The Seven Habits of FINANCIALLY Effective People

What are the key habits that, if mastered and repeated throughout life, will GUARANTEE financial security?
#meaningfulmoney #meaningfulacademy #financialhabits
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Chapters:
00:00 Intro
00:46 1. Spend less than you earn
01:37 2. Pay yourself first
02:30 3. Protect against disaster
03:35 4. Invest in Businesses and Bricks
04:52 5. Diversify
05:54 6. Use Pensions
08:38 7. Review, but don't meddle
09:36 Conclusion
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📫 Leave me a comment below - I read all of them and love hearing from you!

[@ushasundaram1]

This may be an amended version of something Pete did a while ago. That was as follows: 1. Spend less than you earn. 2. Pay off bad debt. 3. Pay yourself first. 4. Build a foundation of insurance. 5. Make a will. 6. Start a pension. 7. Open and Stocks & Shares ISA. 8. Build your portfolio. 9. Pay off your mortgage. 10. Accelerate I know because I have Sticky Notes on my laptop where I make notes from Pete's key videos and I had this for ready reference. Thanks Pete.

[@lynnestait8011]

I am so thankful we took out critical illness cover when we had 2 young children and I was only part time working, my husband was diagnosed with cancer at 39, they paid out which paid off most of our mortgage at the time, such a relief, my husband survived and is still here over 20 years later. My best friend was recently paid out after a breast cancer diagnosis, so from personal experience it is not the 'con' some people allude to - thank you for another great video, Pete

[@mvp_kryptonite]

Fantastic content!!! Number 1 live within your means is so vital. You’ll soon realise you shouldn’t care about others thinking that you can’t control

[@Andy72668]

As ever Pete great video - recommend the podcast to anyone who hasn’t listened to it yet. Thanks for explaining all this stuff in a friendly way that’s easy to digest

[@stuartogden1660]

Thanks for posting Pete. I hope you’re regaining some of your energy

[@marionexley7355]

Brilliant video, thank you so much.

[@markcarter9476]

Whilst I agree with your analysis and it is very good advise, I have to take issue with point number 3, insurance. I have always had the opinion/experience that insurance companies will do everything in their power (and sometimes outside of their power) to not pay out, so I have steadfastly avoided insuring myself for anything that I do not legally have to. This has worked well for me. When a problem occurs I do not have a protracted argument with myself and can go and buy a replacement item from whom I like for what I like, or alternatively absorb the hit. I fully understand that many people are risk adverse and would not be able to sleep at night, but I sleep fine and have saved an enormous amount of money that I have invested.

[@MeaningfulMoney]

The stats says otherwise, Mark, with 97% of life and critical illness claims paid by the industry. Those that are not are usually down to fraudulent application or things being missed off unintentionally.

[@markcarter9476]

That may be true but stats will also show that the chances of you having to make a claim are very, very small and the industry takes in far more money than it pays out.@@MeaningfulMoney

[@TheEroticDonkey]

Yes, don't insure TVs and laptops, but your life is different. You can't go and pay for a replacement income if you or are a partner die or have a life changing accident.

[@TheEroticDonkey]

Yes, don't insure TVs and laptops, but your life is different. You can't go and pay for a replacement income if you or are a partner die or have a life changing accident.

[@MeaningfulMoney]

Of course it does - that’s how insurance works. If there no profit in it, then there wouldn’t be an insurance industry. As TheEroticDonkey(!) says, only insure the important things

[@MrLukas239]

Hi pete, great video as always. I would love a deeper dive on investing in "bricks" specifically, whether that be in the comments section or another video, i leave up to you!

[@kevinsyd2012]

I agree with all these, but I'm cautions with insurance. For every example of a life or critical illness policy that has paid out, there are many that have not. Make sure you read the insurance policy very carefully, ensure that ALL the details you give are totally accurate (particularly past medical history), ask endless questions preferably in writing, ensure that your policy is updated each year with any health changes, and don't always go for the cheapest. Then you or your loved ones may be lucky and receive the expected pay-out if the worst happens.

[@MeaningfulMoney]

“For every life or critical illness policy that has paid out, there are many that have not” Sorry, but that’s just not true. Actually, for every 97 that pay out, there are three that do not, and these usually due to incorrect applications, whether intentional or not, and outright fraud.

[@jamesmiles1522]

Great work Pete. Very honest.

[@MeaningfulMoney]

Thanks 👍

[@glynjones1112]

Pete, I've largely completed the debt blast and im due to receive an inheritance so im feeling in a good place. However, im wondering whether i'm best investing the inheritance in my pension as my pension is a LGPS DB pension? 🤷

[@shimsteriom4191]

Absolutely brilliant Pete, thanks

[@pjones2303]

Thanks Pete, I fall down on number 2 I put money in my savings at the end of the month instead of the start. I’m not sure I want to lose that flexibility tbh but I will give it some thought. Great videos thanks 🙏

[@brysoga]

I switched to doing this at the start of last year. It is a game changer and when you get used to it you actually quite enjoy it and look forward to pay day so you can top up your savings. But you do have to get used to never having much in the current account though.

[@MrDuncl]

If you don't want to lock your money into pension or risk it in shares, some of the Regular Savings accounts offer decent interest rates (6% +)

[@andylayard8114]

Another great video

[@MeaningfulMoney]

Thanks Andy - I appreciate that!

[@MissBeeGood]

Doing pretty good on most points but must admit I haven’t the foggiest about investing 😬

[@MeaningfulMoney]

There’s lots about that on the channel! Start here: kzbin.info/www/bejne/i6S5YYSvds6ljbcsi=XO1NbxHyOFYOy_Tt

[@caz7960]

Thanks Pete - useful content. You made a passing comment that higher rate tax payers get more benefit from pension contributions when they do their tax return. Can you expand on this please or refer me to another one of your videos. I pay tax through my employer and am in the higher rate tax bracket. I’ve queried before with payrol if I need to do anything outside of this for tax reasons relating to my salary & been told no. It just gets mentioned by various people on here & I worry that I’m not doing something I should be. Thank you

[@cb7560]

Good list - and good advice. I'd add the following to help you do point 1 - don't use credit cards, store cards, lay-by etc, save a minimum of 20% of your pay, don't waste money on cars etc - leasing agreements - always buy cheap cars second hand and drive them for years, and give money to charity. On investments, you should invest in your health and your on-going education and books. Only use low fee ETFs or investment trusts - avoid stock-picking, investment managers.

[@phil_nicholls]

Credit cards can, if used properly (paid off in full every month generally), be a very useful resource, and many come with decent benefits. Company car schemes, and salary sacrifice, can make running a car, even a new car, very cheap indeed. Certainly don’t borrow money to buy a car, that’s just doubling up on interest payments and depreciation. The rest of your points I’ll happily go along with. 👍🏼

[@kw8757]

Section 75 consumer protections that come with using a credit card are very useful, I've used it several times successfully to reclaim for faulty goods and services, running into the thousands of £. Just don't be frivolous and pay it off every month.

[@gorticastle8]

Thanks Pete another great video

[@virtualunreality8326]

Brilliant as ever. I wish I had been able to learn about all this fifty years ago.

[@patmartin9727]

Me too if only we could turn the clock back.

[@virtualunreality8326]

@@patmartin9727 mind you, fifty years ago this advice didn't exist... it was at the height of the mis selling scandals! Either way, we are here and now and can access quite a lot!

[@shellyperera2010]

Me too! Am making sure my kids know though 😊

[@virtualunreality8326]

@@shellyperera2010 these days it's a different world though isn't it?

[@MrDuncl]

There used to be a really good advert "The difference between starting a pension late and not starting one at all".

[@Gazmaz]

I’m sorry but it made me laugh when you said if a new baby comes along 😂 what rather than an old baby 🤣. Keep up the great work 👍🏼

[@MeaningfulMoney]

Well, sometimes I have to help out my old babies, too!

[@Chanesmyname]

Insurance, you pay for it and wish you never have to use it. 😅

[@narainsrividya341]

Great simple steps. Thx Pete. Good advice and will look to pick a couple of these to implement. 👍

[@MeaningfulMoney]

That's the way - it's all in the doing! Thanks for watching!

[@iandawson7373]

Invest we have a job to live and make ends meet for a lot of people it's all right if you are well off but sadly not for the average person

[@MeaningfulMoney]

I can give you countless examples of ‘average’ people who manage to save and invest. I know is it is hard, I really do, but being fatalistic about it is not going to help you. If nothing else, you should be in your workplace pension, assuming you’re employed - you can’t afford not to be…

[@TheEroticDonkey]

You can invest as little as £10 on some investment platforms

[@MrDuncl]

@@TheEroticDonkey Our pension scheme at work is being amended so if you pay in 1% of salary the company pays in 2 or 3 %.

[@kunverjihirani276]

😊🙏👍

[@lyracian]

I think I have got 5 out of 7 sorted. I still meddle too much!

[@MeaningfulMoney]

We all do!

[@simoncelt5590]

I’m stuck on the pay yourself first

[@MeaningfulMoney]

I believe in you, Simon

[@patmartin9727]

Great Video Pete, a pity this isn’t taught in school. If I had started doing all these things from my first wage packet. Sadly this didn’t happen but as I aged I learnt some sense thank goodness. Thankfully I have accrued a pension and a saving pot along the way to my now retired,debt free status.

[@goodgirlsguide]

Pension depends on you living long enough to enjoy it.

[@MeaningfulMoney]

Yes, but the odds are overwhelming that you will!

[@2007sssss]

As a heads up, the pensions comment of putting in £80 and HMRC puts in £20 for a basic rate taxpayer, is incorrect. It's 20% added, 20% of £80 is £16. Are there other errors in this video? Being serious, great video 👍👍

[@reekie19]

No it's not. A basic rate tax payer pays 20% tax on gross earnings. If you pay £80 into your pension HMRC adds £20 to make a gross pension payment of £100. 20% of £100 is £20.

[@MeaningfulMoney]

The 20% is of the gross figure, that is, £100. 20% of £100 is £20 which leaves a net contribution of £80. I promise, I know what I’m talking about, having done this for 25 years! Thanks for commenting and watching 👊🏻

[@TheEroticDonkey]

How embarrassing for you 😅

[@markwaudby]

As a heads up, know your maths before posting!! You put in £80 you get £20 added by HMRC...FACT!!!

[@marionexley7355]

Ouch!!

[@smcgeminimustang]

Warren Buffet and Charlie Munger said you only need to invest in 6 companies to make you rich.Diversification is a waste of time and shows you haven't done your research.

[@MeaningfulMoney]

Most people are not Buffet and Munger, and wouldn’t know how to choose just a few companies without risking too much. Those of us in that situation diversify across entire indices and do just fine.

[@markwaudby]

What 6 companies have you chosen then?!!!

[@person.X.]

@@MeaningfulMoney You have the patience of a saint! 😇

[@MrDuncl]

Warren Buffet often recommends trackers and ahs specified in his will that when he dies that is what his wife's money should be put into one. p.s. One of my major investments was in safe, steady, and high income Lloyds bank. Then in 2008 the Government persuaded them to buy out basket case Halifax, a company I had predicted would go bust back in 2003. p.p.s. That has just made me think of rule 8. Don't over-leverage. As is playing out at the moment, taking out the biggest mortgage anyone offers isn't always a good idea.