Episode 27: Money matters: how to finance a career change – with Pete Matthew of Meaningful Money

Pete Matthew of Meaningful Money gives us the lowdown on how to manage your money and prepare yourself financially for a change of career.

Today’s guest

Pete Matthew of Meaningful Money

Website: Meaningful Money

Facebook: Meaningful Money

Twitter: @meaningfulmoney

Instagram: meaningfulmoney.tv

YouTube: MeaningfulMoney

Contact: info@jacksonswealth.com

Pete is a very content husband and father of two wonderful children. He’s also a Chartered Financial Planner and Managing Director of Jacksons Wealth Management in Penzance, UK.

After reading Crush It by one of his internet heroes Gary Vaynerchuk, Pete realised that he could use the internet and social networking to get a very important message across.

The point of his website is to convey Pete’s belief that Financial Planning is really simple for the vast majority of people. It is possible for anyone to achieve their goals, whether financial or otherwise, by following some pretty basic rules.

What you’ll learn in this episode

  • Why preparedness is the key to any transition
  • Identifying and categorizing your costs and working out what costs are “essential” and what are “lifestyle”
  • Why it’s better to save to cover a future gap than to borrow
  • Ways to increase your income
  • The importance of being “intentional” with your spending and setting priorities

Resources mentioned in this episode

Please note that some of these are affiliate links and we may get a small commission in the event that you make a purchase.  This helps us to cover our expenses and is at no additional cost to you.

To see the resources recommended by all our guests, visit the Resources page.

Episode 27: Money matters: how to finance a career change - with Pete Matthew of Meaningful Money

Jeremy Cline
What's holding you back from making a change to your career? If it's worries about the impact it will have on your finances, you're in the right place. I'm Jeremy Cline, and this is Change Work Life.

Hello and welcome to Change Work Life, the podcast that's all about beating the Sunday evening blues and enjoying Mondays again. Chances are making some kind of career change is going to have an impact on your finances. Maybe you want to do something where you're paid less, maybe you want to study for a qualification and you've got to think about course fees, plus the cost of taking time out from work to do it. It might all seem a bit overwhelming and maybe it puts you off just thinking about it. Fortunately, we've got people like our guest to help you through it. This week, it's Pete Matthew, who is a financial planner and the founder of Meaningful Money - a podcast and YouTube platform with a huge amount of information when it comes to all things financial. In this conversation, we talk about how you go about planning your finances when it comes to a change of career. Hi, Pete, welcome to the show.

Pete Matthew
Thanks Jeremy. Good to be here. Thank you for having me.

Jeremy Cline
Can you start off by introducing yourself and telling us a bit about what you do?

Pete Matthew
Sure. So my name is Pete Matthew. I 44 years old. I'm a Yorkshireman originally but I live in the very far west of Cornwall in Penzance because I married a Cornish girl, so my fate was sealed really. I knew within a week of meeting her that firstly, I'd marry her and second that I'd end up at the end of the world. Nice place to bring up kids. I've got two daughters nearly 20 and 16 and a half, and a Jack Russell called Maisie. For a living I'm a Chartered Financial Planner, so that's kind of a high end financial advisor if you like. I co-own a practice down here in Penzance called Jackson's Wealth Management with two of my best friends and it's a very long established company actually, we have bought into it - it's been in Penzance since 1974 and can actually trace it's roots back to 1923. So it's very much part of the fabric down here. But as a weird little hobby and sideline nearly 10 years ago, I started shooting some short explanatory videos about how money works, and then branched into podcasting, all under the name Meaningful Money, and that's nearly a 10 year old thing now and it's just become this monster which has completely taken over my life, but in very positive ways. So by day, I'm a Chartered Financial Planner, and by night, I'm a podcast and a YouTuber.

Jeremy Cline
And so how did you get into the financial planning in the first place?

Pete Matthew
Like most finance advisors by accident. Nobody decides at 16 years old that they desperately want to be a financial advisor, you know - it's one of those things that most people fall into. So I did entirely the wrong degree, I did an electronics design degree. I say I did it, I failed my second year. By that time, I'd met Joanne and wanted to get married, and just didn't have any love for electronics at all. I liked playing with gadgets but not designing them and certainly not doing the maths required to make the electronics work. I failed my degree in left and went into management for McDonald's where I'd been working as a student, went into full time salaried management with them - amazing place to work as long as you didn't mind never ever seeing anybody outside McDonald's ever again because it was crazy hours, stupid work patterns. Loved it, learned a lot, but grew to hate the amount of time that I had to be there, particularly newly married. And my wife was a paediatric intensive care nurse, so she was on shifts, too - so we often didn't see each other for days at a time, which was not ideal, obviously. So something kind of had to give and I had a friend who worked for the Co-op Insurance. That used to be called industrial branch insurance where you used to go around every four weeks and collect life insurance and car insurance and house insurance premiums door to door, you know, existing clients - it wasn't sort of cold calling or anything like that - existing clients, you'd collect the premiums build that relationship and you became their financial salesman really, you could hardly call it advice. Sort of classic career path from there through two tied agencies with the Co-op and then the Royal and Sun Alliance, then became an IFA in 2000. Moved to Cornwall, I ended up working for a law practice actually, as their sort of in-house financial planner, and then bought into Jackson's in 2007. It's a sort of textbook career path really, tied advisor to IFA to business owner. So I've been doing it 22 years as of February. I'm sure I'm not old enough to have a 22 year old career, but there we go!

Jeremy Cline
And tell me a bit more about what made you start doing the podcast, because 10 years ago, I mean, yeah podcasts exist, but they were nowhere near as prevalent and popular as they are now.

Pete Matthew
No. I think we were only just getting started with podcasting. I should say I started with video first. I shot about 285 videos I think before I made the leap into podcasting in November 2012. I started shooting videos back end of 2009, put the first one up onto YouTube in April 2010. So it's coming up my 10 year anniversary. The reasons for doing it, I would say that really there was three things that really gave me the push. There was a set of legislation that was on the horizon - it actually didn't come in until early 2013 in the end - but what that legislation did, it was called the retail distribution review and it abolished commission for investment and pension products. Now, that is unequivocally a good thing - commission being the root of many a misselling scandal. But what it also did as perhaps an unintended consequence was disenfranchise a massive swathe of the population for getting any advice at all. Because if advice is fee based, and advisors, you know, have many compliance hoops to jump through, which of course, is costly, it meant that, you know, a young family that came into a small inheritance, were never gonna be able to afford anything like decent advice. I kind of wanted to help people to help themselves really. I'm very much of the opinion that most people don't necessarily need a financial advisor until they get to the many and complex decisions around the retirement bit, and building wealth is actually quite simple. So I wanted to sort of equip people to do that. So that was one trigger, really - just to do something more than help my own clients get a bit richer over time. That was the first thing - I wanted to do a bit more than that. Secondly, I had a lot of people tell me that in different contexts, I was good at explaining things so at work, home around the dinner table or the church that I was a part of just explaining how things work in a way that people can understand. And then thirdly, I read a book called Crush It by Gary Vaynerchuk. The premise of that book - I won't bore you with his story - but he's a sort of classic American Dream story, really - Russian immigrant to New York, dad got a job at an off-licence, ended up being the manager, then the partner, co owner, and then ultimately, the owner, and Gary sort of came into it when he came of age and built it into a $60 million a year, sort of powerhouse business. But Gary started shooting videos about wine, really, and the premise of his book was that whatever your message is, whether it's wine or in my case, personal finance or anything, if the message is good, and if it's helpful for people, people will show up and they will spread that message for you and I thought I'd have a go really, so I bought a little flip video camera which is now on my shelf over there and just started shooting videos and started extremely slowly. Nobody was watching except for maybe my wife under duress and my mum, but eventually it became this - certainly when I switched to podcasting, that's when it really started to get interesting, and it's now suddenly the number one independent personal finance podcast, hundred thousand downloads a month, nearly three and a half million total downloads. And it's just become this monster and a massive lead engine into my brick and mortar business - all of which was completely unintended. So it's been a weird journey really, all entirely by accident - which is not a great message, let's face it!

Jeremy Cline
It's that knowledge that I really wanted to tap into and have you on the show. We're talking here about someone a career crossroads, and they know that they want to change, but one of the things that is frankly scaring them is the whole financial side of it. That could come up in any number of ways. It could be that they need to re-qualify and so they've got to spend money on qualifications, going back to university maybe, something like that. It could be that they're worried about taking a pay cut. Maybe they're doing something where they're very nicely paid, they've got the middle class lifestyle but they've discovered that actually, they want to do something where they're actually going to be earning a third less or something like that. And they're worried about how they're going to support their partner, the children and so on so forth. Or maybe it's someone who wants to take a career break. Or maybe it's someone who wants to start their own business, but they're worried about, well, you know, it's going to take a while before I'm actually making some money from it. What do I do in the meantime? I mean, that was a stream of consciousness, and I imagine that's the stream of consciousness that a lot of people have in their heads when they're starting. So where do you begin when you're looking at all this? What's your starting point? What's the first thing you do?

Pete Matthew
The key to any transition is preparedness - being prepared. Any kind of snap decision to quit and go find yourself or start a business or whatever - to make that decision quickly, without being prepared is almost certainly a recipe for disaster. I think the first thing that people need to do is to think in terms of cash flow, because I deal with some pretty wealthy people, and I talk to lots of very ordinary people on the podcast and no matter how rich you are or not, financial wellbeing generally comes down to money in and money out. So if there is more coming in than is going out in lifestyle costs, then that's fine - as long as you're saving that excess. If there is less coming in than is going out, then that's a one way ticket to a spiral of debt and things like that. It's really important that people understand what their costs are, and sort of broadly compartmentalise those into necessary costs, minimum lifestyle costs and stuff that isn't necessary. So no matter how much you tell yourself it is, your Sky subscription or Netflix is not necessary. Neither is your gym subscription - it's not necessary for living. It's clearly a good idea as long as you use it, but it's really important to say okay, this is food, fuel to get to and from work so I can earn a living, Council Tax, electric, gas - these are the necessities of life. Almost everything else - holidays, driving a Mercedes rather than a Mondeo - those are lifestyle. Those are luxuries, essentially. So it's really important to know what they are and to be brutally honest with yourself. There is an emerging movement in this country, it's quite a big deal in the US, called the FIRE movement, Financial Independence Retire Early. And a large part of that is pretty aggressive reduction of costs. And even if you don't sort of fully buy into the whole end game of the FIRE movement, that emphasis on understanding what your lifestyle costs and keeping control of that is really, really important. The problem is for most of us who have decent jobs, we don't necessarily need to budget because we kind of know what's coming in and we kind of spend it all every month, and we're paying into our workplace pensions so that's cool - so really important to know your costs, I think. And then if you're coming up to a transition, if you say yes, I want to make this change, you obviously you need to cost that change. So if you're going to need to re-train, then that is you know, you're going to need to cost that out. If you are going to have a reduction in your income, you're going to need to find that money somewhere. So you will either need to reduce costs accordingly, or you will need to have money behind you from which you can draw the difference between your reduced income and your current lifestyle. And that's fairly simple maths generally - you know, if you are 1000 quid a month short between your income which is reduced now because you've changed your job and what your outgoings are, and you've got 10,000 quid in the bank then if you draw down 1000 quid a month, then you've got 10 months worth of living costs covered, thereafter you're going to be borrowing and that's trouble territory, really. So none of this is rocket science. It really isn't about whether you hold it in an ISA or something like that, or which ISA it's with. That really is detail - really money that you're going to spend in the next year or so, year or two or even three should be kept in the bank anyway where it's accessible and risk free. Understanding your costs and then having the money to cover those costs. Of course, that means mean thinking quite some way further ahead and think, okay, actually, I'm going to need to have 20,000 quid behind me before I make this change. And so then you're already screwing down your costs so that you can save that money. Yes, you might be able to borrow it, obviously if you can avoid borrowing then so much the better. But it really is about being prepared and thinking ahead. Does that make sense?

Jeremy Cline
Yeah, that does. So when you're looking at your time horizon, if you can identify that there is going to be this gap between what's coming in and what's going out, then I suppose there's two possible ways that you could plug that gap. One is by having a capital pot behind you, or another is somehow having another stream of income along the side - and I suppose that could be from rental property or it could be doing a side job or or something like that. How should you be thinking in terms of the capital pot? Is that something that ideally you want to draw it from that, or is it something ideally you want to avoid drawing on, how much do you plan on needing in that - talk a bit about that, appreciate a lot of that's probably as long as a piece of string!

Pete Matthew
Well that is a bit of a how long is a piece of string question, because somebody living in a two-down terraced house in Hull is going to probably have a lot lower monthly expenses than somebody in a flat in London or in the outskirts, so it is very much a sort of a piece of string. But we can all do probably more than we think to reduce our costs. If we need a capital sum to bridge that gap that can come from various sources - we can save it, we can ask Bank of Mum and Dad for a loan. We've many of us done that at various points, because the boomer generations which - I'm 44, my parents and my parents-in-law, you know they've done pretty well with property price growth and all that sort of stuff and they have they've retired now and they have means - that is a potential source. I really do think the key word needs to be planning. If anybody ever asks what I do I will always say I'm a financial planner, never a financial advisor. Not least because if you say you're a financial advisor people back away in fear in case you sell them an endowment or something. But financial planning is exactly what it suggests - it's 'Okay, we are here now, we want to get to here. So what do we need to do practically to get from A to B?' That is our sort of transition time, that's our planning and action time to get to where we want to be, and if that endpoint for you is leaving your current job and starting a new business or leaving your current job, which you're not really enjoying anymore, and instead doing a job which is lower paid, then before you get to that point, you need to be prepared. Capital comes in many forms. One thing I wouldn't necessarily do is borrow it at market rates - that's a hell of a thing, you know, if you're going to reduce your income and take on a personal loan say, that's not a great combination. It's not a great way to start out. Better discipline is to save it in advance. I have to be careful not to get too soapboxy here, but there are plenty of people who say 'My costs are already screwed down, I couldn't possibly save'. I do absolutely have sympathy for that. But I get that a lot from people, and then they maintain their golf club membership no matter what. We can all screw down things. But also, we've never lived in such a time of incredible opportunity for making money on the side - anything from Amazon affiliate stuff to, you know, selling stuff through Amazon or eBay, through renting out the parking space if you've got a parking space in your house, care share type stuff - there are a million ways these days of making some money on the side. And if it only needs to be one or two hundred pounds a month, that's actually relatively easy these days. And there's all kinds of resources online to help you to do that. Some of its pretty scammy, but a lot of it isn't - a lot of it is very straight. The internet tends to reward people who add value to other people's lives.We could talk a little bit about some resources for that in due course, but it's about being prepared and understanding how to bridge that gap really, and there are more ways of doing that than ever before.

Jeremy Cline
Do you find that people have a preference or something maybe they haven't even considered the idea that actually they can make an extra income. Do people automatically go to 'Oh, well, I'm gonna have to look at cancelling the gym membership', and if they're unwilling to do that, how do they get through that mental block?

Pete Matthew
One of my sort of key words that I bang on about all the time on the podcast is to be intentional. If you want to keep your gym membership, just understand the implications of that. I really like coffee. My office is right next door to a Costa, and so loads of sort of would be financial gurus would say well, if you want to save more money, you need to cut out buying your morning coffee, and sod that, I really like my daily coffee, right? But I understand the implications of it - a) I can afford it and b) I choose to have it, understanding that that probably is 50 or 60 quid a month that I could put into my pension, but I choose not to. So it's about being intentional and being an adult about it. And rather than being a little bit too default, 'Oh I really like my golf club membership' - so that's fine and stick to it. But understand that that's then what, seven, 800 quid a year - I don't really know I don't play golf - that you're going to need to find which isn't necessary for your survival. So be intentional - just add up the things that you absolutely refuse to give up and then that's your baseline isn't it. But if that includes two foreign holidays a year, then don't complain about the fact that you're trapped in your middle class job. If you really want to make a change, then it might be that that change extends to more than your source of income. You can come at any shortfall in income versus outflows in one of two ways or both ideally - you can reduce costs or you can increase the income. By far the easiest way is to come at it from both sides really, reduce your costs and increase your income then, you know, that's definitely the easiest way to do it. People underestimate the amount you can achieve in the evenings. I've been doing Meaningful Money almost exclusively in the evenings and weekends except for the last year and have built it to quite a machine which now produces multiple five figures, shall we say, per year in evenings and weekends. Okay, for the last year I've done it a day a week as well. My colleagues here at Jackson's my financial planning practice essentially gave me a day a week, which is why we're having this conversation in the morning. Because it benefits Jackson's and so they saw the wisdom in giving me the space to do that. But prior to this time last year, so the back end of 2018, I was doing Meaningful Money exclusively in evenings and weekends. And it shows you what you can do if you stick at it and put your mind to it.

Jeremy Cline
Just going back to the reducing costs. Yes, absolutely you can cut things, but you're always going to get to a floor below which you can't actually cut anything any further aren't you?

Pete Matthew
I mean, well, unless you unless you go back in with parents or something like that. So yes, most of us will have a natural floor. Yes, of course. That's just real life.

Jeremy Cline
Do your clients when faced with these choices, do many of them find alternative sources of income? Do people get on the internet bandwagon?

Pete Matthew
I should clarify that my clients here at Jacksons, they're generally not in this position. We tend to deal with high net worth clients usually in and around the transition into retirement - because that's the most complex area of personal finance. I think people have built up multiple pension pots and different sources of income and things like that. I'm not sort of coaching people in the sort of situation that we're talking about here. I speak to those people through Meaningful Money, but that's not what I do for a living essentially. Most people, I think if they are really serious about making a life change, like we're talking about here, they understand that it's probably going to be far more reaching than they perhaps at first thought. And that idealism meets practicality usually with a pretty hard bump. So yes, I'd love to learn a third less than I am now - but in order to do that, I will have to make some pretty radical changes. Am I prepared to do them or not? How much do I hate the current job? How much do I want to do the new one, and it'll come down to priorities. There's a line from Jesus actually, 'Where your treasure is, there will your heart be also.' So the stuff that you really value, that's what your passion into, and if you value stuff and lifestyle, you'll get no judgement from me - it's your life, you live it or you want to do it - then that's one thing, but you're gonna need to pay for those things. If you value what your ideal job might be in doing that sort of thing instead, even if it pays you less, you will throw everything at that. I just think that's real life. You can tell what people really care about by the way they spend their money, I think.

Jeremy Cline
Do you find there's a lot of trying to keep up with the Joneses, which I guess is something that you might get in your area as well as other people?

Pete Matthew
Yeah. There's a little bit of that in all of us. And again, that's not something that I would judge people on. But it never makes us happy. It's very tempting when the person across the road who has the same job as you is driving a nicer car than you. One thing I've learned though, is I would go to finance advisor conferences or seminars or whatever and the car park is full of BMWs and Lexus's and Mercedes and Audi's so I drive an eight year old Seat Ibiza, because I don't go anywhere - not really. My wife has a slightly bigger car, a Rav4. I love cars as well - I would dearly love to drive a BMW or whatever, but I choose not to do so because right now I'm concentrating on paying my mortgage debt off. Whereas I'm thinking I'm sitting in a room of financial advisors here - they should know what they're doing, but I imagine many of them have just assumed that it's normal to lease a car their entire working life, or they've bought into some terrible sort of 'Well, I need to put forward an appearance of success'. Hence I will drive a BMW even if I can't really afford it. Maths just doesn't stack up, and we should know better as a profession, but keeping up with the Joneses, it's a sort of default assumption that we need to have better and bigger - and we just don't, and I think we need to spend some time thinking about what is really important. It's another reason why I really like the FIRE movement actually, they've got a lot of good stuff to say on this.

Jeremy Cline
So you've been through the exercise, let's say you know that you're going to take a year off to do a course and you know how much your tuition fees are and what your living costs are going to be, so you've identified a sum. How pessimistic should you be about things? So how much should you build into well actually it might cost more or it might take longer, or that sort of thing? I'm sure it depends on what it is you're doing, but perhaps you could talk a little bit about that?

Pete Matthew
Yeah, I understand the question, and like so many personal finance questions, the biggest influencing factor on that will be your own personality and feelings about what you could summarise as risk really - I'm not talking about investment risk here or anything like that. But the longer I do my job, the more I realise that personal finance in its entirety is more about behaviour and personality than it is about how money actually works. So if you are a worrier, and if you if you're self aware enough, and think actually my financial day to day control perhaps isn't as tight as it ought to be, then you ought to build a bigger margin of error, or safety net if you like. Whereas if you are the sort of person who not only is very disciplined and keeps very cautious and careful track of spending and is confident in that, then you probably don't need to keep much of an overflow at all. Then everybody should always have an emergency fund - a pot of money put to one side. It's not a holiday fund, it's not Christmas fund, it's an emergency fund. It's a pot of money, how big it is is up to you really. We'd generally say between three and six months worth of minimum monthly outgoings and that is not touched. You don't use that to fund your lifestyle. That is, what happens if I have to drive three quarters of an hour each way to my college and my car blows up - how do I then get to my course that I'm doing? It's an emergency fund. That should be on top of your pot that you've identified as being able to sort of bridge the gap for you while you retrain or whatever.

Jeremy Cline
Do you find people ever go too much the other way - that people are overly cautious, and perhaps that prevents people from doing things, investing things, maybe taking steps towards a career change or whatever, but they're just too cautious about what might happen?

Pete Matthew
Yeah, overthinking generally. The maths actually is quite simple. But yes, I think again, that's a personality trait. Some of us overanalyze and overthink things, and that's just something we need to push past. So the short answer is, yes, that does happen, and not that frequently. I think probably more often people underestimate what they might need. We tend to be - particularly males, I have to say - we tend to be over optimistic with our assumptions about lots of things. It's why women make better investors!

Jeremy Cline
You mentioned that you've got a couple of resources that might help people, so perhaps you could spill the beans and let us know what they are?

Pete Matthew
I think just before I get into that Jeremy, something's just popped into my mind, if you don't mind. I think as well as sort of your practical household stuff, how much do I need to spend to bridge that gap or whatever, it's important that you understand and be prepared. If you are say, to set up in business, there's certain things that you need to do, you would need to register national insurance, and make sure that's all correct. Tell them that you're going self employed or obviously if you set up a limited company, that's a separate thing as well, you'd need to set that up. Always crucially important if you are going to set up a business, that you keep business finances separate from personal. I've lost count of the number of times I've come across self-employed people and they use the same account for their business as they do for their personal spending, and it's a nightmare to unravel. I'm not an accountant, so I'm not doing the unravelling, but you know, it's quite easy to have two separate bank accounts, right! These are basics of good financial management and yet we're not taught it in school so we can't assume that people know this. Whatever you're planning to do, if it's self employed or set up a limited company, speak to an accountant or a financial advisor and just grab an hour of their time - an accountant is usually a good place to start with that - and ask them what you need to do to set up right from the outset. There are amazing software apps these days, very low cost - Free Agent, Zero - to help you run the finances of a business, whether it's limited company or self employed. Just sign up for one of those - they're like 20 quid a month or something - to get your finances off on the right foot from day one. They'll even give you a running view of what your tax bill will be day to day - you know, right now you owe this much tax so you can start to put that stuff aside. Basic financial management is really important. So understand the implications of whatever it is you're going to do and be prepared for the slight dip. That's the message today really.

Jeremy Cline
Do you think this is something that actually will be basic financial advice and financial planning and how to think of your money?

Pete Matthew
Yeah, there are very early stage moves towards adding this to the curriculum. You can add some basic parts of the curriculum at say GCSE level, but I think the time in school where it really needs to be taken seriously is at tertiary. So 16, 17, 18 - of course folks are still in full time education, they're either apprenticing or they doing vocational stuff, or they're doing A-levels or IB. And that's a good time to do it. Because from that they are either going to higher education where they will be responsible for managing personal finances probably in anger for the first time or they're going into the workplace. So I think there ought to be some kind of national standards curriculum of the basics of how debt works, particularly, that's the most insidious thing. I think it's a sort of tacit assumption that it's normal to have a load of debt your entire life when it just doesn't need to be. The dangers of that, the difference between good and bad debt and things like that I would love to see taught at tertiary, and even support given to students at university and for employers of young adults to be made to do some kind of financial wellbeing. I think we're a long way from that but that's something I'd like to see happen for sure.

Jeremy Cline
What do you think would be the study text? I mean people talk about you know, Rich Dad Poor Dad and that sort of thing.

Pete Matthew
Definitely not Rich Dad Poor Dad, it's a good book, don't get me wrong, but it ain't panacea. I should hesitate from plugging my own book here - I wrote my own book to be the one book that most people need, but I mean, no 16 year old's going to read it, right? So I think you probably would need to come up with something new for 16, 17, 18 year olds and they're not going to read a book probably anyway, I think we need to find ways of reaching younger people. It'll be through Instagram probably at the minute, or Tik Tok or something. But there's definitely going to be ways and obviously if they're sitting in the classroom, then they're forced to listen, whether they hear or not, but I wrote my own book, The Meaningful Money Handbook, to try and be the one book that most people need. So it follows my three steps really to financial success - it isn't rocket science, it's spend less than you earn, so there's a whole section about budgeting, spending management, getting out of debt - really important if you're in it already or avoiding it if you're not. Secondly is to insure against disaster, because there's a whole load of stuff that we can control and quite a lot that we can't. We can't control if we get a debilitating illness, which stops us from working. We can't control if we are a partner die early. So there are some basic insurances that you can put in place so that your financial plans are not completely derailed, so they might have to change but they're not completely derailed. And then thirdly, how to invest to build on that foundation of insurance. It's really not rocket science. You know, most people just need a pension and an ISA. Pensions are usually available through work now, so you just need to join it. Don't even think about it, just join it, you'll never regret it! And then for outside of pensions, most people just need a stocks and shares ISA. So the book deals with that, it tells you how to pick funds within your pension, your ISA and stuff like that. That's the book that I would love everybody in the UK to read for slightly self-serving reasons!

Jeremy Cline
Fair enough! And something you just said then has made me think - you talked about investments, and everyone talks about investments having, you know, a minimum, what five year horizon or 10 year horizon or whatever it might be - going back to what we were talking about where you're looking to build up a capital pot, perhaps in a more shorter term, so two years, three years - one of the things that I really don't like is looking at bank accounts, which have a lot in them, because I just think that is getting worth less and less and less every day because of inflation. Is there a halfway house or something that someone with say a three year horizon can look to put their money into, which is going to give them a bit of a return and not just get lost in inflation, where they're looking at this very defined thing that they need to do in say, two or three years?

Pete Matthew
Not really. What I tend to say is if this money is for a given purpose in the short term, it really isn't about building your wealth. It's about facilitating something happening now. So don't worry about inflation because you're gonna be spending that money in the next couple of years anyway. Inflation is less of a factor in the shorter term and much bigger factor in the longer term. That's why you don't keep money that you want to retire on in the bank, you put it in stuff which will grow super inflationary so it's actually increasing in value. But money you're going to use in the next two, maybe three years, I wouldn't lose any sleep over inflation, because that's not the point. You're going to spend it anyway. Just forget about inflation and keep it safe, far more important than trying to game the system. Yeah, you know, you might invest it and make 10, 15% if you time it right - but you're just as easy and likely to lose that much, and what you don't want to ever be is a forced seller in a distressed market, so if you invest, and then suddenly you need that money, and the market happens to be off 15, 20% at that point - because it happens, right, we might have had we've had 11 years of pretty benign markets for the most part, most of us, many investors have never experienced a true prolonged market decline, so it isn't a one way trip - the last thing you want to be is a forced seller while you've got less money in there than you invested, that's just disastrous. That's the main way that wealth is destroyed, is being a forced seller in distressed markets.

Jeremy Cline
You've mentioned your book, which I will certainly link to in the show notes. Any other resources which you'd recommend to people, either on this topic or something which has helped you personally?

Pete Matthew
This is the sort of thing that I can give you about 50 different resources, but if I'm going to be sort of somewhat edited in the list that I give you - in terms of making income on the side, if you want to increase your income while you're still doing your current job, listen to the Smart Passive Income podcast by Pat Flynn. It's one of the podcasts that's been going on a decade now I think, and it's one of the podcasts that got me into podcasting because he's just so consistent and so good - interviewing people who are making money in all kinds of different ways, from physical products to online stuff. It's incredibly diverse and Pat is one of the good guys online - straight as a die, honest as the day as long, loves his family - that's the driver for everything he does. So there's nothing smarmy about him. I've been massively influenced by a guy called Michael Hyatt online, michaelhyatt.com he's a sort of leadership and personal productivity genius I think. He was a CEO for one of the biggest publishing houses in the world, started blogging just as a means of keeping in touch with his staff really, and then suddenly hundreds of thousands were reading it every month and he now has an eight figure a year business teaching this stuff. And again, quality guy - I've learned a lot, I use his full focus planner every day which is a sort of analogue planning system which works in conjunction with your digital calendar, all that sort of stuff and all the content around that I've really enjoyed and benefited from. Any book by Ryan Holiday - if you talk about self awareness right, we talked about self awareness being the key, not only how much you spend and your sort of personal tendencies towards money and things like that - any book by Ryan Holiday, great place to start is Ego is the Enemy. It's a book so good I've committed to reading it every year for the rest of my life. Seriously, it's outstanding. So many self help books will be rah rah, you can do this, you've got this, I believe in you. It's like yeah, that's all fine, all quite American - Ego is the enemy, Ryan Holliday, I think is the best guy interpreting the stoic philosophy into modern everyday terms. Ego is the Enemy is full of stories where people's ego have really let them down and made catastrophic errors as a result, or because they've kept their ego in check has led to good outcomes. The whole stoic thing is very much about living your best self and virtue and things like that. And the Ryan Holliday books are just outstanding. So I'm listening to his current one called Stillness is the Key at the minute, but a good place to start is Ego is the Enemy - it will put you in your place in a really productive way, tell you that you're not all that, but actually, you can achieve great things even so. So I love that stuff. And I could probably go on but I think I'll stop there!

Jeremy Cline
That's enough for me to put in the show notes! And where can people go to find out more about you and maybe get in contact with you?

Pete Matthew
Well, the best place is MeaningfulMoney.tv - that's the home of everything I do really. Meaningfulmoney.tv - there's a contact form there, or just hit me up at Pete@meaningfulmoney.tv. Love to hear from any listeners and answer any questions. Yeah.

Jeremy Cline
Pete, thank you so much.

Pete Matthew
Jeremy, thank you so much for having me, man. It's been fun.

Jeremy Cline
Well, I hope you enjoyed that episode, loads of great tips. The biggest one for me was what Pete was saying about being intentional. Pete wasn't saying you should give up the gym membership or give up the daily coffee from Costas or Starbucks. What he was saying was that we should be intentional about our spending. You have your gym membership because you use the gym regularly, enough to justify it. You spend money on things that are important to you that you actually use. I loved what he was saying about being intentional about this, about being intentional on what you spend your money. Show notes are at changeworklife.com/27 and if you've enjoyed this episode and found it useful, it'd be great if you could share it on social media. If you look at the show notes page, you'll find links so that you can share the episode on Facebook, Twitter, Pinterest, and it would mean a heck of a lot to me if you can share this episode. I mean, if you found it useful, chances are someone else will too. Pete talked a bit about making money on the side and next week we're going to be talking to someone who's done that so successfully that it's actually enabled them to quit their job. It's going to be a good one and I can't wait to see you then. Cheers. Bye

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