressed by all the advice that’s waiting for expectant parents over at the money made clear website.  And I was surprised to see that quite a lot has changed since I had babies (apparently they don’t make you bite on a bit of wood during delivery any more! And Dads can have time off too!)… 

in particular I learned that:

·      Yes, most Dads can have two weeks’ paternity leave (start lining up the jobs for him now)

·      Expectant mums are entitled to paid time off for antenatal care (no need to take a day’s holiday or throw a sickie)

·      Mums may get help with childcare costs while studying or retraining (perhaps go for a Crowd Control qualification if you’re having a large brood?)

·      Even if you’re self-employed you can usually claim Maternity Allowance (if you’re a self-employed financial advisor you probably know this)

·      Dads can pay into a pension for their partner (this I did know but it really is worth repeating –anything to stop women’s pensions taking more of a hammering).

www.moneymadeclear.org/parents

So if you’re the type who thought that planning a family just involved sex and knitting (not at the same time) it might be advisable to get yourself over to www.moneymadeclear.org.uk/parents/ 

Just to make absolutely sure you don’t do something you regret. I’m speaking financially here. You cannot take babies back and ask for a refund.

Working Mums...it’s not (necessarily) about the money

THIS WEEK WE'RE THRILLED TO HAVE A GUEST BLOG POST FROM JESSICA CHIVERS. JESSICA IS THE THINKING WOMAN'S COACH AND HER BOOK MOTHERS WORK! WILL SOON BE PUBLISHED BY HAY HOUSE, HELPING MUMS TO GET A GRIP ON GUILT AND MAKE A SMOOTH RETURN TO WORK.

“But you don’t need the money so why are you doing it?” is a common reaction to a mum bemoaning the difficulties of combining paid work, a caring role and household duties (the so called ‘triple bind’ of working motherhood). 

But that misses the point of why many women go to work, mother or not.

In a survey of 200 working mothers I discovered money really isn’t the be-all and end-all of working. 

But then I think we all knew that anyway. 

Given the option to escape a demanding preschooler,  service your brain cells, go to the toilet in peace and get apreciated for doing something well that you enjoy, surely you’d grab it with both hands?

Whilst many mothers want this, the financial cost of working can be prohibitive. The average annual cost of a nanny outside London is £22,220 gross. That’s about £93/day with four weeks holiday pay (NannyTax wage survey 2009). Not bad for the nanny. But fairly grim for the want-to-be-working mum. When writing my book, Mothers Work! I met several mums who’d love to go back to work, but can’t make it pay. Like the cook with three children under five, and the events manager who couldn’t finance the childcare for the long hours the job demands.

So what can we do about this? One: we need to get creative about the way we organise childcare. Two: we need to become better negotiators. That includes pay rises, pitching for promotions and asking for flexible working.

It’s been said that men will apply for a job if they can do 30% of it.  Whereas women who can do 70% of the job will um and ahhh over the 30% they can’t do.

As women,we need to claim back our confidence and ask for what we want. That might mean asking dare I say it (*mock shock horror, Edward Munch hands of face pose*) daddy to ask his employer about flexible working so he can do more of the childcare. Or having the brass neck cheek to demonstrate why a pay rise is in order in the middle of a recession. I could go on.

Think of the money gained if you could work one day a week at home (OK, it would actually be two evenings - there’s no way you’d get more than an hour’s work done with a toddler – the guilt would get you before he got bored of the telly). And think of the extra saved for a rainy day if fathers were ‘working from home’ on another day too.

For some there may be the option of roping in the friend or rellie who thinks being around children all day every day is such a good thing that they question why you’re working when you don’t need to....

Do what you need to do and ask for what you want!

THANKS JESSICA  - INSPIRING WORDS AS ALWAYS. FIND OUT MUCH MORE ABOUT JESSICA ON HER FABULOUS WEBSITE (PACKED WITH TIPS AND INSPIRATION)!

Will seeing our older self change what we do?

Mid-life woman comes across a frog.

“Kiss me, kiss me and I’ll turn into a handsome prince” says the frog.

Mid-life woman looks at the frog.

“Go on”, he says, “aren’t you going to kiss me?”

“At my time of life”, mid-life woman says,“ I think I’m actually more interested in a talking frog.”

Let’s face it, our needs change as we get older. I’d be the first to admit that a bacardi breezer only appeals because it has the word cardi in it. But as humans we’re pretty rubbish at predicting the needs of our future selves. Hence we’d rather spend now than save for the future. And ‘pension’ is not the coolest word in a at twenty-something’s vocabulary.

Psychologists are keen to know how we can close the psychological distance between the ‘present self’ and the ‘future self’. Because for some of us our future self is so remote it could be another person, a complete stranger in fact. And we neglect that person at our peril.

Hal Ersner-Hershfield from Northwestern University USA summed it up like this:

To those estranged from their future selves, saving is like a choice between spending money today or giving it to a stranger years from now.

In my lab we’re carrying out a neat experiment to see if we can bring people closer to their future selves. We’re making them look at images of themselves when older (using computer technology). Then we’re asking them about their motivations to save, quit smoking and live a healthier life. We’ll compare the results with people who simply look at images of their present selves.

I’ll let you know what we find.

This is me after ageing technology has been applied (not after a heavy weekend).
Not sure I'll really get wrinkles on my fringe though...

Women's state pension age delays

The Government has just published its timetable for raising the state pension age faster than previously planned.

More women will have to wait longer before being
 able to splash out their pension money.

Most women face a delay of a year, picking up their pension book at 66 rather than 65 years of age. However, more than half a million women face a delay of over a year. Of those, 300,000 face a delay of more than 18 months and 33,000 a delay of two years.

Click HERE to see the old and new dates for women born on 6 April 1953 to 5 April 1959.

A woman's pension age also sets the qualifying age at which she can claim pension credit, winter fuel payment and free bus passes in England. If we needed another reason to provide for our own retirement and not depend on the state, here's one.


Story from BBC NEWS: http://news.bbc.co.uk/go/pr/fr/-/1/hi/programmes/moneybox/9119246.stm

Guest blog from Allison Mitchell

THIS MONTH WE ARE THRILLED TO HAVE A GUEST BLOG FROM ALLISON MITCHELL.
Allison is the brain-child (like that Allison?) behind MANICMUMS.COM. 
She has applied her wealth of expertise about time-management in business to making home life more streamlined, efficient and... well, less manic. 
And since, as they say, time is money we thought we'd love to have some wise words from Allison here....

Put off Procrastination!

The cost of putting things off is always greater than the price of doing them. There, I’ve said it. 

At its most simple, the dish washed straight away is done quickly, the dish left overnight requires effort to tackle the crusty residue. 

But we’ve all done it, haven't we?  The report written in the dim glow of midnight oil, the jerry can walk of shame, when the car was running on vapor, wearing yesterday’s knickers when the cupboard was bare (or is that just me?)

Anyway, if your life swings along to the tune of, ‘The Sun’ll Come Out Tomorrow’  and you live in the knowledge that tomorrow is always a day away, you could well be living with the emotional costs of procrastination on your bottom line. But, it’s not all psychological, have you ever calculated the hard financials?

What about the cost of that parking fine?

‘Manana,’ the ticket whispered sweetly in your ear until the fee doubled.

And hey, why were you ticketed in the first place? Oh yes, you left for the interview at the last gasp and had to park on double yellows.

‘Tomorrow, tomorrow, I love you tomorrow,’ said the tax return, due January 31st, but oops, before you knew it, February arrived, along with the penalty notice.

I could go on, but you’ll think I’m a nag. Suffice it to say, if you're the kind of person who wouldn't leave a burning building until the flames were licking their bottom, then it may be worth considering what procrastination is really costing you. Please, please don’t say you’ll think about it later!!

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Thanks Allison, find out more about Allison's work here.

Numeracy starts in the nursery (or don't teach your toddler trigonometry)

Nowadays you don't have to be good at maths to be good with money.
With all the modern wizardry around- from calculators to on-line budgeting tools - only dinosaurs would be seen dead reciting their times tables.

But did you know that numeracy starts in the nursery?

Yes, a recent study from the US* found that when parents spoke more number words to their infants, the kids had better mathematical knowledge at age 3. Since early mathematical ability predicts later academic achievement there's a good chance these kids would go on to do better at school.

Numeracy is an innate ability. Even pigeons can count and chimps can do fractions**.  So your little ones have brains that are hard-wired to understand numbers.

Chimps also have amazing memory for numbers- bet you can't beat this one!

But I'm dead against hot-housing children so don't start teaching your toddler trigonometry whatever you do.

You could try dropping more number words into daily conversation and routines though. 

Perhaps the next time your two year old has lunch, instead of saying 'I'll cut up your veggie-burger', try saying 'I'll cut your veggie-burger into four pieces'. 

Of course the downside is she'll start telling you 'that's Mummy's fourth glass of wine', but by that time you'll be past caring.



*by Levine et al from University of Chicago, published in Developmental Psychology
** Woodruff, G., & Premack, D. (1981) Primitive mathematical concepts in the chimpanzee. Nature, 293, 568-570.

Don't drive miles for cheap petrol.

This photo was taken on a visit to Liverpool last year....ooh, makes you want to rush in there for some health advice doesn't it?

On the rare occasions that I visit the gym (I know, I know) I always get really miffed if I can't find a parking space close to the entrance. As if walking a few hundred yards isn't exactly what I need to do.
Are you a living bundle of contradictions? Now there's talk of reducing the price of petrol, are you tempted to drive around looking for the cheapest deal?
Do you eat ready meals while watching cookery programmes? Lie on the sofa watching a fitness video?  Slouch around wearing jogging pants and running shoes?

Well, can we suggest you sprint over to the money made clear website  for a workout that most of us could do with at this time of year. Financial fitness here we come.

We particularly like their 'Give your money a workout' article.
You can gorge on all their solid, sensible, straightforward advice  - and it won't cost you a penny.

Poorer men prefer larger women

Following the recent tragic death of the anorexic model Isabelle Caro, fingers have been pointed at the fashion industry and the media who brandish images of these emaciated forms.

But did you know women’s preferred body sizes are determined by men’s economic circumstances?

Ideals of female body shape vary across cultures: Men in cultures with scarce resources tend to prefer heavier women, whereas men in cultures

with abundant resources prefer thinner women. In all cultures, men who are hungry will select a larger female shape as their ‘preferred’ size. That, apparently, is all down to perceptions of resource scarcity.

Also just making men feel they’re poor makes them prefer a larger woman.

US researchers* made men think about how much money they had on them. Those who realised they were-cash-strapped preferred heavier women.

They also asked men about their wealth. Some answered on a scale from 0 to $500, others on a scale from 0 to $400,000 (a scale that makes people feel relatively poor). Sure enough, men who responded using that scale subsequently selected larger females as their preferred shape.

What’s more interesting is that it doesn’t work the other way round. Women’s preferred male shape is unaffected by how hungry or poor they feel.

Ben and I have been discussing this at length. He’s not keen on all those evolutionary explanations, which I have to admit are a bit too convenient and can’t be refuted empirically. He reckons it’s because men are more visually triggered – this renders them more susceptible to priming effects. I would add that maybe women just aren’t that shallow.

Maybe one good thing that will come out of the age of austerity is that the more men tighten their belts the more women can loosen theirs.

*Psychological Science 2005 16:167. Leif D. Nelson and Evan L. Morrison

The Symptoms of Resource Scarcity : Judgments of Food and Finances Influence Preferences for Potential Partners.

10 easy money actions for the financially challenged

...or the financial phobic.

None of these are scary. Or difficult.  But they could make a huge difference to your financial health.

Decide how many of them you will tick off this year: 

1.    Get on-line banking (if you haven’t already). Stick a weekly reminder in your diary to check your statement. Marvel at (or bemoan) where the money goes. Tackle leaks.

2.    Charity shop. Devise a whole new image based on charity shop finds. You can always restyle or dye stuff. Fashion victim = financial failure.

3.    Perform some plastic surgery. Cut up credit cards and just use cash. Slash and burn store cards, show them no mercy.

4.    Learn about compound interest. It’s how investments grow and why debts go ballistic. Spend 5 minutes getting to grips with it here. Feel immediately enlightened. Smug even.

5.    Sweep some money into a savings account. Every month. Do it by direct debit. You won’t miss it going out but you’ll love it piling up.

6.    Ask someone for money. Now. Nag your boss for a rise. Call in debts. Haggle for a discount on your next purchase. Take something back, demand a refund.

7.    Make kids earn money. Stop being their cash cow. Make them get a job or sell old toys on eBay. Threaten to charge them rent. If they’re over 18 charge them rent. Be less tough on toddlers.

8.    Deal with credit card debt. Transfer to a 0% interest card. If your savings earn less interest than you’re paying on your card, use them to pay off the debt.

9.    Play the long game. Give your future self a gift. Boost pension payments (or start one). Over-pay on the mortgage. Take out a 5 or 10 year high-interest investment.

10.  Stem the flow of wasted money. Unused gym memberships. Forgotten magazine subscriptions. Thirsty cars. Taxi/takeaway/smoking/alcohol habits. Put what you save into a separate account, just for you.

Don't lose out in divorce!

Did spending two weeks cooped up, snowed-in and turkey-bound put a strain on your relationship? 

Was it the iron he gave you for Christmas, or his failure to mention that his mother was staying for ten days, that finally had you slapping the words ‘quick divorce’ into google?

Hold on a minute. Remember that a marital break up isn’t just for Christmas, it’s for life. So don't make decisions that might cost you later on. The common view is that men get fleeced by women in divorce settlements. The reality is quite the reverse.

A study by the Institute for Social and Economic Research found that divorce often rescues men from poverty while plunging women into it. The incomes of ex-husbands rose by 25% immediately after a split. Yet women saw a sharp fall in their finances, which rarely regained pre-divorce levels.

Sadly, 27% of women ended up living in poverty as a result – three times the rate of men – and only 31% received maintenance payments from ex-husbands for their children.

Now help is at hand in the form of the Moneymadeclear divorce and separation

website. 

This site brings together loads of useful financial information, plus impartial help with financial issues, including:

• thinking about divorce or separation

• the steps involved

• if you have children

• living arrangements

• splitting what you have – using an interactive online calculator; and

• managing your money.

With the moneymadeclear interactive online calculator you can draw up a budget to help you:

·      work out what you have and what you owe (it suggests a number of actions you can take)

·      look at how you can split what you have (it explores different scenarios and helps you prepare for discussions with your partner, solicitor or mediator)

This is the first calculator of its kind. And it's been created with help from experts in this field, including Relate, Resolution, National Family Mediation, Families Need Fathers and the Family and Parenting Institute.

So much better to hit him with some plans, straight facts and plain talking than with the iron.