Three tips for reluctant savers
Leading consumer website Citywire Money is launching an initiative to galvanise the 9 million people in the UK it believes have the capacity to make long-term savings but don’t, blaming (they themselves say) confusion, mistrust or plain laziness.
As part of their initiative, Citywire asked me last week, as one of ‘a group of seasoned investors’, to come up with three pieces of advice I would give to investors who are starting on ‘the long term savings journey.’ As if a few nuggets of pithy wisdom or practicality could break through the defences of the wilfully disengaged! As if they will even be among the 1.5 million annual unique visitors to Citywire Money’s website!
My first thought was they really only need two: ‘wake up’ and ‘smell the coffee’. I really do believe the wilfully disengaged, whether or not part of the ‘something for nothing’ brigade, will respond better to the stick than the carrot – and probably not until the stick, too late, has struck them hard where it hurts.
My second thought was that you can’t fight resignation with resignation. Maybe even amongst our own clients there are some who had been previously disengaged or lazy. What worked for them? That prompted three nuggets which I duly sent Citywire.
Visualise your past, from the future: imagine yourself in the autumn of your life looking back and thinking what would make you feel ‘job well done’ and what would have caused you most regret. Anything involving money!
Ask for help: everything is easier with a plan but turning your ‘no regrets’ future into a plan requires professional help. Go see as many IFAs (not your local bank, please) as it takes to find the financial planner who ‘gets the visualisation thing’.
Pay up for planning and pay down for products: this is the opposite of what people think (and the industry wants you to think) but planning is your key and products are really only commodities, so keep them basic and low cost.