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The Finance Edit

The Finance Edit

Conquering your finances with style

 At Christmas time a dear friend kindly gave my friend and I a copy of ‘The Home Edit’ as part of our Christmas gift.

For those who have no idea what I am talking about; ‘The Home Edit’ was set up by two down to earth mums in America, who excel at organizing every nook and cranny in your house so that it goes from being a junk yard to a wonderfully organized, pristine and beautiful space.

I had never heard of it when I received my gift but I was reliably informed that they have a Netflix series along with various books and social media accounts. A must watch apparently!

Those that know exactly what I am talking about will understand my initial blind panic, something along the lines of “Holy heck! How does she know about my cupboards?”, “What if she asks me for before and after photo’s?” and “Maybe I can just hide everything in the attic or the garage and nobody will know?”.

For the record my house is certainly not a bomb site, it’s always tidy and everything has it’s place. However, after a brief flick through the book, I knew everything having a place and cupboards being semi tidy is not really what the home edit is all about.

What is ‘The Home Edit’?

Imagine for a minute beautiful boxes, all labelled in every cupboard, wardrobes organized in rainbow colours. When I say every, I mean literally every! Food cupboards, fridges, sock drawer, the lot and like every good house program or book they show the before and after pictures and I must confession the “after” pictures definitely bear no resemblance to any of my drawers or cupboards, let alone the cupboard under my stairs. Some houses have a junk drawer, I have an entire walk in cupboard/dumping ground for random things. It probably explains why the house is always tidy because if I don’t know what to do with it, it goes in there.

Frozen in procrastination

The next week was fairly glum, having now at least starting reading the book rather than just staring in awe at the pictures, I established the edit was going to take a bit more time, effort and energy, none of which I fancied. The contents of my cupboards = Boring!

I spent another week opening and closing drawers, pulling a face and realizing that this task might be bigger than me. In December other than knowing my wardrobe’s needed a good sort out and a trip to the charity shop I was comfortable I had the house in hand… but then in mid-Jan the text message I had been dreading arrived. “How are you getting on with the book ladies and how are the cupboards coming along?”

“Oh Fluff!” guilted into action I needed to do something to show a bit of willingness because unfortunately the hope that some magic fairies would appear with a stack of pretty boxes, labels and a desire to sort everything in my life into rainbows simply wasn’t going to happen. Nor was my friend going to forget the generous gift she had given me with the promise it would change my life.

So having referred back to my trusty book and with a bit more research (also known as procrastination) by actually watching a couple of episodes on Netflix, I established the process is made up of three stages. None of which were rocket science but apparently done right they would in fact give me beautiful organization in my life.

The edit suggests start with something small so I opted for the bathroom cabinets. I wouldn’t have said they were a bomb site but I followed the process and while I can’t proclaim that its changed my life, they are definitely much better. I was happy that my bathroom was spotless and there was no random clutter on the sides. I can confirm at the time of writing one month on the bathroom is still immaculate.

The stages

Ok so the stages are:

  • “The Edit”;
  • “The Assembly”,
  • “The Upkeep”.

Seems entirely reasonable and logical really. First you drag everything out, you edit or sort it so that you know what you are keeping, taking to the charity shop or taking to the tip. As you can imagine by the end of January I was on first name terms with the lovely chaps at the local tip.

Once you are left with what you keeping you can the reassemble everything. The edit suggests labels and pretty boxes. This then enables you to “up keep” the cupboard because you know where everything is supposed to live and your brain automatically puts it back in its proper location (in theory).

I initially rebelled against the idea of labels. I mean why do I need a sign to tell me where I keep towels or toilet rolls but it suddenly occurred to me that this is basically what Caroline and I do every single day. Whilst I might begrudge the labels when it comes to the upkeep it does actually help.

 The financial version of the edit

 As Financial Adviser’s, Caroline and I always start with our version of the edit. We meet the client and we get to know them by completing a fact find which is basically a thorough review of everything. Through this discussion we find out all about the client, their current circumstances, their hopes dreams and aspirations. Whilst this sounds fluffy, understanding what makes a client tick enables us to understand what help they really need.

Like me with my home edit, often clients are initially sceptical about the process or sharing their lives with us. Let’s face it for many people finances are not very exciting, like my description of sorting cupboards… it’s often viewed as boring, people think its going to be scary and worry about “what will they find?” and “oh heck, what will I have to admit to?”. You can see why I think this sounds familiar as we could well be talking about me and the dreadful cupboard under the stairs.

During a fact find we always try to help our clients by starting small. We usually start by asking the client to prepare a budget planner. We know it’s the item that everyone dreads but actually it’s invaluable. It tells us lots about your understanding of your finances  as well as whether anything is being masked. Think of it like your junk drawer, if you shove some books or towels on the top of the mess, you can make it instantly look better but the minute someone digs under the books/towels they are going to find all manner of mess and clutter.

What I would say is don’t despair as this is perfectly normal. I can’t remember the last time I looked at a budget planner and didn’t find a whole hosts of things the client omitted, forgotten about or simply didn’t understand.

Once we have a picture of the current circumstances we may well look at de-cluttering direct debits, closing obsolete accounts, consolidating and tidying up. There is really nothing scary or difficult in the process but it can be difficult to see what needs changing, amending or adjusting when you try to do it yourself.

As with me and my home edit, you can also see that moment when the client goes from nervous or less enthused to being totally bought in and seeing value in the process and what we do.

Assembling a plan

Once we have “edited” to understand a clients circumstances, then we “assemble” or pull together a financial plan. We even use labels whether that be funds for “today”, “tomorrow” or “the future”, or when helping someone to gain control of their budget you might expect to see pots for insurance, holidays, car expenses and emergency funds. Everyone’s finances are different but labels are often used because like the edit where you are guilted into putting things back in the right place, a label on an account makes the person stop and think about whether they are using their money for the right thing before they withdraw it.

The assembly in our financial edit is very much about helping the client to get all their ducks in a row. Helping them to see the gaps or changes, giving them the tools or ideas to fix these and setting them up to succeed.

And finally the upkeep

The upkeep stage of managing finances has many similarities to that of upkeeping your home. Although unlike ‘The Home Edit’ where they hope the boxes and labels will fix the problem, we take a more hands on approach. For each client this will be different, but as a minimum an annual review will help keep you on track.

For some reviews will need to be more regular, for example someone trying to budget might want a monthly or quarterly check-in. If this sounds scary, it really shouldn’t. The number of check-ins is actually decided by the clients and not us. I will always ask if they want a check-in and when they want it, and in my 20+ years as an Adviser nobody has ever said “no thanks”.

Clearly an annual review would be easier for us but in the same way a client feels good when they are on track, we both get that warm fluffy feeling when one of our clients succeeds so if a more regular check-in will get them to that point we will always say yes!

I am quite sure there are a great many other similarities to the edit vs our financial advice but my final thoughts are on my friend and my initial reaction to my gift. The gift was clearly given with love, but what I found interesting was the way my friend was genuinely and absolutely bought in to ‘The Home Edit’ lifestyle.

I assure you I have teased her rotten for the endless pile of boxes by the door which are bound for the tip whenever I visit, and I’m banned from even discussing Lego. However her genuine glee as she described sorting her utility room on the 2nd Jan when every one else was probably still in a food coma was enviable and is enough to make anyone smile. It did however remind me of a clients in two ways.

Maybe I should write a book or get a TV series?

Having now had a month of meticulously working my way around the cupboards and drawers in my home “editing” them, I am rewarded each time with that warm and fluffy sense of achievement. Daft really it’s just a cupboard, only I know how good or bad the contents is but it does provide a sense of calm, has saved me money, sanity and I know exactly where everything is.

These reactions appear regularly in discussions at the end of a client meeting or in our testimonials. The client is grateful for the time spent and a sense of calm that descends for a client when they understand where they are at, they have everything under control and they know where they are going with their finances.

The second is that our biggest advocates will always be our clients. They understand the way we work, they know we are open, honest and not there to judge. But to an outsider the concept of meeting a Financial Adviser is often daunting and leads to thoughts which were suspiciously like my initial reaction to the book!

If you ask a client about their experiences, like my friend they are absolutely bought into the finance edit lifestyle and many actively promote their experiences because they know and have seen the benefits to them. They believe so passionately that they share that passion and want others to experience the same things.

For those yet to seek some financial advice (or edit your house), you can be as sceptical as you like but what I would say is don’t knock it till you try it, you just might never look back!

I definitely feel a book or a TV series coming on for this financial version. Anyone know an agent?

And lastly, to my dear friend Samantha. Thank you… Yes really! You are now free to say I told you so. I am a complete convert but I could really do within some help with the cupboard under the stairs when you have finished with the Lego…

For more help and advice, call us on 01482 275540 or, complete our contact form here. We also offer no obligation financial advice in our complimentary guide covering wealth management, retirement and inheritance tax planning.

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