The large effect of modest saving
You know how according to my new publishing schedule I am supposed to publish useful and exciting book review and/or discussion today? Well, I have written one; actually I have two because I can’t wait to tell you about the new e-book by my friends at My University Money. But this will have to wait for a day or so because something happened today that took me in a completely different direction. Signs should be respected even by rationalists like me. So, here it goes.
Last night, The Money Principle published a piece on the UK budget; one of the controversial points in it is the withdrawal of ‘child benefit’ – this is a relatively modest payment people with children get. Thinking through the budget and reading through John’s post, I had a niggling feeling that something was trying to come out; something that I have vaguely noticed before but never completely managed to get the grip of.
This morning John and I were having coffee, discussing another sticky point of the budget – the way in which it disadvantages people over 65 – and it suddenly crystallised and took definite shape. We mentioned that the child benefit is £20.30 (roughly $30) which means that we should be getting about £81.20 per month ($128). But I know my numbers and I knew that we have been getting £53.60 ($84) per 4 weeks. This can’t be right! Have you reached your peak earning years?
About twenty years ago I went to one of these ‘do as I do and you will get rich by selling crap to suckers like you who want to get rich’ seminars. Don’t misunderstand me; I am all for proper wealth building seminars that openly admit that the only place where success is before work is in the dictionary and that not everyone in the room will end up wealthy. You know you have paid for a good one when you hear that statistically only a fifth of the attendees will take action and even a smaller proportion will do it smart!
This is not what I wanted to talk to you about though; what I remember very clearly from the really useless in any other way seminar I attended is the following:
‘You have reached your peak earning potential by the time you get in your 40s. After that, it is all over the hill!’
Although I was in my late 20s then, I remember my analytical nature objecting. Surely, this is far too young! Or is it?
Apparently, at the time of the seminar this was almost correct: twenty years ago, statistically, the peak earning years were 35 to 44. Today, however, this margin has moved by about ten years and it is 45-55. Now, you will understand that for obvious reasons I was very pleased to get my hands on this statistic. One, it means that I am half a decade away from my earning acme – much can happen in five years you know, particularly if one has a good plan and is taking action (my estimate is that if we achieve about 40% of what is on our plan we are doing spectacularly well). And two, this is a good one to pitch into any even remotely ageist debate – it is not only that I have better insurance because I am older; I also earn more now that I am older. Ha, ha!
Five differences between women and men and their effects on our relationship with money
Today is International Women’s Day and although we are not very big in celebrating it in the UK – we have shifted our celebrating to the much more politically neutral and commercially expedient Mother’s Day – I want to mark it. After all, I am from Bulgaria where people really believe that ‘men are the head of the family but women are the neck’ and celebrating women and their strength is important. Every 8th of March Bulgarian women get flowers from husbands, lovers and children.
International Women’s Day started as a socialist event to promote equal rights for women, including the right to vote. A century later most women on the planet vote, and most women have access to labour markets but we still earn only 10% of the world’s income and own less than 1% of the world’s property. This is despite the fact that women a becoming more and more prosperous in the Western world; this is not ‘the world’ right? Is there anything specific about women and money?
This made me think about key differences between the way in which men and women relate to money. I believe that apart from the layers of cultural conditioning the different ways in which men and women relate to women boil down to the following:
100 words on the questions we ask
When deciding on action and considering our future we often ask ‘what’ questions. ‘What shall I do?’; ‘What will happen?’; ‘What does the future hold?’ Asking these questions we may forget that, with very few exceptions, we can do anything, anything could happen and the future is a mystery. Asking…
100 words on ‘understanding’ and ‘changing’ life
Marx’s eleventh thesis on Feuerbach states: ‘philosophers have only interpreted the world; the point is to change it.’ It seems to me that this is very significant and applicable not only to society and economy, but also to our mundane everyday lives. I often hear myself asking ‘why did you…
100 words on bringing up children
Being a parent can be a daunting experience. Most parents worry most of the time about whether they are doing ‘the right thing’. Like in other areas of life we tend to worry about the wrong thing. I agree with Umberto Eco who said that all children start their life…
100 words on life-work balance
People often have problems balancing life and work. Working long hours, even when we enjoy what we do, is proven to damage our health; this also means that ‘our labour can’t reproduce itself’. Put simply, we have no time to rest and we have no time to brush up on,…
100 words on life and exercise
When I sweat in the gym and people ask me ‘does exercise ever get easier’ I have a simple answer: ‘no’. Exercise is not supposed to get easier; when this happens it means that you are not working hard enough and are not getting fitter. If you find exercise easy…
100 words on writing
For lazy, restful Saturdays, I am introducing posts on different topics that are exactly 100 words each. I know that Len Penzo does this but it looked like such good fun that I decided to have a go. These short pieces gave me great pleasure to write and I hope…
Goal Setting for High Impact and Productivity (Get Your Ducks in Line)
Lately, I have been thinking a lot about goal setting and the ways in which we can organise our goals to achieve the highest possible impact with the lowest possible effort. This is usually about changing things, about moving in a desired direction. If you have set goals already…
Dream your goals and plan your dreams: the Walt Disney groove
You already know that I don’t set my goals by tinkering with the present but trace back my dreams; this way my goals are a compass helping me to follow the direction of my life. There are two main difficulties with this: one is that we have generally forgotten…
What gives me most value?
Below is a guest post from Marissa over at Thirty Six Months, where she blogs about paying off debt fast, curbing her impulse shopping and all the other things one has to do become financially independent. You can see my post, The fastest route is rarely the most direct one,…