In this week’s On the Money interview, I talk to Mrs Mummy Penny herself, Lynn James.
On the Money: Conversations with money bloggers
What is your earliest memory of having and spending money?
My earliest memory of money is where I used to spend hours counting my dad’s tankards of coins he used to collect. There were 20p’s and 5p’s. As a very young girl, maybe 5 or 6, I would pile it up and put it into bank bags for him to pay into the bank.
My earliest memory of spending money was getting my 50p pocket money per week and spending 10p per day on sweets in the sweetie shop up the road on the way to school.
Have you ever felt out of control with your money?
So many times. I have written about this at length, most recently being my confessions of a personal finance blogger. In April 2017, I felt very out of control with a big amount of debt to repay. We could cover the minimum payments, but the journey of debt repayment felt so long and painful. Turns out income levels changed and therefore debt repayments could increase dramatically. The huge amount of debt will soon be paid off.
However, this isn’t the only time this has happened, I have a tendency of getting into this debt cycle regularly and was only reminded of it this week when out for a drink and a chat with one of my best mates. I live in the present and want things now. My tendency is to buy and pay later, rather than saving and then buying later. I don’t want to live like this but it is behaviour of twenty years engrained into me.
What was your worst money decision?
My worst money decision was to say no to contributing to my pension during my 20’s when I was working in a well-paid job with Tesco. I was earning good money and the Tesco contribution was double mine. But I decided that I couldn’t afford the £100 or so a month it would have taken out of my monthly salary. A silly decision that has probably cost me around £40k in my pension pot. I really regret this decision.
What was your best money decision?
I first bought a house when I was 24. Despite the crazy pension decision, I did get onto the property ladder as early as possible. I have moved to a new house twice since then and have generated more and more equity and value each time. We now have a large chunk of equity in the house, much more than the mortgage we owe, so I feel very comfortable that I made the best decision there.
What is your best tip for saving money at home?
A regular check of your direct debits and budget is a worthy exercise. Every few months is fine or maybe before a big financial decision is taken. You might be surprised at what you find in your expenses. There may be payments that can be switched to a different company to make a saving or even cancel if you are not using the service.
I recently checked my expenses and made a big saving of £42 per month by switching broadband and removing Sky Sports and Sky Movies from our TV package.
What is your best tip for saving money out and about?
Always have a water bottle and few snacks stashed in your handbag. This always saves when I am out and about. It also stops me from having a little browse in the expensive shops at Kings Cross when I am at work.
What would be your advice to the 18-year-old you regarding finance?
I would tell myself that credit cards should not be relied on. Not to start adult life with the mindset that credit can be used to get everything right now. I would emphasis the importance of saving up to buy thing that you want and waiting.
What was your biggest ever bargain?
Oooh, tricky question. I am generally good at negotiating on all big things. We recently bought two cars and saved £5k off the list prices. We agreed to pay £225k for our house 9 years ago and negotiated this down to £222k on the day of exchange at the last minute. Our house is now worth at least double that, so it was a great investment.
Or maybe that 5p carrot cake that I found in the Co-op a few months back?!
What was your most recent purchase?
I was in London for a series of meetings this week and spent a shockingly high amount of money on Green’s juice drink from Pret A Manger. It felt like I was being very healthy getting it, but it cost £3.79!!
I was also in London last week and was early for a meeting near Regent St, so popped into H&M for a browse. Due to extreme debt repayment I rarely buy clothes, but I did invest in a new pair of pumps, a red and blue Breton top and the most beautiful orange frilly sleeve top. I spent £40 so nothing excessive!
Do you stick to a monthly budget?
Yes. We have a strict budget with every cost accounted for, even for the irregular costs and random items that need to be paid every few months or once a year. The base bills are paid then another chunk goes into a saving account to allow for the one-off costs.
Do you have any long term financial goals you would like to share?
I want to have enough money in my pension to retire comfortably. Fortunately, I have a pension plan from my employment during my 30’s but that needs to be regularly added to. I also have a stocks and shares ISA,but that is more of a pot for my children to give them freedom to choose their future paths at the age of 18.
If you won a million on the lottery, what is the first thing you would do?
I would go on the most luxurious holiday, probably Necker Island for 10 days. Then I would plan out what we should do with the money. Most likely a new house, some money given to friends and family who need it, and investment.
Lynn runs the blog MrsMummyPenny and says: ‘This has been my full time job for the past three years, after quitting the corporate world to start my own business. My background is commercial finance and I qualified as an accountant back in the day. My website is a blog all about personal finance: healthy wealth, body and mind.’