A lot of people find it hard to plan for their long-term financial future, particularly for life after they stop work – i.e. retirement. Humans are wired to favour the here and now, rather than the dim and distant future, and given a choice of spending for an immediate reward - no matter how fleeting or small - or saving money for a future us that we can’t envisage or relate to, spending now is often more appealing.

When I give talks about financial wellbeing I sometimes ask the audience this rhetorical question:

“If I could look through your bank statements with you, would you be proud or ashamed of what you’re doing with your money?”

The look of relief on the audience’s faces is palpable when I say that I’m not going to pick on anyone to find out!

The key to high financial wellbeing is to make sure that your income and expenditure balance each month, and that some of that spending is for the future you i.e. repaying debt and building financial capital.

As I explained in my blog – Can you afford your job? – if you can’t reduce your spending any further then you will need to find a way to earn more money. Either you’ll need to work overtime, do an additional job or change your main job for a higher salary.

At a basic level, humans are motivated by the desire to avoid pain or to gain pleasure, and research shows that our desire to avoid pain is twice as much as our desire to gain pleasure.

But when it comes to spending money there are so many temptations and opportunities that can cause us to lose control of our day to day spending, which can lead to the very pain we are keen to avoid.

“Time is money” is a saying that I heard a lot when I was young. The implication being that your time has a value that can be measured in financial terms.

But money can also buy time, in the sense that it enables you to delegate or outsource those tasks which you don’t enjoy or are not good at doing, thereby freeing you up to do those things that you are good at and enjoy.

Although I hated sports activities when I was at school, I’ve always taken my physical fitness seriously.

When I turned 36, I decided that I needed to add more lean muscle and improve my overall strength. I had no shortage of motivation and was very disciplined about doing my workouts. I read books, watched videos and spoke to some fitness friends about how to improve my fitness regime, but I never seemed to make much progress.

When food was scarce and the danger of death was all around, surviving long enough to pass on their genes was the main objective of ancient humans and our brains developed accordingly.

But while the human race has made tremendous progress in eliminating food scarcity and danger to life, our brain hasn’t really changed much. This means we are hardwired to favour instant rewards over deferred gratification.

Barely a day goes by without an announcement from the Boris Johnson led Cabinet of new public spending. Health, education, criminal justice and BREXIT preparations are just some of the recently announced priorities that will cost many billions of pounds to deliver.

While the Chancellor, Savid Javid, has said the government can fund all these initiatives from the UK’s current ‘fiscal headroom’ (which means more borrowing), and that may well be the case, it’s also entirely feasible that he could raise taxes to meet some or all of this spending.

Rihanna is a successful 31-year-old singer, actress and fashion designer.

Despite having earned a significant amount of money, by 2010 she was $9 million in debt and on the brink of bankruptcy. Rhianna then sued her accountant, Peter Gounis, for giving her bad advice, saying that he failed to advise her against buying a home for $7 million when her cash position was precarious.

When you’re in a social situation and meet new people, the most common initial question is ‘What do you do for a living?’ 

The job question seems innocuous, inoffensive, and uncontroversial. But really it is about the other person subconsciously working out their status compared to you and whether you are below, above or on a par with them.

Life has a habit of throwing you curve balls. Some of those curve balls relate to money. Whether it’s your car needing repairs having failed its latest MOT, a school trip that your child forgot to tell you about, or the washing machine finally giving up the ghost, unexpected expenses often arise when you can least afford them.

A few months ago, I arrived at a venue to give a talk on financial wellbeing. I realised that my iPhone was almost out of power and I had left my charging lead at home. I asked the receptionist of the venue if she had a spare charging lead that I could use.

“Sorry we haven’t got a lead for your type of iPhone, and my own phone is an iPhone X so I can’t let you use mine.” She said. “You have an iPhone X? You must be doing well, they cost over £1,000!” I responded. “No, I do it on contract at £80 per month.” She replied.

Learning to control your day to day spending is one of the most important skills to master if you want to have high financial wellbeing. And in my earlier post and video – How to get control of ALL your day to day spending – I explain how to do this.

I’m not a big fan of penny-pinching and coupon-cutting, as that promotes a scarcity mindset, but identifying opportunities to spend less on the things that you included in your spending plan make sense.

A few months ago I started looking to buy a car.

A bit of research showed that the price of the make and model I wanted ranged from £18-32,000 depending on model, age and mileage. I set a budget of between £20-25,000 with the aim of trying to spend at the lower end of this range.

Can you imagine being a billionaire?

Well that’s the fortunate situation for US reality media personality, model and social media influencer Kylie Jenner. At just 21 she is reported to be the world’s youngest billionaire, primarily based on the success of the beauty and clothing products business she has built since her teens.  

People are often described as pessimists or optimists – the proverbial bottle half empty or half full. How you see things - whether a life event, opportunity, obstacle or external messages - can have a big impact on how you react to and deal with them. Where one person sees a problem, another sees an opportunity. Where someone sees enjoyment, another sees boredom.  

At a basic level we are all are motivated to achieve one of two things – to avoid pain or to gain pleasure.

But psychologists say that human motivation is also closely associated with each person’s sense of personal identity – of the person you think you are, or that you want to become. All the actions we take – what motivates us – is in pursuit of that identity or sense of self.

Sometimes we waste money by buying things that we either don’t need, or get little benefit from, or that don’t last, or that don’t add to our wellbeing. Sometimes it’s all these things.

But sometimes it’s good to ‘waste’ money, and that includes buying human insurance that you never make a claim on. Human insurance is an insurance policy which pays out if you can’t work due to illness or disability, or you get a critical illness, or you die.

In my latest Financial Times article - Will inherited wealth help or hurt those you love? - I cover the issue of why 90% of families’ wealth doesn’t survive three generations and what to do about it.

Learning to control your day to day spending is the essential foundation upon which your financial wellbeing is built. My Smart Spending System introduced the simple concept of the THREE YOUs and using separate accounts to quarantine money for those different priorities, as shown in the diagram below.