I don’t know about you but as a child I often heard the phrase “Wouldn’t it be nice to be a kept woman“. Back then I really didn’t understand what it meant but I recognised that it meant you would be looked after financially as you grew into adulthood and beyond.
Today I’m delighted to bring you a guest blog from Kelly East at Luna Financial Planning about the perils of being a kept woman and how you can start your path to financial independence.
Having spent over a decade in financial services, I have met countless wonderful, clever, intelligent women who still receive an ‘’allowance’’ from their husbands for housekeeping!
Some women still have no idea what it really means to be financially independent and why they should start this process NOW!
My role as a financial adviser is to help clients, (particularly women) to really come to terms with what it means to be financially independent. I help clients embrace their financial freedom and guide them step by step through all of the stages and obstacles life throws at them on a daily basis.
Depending on experience, my clients may need help understanding what their financial goals are. For some it could be a very short term goal such as saving to buy a car or maybe a long term goal such as saving for retirement. The key is to always be realistic and specific and to start as soon as possible.
If you plan to support yourself and maintain financial independence, you need a clear understanding of your personal finances. Start by looking at your bank and pension statements, tax returns (if you’re self-employed), and any other investment / savings accounts you may have. Knowing your figures is the first step to success.
According to Netwealth, it is the woman who suffers the most in heterosexual marriages following a divorce. They found that women are often the party with fewer financial assets. Women are more likely to take time off to care for family, and this can often result in lower earnings as well as a smaller pension pot in retirement.
Tellingly, nearly two in five divorced women regret not maintaining greater financial autonomy (39%) and greater financial engagement (37%) over the course of their relationship, according to the research.
Men fare far better, with 44% stating they have already saved or expect to save enough to achieve a comfortable retirement, for example, Netwealth found. I completely agree with Emma-Lou Montgomery, associate director for Fidelity International who said women need to start planning now and not wait until the worst happens. Giving some thought to what you would need in retirement should your marriage break down admittedly isn’t the most romantic of things to do, but it is important to be realistic.
Fidelity International found more than half (56%) of married women do not have a ‘Plan B’
arrangement in place. According to the Government’s own Wealth & Assets survey, one in ten married women admitted they plan to rely on their spouse’s pension in retirement, for example, even at a time where divorce affects around one in two couples. Worryingly, the same Government research found 17% of married women surveyed had no pension of their own at all.
Even those who do have much less saved; a typical woman has a pension worth just a third of a man’s, according to research by NOW: Women have pension worth £51,100 while men have around £156,500. Over-reliance on a partner for financial stability is all the more concerning with the rise of co-habitation, where those who are unmarried would have no automatic rights at all to the other’s wealth in the event of death or break-up.
A divorce can completely unravel both spouses’ finances for various reasons, which is why it is important you take control of your money after a marriage ends so that you can secure your own financial independence as soon as possible.
Budgeting is something each of us should be actively doing on a monthly basis no matter what our circumstances are. Why? because if you don’t know how much money you have coming in every month, how can you realistically expect to understand if you can afford to pay for the items you are spending on each month. Everyday expenses such as mortgage or rental payments, food, utility bills, children’s clothing, insurances, fuel, birthdays, Christmas, holidays etc etc . These are just a few of the expenses we may need to budget for …. the list goes on.
As a financial adviser I really do understand that the very start of a financial relationship with yourself is budgeting. I have created a FREE comprehensive budget calculator available for you to download and use at https://lunafinancial.co.uk/which covers items that perhaps you don’t ordinarily budget for, but nevertheless definitely need to be accounted for.
Our budget calculator will help you clearly identify if your current income is suitable to cover your current expenditure. It’s very easy to use and it’s there for you whenever you need it.
Budget for self-care.
It’s easy for anyone, but especially parents, to neglect their health and well-being during divorce. Self-care, particularly during a stressful transition, is critical. You can’t take care of your children if you don’t take care of yourself.
There are thousands of free yoga and exercise videos on YouTube instead of expensive gym memberships. Our local library offers lots of free classes including meditation and mindfulness as well as offering lots of free to rent books and movies.
Pensions on Divorce
Pension sharing isn’t always the first thing divorcing couples think of. Typically, most people focus on what will happen to the family home. But pensions are a huge asset and important when planning your future – so deciding what to do with them is extremely important.
There are three options for dividing up pensions as part of a divorce:
- Pension Sharing. Pension sharing is a formal agreement to divide your pension assets at the time of divorce. The courts work out exact percentages and the receiving party can become a member of the pension scheme or transfer the value to a new personal pension in their own name. This gives complete separation and is the most common option.
- Offsetting. The value of the pension is offset against other assets. For example, one spouse keeps their entire pension, and the other is given alternative assets (e.g., property or cash) of the same value.
- Earmarking. All, or part, of the pension is earmarked to be paid to one party when the other starts to draw pension benefits. There is no legal transfer of ownership.
LUNA Financial Planning’s approach is one of complete and genuine care for their client’s wellbeing. In our experience the financial and emotional challenges of a divorce require specialised planning. By planning before, during, and after the divorce you can achieve an objective, thoughtful and equitable settlement. We are happy to form a relationship with your solicitor and between us we can work together.
Your credit score reflects your ability to get credit. The lower it is, the more you may struggle to get approved by certain companies. If you have little or no credit history, this could negatively affect your credit score. You’re probably thinking that’s a bit odd. If you’ve never needed to borrow money before and you have no debt, surely, you’re the perfect person to lend to? The thing is most companies like to see a good track record of sensible borrowing – it helps them decide if you’re likely to pay them back on time.
Unfortunately, you’re unlikely to get a high score without having used credit – even if you’ve taken other steps to improve your rating, like registering on the electoral roll.
It’s worth noting that some people may have a low score because of negative influences on their credit report, such as late payments. If this is the case for you, there are ways you can improve your score.
Ways to help build your credit rating:
Opening an account or getting a credit card can lower your credit score initially, before helping it improve. Experian Credit Reference agency suggest:
Get on the electoral roll. It’s quick and easy to register on the electoral roll. Companies use this information to confirm your name and address are correct and up to date, so it’s crucial to building your credit history. If you’re not eligible to register on the electoral roll (e.g., you aren’t a UK national), you can add a short notice of correction to your Experian Credit Report explaining why.
Open a bank account. Having a bank account and managing it well shows companies you’re financially responsible and starts to build your credit history positively. If you have an overdraft, stay well below the limit (using no more than 25% of it is a good rule of thumb) and try to pay it off as quickly as possible.
Get a credit card. If you’ve opened a bank account and are managing it well, the bank may also be willing to give you a credit card to build credit. Paying it off on time and in full each month will help build a positive credit history and improve your score.
Take out a small form of credit. This might be a mobile phone contract. They’re usually easier to get accepted for than credit cards but can still demonstrate your ability to pay your bills on time and be financially responsible.
Manage your household bills well. Looking after your utility accounts (e.g., water, gas and electricity) can help build your credit history and show companies you’re responsible. Even rental payments can improve your score, provided you make them on time and in full.
Thank you to Kelly East for this informative and practical advice. I also come from the school of thought that it’s important to have more than one stream of income. If you’d like to learn more about one of my income streams, enter your details here to watch a short video.
I’m often told that the way my partner and I got together is like something out of a Fairy Tale or Hollywood movie, and as today is Tell a Fairy Tale Day I thought I’d share some of our story with you.
We first met 23 years ago in 1998, it wasn’t love at first sight. In fact, my first thoughts were; he was rude, arrogant and I wouldn’t want to bump into him alone on a dark night! I was out with some girlfriends for my birthday, we’d bumped into some mutual acquaintances, one of whom was the person I really fancied, and we’d all started enjoying the evening together, drinking, chatting, laughing, this rude, arrogant man seemed to tag along and we just couldn’t shake him off.
At the end of the evening we were all jumping into taxis and I discovered to my horror that he lived at the other end of the village I was in. So we had to share a taxi. I got out at his street so that we split the taxi bill and he invited me in for coffee. Bizarrely, I agreed. We sat at his kitchen table drinking coffee and talking. We talked all night. I recall sitting at the table seeing the sun come up and realising I still wasn’t home.
This was a revelation to me, a man who invites you in for coffee and a chat and genuinely wants coffee and a chat. My interest was piqued.
He called me a couple of weeks later and we went on our first date – to the local Rugby 7’s tournament! We actually dated for a year before going our separate ways; I went to live and work in London (I was living in South Wales at the time) and he went to Nottingham University as a mature student. These were the days long before mobile phones were common-place and we just couldn’t maintain a long-distance relationship.
Not a day passed without me thinking about him. In the years that followed I got married, had a baby, got divorced, went through business failure, bankruptcy and more before I started to put myself first and started following my dream to become an actor.
I recall receiving the call that told me me I was cast in a play that was due to tour the South West of England. I said to the partner I was with at the time “I have no idea how, but I know that this play is going to change my life”.
It did change my life.
Whilst I was in rehearsal and chosen as the ‘poster girl’ for the play, that man I’d met all those years ago had headed into his local theatre to book tickets for a production. Looking at the posters advertising forthcoming productions, he thought he recognised the woman in the poster for ‘Ward 7’, the play I was in. Asking the box office manager if he knew who I was, and mentioning me by my maiden name, the box office manager also recognised me as I had been in a children’s theatre group with his daughters when I was a child.
A few telephone calls later and they had ascertained that ‘Yes’ I was the woman they thought I was. At that point all I knew is that someone who thought they knew me had booked tickets for opening night. I had no name, it could have been anyone.
A week before opening night I received a Facebook message request. It’s fair to say my heart skipped a beat when I saw who it was from. But I was sceptical. I hadn’t heard from him for 15 years at that point and the last I’d heard he was living and working in Canada with his girlfriend. I agreed to meet him for a coffee.
Within minutes of meeting I knew I was in trouble. All of those old feelings came rushing back and the conversation we had that day over coffee just reinforced the message that he really was the love of my life.
He turned up on Opening Night and within 3 weeks I had left my partner and moved in with him to his bachelor pad in a seaside town in the South West of England. That was 8 years ago and I’ve never been happier.
I’ve often said ‘when you ‘know’, you ‘know”. I always knew he was the love of my life, it took him a while to realise I was the love of his life. That day we met for coffee we talked openly and honestly to each other for hours. We had both felt the same way, he just hadn’t felt he deserved to be loved.
The past 8 years haven’t been easy. We’ve dealt with stuff that would have broken a less strong, healthy or robust relationship. But we have continually felt more and more in love with each other.
Can we look back and say we would have done things differently? Of course we can. But there is nothing in either of our pasts that we’re ashamed of, nothing that either of us doesn’t know about the other, and nothing that we know we can’t overcome in the future.
What we have, is what our relationship was based on from that very first night we met when I didn’t like him at all – we have communication, honesty and trust. We have shared values.
Yes, the way we reconnected is something of a Fairy Tale but there’s truth in the adage that ‘life is stranger than art’.
I’d love to know your Fairy Tale moments.
Recently I have spent a number of hours each week working at my local hospital. It’s certainly been eye-opening and I have so much respect for my colleagues who have worked at the front line for the entirety of this pandemic thus far.
But what has struck me most, and something I’m privileged to witness, is the diversity of relationships that I’m party to during my time there.
There is the obvious patient/clinician relationship, and all staff are trained to help patients who are anxious and worried at this time, to ensure their visit to the hospital, however long, is as comfortable and stress-free as possible. Something that requires a lot of resilience in these testing times as procedures seem to change with each new news report.
Then you see the parent/child relationship. Where I’m working it’s often mid-life children accompanying their elderly parents. A generation who as war babies were the most vulnerable at the time of their birth and now once again, find themselves among the most vulnerable in our society.
Then there’s the couples; young and old, long and short term. The young couples barely seem to talk to each other, heads down glued to their mobile phones giving silent moral support in their joint isolation. And the elderly couples, worried about what news may be imparted to their loved one, looking after each other with an enduring love that so many of my clients seek for themselves. They will often have spent the entire day at the hospital for one short appointment with a clinician who could potentially change the course of their life.
And I see the couples where there is obviously conflict or abuse, often the individual won’t even recognise that the conflict is there but for someone finely tuned to detect it, it’s obvious. I see myself in the women or men who present scared of their own shadow, their partner doing all of the talking for them and complaining if their appointment is more than just a few minutes late because they, not the patient, are being inconvenienced.
I relish talking to the patients, giving a smile, behind my mask, ensuring it reaches my eyes. Making what I hope is a reassuring gesture to those who arrive worried and anxious. And doing all I can to make their brief interaction with me as pleasurable as possible. For those who can’t walk without assistance and have a long wait, I fetch water from the water cooler, and I’ve assisted those who can’t read or write to complete forms that are confusing enough for the most literate of us.
You see all of life in a hospital, the good, the bad and the ugly; but for me, the best parts of wearing PPE and having the constant sting and smell of hand sanitiser as company, is giving random acts of kindness to worried strangers, and observing the myriad of relationships that play out day by day in the midst of a pandemic serving as solid reminders that life really does carry on amidst the ebb and flow of whatever nature throws at us, and that strong, healthy and robust relationships can endure whatever adversity is pushed across their path.
Do you ever feel like you’re stuck in Groundhog Day?
Many of the women over 40 who I work with tell me they feel trapped, doing what they think they SHOULD be doing rather than what they WANT to be doing, keeping everyone else happy rather than themselves, stuck on a treadmill of monotony. Their relationship is stuck in a rut and it’s impacting all other areas of their lives.
How and why does that happen?
Well, it’s all down to our subconscious. Ultimately, it’s designed to keep us safe and alive and let’s face it, if you’re reading this, it’s done a pretty good job so far hasn’t it?
But, whilst keeping you safe and alive, it’s also stopping you from having a truly fantastic relationship and living the life you want to live.
You know all those times you’ve said to yourself “what if?”? That will be your subconscious reminding you that by taking a risk you could potentially cause yourself an injury or lose your life.
Now of course, taking the initiative in your relationship is highly unlikely to cause you to lose your life (and if it is, you need to seek immediate help by calling 999) but the human brain hasn’t evolved quite as fast as the environment around us and that reptilian brain is kicking into survival mode and trying to protect you from the perceived danger of a stampeding woolly mammoth!
So in trying to protect you, your brain reminds you of all of the reasons why doing something you WANT to do rather than what you’ve always done before ( i.e. what you SHOULD do to protect you from said woolly mammoth – or in a more up to date scenario, to protect you from shame or embarrassment) is safer and better for you! Yes, there might well be occasions where it will actually save your life, and in those instances I implore you to listen to it but the reality is, in this day and age, we are so surrounded by health and safety, and a million and one other ways to keep ourselves safe as we live our lives, that we don’t need quite the same amount of protection and reminders that our ancestors needed.
The trouble is, too many of us don’t question our subconscious or the well-meaning but equally fearful guidance of family and friends; all of whom are going through similar scenarios in their own minds and coming up with very similar results.
And so, we carry on doing what we’ve always done and our subconscious keeps quiet, knowing that until the next time we consider doing something different, stepping outside of our comfort zone, we’re safe and free from harm.
But what our subconscious doesn’t know is that this is part of what causes our relationships to fall into a rut; to become safe, dull, boring, routine. Whilst it may be keeping us safe from physical danger, it’s actually damaging our long-term emotional health.
Being in a relationship that doesn’t fulfil your needs on either a physical or emotional level is equally as damaging as that stampeding woolly mammoth was to our ancestors.
You have a choice; either carry on living as if you’re in Groundhog Day, allowing your subconscious to keep you safe from woolly mammoths, or you can break out and create your blockbuster life that includes a strong, healthy and robust relationship and all of the benefits of the sexy little extras of the ripple effect!
If you choose the latter then book a free 15-minute call with me here to banish those woolly mammoths and free you from Groundhog Day.