Stock image used to preserve interviewee anonymity
Partners and parents – with more than just yourselves to think about, how do you feel about investing? We asked people to open their money diaries anonymously and share how they spend and save. This week’s case study has a second child on the way…
I am married with one son with another baby due in April. My first-born starts school in September so we will have a brief break from childcare costs. My wife is a freelance chef with a fluctuating salary so I tend to pay the lion’s share of the housing costs – she’s about to take up to a year off so I’ll need to fund the shortfall.
We moved to Frome from London during the pandemic, which has brought some costs down but increased others, like travel. I mostly work from home but travel to London once or twice a week for meetings. I try to travel off-peak and organise my meetings to suit, but it doesn’t always work out that way. We are really keen to start saving for the potential private secondary education for our children. My wife and I both attended private secondary schools and we’d like to try to provide the same for our children – but it is looking increasingly out of reach.
Age 36
Lives in Frome, Somerset
Salary £72,000
Take-home £4,296 pcm
Housing status Mortgage on a three-bedroom house
Lives with Wife and four-year-old son – with a baby on the way
Housing costs £1,300 pcm
Savings Instant access cash savings: £4,000; Stocks & Shares ISA: £6,000
Pension Workplace pension. Personal contribution is 5 per cent via salary sacrifice, employer adds 3 per cent. Has £11,000 in it. Two old pensions from other jobs need to be brought together – probably have £2,000 in them each
Utilities £220
Other monthly outgoings
• Car lease, £170.35
• Commuter train costs, £300-£600
• Childcare, £320
• TV subscriptions, £31.96
• Internet, £45
• Mobile, £38
• Eating out, £200
• Groceries, £450
Waitrose or Aldi?
With the amount of snacks my son eats, it has to be Aldi. The wine selection is great, too.
Mr Porter or M&S?
Mr Porter. I kind of need to look a certain way for my job so I tend to buy expensive brands, but less frequently.
McDonald’s or Nobu?
I’m more likely to be seen scraping McNuggets off the back seat of my car than at a table in Nobu.
Margate or Mauritius?
Margate every time. The days of enjoying expensive holidays are over.
Tesla or train?
Currently train, with aspirations to be Tesla when the kids leave home in 18 years.
How much do you think you can afford to invest?
I think I can put aside £600 a month. I also want to start paying off more of the mortgage monthly, so I need to factor in those costs.
When asked about savings in a YouGov survey, 43 per cent of people said they just wanted to be financially secure – to have a nest egg for a rainy day. What are your savings goals beyond private education?
We’ve certainly both got one eye on retirement. My wife’s pension pot savings have been patchy at best because she hasn’t had workplace pensions. I’d like to find a clever way for us both to put money away over the next 30 years.
Investment was deemed to be too complicated, boring or scary for 39 per cent of the people we surveyed. Only 7 per cent said it was exciting. What about you?
I’m actually really into the idea. I’ve always had a feeling that I’m not being smart enough with my money, so the opportunity to get some guidance for our situation and make some savvy investments is really exciting rather than boring. I’m envious of a lot of my friends who studied finance and have a good eye for an opportunity.
Only a quarter of our respondents said they would consider risking their money. Would you take a risk for a bigger return?
I’d take a risk with a portion of the money we can put aside, but certainly not all of it. I’ll soon have two kids to think about and I don’t want to jeopardise all that we have. I think we’re comfortable enough to take some risks.
Confidence is a big issue – 64 per cent of our respondents say they’re not confident they have enough knowledge to start with. Do you feel that way?
I feel confident about our Stocks & Shares ISAs. I think it’s just about getting the right guidance. It’s criminal that so many of us just don’t have the financial education to know what our options are. I’m looking forward to learning more. The idea of missing out plays on my mind. I’d like to have the support I need to act decisively with investments.
How could this week’s diarist get started?
We ask Jo Harris, director at Lloyds Bank
Before you take your first steps into investing, you should consider paying off any short-term debt, building a rainy day fund and investing more via your workplace pension. If you are looking for more ways to invest, boosting your investment knowledge is a good way to build your confidence.
At Lloyds Bank, our online educational guides, videos and articles are easily accessible. We can help you compare the different investments available based on the amount you want to contribute and your investment timeframe, and support your understanding of risk.
Having a varied portfolio of investments can help manage the risks you are exposed to and minimise any potential for loss, too. If you’re looking for a simple platform with a wide range of investment options, our share dealing service provides flexible access to a variety of UK and international shares, funds, exchange traded funds, bonds and gilts.
If you prefer a more hands-off approach, we offer Ready-Made Investments where you can invest from just £50 a month into a portfolio of funds built and managed by experts, at a risk level that best suits you.
The value of investments, and income from them, can fall as well as rise, and you may get back less than you invest. That’s why investing for five-plus years helps to reduce the impact of market changes over time.
Explore more ways to invest with Lloyds Bank
Photo: Shutterstock
Statistics source: YouGov, sample size 2,090 UK adults, survey dates December 15 to 18, 2023
Important information
Some of the products promoted are from our affiliate partners from whom we receive compensation. While we aim to feature some of the best products available, we cannot review every product on the market.
