WEBVTT - Money on Tap: Why Easier Isn’t Always Better 0:00:00.240 --> 0:00:03.060 This series is brought to you by LNG, helping you 0:00:03.060 --> 0:00:05.010 build a future that's a little bit richer. 0:00:06.480 --> 0:00:09.360 Hello and welcome to A Little Bit Richer, brought to 0:00:09.360 --> 0:00:13.410 you by LNG with me, Iona Bain. In today's digital 0:00:13.410 --> 0:00:17.670 world, our culture has shifted from cash to cashless and 0:00:17.670 --> 0:00:20.790 it's affecting how we manage our spending and future finances. 0:00:21.390 --> 0:00:23.340 Today, we want to talk about the role of cash 0:00:23.340 --> 0:00:25.500 in society and what we can do to put some 0:00:25.500 --> 0:00:28.710 friction back in our finances when our money is increasingly 0:00:28.710 --> 0:00:31.650 digital. Here with me to discuss all this is friend 0:00:31.650 --> 0:00:35.699 of the show, Emmanuel Asuquo. Emmanuel is a financial advisor, 0:00:36.000 --> 0:00:42.629 TV presenter, motivational speaker, best-selling author with 15 years experience in financial consulting. 0:00:44.430 --> 0:00:45.420 Welcome back, Emmanuel. 0:00:45.659 --> 0:00:46.350 Hey, Iona. How are you? 0:00:46.830 --> 0:00:49.890 I'm good, thank you. Eman, we're seeing a lot online 0:00:49.890 --> 0:00:52.110 now about people returning to cash. 0:00:52.170 --> 0:00:52.680 Yes. 0:00:52.860 --> 0:00:55.410 Why do you think that's happening and what are the 0:00:55.410 --> 0:00:56.610 benefits of using cash? 0:00:56.670 --> 0:00:59.220 Yeah, I think the reason I'm seeing people return to cash 0:00:59.220 --> 0:01:03.120 is just the fact that contactless is such a disconnect. 0:01:04.260 --> 0:01:06.600 One of the hardest parts about money is the fact 0:01:06.600 --> 0:01:09.240 that every day you step out of your house, somebody's 0:01:09.240 --> 0:01:11.729 trying to take money from you, not in a bad 0:01:11.730 --> 0:01:14.640 way, but just, " Here's a service that you can take," or, " 0:01:14.640 --> 0:01:17.069 Here's a product that I think you'd like." When you 0:01:17.069 --> 0:01:19.950 can tap that away, you have all the access to 0:01:19.950 --> 0:01:22.590 all your money. Money just continues to go, and I 0:01:22.590 --> 0:01:24.720 always tell people, " Money flows. It comes in and it 0:01:24.720 --> 0:01:27.090 goes out." If you don't find blockers or you don't 0:01:27.090 --> 0:01:29.160 find ways to put your money in certain places, it 0:01:29.160 --> 0:01:30.690 will just leave your hands no matter how much you 0:01:30.690 --> 0:01:34.410 make. If I have 50 pounds and I'm only using 0:01:34.410 --> 0:01:36.750 cash, I can only spend the 50 pounds I have. 0:01:36.840 --> 0:01:39.360 No matter how much I want to spend 100, I 0:01:39.360 --> 0:01:44.250 have access to 50. It helps you stop yourself when 0:01:44.250 --> 0:01:46.770 that impulse comes in because you're limited. Then, if you 0:01:46.770 --> 0:01:47.760 want to go and spend more, you have to go 0:01:47.760 --> 0:01:50.850 to the cash machine. When it's just tap, it just 0:01:50.850 --> 0:01:54.030 so simple, so easy, and it goes so fast. That's 0:01:54.030 --> 0:01:56.370 why so much more people are coming back to cash 0:01:56.370 --> 0:01:58.830 as a way to fill that connection to money because 0:01:58.830 --> 0:02:01.470 there's a pain. There's no pain when you're tapping away. 0:02:01.980 --> 0:02:03.810 I think that's why people are coming back to cash. 0:02:04.080 --> 0:02:06.600 Do you think that that shift in mentality can also benefit 0:02:06.600 --> 0:02:08.850 you if you're shopping a lot online? What you were 0:02:08.850 --> 0:02:11.940 describing about leaving the house and having commercial pressures, you 0:02:11.940 --> 0:02:14.100 don't even have to leave your house now. It's all 0:02:14.100 --> 0:02:17.910 there in your pocket on your phone, constant inducements to 0:02:17.910 --> 0:02:20.100 spend money through social media and internet shopping. 0:02:20.370 --> 0:02:23.220 100%. I do this thing with my clients where I 0:02:23.220 --> 0:02:25.620 tell them, " Look, we've got a 48- hour rule," so even 0:02:25.620 --> 0:02:27.240 if you see the thing you want to buy and it's 0:02:27.240 --> 0:02:29.310 on sale and you're just like, you got to wait 0:02:29.310 --> 0:02:31.919 48 hours. Do you know that with my clients, something 0:02:31.919 --> 0:02:34.320 like 75% of the time, they do not end up 0:02:34.320 --> 0:02:37.139 buying it when they're back in their right mind. There's 0:02:37.139 --> 0:02:40.020 something about when you're online and you're spending and the 0:02:40.020 --> 0:02:41.970 deals are there and you think about, " Oh, I'll do 0:02:41.970 --> 0:02:43.980 this there and I'll do this there," and when you 0:02:43.980 --> 0:02:45.840 walked away and come back, you realize, " I got something 0:02:45.840 --> 0:02:48.240 similar in my wardrobe already," or, " I don't actually need 0:02:48.240 --> 0:02:51.030 that," but in the moment while the adrenaline is pumping, 0:02:51.150 --> 0:02:52.919 you feel like, " I need this now. I can't live 0:02:52.919 --> 0:02:55.500 without it." Just giving yourself that gap. You could go 0:02:55.500 --> 0:02:57.600 to every shop you want to go to without ever 0:02:57.600 --> 0:02:59.910 leaving your house, and it becomes dangerous. There needs to 0:02:59.910 --> 0:03:02.310 be a delay. We've got more stuff than we actually need. 0:03:02.639 --> 0:03:04.350 Delays are good for us sometimes. 0:03:04.350 --> 0:03:06.030 Exactly. There needs to be a delay. There needs to 0:03:06.030 --> 0:03:08.190 be a pause to actually say, " Do I need this 0:03:08.310 --> 0:03:10.290 right now, or am I just buying this because I 0:03:10.290 --> 0:03:13.410 have the ability to?" Again, sometimes we are emotional spending. 0:03:13.680 --> 0:03:15.840 It's the, " I don't feel so good today, I'm going 0:03:15.840 --> 0:03:17.970 to buy myself something." " I've had a great day. I'm 0:03:17.970 --> 0:03:19.861 going to buy myself something." Whatever mood you're in. 0:03:19.861 --> 0:03:21.540 Spending is the answer. 0:03:21.600 --> 0:03:22.138 Yes. 0:03:22.680 --> 0:03:24.899 Two things that have really helped me in terms of controlling 0:03:24.900 --> 0:03:28.470 my online spending. One is not having a digital wallet, 0:03:28.470 --> 0:03:31.830 at least for a period of time. If I have 0:03:31.830 --> 0:03:34.230 Apple or Google Pay, then it just makes spending too 0:03:34.230 --> 0:03:36.960 easy. Whereas, even if it is a case of having 0:03:36.960 --> 0:03:39.510 to get a card out of my purse, that puts 0:03:39.510 --> 0:03:42.060 a bit more friction into my finances. Then, the second 0:03:42.060 --> 0:03:46.560 thing is removing automatic credit card details. When you are 0:03:46.560 --> 0:03:49.950 shopping online, the way it just fills all the forms. 0:03:49.950 --> 0:03:50.490 You know what? 0:03:50.490 --> 0:03:50.940 Magically. 0:03:51.120 --> 0:03:53.520 Yeah. Magically. Oh, well there we are, and there's no 0:03:53.520 --> 0:03:56.130 reason not to spend now. Not ticking that box to 0:03:56.130 --> 0:03:58.350 also fill my credit card details has definitely made a 0:03:58.350 --> 0:03:59.220 bit of a difference. 0:03:59.250 --> 0:04:02.040 Yeah, I'm the same. I'm a big fan of using 0:04:02.280 --> 0:04:04.530 my chauffeur service through an app that I'm not going 0:04:04.530 --> 0:04:06.869 to mention, but also, I use that app for eating 0:04:06.870 --> 0:04:09.150 as well. If I know I've ordered a bit too 0:04:09.150 --> 0:04:11.520 much, then I'm going to uninstall for a period of 0:04:11.520 --> 0:04:12.990 time, so I have to get back on the bus, 0:04:12.990 --> 0:04:17.041 back on the train and back cooking in the kitchen. 0:04:17.041 --> 0:04:21.120 Yeah. Do you think that also there's a correlation here between 0:04:21.480 --> 0:04:24.000 cash, helping you keep on top of your budget and 0:04:24.000 --> 0:04:25.979 being on a low income in the first place and 0:04:25.980 --> 0:04:28.710 really having to watch every penny? It's interesting. When I 0:04:28.710 --> 0:04:32.339 go to my local discount supermarket, the queue for the 0:04:32.339 --> 0:04:34.950 manned checkout is always really long, and that's because it's 0:04:34.950 --> 0:04:36.420 the only checkout that accepts cash. 0:04:36.420 --> 0:04:39.330 Cash. Yeah. I think businesses are missing a trick. I 0:04:39.330 --> 0:04:42.419 get it. It feels great. You can go and just scan it and 0:04:42.420 --> 0:04:44.580 pay and go, but the reality is that for a 0:04:44.580 --> 0:04:47.970 lot of people, especially when money is tight, I can't 0:04:47.970 --> 0:04:50.640 afford to pay the wrong amount. I need to make 0:04:50.640 --> 0:04:53.040 sure that what I'm spending is I can actually afford. 0:04:53.130 --> 0:04:56.040 I need to give myself a budget. I think we don't 0:04:56.040 --> 0:04:58.050 think about it in that way, like you said, watching 0:04:58.050 --> 0:05:01.920 every penny. I've seen my mum pour out her purse 0:05:01.920 --> 0:05:05.460 and count 5 Ps and 2 Ps to make up enough 0:05:05.550 --> 0:05:07.560 to buy what she needs to buy because that's all 0:05:07.560 --> 0:05:10.020 the money she has. Sometimes, when you're tapping, you don't 0:05:10.020 --> 0:05:12.810 have that and then now, with overdrafts and all that, you're just 0:05:12.810 --> 0:05:15.870 getting yourself into more trouble and actually, coming back to 0:05:15.870 --> 0:05:19.170 cash and limiting yourself, it can feel negative, but actually 0:05:19.170 --> 0:05:21.930 can have a much more positive impact because you are 0:05:21.930 --> 0:05:24.240 living within your means. I think we have to go 0:05:24.240 --> 0:05:27.060 back to get into a society where actually it's okay 0:05:27.180 --> 0:05:27.510 to say no. 0:05:28.110 --> 0:05:30.720 It is hard using cash now. A lot of shops 0:05:30.720 --> 0:05:33.210 won't accept it. You can't pay your bills with it. 0:05:33.210 --> 0:05:35.909 You can't save and invest with it. What are the 0:05:35.910 --> 0:05:36.931 difficulties of using cash? 0:05:36.931 --> 0:05:40.080 It is so hard to use cash. I mean, I 0:05:40.080 --> 0:05:42.659 used to be a cashier in a bank. People would 0:05:42.660 --> 0:05:45.390 come in, they'd have their energy bill, they'd write how 0:05:45.390 --> 0:05:47.400 much they're going to pay, and we'd scan it through. 0:05:47.520 --> 0:05:50.550 We'd take the cash and pay their bills. Now, everything 0:05:50.550 --> 0:05:54.420 is direct debit. Everything is online. Again, you can't keep 0:05:54.420 --> 0:05:54.960 that control. 0:05:55.140 --> 0:05:57.240 There are some big drawbacks to cash and I think 0:05:57.300 --> 0:05:59.609 you're going to feel very passionately about one of them, 0:05:59.610 --> 0:06:02.640 which is that sometimes people will say to me, " Well, 0:06:02.670 --> 0:06:05.430 can't I just put my money under the mattress," because 0:06:05.430 --> 0:06:09.120 that's clearly the safest thing to do, and yet people 0:06:09.120 --> 0:06:11.400 will be missing out on growth. Talk to me about 0:06:11.400 --> 0:06:15.000 why cash can't be the answer to all our financial problems. 0:06:15.089 --> 0:06:17.880 Exactly. If you've got your life savings under a mattress, 0:06:17.880 --> 0:06:21.029 I totally understand that, but if you do get burgled 0:06:21.029 --> 0:06:24.060 or if there's an accident, all of a sudden, all 0:06:24.060 --> 0:06:27.750 your money's gone. No security, no safety, there's no protection 0:06:27.750 --> 0:06:29.460 on that. Whereas if it was in a bank account, 0:06:29.640 --> 0:06:32.279 you have protection. You have people that you can talk 0:06:32.279 --> 0:06:34.470 to say, " Look, this is my money and something's happened 0:06:34.470 --> 0:06:38.700 to it." That's number one. Number two, inflation. We all know that 1, 0:06:38.700 --> 0:06:43.050 000 pounds five years ago is probably around 600 pounds 0:06:43.050 --> 0:06:45.900 today. If you would've left it under the mattress, you 0:06:45.900 --> 0:06:47.550 might have gone back and said, " I've got 1, 000 pounds," 0:06:47.790 --> 0:06:50.339 but money is only valuable when you use it, and 0:06:50.339 --> 0:06:52.799 I don't think people understand that concept. What we do 0:06:52.800 --> 0:06:54.420 is we look at money and say, " I've got 1, 000 0:06:54.420 --> 0:06:56.520 pounds today. Five years later, I've got another 1, 000 0:06:56.520 --> 0:06:58.800 pounds. I still got 1, 000 pounds. I haven't lost anything," 0:06:59.190 --> 0:07:01.469 but actually if I go to spend that money and 0:07:01.470 --> 0:07:04.230 I can buy it less, then I've lost money in 0:07:04.230 --> 0:07:08.580 real terms. If we think about it, 50K used to be how 0:07:08.580 --> 0:07:12.000 much to buy a house. 50K is now not even 0:07:12.000 --> 0:07:14.910 enough for a deposit in some places. If I've gone 0:07:14.910 --> 0:07:16.500 from a place of being able to buy and own 0:07:16.500 --> 0:07:18.900 a house to now only having enough for a deposit, 0:07:19.200 --> 0:07:21.480 I've lost money in real terms. 0:07:21.480 --> 0:07:23.130 It's really hard for people to get their heads around 0:07:23.130 --> 0:07:25.110 that concept though, because it's quite abstract. 0:07:25.140 --> 0:07:25.710 Exactly. 0:07:25.860 --> 0:07:28.800 Once you grasp it, actually, you can never unknow it. 0:07:28.800 --> 0:07:30.750 Never ever know it, and you just see it all 0:07:30.750 --> 0:07:34.590 the time. Then, like you mentioned, interest. Again, banks pay 0:07:34.590 --> 0:07:36.600 you interest for leaving your money with them so you 0:07:36.600 --> 0:07:37.320 get that growth. 0:07:37.740 --> 0:07:41.280 How can we manage our money better when it would 0:07:41.280 --> 0:07:44.640 just be otherwise so easy to tap our money on 0:07:44.640 --> 0:07:46.950 that card reader and see it leave our account? 0:07:47.280 --> 0:07:49.890 I think the main thing is your money mindset. When 0:07:49.890 --> 0:07:51.420 we talk about money being the root all evil and all that, 0:07:51.660 --> 0:07:54.420 it's people. It's all us as human beings, how we 0:07:54.420 --> 0:07:57.210 use money. Money is not the problem. Money is there 0:07:57.210 --> 0:07:59.730 to be used. It's how we use it that becomes 0:07:59.730 --> 0:08:02.760 the problem. For me, it's about understanding your money mindset 0:08:02.760 --> 0:08:05.100 and how you look at money and dealing with your 0:08:05.100 --> 0:08:07.290 money trauma and the things that you've been through and 0:08:07.290 --> 0:08:10.620 how you express yourself when it comes to money. That 0:08:10.620 --> 0:08:12.870 is the first place that people really need to work 0:08:12.870 --> 0:08:14.820 on themselves on in regards to how they look at 0:08:14.820 --> 0:08:18.000 money, how they use money, what is their attitude to 0:08:18.000 --> 0:08:21.360 money, and that's really, really important. Then it's about budgeting 0:08:21.420 --> 0:08:23.970 and for me, one of the best ways to budget, 0:08:23.970 --> 0:08:25.710 I know we've got all these online banks. For me, 0:08:26.370 --> 0:08:28.830 envelopes, I don't care what anyone says. 0:08:29.100 --> 0:08:29.310 Really? 0:08:29.460 --> 0:08:32.100 Going back to the envelope is the best place to 0:08:32.100 --> 0:08:35.819 get started. I have clients today that I made envelope. 0:08:35.880 --> 0:08:38.579 You have X amount for this week because you've got 0:08:38.580 --> 0:08:42.329 to teach yourself the discipline. Money is a habitual. If 0:08:42.330 --> 0:08:45.360 I build a good financial habit, that will continue. 0:08:45.720 --> 0:08:47.910 You mean to say, withdraw cash, put it in an 0:08:47.910 --> 0:08:49.800 envelope that you need for that particular area of your 0:08:49.800 --> 0:08:50.429 life that week, and that's it. 0:08:50.429 --> 0:08:50.430 That's it. 0:08:50.430 --> 0:08:50.640 Right. 0:08:50.640 --> 0:08:54.150 That's it. If you've got 100 pounds for the week. 0:08:54.420 --> 0:08:56.520 If on Monday you decide to spend 80 pounds, it's 0:08:56.520 --> 0:08:58.349 going to be a tough week. Do you know what 0:08:58.349 --> 0:08:58.588 I mean? 0:08:58.800 --> 0:08:59.130 Yeah. 0:08:59.219 --> 0:09:02.610 You need that experience. That's how I learn money. People ask, " 0:09:02.610 --> 0:09:04.650 Well, how did you get this mindset about?" No, I 0:09:04.650 --> 0:09:07.170 learned the hard way. I come from struggle. I come 0:09:07.170 --> 0:09:09.390 from not having a lot and having to look after 0:09:09.390 --> 0:09:11.040 it. It's one of the things I always worry about 0:09:11.040 --> 0:09:13.109 with my kids is that now they live a life of 0:09:13.110 --> 0:09:15.990 privilege. How do I make sure they understand the importance 0:09:15.990 --> 0:09:18.780 and the value of money? For me, having the envelopes, 0:09:18.990 --> 0:09:21.209 now again, once you've done that, you can evolve. A 0:09:21.210 --> 0:09:22.920 lot of these other accounts now allow you to have 0:09:22.920 --> 0:09:25.260 pots and all of that, and that can be great, but 0:09:25.470 --> 0:09:29.010 until you can do it in the physical, I don't want you to do it in a digital. 0:09:29.100 --> 0:09:33.449 Right. I see. If we follow the envelope approach and 0:09:33.450 --> 0:09:36.390 we can stick to only spending 100 pounds a week 0:09:36.390 --> 0:09:39.000 and we've passed that test, Eman gives us a big 0:09:39.000 --> 0:09:44.610 tick, then we can progress and graduate to digital ways 0:09:44.610 --> 0:09:46.530 of putting friction back into our finances. 0:09:46.530 --> 0:09:46.980 Yes. 0:09:47.010 --> 0:09:49.559 Have you got a few favorite strategies here? 0:09:49.740 --> 0:09:51.929 My favorite is splitting your accounts up. One of the 0:09:51.929 --> 0:09:54.599 biggest mistakes I see people is that they have all their money in 0:09:54.600 --> 0:09:58.199 one account. It is a problem. It's a nightmare because 0:09:58.320 --> 0:10:00.660 Friday night, you look at your account, it's fit and 0:10:00.660 --> 0:10:02.880 healthy, and you think, " I'm going out. I'm going to have a good 0:10:02.880 --> 0:10:05.970 time." Monday morning, the direct debit's come out and you've 0:10:05.970 --> 0:10:10.140 messed yourself up, and it repeats every month. For me, have 0:10:10.140 --> 0:10:12.870 an account for your bills. Number two is that there 0:10:12.870 --> 0:10:15.480 are banks that will pay you cash back for paying 0:10:15.480 --> 0:10:17.760 your bills from those accounts. You can actually make money 0:10:17.880 --> 0:10:20.790 paying your bills, and that way you can monitor. What 0:10:20.790 --> 0:10:23.130 I do with my bills account, every six months I 0:10:23.130 --> 0:10:25.709 go in, I love football, and I renegade. I list 0:10:25.710 --> 0:10:28.199 them all, and the bottom three, I either get rid 0:10:28.200 --> 0:10:30.360 of or I call them up and ask for a 0:10:30.360 --> 0:10:32.429 better deal where possible. 0:10:33.089 --> 0:10:35.040 That's a pretty ruthless approach you're taking there. 0:10:35.100 --> 0:10:36.929 The thing is, what I've realized is that a lot 0:10:36.929 --> 0:10:39.510 of the time you have these subscriptions, I'm actually using it. 0:10:40.020 --> 0:10:42.510 I'm actually getting value from it. Why do I still 0:10:42.510 --> 0:10:45.360 have this? I might have a subscription, especially with kids. 0:10:45.540 --> 0:10:47.460 I might have a subscription. They used it for that 0:10:47.460 --> 0:10:49.860 period of time, but they're not using anymore. Because it's 0:10:50.010 --> 0:10:51.840 five pounds and it comes out monthly, I don't feel 0:10:51.840 --> 0:10:54.240 it. I don't see it. It's just coming out. Actually, 0:10:54.360 --> 0:10:55.620 that's 60 pounds a year. 0:10:55.830 --> 0:10:58.500 Whereas if you had to actually hand over that fiver, 0:10:58.559 --> 0:10:59.220 would you do it? 0:11:00.210 --> 0:11:03.510 You wouldn't. You wouldn't, and you would've realized a long time ago. It is 0:11:03.510 --> 0:11:05.520 really important to look at your subscriptions and have an 0:11:05.520 --> 0:11:08.429 account for that. Then, I have a second account where 0:11:08.700 --> 0:11:11.550 I put myself on a budget. I have an account 0:11:11.550 --> 0:11:12.929 and I say, " Look, this is how much I have 0:11:12.929 --> 0:11:15.360 to spend," because one of the biggest problems with money 0:11:15.600 --> 0:11:17.250 is when you have access to all of your money. 0:11:17.610 --> 0:11:19.290 When you have access to all of your money, you 0:11:19.290 --> 0:11:22.140 are causing yourself problems. What I do is I only give 0:11:22.140 --> 0:11:24.630 myself access to a portion of my money that I 0:11:24.630 --> 0:11:26.699 know that that's for me. I know my bills are 0:11:26.700 --> 0:11:29.309 paid, and then I have a savings account that I've put my 0:11:29.309 --> 0:11:32.640 savings in. Now, I can spend this money guilt free. 0:11:33.030 --> 0:11:34.620 One of the biggest things about budgeting is we feel 0:11:34.620 --> 0:11:37.530 our budgets restrict you. Actually, a budget sets you free 0:11:37.770 --> 0:11:40.050 because I can spend this money however I want and 0:11:40.050 --> 0:11:42.780 know I've paid all my bills, I've saved for my 0:11:42.780 --> 0:11:45.780 goals, and now I'm free to spend this money and 0:11:45.780 --> 0:11:48.720 using the online bank. Either on Monzo or Starling, one 0:11:48.720 --> 0:11:51.839 of those types of banks where they're rude. They'll text 0:11:51.840 --> 0:11:53.460 you and tell you, " Oh, you spent more on takeout 0:11:53.460 --> 0:11:57.420 this month." Nobody asked you, but thanks anyway. You can keep 0:11:57.630 --> 0:11:59.580 an eye on it, and it makes it so much easier for 0:11:59.580 --> 0:12:01.320 you to be able to be in control of your money. 0:12:01.470 --> 0:12:04.110 Well, that's good because you don't then have to take 0:12:04.110 --> 0:12:07.679 all that responsibility on yourself. You're almost outsourcing the accountability 0:12:08.490 --> 0:12:09.059 to your bank. 0:12:09.059 --> 0:12:13.200 Exactly, to your bank, and that's important. More and more banks are understanding the importance 0:12:13.200 --> 0:12:15.210 of their role as well. That's really important. 0:12:15.929 --> 0:12:18.630 What are your feelings on having spending limits? I mean, 0:12:18.630 --> 0:12:21.960 would you advocate having a spending limit per day or 0:12:21.960 --> 0:12:23.820 per week? What are the pros and cons? 0:12:23.880 --> 0:12:27.569 Yeah, I think spending limits are good for people who 0:12:27.630 --> 0:12:30.569 are impulse spenders. If you are someone that knows that 0:12:30.960 --> 0:12:33.570 if you walk into a shop and you smell certain smells 0:12:33.570 --> 0:12:36.360 or you see a yellow sticker, you're gone. Then, you 0:12:36.360 --> 0:12:39.240 need a limit how much you can spend because you're going to 0:12:39.240 --> 0:12:42.120 overspend. If you are someone that's in more control, then 0:12:42.120 --> 0:12:43.830 maybe you just have a limit for the week or 0:12:43.830 --> 0:12:45.900 the month or whatever it may be, but also to 0:12:45.900 --> 0:12:48.689 understand that life happens. As much as you might have 0:12:48.690 --> 0:12:51.510 spending limits, there might be an opportunity. For example, if 0:12:51.510 --> 0:12:52.920 I know I want to go on holiday and then 0:12:52.920 --> 0:12:55.079 there's a really good deal, does it make sense to 0:12:55.080 --> 0:12:57.150 me saving all the way up to the holiday and 0:12:57.150 --> 0:12:59.550 paying the higher price if I can get a 0% 0:12:59.850 --> 0:13:02.670 credit card and pay that now at a discount price 0:13:02.850 --> 0:13:05.280 and then pay that off? We've got to be wise 0:13:05.340 --> 0:13:07.319 in our spending, but know that if I'm spending this 0:13:07.320 --> 0:13:09.960 now, what are the other sacrifices that I have to make? 0:13:10.350 --> 0:13:11.820 If I'm not prepared to give it up, then I'm 0:13:11.820 --> 0:13:12.570 not prepared to spend. 0:13:13.110 --> 0:13:17.280 I have a theory that financial technology was once judged 0:13:17.280 --> 0:13:20.130 on how easy it could make everything. I think in 0:13:20.130 --> 0:13:22.860 the future, we will want financial technology that actually makes 0:13:22.860 --> 0:13:26.459 everything that little bit harder and will allow us to 0:13:26.460 --> 0:13:30.270 put these boundaries and this friction in place. Do you 0:13:30.390 --> 0:13:33.120 see financial technology evolving in that direction? 0:13:33.210 --> 0:13:36.150 Yeah, I definitely do. We've seen with people having different 0:13:36.150 --> 0:13:38.520 accounts and pots that they can't get access to. You have 0:13:38.520 --> 0:13:40.679 a direct debit from your account into a pot, but 0:13:40.679 --> 0:13:42.809 you can't access that pot and it won't show up 0:13:42.809 --> 0:13:45.870 on your online banking. We're seeing it already that actually, 0:13:46.410 --> 0:13:49.050 we have to hide money from ourselves because we naturally 0:13:49.050 --> 0:13:51.360 want to spend it, but we benefit from it because 0:13:51.390 --> 0:13:53.580 when you then look at it 12 months down the 0:13:53.580 --> 0:13:56.370 line, you're like, " Wow, I saved that much." It is 0:13:56.370 --> 0:13:58.530 really important. That's another hack that I always tell people, 0:13:58.650 --> 0:14:02.400 have a standing order on payday to your savings account, 0:14:02.880 --> 0:14:03.870 so you pay a like a bill. 0:14:04.230 --> 0:14:07.501 Because actually, it has never been easier to save. That's the upside of all this. 0:14:07.501 --> 0:14:07.502 Exactly. 0:14:07.502 --> 0:14:11.130 You can really make it work for you in terms of 0:14:11.280 --> 0:14:14.160 how accessible this technology is, I mean, a good example 0:14:14.160 --> 0:14:16.950 is yesterday morning, I woke up and I saw within 0:14:16.950 --> 0:14:19.770 my banking app that there was an easy saver account 0:14:19.770 --> 0:14:22.920 available, paying 4%. I opened it within a minute.'. 0:14:22.950 --> 0:14:23.190 Yeah. 0:14:23.580 --> 0:14:25.050 Hey, Presto, I'm a saver. 0:14:25.560 --> 0:14:26.070 Wonderful. 0:14:26.640 --> 0:14:28.410 I'm not saying that's the first time I've ever saved money. 0:14:28.410 --> 0:14:28.531 No, of course not. 0:14:28.531 --> 0:14:32.310 Just in case anyone's wondering. It was just remarkable how 0:14:32.310 --> 0:14:33.570 easy it was to do that. 0:14:33.600 --> 0:14:34.140 Yes. 0:14:34.530 --> 0:14:37.770 How can we use these technologies to actually help us 0:14:37.770 --> 0:14:38.610 save money? 0:14:38.940 --> 0:14:42.540 Yes. Like we're saying, it makes it easier to save, but also 0:14:42.750 --> 0:14:45.120 to invest for the longer term. Now, it's never been 0:14:45.120 --> 0:14:47.670 easier to open up a pension or stocks and shares 0:14:47.670 --> 0:14:51.420 I saw or invest in stocks. Using the technology has 0:14:51.420 --> 0:14:53.610 made it easier for us to invest as well longer 0:14:53.610 --> 0:14:56.760 term. Just embracing it means that now, we are able 0:14:56.760 --> 0:14:58.560 to do things that maybe before we'd have to go 0:14:58.560 --> 0:15:00.540 to a bank to do or so forth, but we 0:15:00.540 --> 0:15:02.580 can now do ourselves and be in more control. 0:15:03.030 --> 0:15:04.921 A good example of that is round up savings, right? 0:15:04.921 --> 0:15:04.922 Yes. 0:15:04.922 --> 0:15:08.160 If you spend 98 P and you have two P rounded 0:15:08.160 --> 0:15:11.190 up into a savings or investment pot, two P in 0:15:11.190 --> 0:15:12.420 and of itself is not going to add up to 0:15:12.420 --> 0:15:14.520 a lot, but over time it might make a bit 0:15:14.520 --> 0:15:15.120 of a difference. 0:15:15.120 --> 0:15:18.420 No, definitely. And it's all about the habits. I always tell people sometimes it's not 0:15:18.450 --> 0:15:20.730 about getting rich. I think we think about, we've watched 0:15:20.730 --> 0:15:22.560 Wolf of Wall Street and all these other films, and 0:15:22.560 --> 0:15:24.750 we think, oh, we've got to invest this. Actually, just 0:15:24.750 --> 0:15:27.900 building up that habit. If I know that two P, 10 P, 15 0:15:27.900 --> 0:15:30.150 P, every time I spend is going in there, it's 0:15:30.150 --> 0:15:33.030 a habit. Once I built that habit and I've seen, okay, wow, I've 0:15:33.030 --> 0:15:36.180 put in 20 pounds this month, and now that 20 0:15:36.180 --> 0:15:38.910 pounds is worth 25 pounds. Imagine if I had 100 0:15:38.910 --> 0:15:41.160 pounds in there. Now you've got more confidence to say, " 0:15:41.160 --> 0:15:43.440 Actually, I can put a more regular amount in there 0:15:43.440 --> 0:15:46.410 because I see that this works over time." It's about 0:15:46.410 --> 0:15:49.350 building those habits. Technology has made it easier. Before, if 0:15:49.350 --> 0:15:51.540 you wanted to invest, there was a barrier to entry. 0:15:51.600 --> 0:15:51.750 Yeah. 0:15:51.750 --> 0:15:53.970 Those barriers have been taken away. We've got to embrace 0:15:53.970 --> 0:15:56.250 the technology and start to make it work for us. 0:15:56.760 --> 0:16:00.420 Brilliant. Well, let's end with three tips on how you 0:16:00.420 --> 0:16:03.420 can use the digital world of money to build your 0:16:03.420 --> 0:16:03.960 own wealth. 0:16:04.200 --> 0:16:07.710 Great question. I'd say number one is to really understand 0:16:07.770 --> 0:16:11.730 your money. As we talked about, embrace the technology, understand 0:16:11.730 --> 0:16:13.710 where your money's coming in and out of, because people 0:16:13.710 --> 0:16:15.450 always tell me, " What's the cheat code? How can I 0:16:15.450 --> 0:16:17.760 make more money?" There's only two ways. You either make 0:16:17.760 --> 0:16:19.680 more money or you cut your costs. That's all we're 0:16:19.680 --> 0:16:22.560 ever talking about really. You've got to, number one, understand 0:16:22.560 --> 0:16:24.989 where your money's coming from, where it's going, and then 0:16:24.990 --> 0:16:27.870 utilize the tools that are available to you. Number two 0:16:27.930 --> 0:16:31.020 is saving. Make sure you're getting the best on your 0:16:31.020 --> 0:16:33.360 savings. The money that you are able to save, make 0:16:33.360 --> 0:16:35.340 sure you're getting the best rates on your money and 0:16:35.340 --> 0:16:39.810 review that regularly. That's really important. Number three, feel free 0:16:39.810 --> 0:16:41.910 to limit yourself. I think we are in a society 0:16:41.910 --> 0:16:44.190 that has no limits. We all want to have no limits, and 0:16:44.190 --> 0:16:46.650 we want to live life to the maximum, but actually 0:16:47.040 --> 0:16:49.860 embrace the fact that you can limit yourself and make 0:16:49.860 --> 0:16:51.870 it a bit tough. Make some friction in your money 0:16:51.990 --> 0:16:53.130 so that you can keep more of it. 0:16:53.310 --> 0:16:57.600