Don’t Die with Too Much Money (or run out before you start to push up daisies!)

I’ve just turned 50 (shush, don’t tell anyone, I’ve been investing my money in expensive skincare serums, something Alan would definitely not approve of!). It’s sobering for me. There’s a big difference between 49 and 50, like I really am officially a grown-up. I’m halfway through life, maybe I’m even ¾ of the way through – who knows? The point is that it got me thinking, especially after speaking to Alan last week about bucket lists. Of course, I have a bucket list, I want to go to Australia, I want to cuddle a wombat (!) and I want to go on the bullet train through Japan, but these dreams seem years away. However, having just had another long chat with Alan, perhaps I need to do some more thinking. Some Financial Bucket thinking.

Financial Buckets are not Bucket Lists but they should probably go on the bucket list and be high up on there. Alan has encouraged me to get my Financial Bucket in order. If you’re not sure what a Financial Bucket is, then I urge you to watch Alan’s fun but informative video. It’s a good viewing, it’s light and easy to digest but it has a real point to it (it’s here).

Quick Overview of Financial Buckets
As a quick overview, your Financial Bucket relates to the money you have easy access to. It’s your income, your salary, your child benefit (if you’re like me and have kids under 19), it could also be your monthly pension (if you’re that age) and money that comes in from investments, rentals, ISA’s, old endowments, shares etc. It is not your house, your pension fund or your business. It’s about liquid cash you can get your hands on.

Your Financial Bucket is the money that you can decide what to do with, whether to save it, spend (some of it, not all of it!) or use for a financial product. It’s also about working out how much you’ve got coming in, how much you have coming in at a later date and evaluating your lifestyle and expenditure to make sure it all adds up.

As I’m now 50 (!) I think about money much more than I used to. I mentioned this to Alan, asked him when is the right time to plan for the future and the answer (which I knew really) is that he has clients age 30 and clients age 80 – and every age in between. You can never start too young although different ages require different thinking because there are different commitments. My biggest commitment now is to my children and giving them the best I can but as Alan also says, it’s still important to think about the future – my future, your future and you can always change your Financial Bucket (more on that later).

Don’t Die with Too Much Money!
Another caveat that came from my conversation with Alan is that you shouldn’t die with too much money! That’s quite a grand statement (and with school age children not something I’m worrying about now but I’d love to get to the point of worrying about that!). Simply put, it means, don’t be like one of Alan’s clients, a wealthy lady without children, who wanted to keep hold of her money “just in case”. She dreamt of travelling across Vancouver by train, seeing the Rockies, fulfilling something from her bucket list but was concerned at the £10,000 cost. She never did travel across Vancouver. Now? She’s got Alzheimer’s, oh, and all that money, that she never enjoyed.

But Don’t Run Out and Buy a Yacht!
Alan isn’t saying go out and spend that money – if you’ve got it. He’s saying there’s room for saving, planning for the future and enjoying those bucket list moments (did you read the piece on bucket lists? (It’s here if not). After all, you can’t take it with you when you die.

Do Plan for the Future
Being a Financial Planner with over 20 years of experience (not a Financial Advisor – there’s synergy but there’s a difference), Alan always puts his clients first. I know he’s sincere and he’s so nice to talk to! Rather than just asking clients what they’ve got and dishing out a financial product, he likes to plan their financial future so they have enough money to enjoy life, tick off those bucket list items (ok, maybe not every single one, but some for sure), spend money but have enough to live happily and well.

It’s his job to help his clients do everything they want to do in life, without running out of money. To still be able to leave money to the kids, the grandchildren or charity too if they want to, he can even help clients if they think they don’t have enough money – with careful financial planning, his clients should never run out of money too soon. I loved what he said to me “No doubt you’d rather never see the postman deliver that overdraft letter because you died the day before the postman arrived to drop it through your letterbox. You were 100 years old and lived well” Of course anyone would like this scenario (and know you had enough to leave something to your kids and grandkids etc.).

Understand Money
Your Financial Bucket is also about understanding money. Yes, we all understand what money does but do you understand what your money could be doing for you? If you do – great, I envy you! If not, it’s actually easy to get to grips with. In Alan’s view (and with so many years of financial planning behind him, he knows), it’s not about getting the best return on investment, it’s about growing older and using it for YOU, your family, charity (if you want to) and still having enough left over. If you’re lucky enough to have a lot of money, don’t be scared of it, don’t save it up just in case…plan it! There’s a difference. Alan isn’t suggesting you rush out and buy a Ferrari or jump on the first world cruise you can. He’s suggesting coming up with a not-so-cunning plan that makes sure you’re financially secure for the rest of your life.

Basically, there are three types of people when it comes to money.

• Those that have too much
• Those that don’t have enough
• Those that have it at just the right amount!

Do you know which group you fall into? Surprisingly, many people don’t. Work out which you fall into, plan your financial future but also be aware that like anything, plans can change.

Alan had a good analogy he mentioned that I’m going to share with you.
Let’s say you get into a taxi and you tell the driver you want to go somewhere that’s 50 miles away. He (or she) says to you, I’ve set the Satnav and it’s saying it will take an hour; shall I turn the Satnav off now? You say, no! Why would you do that? Suppose we hit traffic? Suppose a road is closed? We might need to divert and take another road to reach our destination.

There’s the point, journeys change. Your Financial Bucket will no doubt change. It’s worth revisiting at regular intervals to re-assess it. We all need guidance throughout every life journey and finance is another aspect that needs plenty of guidance. You might need to change your route – that’s fine, with good financial planning you can do that and still tick off your bucket list, have money left over and live life well.

So don’t be scared of planning your finances, speak to Alan, rather than wasting your money or stuffing it under the mattress just in case. It’s about learning what to do with your money to enjoy a fruitful future. With that in mind, I’m off to raid my piggy bank and pop it into my Financial Bucket. You can also speak to Alan about your Financial Bucket – you’ll be pleasantly surprised!