How confident are you about discussing your finances? Fiona Alston spoke with Ms Moneypennies podcast hosts Jill Steeples and Kelly-Anne Quinn about why they started their financial information show and gathered some private pension advice.
Bank of Ireland has released new research around ‘financial confidence’ to ascertain how confident people feel about managing their money. Results show that while people are confident in managing day to day expenses like subscriptions and bills, they lack confidence when it comes to asking for things like a pay rise or considering their long term financial future.
It also showed gender disparity, with women almost half as likely as men to feel confident asking for a pay rise (17% vs 32%), while overall self-confidence is also notably lower among women (64% vs 80% of men).
Ms Moneypennies
With everything else life has to throw at us on a daily basis sometimes managing your finances can be something you put off, or it just feels so confusing and overwhelming at times you have no idea where to start. And as the stats above show, you are not alone, many women feel the same. This is the reason Jill Steeples LIB QFA RPA, company director at Steeples Financial Consulting and Kelly-Anne Quinn CFP QFA company director at Life Planning started their Ms Moneypennies podcast.
The podcast is not to give advice but to share information and start the conversation, stripping away the jargon. It’s been running for the past year and a half and is considered a ‘space for judgement-free finance chats’.
There is a misconception that to talk to a financial advisor you need to have X amount of money in the bank or to put in a pension. “We’re trying to strip all that away,” says Steeples. “We’re just trying to make it approachable for people – you don’t need ten grand in your pocket to come in the door. ”
“Many females have said to us before that they were intimidated seeking financial advice that it was nearly mansplained to them all the time. It’s not about telling people what to do, but it’s just giving them the confidence to speak with somebody, an advisor, whether it’s us or somebody else,” says Steeples.
Private pensions
When it comes to finances one area that often gets put on the back burner is the pension. Last year the Government introduced a new Auto-Enrolment Retirement Savings System, MyFutureFund, so many of you may already be in a pension scheme via the workplace. But if you are looking at private pensions, it’s never too early to start saving. IMAGE asked Steeples to share some sound tips on starting a private pension.
Start a pension as early as possible. The earlier you start, the more time compounding has to work. For example a 25-year-old paying €200 a month for 40 years pays €96,000, the fund grows to just under €400,000 but 40-year-old paying €400 a month to meet the same age pays in more overall but the fund is only about €278,000. It pays to start the pension early, even if you have to reduce payments when excess money is tight or pause it during times like maternity leave. Contribute something, even if it’s small, and adjust over time.
Use a financial advisor you trust and ask questions. You don’t have to go through your bank, speaking to an independent financial advisor/financial planner. Get personal recommendations if possible and make sure you feel comfortable and respected. If an advisor doesn’t involve you, explain things clearly, or you feel “mansplained”, switch to someone else.
Know your charges and review your pension regularly. Many people never read their pension statements and don’t know what fees they’re paying. High charges can significantly reduce your long?term pot. You should have an annual review with your advisor to check if you have the right funds/risk level for your age and goals, if your circumstances have changed with job, kids or large expenses. Review if the charges are still reasonable for you. Ms Moneypennies have an episode on charges here.
Don’t just set and forget. Align your pension with your life goals. A pension isn’t just about what you can afford to save this month, it’s about what income you’ll need in retirement to maintain your quality of life. Do you think you could live off the state pension? Should you have a private pot so you’re not relying solely on the state? But don’t just start a pension and then ignore it for years. It is your financial future, take care of it.
“The state pension in this country is not sustainable. There is no way, when I get to 68, it’s going to be where it needs to be. It’s about €15,000 a year at the minute, so it’s just so important to sort of bridge that gap. If you want to have the same quality of life when you retire, just by putting a couple of hundred euros away a month (plus you’re getting the tax relief on it) it’s an absolute no?brainer to have the private pot there as well,” adds Steeples.
Well, that’s us off to make an appointment with our financial advisers!