The following’s a transcript of a bonus episode of The Pension Confident Podcast - The best of our guests with Philippa Lamb and Lucy Greenwell. You can listen to this bonus episode here or scroll on to read the conversation.
LUCY: Hello, I’m Lucy Greenwell. This is a voice you haven’t heard before. I’m the Series Producer on The Pension Confident Podcast. We’ve covered a lot this year from money personalities and relationships to sharing how not to run out of money in retirement and where to start financially planning for parenthood. We’ve had some brilliant guests from CEOs to campaigners, barristers to financial influencers along with some of our favourite in-house PensionBee experts. So today we’re doing something a little bit different. We’re turning the mic around to hear from our host, Philippa Lamb about some of her favourite moments from this series so far.
So Philippa, every month, we get to learn about the personal financial journeys of our guests, but we never get to hear much about the person asking the questions. So why don’t you tell us a little bit about how you ended up so interested in personal finance?
PHILIPPA: Very nice to see you on this side of the glass, Lucy! I will. But honestly, if you’d asked me when I was 21 if I could see myself as a personal finance journalist 10 years later? I would’ve laughed. I was so feckless about money. I just spent everything I earned. I ran a constant overdraft which just crept up and up. I have to say, by the time I was 31, I had grown up a bit. I’d got married, we’d bought our first place and you know, just like now interest rates were high and they were getting higher. We were really on a knife edge with the payments every month.
So it got personal for me. I was already a business journalist and really luckily for me, I got the chance to move on to a daily personal finance slot on BBC Five Live. I loved it! Talking to real people about their finances, holding organisations like banks and building societies and insurers to account when they behaved badly. I was learning all sorts of useful lessons from expert guests. It was so great. It really felt like it mattered to the people listening. I was so hooked.
LUCY: And the rest’s history?
LUCY: Well, let’s hear a bit more about some of the personal stories that we’ve heard from our very many guests over the past year. Which one has been your favourite? If you can pick!
PHILIPPA: Do you know? This was actually really easy for me to choose. It was the CCO at the Financial Services Compensation Scheme (FSCS), the marvellous Lila Pleban. She talked so honestly about how she got buried in credit card debt when she got divorced. You know, that really rang a bell with me because I remember so clearly all the sleepless nights I had as a newly single parent worrying about money when I divorced my first husband.
LUCY: Yeah, that was in episode nine, wasn’t it? That was all about money and mental health. Let’s hear a clip of it.
LILA: The big time in my life was when I got divorced. If I’m honest, I quite quickly found myself without a roof over my head, without any bank account because everything had been frozen. But I think it was the spiral that happened after that really got me into quite a pickle, if I’m honest. Not checking my bank account, the credit card started to be used. I started to build up a credit card bill, because I was comfort shopping, trying to keep the visage of being in control and being successful, but I wasn’t. I was completely and utterly falling apart and it really came down to a crunch, really at one point, and I had to face it. It took some time to figure it out, and it took some time to pull myself out of the hole. But I totally relate even now, I really struggle to use my credit card. I fear that I’m going to build up another big debt. I pay my bill off every week, because I’m so frightened of it getting any bigger than a little bit and when it does, I do panic even now many, many years later.
PHILIPPA: Let’s talk a bit about how to protect yourself and learn coping strategies, things we need to know about managing this burden of money worry, because it’s not like it’s going away. What is the first useful step you can take if you think stuff is getting out of control? Money’s getting out of control?
LILA: I’ll draw on my personal experience for this one, and I think it’s about facing it, and looking at it and really being honest. I hid away from my money worries, and they weren’t going anywhere, but downwards. So I think it’s about really facing into it and talking to somebody about it.
PHILIPPA: So taking stock?
LILA: Taking stock and just being really honest with yourself. I was only able to take some practical steps to help myself, once I really faced into what was going on.
PHILIPPA: Isn’t she great?
LUCY: Yeah, I love that one.
PHILIPPA: Another of my favourites was Founder of The Money Whisperer, Emma Maslin. She was on episode eight. She talked about the gender pension gap where women so often end up with far, far lower pensions than men.
LUCY: Yeah, it was all about how to teach our kids about money, wasn’t it? Well I’ve got kids, so I was listening very, very hard. Emma was really clear that she’s not prepared to have a gender pension gap for her daughters and she’s already started saving for them.
EMMA: I’m determined that my children will not retire with a gap in their pension compared to their life partner, if that’s a male. In order to do that, I’ve set them up with a pension. I’ve written about it on the PensionBee blog as well.
LAURA: So, this is a Junior SIPP, a Junior Self-Invested Personal Pension?
EMMA: Correct. Now anybody can set up a Junior SIPP for a child. They can pay in up to £3,600 a year. Now I’ve put in that small amount for my children. They’re both under the age of 10. I’m going to do nothing else with it and I’m going to let that grow over time for the next 50 years. I’ve told them this. I’ve told them that they’ve got some money sitting there, but they can’t touch it for 50 years. And it’s going to give them a nice big healthy pot, which, by my rough calculations, and assuming that money kind of doubles roughly every 10 years, they could potentially be sitting with a £100,000 pot by the time that they’re close to 60. And that’s the gap that we look at between men and women’s pensions when they hit that age. So, I’ve done my bit for my children to try and help them with the gender pension gap.
LUCY: Smart woman! I haven’t set up a pension for my kids yet.
PHILIPPA: You know she’s just an excellent mother, don’t you?
LUCY: I know. I’m feeling a bit of a mum fail! You’ve covered so much ground, when you sit back and look at it like this. There’s so much we’ve covered across the series so far. And one of the things I’ve really loved about making it, is that some of the stories that have come out in the studio have been really quite unexpected.
PHILIPPA: I know. Do you remember episode 15? We were talking about financial inclusion. We had Nina Mohanty, Founder of Bloom Money and the Head of Communications at the Financial Services Compensation Scheme (FSCS), that’s Emma Barrow. And they were sharing stories from their own lives about how you can end up with a bad credit rating even if you’ve done absolutely nothing to deserve one.
LUCY: Yeah, I do remember that. It goes to show, doesn’t it? It’s really worth understanding the dark arts of credit ratings because your credit score, you know, can trip you up big time at a certain stage.
PHILIPPA: Nina, you talked about credit ratings at the top of the podcast. As you said, it really damages people’s ability to access financial services. That might be because you’ve fallen into debt in the past, which is kind of a separate issue. But it’s that thing about a ‘small credit footprint’, I think it’s called. And that’s a lot of people isn’t it?
NINA: Absolutely. I think often about my mother-in-law, she was briefly a farm secretary and then took over running the household, and I believe she had a joint account with my father-in-law. So she never actually established a credit file for herself.
PHILIPPA: So she’s invisible?
NINA: She’s credit invisible. And it wasn’t until one day she decided, ‘I want to have a credit card, I want to have a bit of agency in this household’. The options that were available to her were predatory quite frankly. There are everyday people who are credit invisible because they perhaps have never tried to get credit.
PHILIPPA: Young people for example, when you leave home you’re credit invisible, aren’t you?
EMMA: And again, culturally, if you grow up in a less wealthy household, credit can be seen, and was definitely seen in my family, as a very bad thing. You didn’t borrow money. You saved and you lived within your means. So when I went to university, I remember being terrified of getting a credit card because it was drummed into me that you don’t borrow money. Because it’s scary and you mightn’t be able to pay it back and then bad things happen.
NINA: Funny that you had that reaction because in my experience, and I’ve spoken about this publicly before because I’ve gotten over the shame of it. When I went to university in the USA, the banks could still set up shop on campus and say, ‘come and get a credit card’ to any random person on campus. Now they can’t anymore thanks to the Credit Act. But I was offered a credit card and I thought, ‘amazing, free money, I love it’. And of course, I didn’t read the small print, which said it’s 0% interest, but only for 18 months. And so here I was going, ‘free money, la la’, buying the most ridiculous and unnecessary things, especially since I was living in a dorm, and then realising, ‘uh oh, I have to pay this back’. And by then it had snowballed. I think at its peak, it was about $10,000 of credit card debt. And it followed me around. I’ve talked about this before but there’s so much shame that comes with it. I thought, ‘right, I’m never touching credit again’. But then when I moved here I thought, ‘well I’ve got to get a credit card, haven’t I?’ to build that credit score!
EMMA: It’s weird.
NINA: It was a bit traumatic actually, applying for that credit card and thinking, ‘oh gosh, I’ve got to lock it away or put it in a drawer so I don’t use it’.
PHILIPPA: Hey, it’s me Philippa, just interrupting briefly to remind you to click on that subscribe button so you never miss an episode of The Pension Confident Podcast. Remember to share, rate and review too. And now I’ll leave you to enjoy the rest of this month’s conversation. Happy listening!
LUCY: I was thinking that The Pension Confident Podcast’s all about making personal finance simple for our listeners. You’ve covered personal finance for ages now. But has there been any episode in particular that has taught you something that you didn’t know?
PHILIPPA: Oh, yeah. I mean, you never know everything do you? There’s always something new and I tell you, there’s one episode that really stands out for me. And that’s episode six and it was about Shariah investing. Now, I’ve got to admit it wasn’t a subject I knew much about at the start. And it was really fascinating. Here’s CEO of Islamic Finance Guru, Ibrahim Khan, explaining what Shariah investing is and just how closely it can overlap with socially responsible investing.
IBRAHIM: So Shariah investing’s really just looking at the two words. It’s, you know, Shariah-compliant, so it’s compliant with Islamic law. What that actually means is you look at the Quran and the sayings of the Prophet Muhammad, peace be upon him. And then investing, is just investing in line with those rules and regulations. So in a nutshell, that looks like not investing in things that, you know, generate interest, or gambling, or investing in alcohol or pork. These will be like the really obvious ones, and then there’s some others that are under the surface and a bit more technical.
PHILIPPA: Okay. So Shariah-compliant investments, they have different criteria, completely different criteria from, say, fossil fuel free investments, but you would still classify them as socially responsible.
IBRAHIM: I think there’s a really strong overlap between the two. But there’s still a difference.
PHILIPPA: So yeah, so the crossover is, I mean, it’s directly excluding certain sorts of companies, and also its business practices as well, isn’t it?
IBRAHIM: Yeah, absolutely. So if, you know, a company is, I don’t know, involved in, let’s say, the war in supporting Russia in some way, shape or form. That could be, you know, a clear question mark.
PHILIPPA: So there’s judgments involved?
PHILIPPA: That was all so interesting. But what about you, Lucy? I mean, you produce the podcast, you must’ve learned something along the way?
LUCY: Honestly, producing this podcast has actually transformed my personal finance landscape.
PHILIPPA: Has it really?
PHILIPPA: Or are you just saying that?
LUCY: No! First of all, within a few months of making it, I upped my pension contributions by 25%.
PHILIPPA: Did you?
LUCY: Yep, which is really quite unaffordable sometimes. But I know it’s the right thing to do. So I’ve stuck with it so far. I’ve also shifted half my pension into an ethical investment off the back of PensionBee’s Chief Engagement Officer, Clare Reilly’s episode in which she told us all about ethical investments, which really kind of pricked my ears up. And also, I had Junior ISAs for my children which were cash so I thought they were safe as houses. I’ve transferred those into a Junior Stocks and Shares ISA - which I’m really glad I did.
PHILIPPA: Because it’s a long-term investment, isn’t it? They can have a higher risk profile.
LUCY: Yes. I just kick myself that I didn’t do it earlier now.
PHILIPPA: But even I would have done the same.
LUCY: Yeah, you felt it was, kind of, more stable but it was just shrinking slowly. So, yeah. I sit in the gallery, at the other end of the studio, with Dani, David and Brooke - who’re the PensionBee team - listening and it really is interesting. We kind of sit there and go ‘oh, that’s interesting, oh, wow’.
PHILIPPA: I love that. I mean, you’re all people who know about personal finance but you’re learning stuff every time. It’s so great.
LUCY: We’ve had guests in a wide array. I haven’t totted up how many guests we’ve had on the podcast so far, but a lot. And they haven’t just been from a finance background. They’re from all walks of life. So who have we had that’s been surprising and not necessarily from the background you’d imagine?
LUCY: He was so lovely.
LUCY: Meaning they’re not married but they live together?
PHILIPPA: Yes. They can end up with literally not one single penny if their relationship collapses. Even if they’ve had kids with that partner. Now, I already knew they were vulnerable but I hadn’t realised it could be that catastrophic. It was shocking.
LUCY: Yeah, I tell you what, in the gallery that day you could feel the air crystallising. We couldn’t believe it. I had no idea. Let’s hear a bit of that.
PHILIPPA: Every woman needs to hear this.
PAUL: Well let’s start off by talking about simple cohabitation. Let’s face it - over half the people in Britain now, who live together, are not married or in civil partnerships. They’re cohabiting without the benefit of legal ties. I say the benefit of legal ties because I do actually think there are benefits to the legal ties. There are a lot of people out there who think that they have some legal protection if they’re cohabiting for a period of time.
PHILIPPA: The common law idea? Is it anything? Is it a reality?
PAUL: No, it never has been. Certainly not since 1753. And there’s a controversy about whether it existed before the Marriage Act of 1753. Every now and again I end up with, normally a woman, sitting across my desk talking about common law marriage. She’s been living with a man for say 20 or 30 years. She’s brought up his kid, she’s given up her own career to do that, the children have left home and he has now left, perhaps run off with somebody else, and I have to tell her that she’ll get nothing. That the law doesn’t provide for her.
PHILIPPA: Literally nothing?
PAUL: Literally nothing. If the house is in his name, as it very often is, and the children are gone, she gets nothing.
LUCY: You want to tell all your friends about that, don’t you? So horrifying.
PHILIPPA: I did tell all my friends about that. It really matters. It’s horrifying because this could be middle aged women with nothing, no home and no cash. It’s shocking.
LUCY: Unbearable. Do you remember Ellie Austin-Williams? She was talking about this really bad period in her life when her relationship ended. She was sharing a flat with her boyfriend, wasn’t she? And I think she’d let him money and the relationship ended and she had to write off the money -
PHILIPPA: - The loan.
LUCY: The loan, yes. But also she was left saddled with the rent.
PHILIPPA: Two rents. Because she had to rent a place for herself and she was still committed to the rent on the place they’d had together.
ELLIE: Yeah, so I think this is probably the biggest lesson that I’ve learned. Before I met my current partner, I lived with a previous boyfriend and I lent him a significant amount of money. You can probably guess where it’s going. The relationship broke down and I needed to cut ties. So I had to walk away and forget about the few thousand pounds that I had lent him. Luckily I was in a position where my family could help me, but it was a really messy time financially. We had a rental agreement, so I had to move out and pay rent somewhere else whilst also paying rent on the place we shared. But, I always say to people that it was the best thing for my mental health at the time and I wouldn’t change that. Sometimes you’ve gotta just cut the losses and walk away.
LUCY: An eye opener. And I have to say, we’ve played a few clips that’ve been terrible moments for people, but we have a real laugh on the podcast too. You do, and we laugh through the glass too.
PHILIPPA: We do. And I really like that about this podcast.
LUCY: We’re in the second year of the podcast now.
PHILIPPA: It’s good, isn’t it?
LUCY: Looking ahead to next year, what would you like to see covered in series three?
PHILIPPA: Ok, I’ve thought about this and I want to do an episode about renting. So I grew up in London and I worked here for years. I remember just how much of my salary went on rent before I bought my first flat. Then obviously it went on mortgage payments, but it was rent before that. Now, of course, I keep reading news stories about how much more unaffordable renting is now, even than it was back then. Most people, as I understand it, are spending up to about 30% of their monthly income on rent. In London, it can be more like 35- 40% or even more. That’s a huge problem for a lot of people, particularly in the cost of living crisis. I’d really like to do an episode about that.
LUCY: It’s a really good idea. What about dream guests? Because I’ve got one. I’ve always loved Merryn Somerset Webb. She’s a Financial Times columnist and the Editor at MoneyWeek. And she wrote this book, a long time ago that I remember buying and reading in my early 20s it was called Love Is Not Enough. It was about women and money and it taught me, to be honest, it taught me all the things that my parents hadn’t and my school hadn’t. She taught me to think about finances and not to rely on some fictional man that I might, or indeed might not, meet.
PHILIPPA: A valuable lesson that one.
LUCY: Who would yours be?
PHILIPPA: Oh, there’s so many. But this is The Pension Confident Podcast, right? Pensions are always on our agenda. So top of the list for me would be the woman with responsibility for the whole sector. Parliamentary Under Secretary of State for Pensions and Financial Inclusion, Laura Trott. Laura, we’d love to have you on the podcast!
LUCY: Let’s get booking!
PHILIPPA: Oh, yeah!
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