41% of Brits don’t have enough savings to live for a month without income and ⅓ have less than £600 in savings, according to Finder!
The pandemic has come and stayed in 2020, reminding us that if the unpredictable happens, will we be financially ready to cover our backs? This year has shed light on how important it is to have savings, consider financial security and start that emergency fund!
One reason for this could be because of the little financial education delivered in schools or another is the overload of information on the internet, which becomes hard to digest. Speaking about money is a secret language that many of us don’t feel we have the access to. These reasons and more is why the LMF network launched its money matters series.
What is money matters?
Money Matters is an essential 8 week course designed to guide you to a stress-free and prosperous financial life. The LMF money matters series consists of workshops covering four major themes : money mindset, budgeting, saving, personal investing and credit scores. The series was the idea of Barbora Juhaszova , who leads the Financial programme for LMFnetwork and works for Wollit as their head of marketing. Wollit kindly sponsored this series alongside Fledglink and Enation.
Below is a summary of the first workshop in the series, which discussed the importance of having a money mindset followed by tips on how to start saving. We are determined to enable financial literacy and change your perspective on savings. Join us as we create this change today!
Growing your money mindset
The first workshop of the series started with a quick round of poll to understand the money mindset, with 40% of people feeling that they know what goes in and out but cannot control the movement.
Preethi, who is the Head of Industry Marketing at LinkedIn confidently focused on how to change this mindset by explaining that you have to separate feeling from circumstances.
The circumstance is the facts — it’s the reality, whereas the feeling is how you feel about the circumstance. Preethi’s four-step formula is a must to gain financial freedom:
- Visibility — The circumstances : you have to separate the circumstance into money that comes in and money that goes out.
- Understand — Money that goes out can be separated into 3 categories : Money essentials; Money loves; Lost money.
- Save — First you must save your emergency fund, which is the amount of money to cover the cost for 3–6 months.
- Invest — Invest anything over 6 months of savings and consider growing your money.
The session was followed by an active discussion amongst the panelists Preethi, Naomi, Jaz and Amish. They shared their own financial education, how to change the mindset and tips on how to start saving money. To keep things relevant, all panellists mentioned digital apps which have been useful, these included Starling Bank, Monzo and Moneybox. Jaz further explained that she found shifting her mindset came with finding an app which worked for her, such as the Moneybox saving accounts, which rounds up your purchases and allocates the extra pennies into the saving account. Amish discussed that he was able to enter the property ladder by controlling his spending having set a bigger goal and Naomi shed light on ethical investing, starting with the easy task of identifying where your pension supplier and where they are investing that fund.
Of the participants who attended the workshop, 59% had the goal of buying a house and only 7% was to go on holiday. The panellists echoed their advice : set a clear goal, work out how much you need to save every month over a period of time and consciously make the effort to shift your mindset.
More can be discovered via the youtube video here.
Top tips from the panel -
- Follow step 1 and 2 of the 4 step formula
- Start buying groceries and cook at home
- Save for something with a goal, such as a house and break it down into attainable steps such as the deposit
- Ask questions and stay curious
- Engage with your finances
- Look at your bank account
- Use the community and internet to talk to someone, read and learn
- Hold yourself accountable for each decision
- Envision what you want in 5 to 10 years time and then plan your financial future
At the start of the session, 25% of the attendees were proud of their money and 32% of attendees were embarrassed. By the end of the session, 100% of the attendees were proud they’d invested their time to learn about money mindset and encouraged to start shifting their mindset.
Shifting your money mindset is similar to training a muscle which is weak — it may hurt, take time and the results will be slow. However, once you can identify your why and what — why you’re saving and what for — the process becomes more manageable. Lean on your community, ask questions and stay curious! Shifting your mindset is the first step in becoming financially independent, secure and comfortable.
Written by Sana Khan, @LMFnetwork Intern and recent graduate.
A big thank you to Preethi, Naomi, Jaz and Amish, for sharing your experience with us and for providing us with easy tips to save money. The workshop is available on Youtube here.
Thank you to our speakers :
- Naomi Naidoo — is Community Manager at the Finance Innovation Lab, building and supporting the Lab’s community of innovators, activists and change-makers building a financial system that serves people and the planet.
- Jaz Broughton- is a professional coach working with entrepreneurs to help them to reach personal goals and avoid burnout. She combines her side hustle with a full-time job at business analytics company Mixpanel.
- Amish Unalkat- is a young professional who has shifted his money mindset to enter the housing ladder in the UK.
- Preethi Sundaram — the Head of Industry Marketing at LinkedIn, will be sharing her journey from debt to prosperity and expert tips on how can you set your mind to success.