By now everyone in the UK must be aware of the government’s public health message, designed to help manage the COVID-19 outbreak:

STAY HOME | PROTECT THE NHS | SAVE LIVES

With a handful of exceptions, it seems that most people are adhering to this advice.

Despite living in rural Suffolk, on the edge of a village with only a handful of houses nearby, last night (Thursday) it was great to hear our distant neighbours join my family in applauding those essential workers who are working long hours to keep core services functioning.

Most people who are either working from home, have been furloughed or sadly seen their work dry up, now have a lot more time on their hands.

There is an old saying that there is no fool like an old fool.

We all know people who never seem to learn from their past mistakes. Whether it’s choosing unsuitable romantic partners and suffering emotional heartache, doing the wrong job and not being happy or not controlling spending and failing to build financial resources, we all make mistakes. There is no shame in making mistakes, as long as you learn from them.

The two pictures above are of the same place. The one on the left was taken after a savage forest fire. The one on the right is two years later. It’s amazing how quickly the forest regenerated. When things seem bleak, like they do now, remember that they will eventually pass and better times will arrive.

We are certainly living through very uncertain, worrying and scary times.

British prime minister, Harold Macmillan, was once asked what the most difficult thing about his job was. 'Events, dear boy, events’ is what he is reported to have said. 

Whether or not Macmillan said those words, if you are a person, a business or a country, events certainly can throw curve balls, as the current Corona virus situation is proving. 

My friend is a degree educated, high-earning senior manager of a major company. He is very smart and used to dealing with complex projects and managing remote teams, so he’s certainly not stupid. Despite all his skills and experience, he found information about the various pensions that he’d accumulated over 30 years of working, confusing, unclear and overwhelming.

If you’re stressed about meeting the basic daily costs of living – food, housing and basic bills - you can feel mentally under siege. And that can make it almost impossible to make rational financial decisions, leading to you being trapped in a self-reinforcing poverty loop.

Some people have a strong character or experience some good luck, which enables them to escape grinding poverty, but many people don’t and so can’t.

There is an old saying that if you don’t know where you are going, you’ll probably end up somewhere else. And when it comes to your relationship with money and your overall financial wellbeing, it helps to know what good looks like. Otherwise, how will you know what changes you need to make and how will you measure progress?

n the Monty Python film, The Meaning of Life, Terry Jones plays a character called Mr Creosote, a grossly obese restaurant patron. After surveying the menu, Mr Creosote decides to order all the dishes, together with numerous bottles of beer and wine. As Mr Creosote consumes each course, he vomits over himself, much to the disgust of the other diners.

When the Columbia space shuttle took off in January 2003 chunks of insulation foam were observed breaking off and hitting the underside of one of the wings. If the underside of the wing had been damaged, there was a high chance that the shuttle wouldn’t be able to withstand the immense heat on re-entry to the earth’s atmosphere, leading to disintegration of the shuttle.

One of my favourite TV programmes is the Channel Four series SAS: Who Dares Wins. Each series follows a group of men and women on a condensed version of special forces selection training.  

Each day the selection process gradually weeds out those who are unable to cope with the physical and mental stresses and strains of the course. Participants can voluntarily withdraw at any time, but each day the weakest individuals are removed from the course by the directing staff (known as the ‘DS’).

I was recently approached by a chap at my gym who listens to me regularly on the FT MoneyShow podcast. He wanted to know what I thought would happen to the stockmarket over the next six months or so, as he had a large amount of cash sitting about, as a result of a recent property purchase which had fallen through.

I told him that I had no more idea than he did what would happen to stockmarkets over any period of time, but that data from the past 120 years shows that UK equities (with income reinvested) would have turned £100 into about £2.7M, compared to £42,000 from government bonds (gilts) and just over £20,000 from cash, as the chart below illustrates.

When I was a teenager in the early 1980s, I loved watching the quirky 1960s series The Twilight Zone. In the episode A Nice Place to Visit, small-time gangster ‘Rocky’ Valentine is tired of missing out on the good things in life and never getting the breaks that he feels he deserves.

After being shot by a policeman during a robbery, Rocky dies and arrives in the afterlife. Once there, all his whims, desires and wants are met. Beautiful women are at his beck and call.

There is no doubt that buying a home is much more difficult today than it was just 10 years ago. The main measure of affordability is the average price of a house divided by the average salary. In most regions of the UK this ratio has got larger, with London having the highest ratio as the chart below shows.

I want you to imagine that you are having a get together with your family and friends. It might be just drinks, a dinner or a full-on party. The mood is jubilant, happy and excited. There is laughter, chatter and lots of smiling.  You feel on top of the world.

The music is turned off and you tap your glass to get your guests’ attention.

Some money gurus – such as Ramit Sethi in the US and Rob Moore in the UK – make a lot of the importance of people increasing their income to fund their desired lifestyle, and not feeling guilty for that spending.

The idea that you can spend what you want and just find ways to increase your income to fund it sounds very appealing, when compared to the alternative of controlling your spending and making sure that that spending is less than your income.

Money is still a taboo subject for most people. Research suggests that money is one of the biggest sources of stress, anxiety and worry for a lot of people. It can seem scary, complex and emotionally charged.  As such many people find it difficult to talk about money.

In my podcast - Real Money Stories - I speak to people from all types of backgrounds about their money journey and what they’ve learned. My hope is that by sharing money experiences we can all break the taboo of talking about money and use it more wisely, so we worry less and live more.

As part of my ongoing research into personal finance, I recently attended an education session on ‘Serviced accommodation’. This is a form of property investing or business activity which involves letting out residential properties on a very short term – anything from a day to several months – where linen and towels are provided.

This type of letting has really taken off over the past five years, with websites like Airbnb and Booking.com enabling a wide range of people to have a more cost effective, comfortable and flexible alternative to a hotel room.

In my earlier post - How to lower the cost of building wealth - I explained how investment returns compound over the long term to build wealth. But the reality for people in the early stage of their working lives is that how much they save each year will have a far bigger impact on the value of their wealth than the level of investment returns they achieve each year. In fact, it isn’t until you’ve done at least 10 years of regular savings that investment returns will outpace the amount of annual contributions to your portfolio. This phenomenon is known as the portfolio size effect.

In late 2015 I bought an empty house in a rural part of Suffolk, which needed totally refurbishing. I was undecided whether to resell it after finishing the works or to rent it out. The work took me longer and cost me much more than I had anticipated. It also sucked a lot of my time managing the project.

A local estate agent valued the property in spring 2016 and this suggested that selling made a lot more sense than letting it out. In addition, I was keen to release my capital, so I could pursue other investment opportunities.