January Money News
Julia Shepherd
A fully qualified Financial Adviser and Teacher working as a Money Expert helping people master their finances, deal with debt, and finally feel in control of their money and their lives
Sir Terry Pratchett and his Discworld Series.
"Poverty is both expensive and time consuming." This statement is underpinned when Pratchett wrote about Sam Vimes and his boots. Sam can only afford cheap boots, but they do not last. Whereas those with money buy better boots and then never buy another pair.
Being able to afford more expensive and better quality products is cheaper in the long run. If you can afford to buy a washing machine, that is far cheaper and less time consuming than a trip to the launderette.
If you can afford to pay your energy bills by direct debit, that is far cheaper (though still not cheap )than having to buy tokens for the meter. Even better would be an investment into solar panels. Those actually make you money.
This is why the poor stay poor. Things keep breaking, nothing seems to last and to add insult to injury, they all break at the same time.
This is the "Boots theory of socioeconomic unfairness" and it manifests itself in every product or service. In the world of finance, credit is more expensive if you have no money. Debt compounds quicker when you are given unfavourable interest rates. Pay day loans can be crippling, limited access to mortgages means a life lived in damp and insecure housing - if you are lucky!
This is a life lived in survival and if you have never experienced what it is like to live with no money, then you cannot even begin to understand what it is like. Money and mental health, linked.
But, if you never follow the money and learn how it works, you are stuck. Buying cheap boots, feeding the meter and waiting for a good Samaritan to help you with your car, as you cannot afford either one that works nor a breakdown service.
If you would like to learn how to look after yourself financially, I have produced a booklet to help you Thrive in 2025. Maybe for the first time ever.
Why on earth would you want to pay someone like me to help you sort out your finances when you can get it for FREE?
Well apart from the fact that free is a term loosely used in Wealth Management, here are 5 reasons why you may want to consider engaging and paying me instead.
Sales
Many "free" services are offered by companies that have a vested interest in selling you a product, such as insurance or investments.
Add this to the fact that some Financial Advisers work on a self-employed basis, they receive only commission on sales, so whether you need a product or understand what the product does, this is a sales job primarily.
So even if the advice itself may seem unbiased, the recommendations might be skewed toward services they offer.
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Data
Free advice may come with the cost of your personal data. Some firms offer free consultations or advice in exchange for detailed information about your financial situation, which they may later use to market products to you, basically cutting your arm off and beating you with the soggy end.
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Quality and nuance
It is difficult to know who to trust when it comes to your finances which is why to be fully educated and informed on the types of products available and what the concepts themselves mean is worth it.
?It’s easy to be persuaded to buy a financial product if you are unsure as to what it DOES!! And if the person selling it is talking the talk! Empowerment gives you critical thinking skills.
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Long-Term:
Buying a product that you are not sure about costs more money than paying for mentoring. This is the way most wealth management firms make their money. For every year, your funds are under their management, you pay 1% in fees. So as your investment grows, so do the fees. Free financial advice is not free, once you commit to purchasing a product.
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Limits
?Free advice may not address your complex financial situations, emotions or goals and most financial advisers are not interested if you are at the beginning of your wealth journey and are struggling.
Pay for mentoring and education. If your mentor is any good, he or she will find you the cost of their services in the first session.(I do this!)
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Financial good health is more than making money, more than investing and more than eliminating debt.
Working with someone like me, you can look at your past behaviours, what traumas formed those behaviours, how to build new habits and how to use your money to create a life you love.
Child Trust Fund
CTFs were established for children born between 1 September 2002 and 2 January 2011, with the government contributing an initial deposit of at least ￡250 into each account. These funds were intended to grow over time and become accessible when the child turned 18. However, many account holders are unaware of their CTFs or have lost track of them, leading to a significant amount of unclaimed funds.
When I received my Child Trust Fund voucher, I was clueless as to what it was and how it worked. The information that came with the voucher was difficult to understand. Investing was something I knew absolutely nothing about. It seems I was not the only one!
As of January 2025, it's estimated that approximately ￡1.4 billion remains unclaimed in Child Trust Funds (CTFs) across the UK. This unclaimed amount is spread across about 728,000 accounts, with each account holding an average of ￡2,000.
In September 2024, HM Revenue and Customs (HMRC) reported that more than 670,000 young adults aged 18 to 22 had yet to claim their CTFs, with the average unclaimed account valued at ￡2,212.
That is a lot of young people. I can imagine these young people are those who are not financially literate. Some of them may have different learning abilities. Once the child turns 18, then these accounts are out of reach of the carer/ parent.
The Child Trust Fund was an excellent idea executed badly. It was the equivalent of giving a person a fish rather than a rod with which to fish.
Many young people if they do cash in their Child Trust Fund to buy a car are further disadvantaged as when they turn 18, this is a lost lesson in how to grow money. They have time on their side, they could change the trajectory of their life, if only there was someone to help them.
Here is my leaflet on how to look after your teenager and their finances. Enjoy.
If you have a teenager and would like me to teach them the money rules, let me know.