Financial Wellbeing

Another blog post from DU Member Digital Business Coach!

I am unsure as to the date of its publication BUT a new UK-wide strategy to transform the country’s well-being has been launched by the Money and Pensions Service [MaPS] under government mandate. This 10 year vision to improve millions of lives includes five priority areas to help make the most of money and pensions.

So, what is “financial well-being”?

It is knowing we can pay our bills today, deal with the unexpected tomorrow and be on track for a healthy financial future.

Before 2020:

11.5m people had less than £100 saved
9m people often use credit cards to pay for food or essential bills
22m people say they don’t have enough for retirement
5.3m children aren’t getting a meaningful education

Any plan to deal with these issues is welcome but I suspect it will not happen, at least not in the short to medium term. And yet, there is a solution. Unfortunately not one the world’s governments and central banks will support.

Here are some snippets of news you may not have seen on the 24 hour blanket news coverage of COVID-19:

81% of the global workforce of 3.3 billion people have had their workplace fully or partly closed [BBC News online 7/4/20]
Just 2,022 coronavirus business loans have been approved since launching 23 March; this represents 0.65% of enquiries with £291.9m loaned. Around 6m small and medium sized firms in the UK have monthly payroll costs of around £41billion. [City AM 7/4/20]
Worldwide debt reached 322% of GDP in 2019; in simple terms debt rose by £8trillion last year to £206trillion. The Institute of International Finance [IIF] forecast that debt would rise significantly in 2020 – before they knew about the existence of COVID-19. As of December last, the world had $87 trillion more debt than at the start of the 2008 financial crisis.

In other news RBS chairman Howard Davies was a little upset at the Government’s suggestion that the banks repay the bailout they received [from us, the tax payers] by helping businesses survive the pandemic. His main concern is that his and the rest of the banking community can no longer demand personal guarantees from business owners.

He went on to claim that the banks were not bailed out as a favour, but to protect the innocent as failure would have cost the economy too much. REALLY?? Iceland allowed its banks to fail. Look at what happened.

He went on to state that the last crisis was caused by the financial sector. Yes, he really thinks we are that stupid.

Are the banks in the financial sector? Yes. Did the banks create the property bubble by lending 100% and in one lender’s case, up to 125% – even when the housing market was clearly soaring in value? YES. Did that bubble – like all bubbles – burst? YES. Who suffered most? All of us. Who bailed them out? We did.

Do the banks really care that 9m people often need to use expensive credit to buy food?

It is easy to be cynical especially now, when our lives have been turned upside down. But reflect on why these news stories are not getting coverage. It may be that they want us to focus on the crisis at hand, or one crisis at a time. I get that. BUT we need to prepare for what comes next. The good news is, we have the time to begin our learning into a decentralised system that will protect our assets and crucially, our money. With the debt mountain likely to climb very steeply the value of the £ in your wallet/purse will continue to shrink.

Remember what “financial well-being” is? If you can state categorically that you can manage today, deal with tomorrow AND have a rosy financial future, then do nothing.

If you are worried about today and the future you need to get in touch. The learning is provided without cost. Your only investment is time.

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