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The Hidden Risk of Safe Assets

The Hidden Risks of Safe Assets

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Today I am pleased to bring you a guest post from Haydn Martin, a UK blogger whose website is called Perpetual Prudence.

Haydn explores ideas relating to retail investing and other personal finance topics on his way to finding the solution to Lifetime Investing…

In his guest post today he discusses the risks of investing in ‘safe’ assets.

Over to Haydn, then…

 

Risk might be the most important consideration when making investment decisions (like what to invest your ISA allowance in). Get it wrong and you could be retiring on a pittance, running out of money during retirement, or even worse – asking friends/family for handouts. Risk must be taken seriously and properly dealt with, especially when you’re living off your investment portfolio.

It seems strange, then, that risk is so poorly understood by so many.

One aspect of risk that is particularly neglected is the chance of a truly disastrous event crushing the value of the asset in question. The chance of these catastrophic events is ‘unthinkable’ and so not really taken into account by people when making investment decisions.

This is the wrong approach. In this piece, I will be talking about some of the hidden risks of the ‘safest’ asset classes and their implications for the investor.

Cash

What could go wrong with pilling up cold, hard cash under your mattress? This, surely, I hear you claim, entails no risks at all?

As you might have guessed, not quite. First, there are the practical considerations. If you actually store large amounts of cash somewhere in your house, that cash will promptly disappear if you get burgled, if your house burns down, or if your partner changes their mind about this whole marriage thing and does a runner (with the money). If at some other secure location, it can always be pinched. Cash held at a bank is dependent on the fortunes of said bank. As 2008 showed, this might not be the safest place in the world. The government will cover you up to £85,000, sure, but for those of you lucky enough to have more than this, you’re relying on the prudence of bankers.

Aside from the physical, one must also consider the monetary. Inflation, that cruel mistress, is the biggest threat to holders of pound sterling. It may be practically non-existent these days, but casting your mind back to the 70s will remind you of the real damage inflation can inflict on your purchasing power. If inflation is higher than the rate of interest you earn on your cash (that pile under the mattress is earning 0%) then you’re losing money in real terms. You’re actually getting poorer without realising it.

Government Bonds

Taking this cash and dumping it into government bonds may seem like a sensible thing to do, then. The government is probably less likely to fail than banks. These bonds earn some kind of interest to help combat inflation, too. Happy days.

Unfortunately, most of these rates of interest are dependent on the whims of the Governor of the Bank of England, not directly linked to interest rates. If the govna’ wants to maintain low interest rates to stimulate the economy after, say, a global pandemic has put a halt to business activity, they may maintain low interest rates, even with substantial inflation. This means that your bonds will be earning a negative real return. What’s also nasty about these bonds is the fact that their value fluctuates with inflation and interest rates. This means that you don’t actually receive the yield to maturity unless you hold the bond…to maturity. Otherwise, your yield may be substantially lower.

The government acknowledges this problem with bonds and issues index-linked versions to counteract this inflation risk. These bonds return some percentage above inflation, supposedly ensuring that you maintain your purchasing power (and then some). This, however, relies on the fact that the government calculates the rate of inflation correctly. How confident are you in the competence of the government? There is also the chance that the government defaults on their outstanding debt. This is unlikely under a fiat system (because they can always just print more money), but it remains a risk nonetheless. Reckless monetary policy can lead to veeeery high inflation, which is difficult to stop (just look at Argentina for a contemporary example). In this instance, your bonds would be worth precisely 0.

Shares

It would seem then, that relying entirely on the government may not be the best idea. What about companies?

The apparently safest form of investing in shares is investing in whole markets (or parts of markets) using index funds or ETFs. The highest level of diversification one can get is by investing in every market, using a global ETF/index fund. One of the main risks here is fake diversification. A lot of these global trackers should actually be called ‘US & Friends’. For example, if we look at the Vanguard FTSE Global All Cap Index Fund, we see that the US makes up nearly 60% of the fund. If the US performs badly, these trackers will too. There is also the chance that the company doing the tracking goes bust, meaning you will lose some of your investment. This is a pretty unlikely scenario, but it’s a possibility nonetheless.

An alternative approach is to keep your hard-earned money inside the UK, by investing in a basket of British companies. This leaves you rather exposed to the fortunes of the UK. If we prosper in the next 20-50 years, it will probably be a good move. If not, UK companies might not do so well. You are already likely to be heavily exposed to the UK via your job or some other way (like owning a house here), so it may be a good idea to diversify internationally a bit.

Many assets have this problem, come to think of it. If you plan on moving to the French Riviera in ten years’ time, you are going to want some exposure to French assets before you move. Let’s say France does really well in this time period but the UK does not. France is now more expensive, which is fine for French people because they have been getting richer, too. It’s not so fine for you, for whom France is getting more and more expensive. There is also the exchange rate risk to consider. You don’t want to convert your fortune into Euro only to find that it’s not worth all that much.

Just a closing remark on shares. It’s not clear that they will rise over and above inflation, even over long periods of time. The market is a complex system. The 7% return that everyone seems to be claiming the market naturally drifts towards is not guaranteed in practice.

Asset Management

What about just letting someone do your investing for you? Professionals with years of experience and good track records? That’s safe, right?

Empirically speaking, not really. Active managers don’t seem to be able to consistently outperform benchmarks. Those who do outperform appear to have poor subsequent performance (regression to the mean). All-star managers might have gotten lucky. Or maybe they had a winning formula but don’t anymore. Continuing to outperform is far from guaranteed.

When you use these managers, you are putting your fortune into their hands. It’s really hard to judge if these are competent hands or not. These funds can dazzle you with past performance and a good sales pitch, but that is not a good indicator of strong future performance. Take the recent Archegos Capital Management blow-up as a warning (it was the largest trading loss in history). You just never really know what these managers are doing and what risks they’re taking.

Other Assets

Seeing these risks, some prefer to shun the financial world in its entirety and invest in real stuff. Stuff they can see and touch that has a good track record of maintaining value. Things that have historically been valued highly – watches, cars, wine, oil, gold, silver, etc. – could be a good bet. The problem here is that the value of these items is very much dependent on tastes at the time you come to sell. The green initiative could accelerate, crushing the value of cars and oil, for example. Or the demand for watches may just simply die off for no particular reason. I see this as unlikely – things that have historically been highly valued don’t tend to lose their allure overnight without some kind of devaluing mechanism – but it’s possible all the same. The point is, these things are valued pretty much out of thin air.

Some assets are not valued out of thin air. Those that generate cash-flow can have their values reasonably estimated. A small business, for example. Or a property that you rent out. The risks here are specific to each individual case. 

Summing Up

Everyone is an investor. You can’t escape it. Everything that can be valued fluctuates in real value. Every day you are making investment decisions, so you might as well know what you’re getting yourself into (or make sure your financial adviser does!).

A big part of this awareness is knowing about the risks of investments, especially the disastrous, not-often-mentioned risks discussed in this post. Nothing is risk-free. Everything can go to 0 and you can lose all your money as a result, making for a pretty grim retirement. It’s just something you have to live with. You have to be a bit paranoid when composing your portfolio or you could get burnt, and burnt badly.

Of course, risk should not be the only factor when making investment decisions. Your specific circumstances (your goals, your age, your income, etc.) must also be taken into account. But risk should be, in my view, the primary consideration. To thrive, first you must survive.

 

Thank you to Haydn for an interesting and thought-provoking article. Please do check out his excellent blog at Perpetual Prudence as well.

I do very much agree with Haydn that every investment (or savings option) carries some risk. It is therefore essential to be aware of the downside/worst-case-scenario with any investment, while setting this against the potential rewards. Taking excessive risks is clearly to be avoided, but being too risk-averse – and therefore missing out on profitable investment opportunities – can be counter-productive as well. That applies especially to younger people, who may have 30 or 40 years before they retire.

It is also, in my view, crucial to avoid the mistake of putting all your eggs in one investment basket. As regular readers will know, I am a big fan of diversifying your portfolio as widely as possible – across different investment types, asset classes, platforms and risk levels. That way, if one or two investments do go south, hopefully they will be more than compensated by others that succeed.

It is also important to remember that investing is a long-term game. You should generally have at least a five-year time-horizon, to allow for the inevitable ups and downs in markets to even out.

As ever, if you have any comments or questions on this post – for me or for Haydn – please do post them below.

Disclaimer: Everybody’s needs and circumstances are different, and nothing in this post should therefore be construed as personal financial advice. Everyone should perform their own ‘due diligence’ before investing and seek advice from a qualified financial adviser if in any doubt how best to proceed. All investment carries a risk of loss.

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Make Money Selling Arts and Crafts Online

Guest Post: Make Money Selling Arts and Crafts Online

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Today I am pleased to bring you a guest post from Cora Harrison, a UK blogger and vlogger (video blogger) whose website is called The Mini Millionaire.

Cora says she loves to explore new ways of making money, both online and offline. She has a particular interest in online selling (and reselling) and there are many posts on this subject on her blog.

In her guest post today she reveals how anyone with an interest in creating arts and crafts can boost their profits – potentially many times over – by selling their work online.

Over to Cora, then…

 

If you love creating arts and crafts products, you can of course sell them at local markets or craft fairs. If you are looking to sell more and make (much) more money, however, you should definitely consider selling online as well.

There are various ways you can display and sell your work online. Here are some of the most popular.

Your Own Website

Selling arts and crafts on your own website is probably the single best way to sell your hand-made items online.

Having your own website will allow you to contact customers directly, grow your brand, and avoid the fees charged by third-party platforms like Etsy and eBay. In addition, you will not be competing directly with other craftspeople selling similar items to the same pool of customers on the platform.

For this to work, however, you will need to create an attractive, professional-looking website. You will then need to drive traffic to it, using techniques such as search engine optimization (SEO) and perhaps paid advertising. You can use online website building tools such as Wix or Shopify to create your site or hire a professional website designer.

Selling on Etsy

Etsy is an online marketplace dedicated to hand-crafted items. It is known for vintage, unique and custom-made items. It is easy to use, so you can set up your store and sell your crafts online in no time. Many would-be buyers of hand-made products look on Etsy before going anywhere else. Customers can pay by various methods, including PayPal and Google Pay.

On the minus side, many other artists and craftspeople also use the platform. This means it can be hard to sell common items. In addition Etsy charge about 5% of the sales value as a transaction fee every time you make a sale. You also pay about $0.20 for each item you sell. PayPal (the most popular payment method on the platform) also charge a fee for processing payments. All of these fees and charges will eat into your profits.

Facebook Marketplace

Facebook Marketplace is a prime location for selling hand-made crafts products locally. Given that Facebook has a massive user base, you can reach many potential buyers in your area by posting your items there. Posting items is free and you can add up to 42 images of your product in every sales post. The post will also include a description of the product, your location, and the price of the item.

While there is no limit to the number of posts you can make in a day, Facebook may limit posting to avoid spamming the page with similar ads. You have the option of sharing posts on your wall so that your friends may see the posts you have shared in local buying and selling groups. Potential customers will message you for more information and selling terms. The Marketplace is available on the web-based version of Facebook and as an app.

Selling on eBay

eBay is of course primarily an auction marketplace where sellers post items and sell them to the highest bidder. However, you can also create fixed-price listings. It is therefore a good platform to sell hand-made crafts online. The platform uses PayPal as the payment provider for all transactions. Both eBay and PayPal have various fees that you will encounter.

You will also be required to pay a final value fee. The fee is applied at the end of the transaction after making a sale. The fee is a percentage of the purchase price. There are also shipping and handling fees. Shipping fees are based on the method chosen by the buyer unless for domestic shipping, where the fee is calculated from the cheapest shipping method.

You will pay the final value fee whether or not the client pays for the item. If the sale is unpaid, you can cancel the sale or report it as unpaid. Note that eBay will give you credit for this rather than a cash refund.

Why Selling Online is Beneficial

There are several reasons you should consider selling your hand-made crafts online compared with selling in person at craft fairs and so on (though you can of course do both).

First, as stated above, online selling exposes you to a much larger audience than in the case of a market stall. You can sell your items to potential buyers across the country – and further afield – with ease.

In an online store, there are no opening time restrictions. The store runs around the clock and customers can place orders at any time of the day or night, as opposed to a local venue with set opening hours. In addition, you can operate the business from anywhere and target potential buyers who are far away from your location.

An online store also requires less time and effort. Once you have set up your online store and posted your hand-made items, they will be seen whether you are online or not. This allows you to sell your crafts even if you are otherwise engaged.

An online store also has lower running costs than an off-line one. There are no utility bills, rent or other premises costs to pay. You can run your online store from your kitchen, living room or bedroom. All you need is a laptop or desktop computer with an internet connection.

Effectively Selling Your Items Online

  • The Quality of Photos Matters

Just like in an off-line store, in an online store your hand-made crafts need to look good to appeal to customers. It is therefore vital that you take clear, sharp photos of your items. You can take them from different angles to give the customer an all-round view.

A modern smartphone should produce good-quality images in ambient light, but place your items on a white surface to give them a professional look. You can also use image-editing software to make the image ‘pop’.

  • Give Your Items a Perfect Description

Since you will not be there to explain the features of your product in person, it is important to provide a good description alongside your image. Ensure that the customer gets a mental image of the item without getting too sales-y. Most platforms have a character limit within which you can write a description. Use this opportunity to explain all the features that might be of interest to a potential buyer.

  • Keep Checking Your Site Regularly

Keep checking the platform where you have posted the item regularly for customer queries or orders. If the account is linked to your email address, you can have ‘push notifications’ set on your phone so that you know when there is activity relating to your item. The ability to respond quickly to queries will boost your reputation and prevent you from losing customers.

You may wish to post on more than one platform to increase your exposure. Try to estimate the return versus the cost of placing ads on multiple platforms. Having many items listed rather than just a handful will increase your overall selling rates as well, so aim to build up your inventory as quickly as possible.

Good luck, and I wish you every success selling your hand-made arts and crafts online!

 

Many thanks to Cora Harrison (pictured, right) for some great tips and ideas.

Cora Harrison The Mini Millionaire

Selling arts and craffs (online or off-) isn’t something I have ever tried myself, but I know it will interest many of my readers, so I was delighted to receive Cora’s article.

Obviously, you need some artistic talent to do this, but you definitely don’t need to be Leonardo (da Vinci, I mean, not DiCaprio). For example, using inexpensive software you can create attractive printables, which could sell well on Etsy and similar websites. You can read my blog post on this subject here.

But if you really don’t feel that selling arts and crafts online is your thing, you can still make good money selling and reselling products of all sorts online, from DVDs and collectables to Lego bricks! Check out Cora’s Mini Millionaire site for much more information about this..

As always, if you have any questions about this article, for Cora or myself, please do post them below.

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How to save money on your monthly home utilities

How to Save Money on Your Monthly Home Utilities

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Today I am pleased to bring you a guest post from my colleague Will Pointing from GreatDealsMadeEasy.com.

In his article below, Will sets out his top tips for saving money on many of your home utilities.

Over to Will then…

 

Many people stay with their utility providers for years and years without changing, on the principle that ‘loyalty pays’.

Sadly, this only really applies with lifelong friends and the Cafe Nero loyalty app (where you get a free coffee after buying eight!). With yearly price rises on most home utilities, it’s a good idea to review them annually (at least) and save yourself £100s in the process.

As a general rule, new customers get the best deals. Below are some tips on how to uncover the golden deals that are right for you…

Broadband – prices increase to £152/year when you remain with them

A survey by Which? magazine found that 71% of respondents stayed with their ISP (Internet Service Provider) for over three years. Most providers offer the best deals on broadband for 12-18-month contracts, meaning after that period prices shoot up significantly.

Are you out of contract? Check out GreatDealsMadeEasy’s Broadband comparison page or other sites like uSwitch, MoneySavingExpert, MoneySuperMarket or CompareTheMarket. Look for the phrase ‘exclusive’ on a deal – this means this site has the best deal on the market.

Tips: Look for what is included in your deal and whether you really need it. Do you need all those TV channels when you have Netflix? Do you need calls included when you have a mobile phone?

Mobile phone – prices increases to £264/year when you stay with them

It so easy to forget when you have paid off your mobile handset (the companies rarely remind you if you have) and then stay on an inflated monthly rate for years. Phone companies create these fashionable adverts to try and convince you to get the latest phone, when actually buying a SIM-only deal until you really need a handset upgrade is the cheapest way. If you want a new SIM-only deal or a new handset, check out comparison sites like my one here.

Tips: Out of contract? Switch to a SIM-only deal. If not, ensure you are on the right tariff for you and you are not paying for unnecessary data (use free wifi when you can to save on using your data).

Water – average bill is £415 a year

Water UK estimate that the average water and sewerage bill is £415 a year or £34.58 a month. It is recommended to get a water meter installed, so the cost is as accurate as possible.

Tips: Water saving tips include having a shower not a bath, washing up manually, and putting a full load of clothes into the washing machine. Many modern machines also have an ‘Eco’ mode, which uses less water and electricity.

Heating and power – cost around £1,254 a year

Using comparison sites to evaluate different energy suppliers and tariffs is perhaps the simplest, most valuable money-saving action you can take. You can often save hundreds of pounds a year by doing this, especially if you haven’t switched for a while (or ever). Again, many customers continue on a high rate for years without asking the question, ‘Is this the best deal for me?’ I suggest using websites like Compare The Market,  Money Saving Expert and Go Compare.

Tips: After getting the best possible deal, I recommend submitting regular meter readings to your supplier, so you are not overpaying. And turn off your lights as much as possible!

GreatDealsMadeEasy.com is the website to help you save money online the easy way. Whether you’re looking to cut back on your broadband bill, save on a holiday abroad or come up with a side hustle, Great Deals Made Easy will help you find useful tips and top deals. Expect great articles, interviews, reviews and advice. It’s written by digital marketing expert Will Pointing. Expect to find out how you can save money every month, the easy way!

 

Many thanks to Will for some great money-saving tips. Do check out his website at GreatDealsMadeEasy.com as well.

My own top tip would be to check out deals from cashback websites when changing utility suppliers. Sites such as Quidco and Top Cashback are especially worth a look when swapping energy companies. I talked about this recently in my blog post about How to Save Money with Cashback Sites.

On various occasions I have pocketed £70 or more in cashback when switching my gas and electricity providers. You can do this directly by signing up with an energy company via the cashback site (check first on a price comparison site that they are offering a competitive deal, obviously). Alternatively, many comparison services are also listed on cashback sites – so by clicking through to the comparison site and then switching via them, you can get cashback – and a good deal – this way.

And speaking of energy suppliers, you can also save money by getting a smart meter installed. These are currently being fitted free of charge by the energy companies. They help you monitor your energy usage and discover ways you can save money. In addition, a growing number of energy suppliers now reserve their best tariffs for people with smart meters. Check out my blog post Should You Get a Smart Meter Installed?

As always, if you have any comments or questions about this article, for me or for Will, please do post them below.

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Three Most Important Retirement Questions

Guest Post: The Three Most Important Retirement Questions

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Today I have a guest post for you from James Mackay, a certified financial planner and regular reader of Pounds and Sense 🙂

In his article below, James addresses an issue that will be real and pressing for many readers of this blog – how to prepare for retirement and enter it successfully.

Over to James then…

 

If you’re starting to think about your retirement, these are three important questions that you need to ask.

1. Have You Had Enough?

It’s Sunday evening and you’re winding down after a busy weekend with friends and family. As you sit back in your favourite chair and think about the week ahead, you can’t quite get comfortable.

The thought of going back to work on Monday morning makes you feel a bit uneasy. In fact, the thought of doing it for another 5–10 years makes you feel sick!

If you’ve ever experienced this, you might be approaching the point where you’ve had enough (that’s a technical term).

The question you need to ask yourself is whether the pain of going to work outweighs the benefit. If you find yourself in this situation; where you’re emotionally, physically and mentally drained and no longer excited to perform at the highest level, it’s time to do something about it.

Having had enough doesn’t mean that it’s necessarily time to retire. It simply means that you need to change the status quo.

Maybe you’ve had enough of your current role, but you’ve got more to give in another capacity. Your years of wisdom could be very valuable in a different guise. Perhaps you’ve had enough of having a boss and are ready to go it alone. With the years of experience, it’s no surprise that over 50s are the best entrepreneurs. Or maybe you’re happy to carry on but just want a little bit more flexibility around what you do and when you do it.

These are all useful options to explore, particularly if you haven’t got enough to hang your boots up yet. Sometimes, the benefit of working for “just one more year” can make a real difference to your financial situation.

2. Do You Have Enough?

If you’ve had enough, and are ready to move onto pastures new, the next question is do you have enough?

Whenever I ask this question, people start telling me how much they’ve got saved up. But they’ve got it all wrong. It’s like trying to build a house without the seeing the floor plans. You need to start with the end goal and work back from there.

Working out if you have enough requires knowing:

  • Your monthly number – this is how much a comfortable lifestyle is going to cost.
  • Your monthly income – this is how much income you’ll receive from the State Pension, final salary pensions, buy to let properties, etc.
  • The gap – this is the difference between the two, and where your savings come in. Broadly speaking, if you’ve got 20x the gap in savings, you should be fine. Any less and you might not be quite there yet.

But, there’s more to retirement planning than just simply figuring out your ‘number’. Finding your purpose in retirement sounds wishy-washy, but without a clear purpose you’re likely to be one of the 25% of retirees who return to work.

3. Will You Have Enough to Do?

You need to ask yourself what you are going to do when you wake up on that Monday morning, free from the ties of work, and how are you going to fill your time.

If for the last 40 years you’ve been busy being busy – chances are you’re going to get pretty bored sitting around the house for 40 hours a week. I’ve seen many successful individuals retire, only to get bored and return to work within five years. The newly-found free time that retirement provides can be overwhelming for some.

Retirement is about having enough money to sleep at night and enough purpose to get up in the morning. It’s not just about the numbers, it’s about how you’re going to spend your time. Purpose will drive you in retirement, money will fund you. Try not to get those two mixed up.

The bottom line is this… retirement is the biggest transition you’re ever going to make. It’s not the sort of thing you do regularly and not the sort of thing you want to get wrong. By asking yourself these three questions, you’ll improve your chances of achieving a successful retirement.

Byline: James Mackay is a Certified Financial Planner at Frazer James. He has helped hundreds of clients to achieve financial independence and retire with confidence, clarity and purpose.

James Mackay

 

Many thanks to James (pictured above) for a valuable and thought-provoking post. As a semi-retired 63-year-old myself, I can identify with all of the points he raises.

Actually I think there is a strong case for phasing your retirement if possible, maybe reducing the number of days per week you work initially and/or moving to a less pressured role. This can make retirement feel more like going on an interesting journey rather than driving over a cliff!

I also think there’s a good case for continuing to do some work you enjoy during the early years of retirement at least, to boost your income, provide social interaction, and keep your mental and physical faculties sharp. Of course, voluntary work can do this as well (apart from boosting your income, which may or may not matter to you).

If you have any comments or questions about this article – for me or for James – as always, do feel free to post them below.

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How to Start Video Gaming as an Older Person

How to Start Video Gaming as an Older Person

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Today I have a guest post for you by a fellow money blogger who goes by the name of The Reverend.

I’ve wanted to publish a post about video gaming for older people for a while but faced the obstacle of knowing very little about it (my experience of video games doesn’t go much beyond Space Invaders). Still, I know a growing number of older people are interested in this subject, and there are undoubted benefits, not least in terms of sharpening (or preserving) your wits and reflexes.

Anyway, that explains why I was delighted when The Reverend – a London-based video gaming enthusiast (and talented writer and blogger) – volunteered to write an introduction to the subject for Pounds and Sense. Without further ado, here it is…

I turn 40 this year and am not sure if I’m classed as an ‘older’ gamer or not, but one thing is sure, I can see myself gaming forever, regardless of whether I’m ‘too old’ or not. Its important that you do the things you want to, whether it is writing a book, going to the cinema or even playing video games.

The World of Video Game Consoles

SEGA logo

When you think of Video Games, what companies do you think of? The gamers of today will be playing on a Switch, or a Samsung, maybe a Steambox. When I grew up there was Atari, Spectrum or Commodore. This then moved onto NES and Master Systems before going to SuperNES and Megadrive. Everyone remembers Sega and Sonic the Hedgehog. Sega no longer make games consoles, but Nintendo have had recent successes with the DS (in various versions) and the more recent Switch.

One thing you might be surprised by is that many people nowadays are also playing video games on mobile phones and tablets.

Games for Older Gamers

I’d like to start by saying that games are for everyone – your age doesn’t stop you from enjoying the latest titles. We are also at a point where the block-buster video games are making more money than the block-buster movies! It is worth thinking about what you’d like from a game.

Gaming Hardware

To play games you have a few options, but the main choices are:

Most people do have a mobile phone, so this is a good way to start gaming. The Apple App Store and Google Play Store have hundreds of ‘free’ games you can download and try out. It’s a good way to judge whether you’d like a particular type of game – and if the game isn’t for you, you can delete the app and you’ve spent no money.

If you are looking to get a games console it’s best to go to a shop and try one out. Although the controllers all look fairly similar, you might find that the grip to ‘hold’ the controller isn’t comfortable or (for example) you aren’t able to see the smaller screens of the Nintendo 2DS. Most game stores will be happy to talk through the options with you, let you try things out, and maybe even suggest some games based on your interests. These people know their games inside out, so do ask for help!

A gaming home computer can set you back thousands if you want to play the latest games in the highest image quality. If you already have a home computer then a chat with your local game store will help identify which game you’ll be able to play without having to spend any more money.

Gaming Options

What do you like to do to relax? Do you enjoy reading books, watching movies, or sitting down with the Sudoku page of the newspaper? No matter what you enjoy doing, there is a game to suit you.

Love A Good Story?

If you enjoy in-depth story-lines in books, TV or film, then you may enjoy an RPG (or Role-Playing Game). Like books, there are plenty of genres for RPG games. I enjoy the Post-Nuclear-Alternative-Timeline story of the Fallout series of games. These are set in a future where technology didn’t move to the microprocessor and stayed with transistor valves. Imagine 1950s Americana with lasers! Death, destruction, cannibalism, nuclear bombs and drugs – not something you’ll be able to share with younger family members! The Fallout series of games are available on the PlayStation 4, Xbox One, and the PC.

At the other end of the spectrum there is Cat Quest. Of course, not every game has to be about lasers and robots. Imagine a medieval adventure game but feline themed! It is also a PEGI 3 rated game and this means it is suitable for all ages – no swearing or nudity in your cat-adventure – so you can play along with nieces/nephews or grandchildren. Cat Quest is available on the PlayStation 4 and the Nintendo Switch.

Catquest

Enjoy Exploring the Real World?

Perhaps you aren’t an actual gamer and you just want something to make your Real World exploration a bit more interactive. Although released three years ago, Pokémon Go remains a popular game. You may have heard of Pokémon and even the phenomenon that is Pokémon Go. The BBC News has even covered a guy who has 11 phones on his bike so that he can catch more Pokémon.

The premise is that you collect Pokémon. You do this by exploring the real world and when you are notified a Pokémon is in the area, you throw a Poké-ball at it to try to catch it. To make the game more interesting you have Points-Of-Interest called ‘Poké-Stops’ and ‘Poké-Gym’. The Poké-Stops help you lure special Pokémon for you to catch, and the Poké-Gym allow you to battle other players to take control of the ‘Gym’.

Part of the success of Pokémon Go is that it is a ‘Freemium’ game available on both iOS and Android, so most smart mobile phones will be able to play it. The fact it is Freemium means that the game is free to download; however, there are In-App Purchases (IAPs) that will allow you to progress faster.

Pokemon Go

LIKE Life Simulations?

The big name in this genre is The Sims. This is a game where you control a person and all aspects of their life. Imagine the board-game The Game of Life but with interactive graphics and almost infinite possibilities. You can choose the life you want, build the house you want, get the job you want, have children, get married, cook dinner and live out all sorts of dreams that perhaps you didn’t manage in your real life! The Sims is available on PlayStation 4, Xbox One, and PC. There is a basic version also available for the Nintendo DS.

Two Point Hospital

If you want to try running a hospital then there is Two Point Hospital for the PC (pictured above), with console versions appearing in time for Christmas. Maybe you want to become your own dictator – Tropico 5 is on the PlayStation 4 and XBox. Has your life-long dream been to drive a big rig? Then check out Truck Driver, also for the Xbox and PlayStation 4. You can even be a goat in the obviously named Goat Simulator!

There are a number of farming-simulations which don’t focus on the farming and do have a story-line. Available for the PlayStation 4, Xbox and Switch is Stardew Valley. You can also get this on the various App Stores as well as for the PC. There are quests in the game and these are designed to help you get more money so you can develop your farm. [Nick writes: My teenage nephews are keen Stardew Valley players – my brother-in-law once told me he wished they were half as keen on helping with the real garden as opposed to tending their virtual ones!].

ENJOY Building?

The classic building game is Minecraft. It’s available across pretty much any platform or device you can imagine. There is a ‘story mode’ for Minecraft but it also gives you a complete open-world building experience for you to create anything you want. The graphics may remind you of a much earlier generation of gaming, but don’t be fooled – this is a serious game that has a massive number of followers.

Minecraft

More serious is that people do stream their gaming and some of these streamers earn millions of pounds just streaming their games while they play. I bet you didn’t realise that playing video games can actually give you a source of income!

KEEN TO TRAIN YOUR Brain?

If you enjoy solving the Sudoku in the paper every day, did you know you can play these for free on your mobile phone? Go to your App Store and search for ‘Free Sudoku’. There are plenty of versions out there for you to choose from. Just make sure you don’t need to share your camera/photos/contact list/etc with the app – they don’t need this data.

Another well-known series of brain training games is from Dr Kawashima. These games are designed to challenge your brain and keep you thinking. They are only available for the Nintendo 3DS, but the series has been running for over 10 years.

Recommendations

Think about what you want from your gaming. If you want to play with family members then get whatever console they have. There is no point having a PlayStation if the people you want to play with have xBoxes.

If you want to just play something quickly while you have a spare five minutes then check out the free games on the app stores for your mobile phone – there are plenty of games like Candy Crush which you can start/stop with no impact to the game-play. If you want to do some more serious gaming on the move then the Nintendo Switch has a large portable display AND can connect to your TV at home.

Remember you don’t have to buy your games machine brand new. The current RRP of the Nintendo Switch is £279.99; however, you can find it much cheaper if you are willing to buy second hand. You could buy from eBay or Facebook selling groups. Another option is to buy it 2nd hand from CEX, where you will get 12 months’ warranty but you will probably pay more than the eBay price.

I have a PlayStation 4 and an iPhone. The iPhone covers my ‘casual’ gaming when I have a spare 5-10 minutes while I’m out and about. On my phone I have Tetris, Countdown, Scrabble, and Candy Crush. My PlayStation has first-person shooters like Call of Duty, RPGs from the Fallout Series, historical stealth exploration from the Assassin’s Creed series, and various games I can play with my nieces and nephews. They enjoy playing Lego Avengers with me, but I must say I’m much better than they are! (well, that’s what they tell me, but they might just be saving my feelings!)

Final Thoughts

Gaming is for everyone. Whatever you are interested in, there will be a video game for you. Don’t be ashamed if you want to go on a Cat Quest, or you are interested in running your own farm. You might even want to build in the Minecraft world and see where your creativity takes you.

If you have friends/family who play video games then ask them for advice. Most gamers are happy to talk games, explain what they are playing and make suggestions of what you may want to play. It doesn’t have to be only Fortnite and flossing!

Many video games have online/social components and this means you should be careful with any personal information and not give away too much. Treat these networks/messages/etc the same you would with any other online activity. Microsoft has some good advice that is worth following. Stay safe, as you would with any online activity.

Video games can help keep you active, keep your brain engaged, make new friends and keep you connected with your family, especially the younger generation. With all this available to you, why wouldn’t you want to get into gaming?

 

Many thanks to The Reverend for an eye-opening article. If you’ve been considering trying video gaming – or even if you haven’t – I hope this article might inspire you to get started.

As The Reverend says, gaming can be great for keeping mentally and physically sharp, and engaging with friends and family. You could start with games on your mobile or your computer, and maybe move on to consoles if you really get the bug.

As for me, I’ve decided to make a start in video gaming and have downloaded a couple of games to my smartphone. I’m already looking forward to planting, tending and expanding my first farm 🙂

  • Do check out The Reverend’s excellent blog at https://thereverend.co.uk. As well as some great posts about saving money and making money, there are enjoyable and informative posts about travel, food and entertainment as well.

As always, if you have any comments or questions about this article, for me or The Reverend, please do post them below. And if you are an older video gamer yourself, I’d love to hear any advice, tips or recommendations you may have!

Disclosure: This post includes Amazon affiliate links. If you click through and make a purchase, I will receive a modest commission. This will not affect the price you pay or the product/service you receive.

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Active Investing Versus Passive Investing

Guest Post: Active Investing Versus Passive Investing

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Today I have a guest post for you by my fellow money blogger Simon from Financial Expert.

In his post, Simon examines the pros and cons of investing in active versus passive funds. This is (of course) a subject of much debate among both pundits and investors. I will share a few thoughts of my own about it at the end.

Over to Simon, then…

 

For people who are enjoying their retirement or approaching it, choosing the right investments is clearly crucial.

With less time to correct mistakes, a bad investment choice is likely to have a major impact on quality of life in retirement. Many older people therefore struggle to make decisions given the number of investment choices available.

But before picking any particular trust or fund, all investors must first navigate a fork in the road. They must decide whether to follow an active or passive investment strategy.

Active Versus Passive

A fund manager following an active strategy has the discretion to hand-pick shares that they believe represent a superior investment opportunity. They do so in an attempt to deliver a return higher than the market average – for example, the return on the FTSE 100 index of large companies listed on the London Stock Exchange.

Funds that follow a passive strategy, on the other hand, use a mechanical approach of buying most of the shares which form indexes such as the FTSE 100. The objective of replicating the index is to provide a return which mirrors it as closely as possible.

Of these two approaches, which is the more successful? There are many arguments on each side of the debate. Below, I pull out the key pros and cons to help you decide.

In Support of Active Investing

Detailed research is valuable in opaque markets

In emerging markets and other less developed economies, quality financial information is a scarce resource. For example, emerging-market companies are less covered by investment analysts, and the quality of their financial reporting may be lower.

This creates a research deficiency which can be exploited by any active fund with a research team. Any insights generated by the boffins can be used to guide trades and improve the performance of the fund.

This is one of the key reasons why investors opt for active funds over passive funds in the emerging market equities asset class.

Moreover, the higher returns of high-risk markets such as emerging markets helps to cover the premium fees charged by active funds.

Absolute return strategies

Active funds are free to engage in investment strategies which seek to provide a positive absolute return regardless of whether the market is rising or falling.

They can do so by either short selling a company, by switching between asset classes, or by investing for relative value. Relative value investing is where fund managers seek out under-priced securities. They buy under-priced securities and sell over-priced peers. In theory this strategy will deliver a profit regardless of the overall direction of the market, as long as the pricing anomaly corrects itself over time.

These funds seek to provide a lower level of volatility compared to an ordinary equity investment, and similar returns over the long term.

However, the recent performance of large absolute return funds has been underwhelming. In the three years to the end of November 2018, the flagship absolute return fund managed by Standard Aberdeen’s has returned only -6.6% compared to 42% for an average investment trust.

In fact, only 12 of 102 similar funds reported a positive return over the same period. This implies that while active strategies might work on paper, they are difficult to execute in practice, particularly when so much money is chasing the same strategy.

The Drawback of Active Investing

Active managers are losers… most of the time

The track record of active funds highlights their biggest drawback: after fees, active funds tend to under-perform the market average.

The Financial Times reported in 2015 that ‘Nine out of ten active funds fail to beat their benchmark.‘

Fund managers and research staff are expensive. This translates into higher annual ongoing charges. The higher the fees, the higher the bar is lifted on the returns needed to meet investor expectations.

Simple logic can provide a hint at why active funds disappoint:

  • Worldwide, the lion’s share of assets are still owned by active funds.
  • By definition, only half of the market participants can perform ‘better than the average’.
  • Of the winning half, some of these winners will have significantly outperformed, while many will have only incrementally outperformed.
  • Because of the premium fees they charge, any active fund that beats the benchmark only slightly will still come out as a loser after fees are taken into account.
  • Therefore we can conclude that theoretically, only a small proportion of fund managers (those that beat the benchmark by a good margin) can deliver the return that investors expect.

The second issue that plagues active managers is the difficulty of repeating the performance in subsequent years.

A fund manager may have enjoyed a particularly strong year because of sheer luck alone.  Perhaps the fund happened to simply be in the right asset at the right time. This doesn’t guarantee that the fund will enjoy remarkable success in the future.

The temporary and unrepeatable nature of fund success explains why the fraction of fund managers that fail to meet their benchmark rises to the ‘Nine out of Ten’ statistic reported by the Financial Times when their performance is measured over a long time frame.

In Support of Passive Investing

Passive strategies deliver what they promise

Followers of passive investment strategies understand this logic and are prepared to accept an ‘average’ market return, in exchange for the assurance that they will not under-perform it.

Passive funds, which create portfolios which closely resemble the indexes they track, carry much lower fees as no research analysts or star fund managers are needed on the payroll.

With fees as low as 0.06%*, trackers give investors the best chance to achieve as close to the ‘average market return’ as possible. As stated above, this will beat active funds, which typically trail behind the same benchmark.

* Vanguard FTSE 100 Index Trust

The Drawback of Passive Investing

An unhealthy concentration

Indexes are created mechanically by companies such as FTSE and Standard & Poor’s. Each company in the index is weighted by its size, among other factors.

This formulaic approach has the unintended side effect of creating unhealthy levels of concentration.

Vanguard’s Emerging Market Stock fund is a good example. 31% of the fund value is invested in a single country; China. In contrast; India, Brazil and Russia take up just 8%, 8% and 4% of the fund respectively.

Indexes can also be skewed by industry. Financial companies form 24% of the same fund. This vastly outstrips banking’s share of the global economy. Even in the UK, which of course contains London, a global financial capital, banking and finance only contribute 6.9% of economic output.

The result of these distortions is that ‘diversified’ passive investors can find themselves exposed to country-specific, sector-specific or even company-specific risks. They may have no clue that such a large proportion of their portfolio is invested in such specific areas, given the global nature of the fund.

Therefore, while passive funds appear to give retirees the best opportunity to achieve average market returns over the long term, investors should be wary. Any potential index fund should be reviewed to discover whether they have an unintended concentration in a particular region or sector.

About the Author: Simon writes for Financial-Expert.co.uk, an investing website with an educational focus. Recent posts include How to Invest in Property and How to Invest in Shares.

 

Many thanks to Simon for an illuminating article on an important topic for all investors.

Anyone who is considering investing in funds or trusts needs to bear in mind the distinction between passive and active management . For new investors, low-cost passive tracker funds, such as those run by Vanguard and mentioned by Simon above, could certainly be worth considering. But bear in mind the point Simon raises about the risk of unintentionally creating unhealthy levels of concentration in a single country, sector or even company.

Personally I have some money in tracker funds, but quite a lot more in funds that are actively managed. This is partly due to the fact that having no living dependants I can afford to take a slightly more adventurous approach in pursuit of better returns. Nonetheless, I do of course aim to diversify my investments as widely as possible, so that a downturn in one particular market or sector doesn’t impact too badly on the value of my overall portfolio.

I would also comment that most investment funds and trusts incorporate quite a bit of diversification already due to the range of investments they hold. Although they do of course come with a degree of risk, other things being equal this is likely to be a lot less than investing in individual company shares. And for older investors, careful risk management is key to ensuring a comfortable retirement, no matter how long this may prove to be 🙂

As always, if you have any comments or questions on this article, for me or for Simon, please do post them below.

Disclaimer: Nothing in this article should be construed as individual financial advice. All investments carry a risk of loss. Be sure to do your own ‘due diligence’ before making any investment and consult a qualified independent financial adviser if in any doubt how best to proceed.

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How to Know if You Have Prediabetes

Guest Post: How to Know if You Have Prediabetes

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Today I have a guest article for you from my fellow UK blogger Neil Welsh.

Neil has a special interest (and expertise) in diabetes. In this article he talks about prediabetes, a common condition that can lead on to Type 2 diabetes if no action is taken.

Older people – such as many readers of my blog – are particularly prone to this condition. If it develops into full-blown diabetes, it can have life-changing (and potentially life-limiting) consequences. It’s therefore very important to be aware about it and to take action if required. I have a special interest in prediabetes myself, for reasons I will discuss at the end of the article.

Over to Neil then…

 

Prediabetes is no joke. If left untreated it can develop into full Type 2 diabetes in as little as 3-5 years and lead to complications such as nerve damage, heart disease, increased risk of stroke and potential blindness and amputations.

The tricky part is that it’s not easy to know if you are actually prediabetic or not. According to Diabetes UK, an estimated seven million people in the UK have prediabetes: an under-diagnosed condition that makes them up to 15 times more likely to develop Type 2 diabetes.

So what are the warning signs and how do you know if you do have prediabetes?

There are four commonly accepted indicators of prediabetes which are:
– Increased thirst
– Frequent urination
– Fatigue
– Blurred vision

Now, on their own, these are not particularly great indicators. I frequently display a number of these symptoms on a regular basis! So, realistically, these indicators need to be considered in conjunction with other risk factors. You are more likely to develop prediabetes if you have any of these risk factors:
– Being overweight
– Being inactive
– Having high blood pressure
– Having high cholesterol
– Having a family history of prediabetes
– Being of South Asian, African-Caribbean or Black African descent.
– Being over 40 years old

The only way to know for sure if you are prediabetic is to have a blood test. This can either be carried out by your medical professional or using a home test kit.

One of the most effective tests is the HbA1c test. HbA1c refers to glycated haemoglobin. This blood test shows how much glucose (sugar) in your body sticks to your red blood cells. The result tells you your average blood sugar level for the past 2-3 months. If your body is not using sugar properly it builds up in your blood and sticks to the cells.

The longer you have had high blood sugar levels, the higher your HbA1C will be. Less than around 40mmol/mol (6%) is considered normal, 40-47mmol/mol (6.0-6.4%) is considered prediabetic, with anything over 48mmol/mol (6.4%) indicating diabetes. It’s different from an FPG (Fasted Plasma Glucose finger-prick test), which is a snapshot of your blood sugar levels at a particular time, on a particular day.

So what should you do if you are concerned that you might have prediabetes? The number one thing is to act now. Take it seriously and avoid the medical complications that may be around
the corner. Prediabetes is totally reversible. Type 2 diabetes is considered reversible only to the extent that you will be in remission and drug free, but the threat of the condition returning will be constant. The sooner you act on prediabetes, the simpler the reversal process will be.

If you are diagnosed with prediabetes or if you are just concerned that it might be on the horizon then the course of action is the same: make changes to your diet and lifestyle.These changes do not have to be dramatic; in fact, you are statistically better off if they are not. An old Chinese proverb says that it is better to take many small steps in the right direction than to take a great leap forwards only to stumble backwards…and in the case of prediabetes this could not be more true.

Making small changes that are appropriate for you and where you are in your journey is the key to success. Work out where you are now and where you want to be and then take small, consistent
steps in the right direction. It could just save your life!

Neil

About the Author: Neil Welsh specialises in helping people reverse prediabetes. He focuses on working with clients to make changes which product remarkable results. Click here to download Neil’s free Prediabetes Reversal Blueprint, a guide to helping you know what to eat and how to live to stop prediabetes.

 

Many thanks to Neil for an eye-opening article on an important subject that older people (especially) need to be aware about.

I was actually diagnosed prediabetic myself two years ago. How it happened is that on a routine check-up the doctor found I had hypertension (high blood pressure). As I gather is standard in these circumstances, he prescribed various tests to get to the root of the problem. One of these was an ECG – which came out fine – but another was a blood test. My HbA1C result (referred to above by Neil) was in the region defined as prediabetic.

My doctor was actually pretty dismissive about this. He said, “Prediabetes isn’t something we treat.” That wasn’t good enough for me, though, so I researched the topic and read a number of books about it, including the excellent Reverse Your Diabetes by Dr David Cavan. As a result of all this, I made various changes to my diet and lifestyle, in particular cutting down on carbs. To cut a long story short, when I was tested again earlier this year, my blood test results were back in the normal range. My doctor (I have changed to a different one now) said, ‘Whatever you’re doing, keep on doing it!’

I should also add that, probably as a result of losing some excess weight through my diet and exercise regime, my blood pressure has has gone down as well, and I am no longer on any medication for this. Win, win!

Anyway, I hope you will read and note the advice from Neil and download his free Prediabetes Reversal Blueprint. You may also want to check out his Habits for Life programme. By taking action now, you really can reduce the risk of developing full-blown diabetes further down the line. And even if you are already diagnosed with T2 diabetes, both Neil and I believe it is possible to improve your blood sugar control through diet and lifestyle changes and potentially reduce the amount of medication you have to take.

As always, if you have any comments or questions about this post, for me or for Neil, please do leave them below.

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Guest post: The money-Making Apps You Need to Download Now

Guest Post: The Money-Making Apps You Need to Download Now

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Today I am pleased to bring you a guest post from my fellow UK money blogger Bronni Hughes

In her article below, Bronni sets out a number of mobile phone apps you can download for free that can help you earn a useful sideline income, generally for little or no effort.

Over to Bronni then…

 

Phones can be expensive. After buying your handset and then forking out for your minutes, texts and data on a monthly basis, it can feel like you’re just throwing money away. This is why I think it’s important to use money-making apps to try and make some of it back.

Unfortunately, you’re not going to pay your rent with the money you’ll make from these apps, but you could get a tidy stack of Amazon vouchers to put towards Christmas. Not bad!

Jobspotter

If you don’t have this app yet, what have you been doing?! I must have made over £100 in Amazon vouchers since I first downloaded it.

It’s very simple to use, how it works is:

  • Download the Jobspotter app for Android or iOS.
  • Sign up for an account.
  • When you’re walking around town use the app to snap photos of any job adverts you can see posted outside businesses.
  • Earn Amazon vouchers.

Job Ads

It really is that easy! You need to take a clear shot of the job advert itself and one where you can clearly see the name of the business.

Jobspotter will then assess the photo and decide how many points it earns. One point equals 1 cent (USD) of an Amazon voucher. All ads earn points, but one for a chain cafe will earn a lot less than an ad in the window of your local takeaway. If someone’s submitted the job before it won’t earn as many points.

The most points I ever earned in one go was 144 from an estate agent in my local town. It honestly takes seconds to submit each one, and the money can rack up pretty quickly.

There’s no minimum you need to cash out, and the Amazon voucher arrives after about 48 hours usually.

Field Agent

Have opinions about what you buy in the supermarket? Who doesn’t!

Field Agent pays you to share that opinion. Download the app here. Jobs usually involve going to the supermarket and photographing certain shelves and saying which product you’d choose to buy. There are ones on the app right now for £10, and they don’t generally take any longer than 20 minutes to complete.

Bananas

You won’t qualify for every job – sometimes they’re looking for cat owners or people with kids, for example. There are often at home surveys paying £1 or £2 each too.

The app is free to use and download, so it’s worth trying out to see if you like it.

App-based banks won’t make you money, but they do make managing it a lot simpler. Read my review of the Starling joint account.

Shoppix and Receipt Hog

I’ve grouped these two apps together, because I always scan every receipt I get on both apps.

Shoppix is available on Android or iOS – download here. If you use the referral code 3PGPHDNK we both get 200 points.

You’ll get 30 points for a receipt snapped the same day, and 25 points for one submitted any later. You also get good bonuses for using the app every week too, plus extra points for filling out their very short surveys.

You need 3200 points to cash out £5 via iTunes, Amazon or PayPal. It usually only takes me two months of snapping to be able to cash out a full £20.

Receipt

Receipt Hog is a bit less generous than Shoppix, but as you can scan one receipt on both apps you may as well get it. It’s available for Apple or Android here.

How many points you get depends on how much you spend on the receipt. It’s 1,500 points to cash out £5 via Amazon or PayPal. Remember you’ll get bonus points for snapping every week too, as well as “hog slots” where you can win extra prizes.

Want more ways to make money? Find out how I added £10k to my house deposit.

 

Many thanks to Bronni for an eye-opening article. I’m definitely going to download all those apps to my own phone!

Do check out also Bronni’s stylish and informative blog at https://bronni.co.uk/ .

Don’t forget either MobileXpression, the app I wrote about on Pounds and Sense last year. I am still receiving £20 Amazon vouchers every few weeks like clockwork from this. All you have to do is download the app to your mobile phone, and every so often check in to the app to claim any points you have been credited.

If you know of any other good money-making (or saving) apps, feel free to post details below. And, of course, you are very welcome to post comments or questions, for me or Bronni, there as well.

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Make Money with Magazine Letters

As I Write This Letter – How to Make Money with Magazine Letters

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Today I have a guest post for you from my writing colleague S. Bee (her pen-name) on the subject of making money writing letters and fillers for popular magazines.

This is a money-making sideline I have a soft spot for, as many years ago I started my writing career doing exactly this. I remember, for example, having a series of letters published in The Sun newspaper, for which I received the not-exactly-princely-even-then sum of £2 each. I treasured those cheques when they arrived, though!

It’s good to know that this opportunity still exists, even in this digital age.

Over to S. Bee then…

 

When I began writing seriously in 2011, I focused on the fiction market for women’s magazines.

As I became more involved in it, I discovered that several of these short story writers had also enjoyed publishing success with letters in national magazines.

More importantly, they’d been paid a small fee for their efforts. If there was no fee, a prize was offered instead.

I thought, Why don’t I have a go at that? So I did, and eagerly began to send letters in.

My spirits were high. Surely I’d see my name and piece in print somewhere? But no. Sadly, I didn’t get anywhere at all!

After a few months, I felt ready to try again. However, this time I carried out research first. I studied the tone and style of the magazine I intended to submit to, and what type of letter was likely to be picked for publication, plus the subject of it. For example, I learned that positive feedback about a previous feature was very popular.

I kept my submission short and snappy – and my hard work paid off. I was absolutely thrilled to see my very first letter published in What’s On TV magazine. I was delighted to receive a payment of £10 for little more than a paragraph.

Since then, I’ve had lots of letters published in Woman’s Weekly, The People’s Friend, Yours, My Weekly, Web User, Vegetarian Living, Take a Break and Your Cat. And lots more in What’s on TV – I even made Star Letter status once! (I was paid £25, instead of their usual £10).

How do I find ideas for letters? It’s easy – you need to think of what could appeal to readers.

For Woman’s Weekly, I once wrote about the tests I undertook for breast cancer. I urged readers not to ignore any call-ups. (Thankfully, I was okay.)

I’ve also been featured with several opinion pieces for the ‘You’re Telling Us’ page in Take a Break magazine. The ‘You’re Telling Us’ question can be found on the TAB Facebook page. They request a photo of yourself and your age, too.

TAB also publish call-outs for a true-life reader experience type of feature in the magazine. I’ve had ‘A letter to your younger self’ piece published and a ‘Christmas cringes’ one too. These can pay more – up to £100.

The TAB letters page, ‘We’ve Got Mail’ currently pays £25 and £50 for the star letter. They like photos with the letter.

TAB also have call-outs in the mag for paid photo opportunities, e.g. pets or kids in a messy/awkward situation.

Some publications offer a prize to the star letter only.

I attempt it, and often I don’t win the prize, yet I’m still pleased to see my piece published.

I’ve won a small beauty prize for my star letter in the free TESCO magazine, and being selected for Your Cat‘s star letter scooped me a range of cat toys and biscuits. Your Cat will pay for true life cat tales, too.

Update: Tesco now only award a prize to the star letter in their mag – it’s a £50 Tesco voucher. That’s bound to help with the grocery bill!

My prize letters in a monthly writing magazine netted me a free one-year magazine subscription – twice! (a fantastic saving of around £160).

If you have a hobby, e.g. computers, gardening, cooking – pick a suitable magazine that accompanies it. For instance, my hubby is a very good cook and baker. He’s had several recipes published in Take a Break‘s My Favourite Recipe magazine. (He was awarded £25 per recipe.)

It’s not just letters. Some magazines also publish short poems.

I’ve had several poems published in the fortnightly Yours magazine, and a weekly, The People’s Friend. These magazines like rhyming, upbeat, reader-friendly material.

TPF award a small prize (I’m not sure, but it used to be a tea caddy and a packet of loose tea) if your poem is selected for publication in their letters page – however, they pay £15 per poem if you target your poems to their other publications, e.g. their fiction special, annual or fireside book. The magazine has different email addresses for these slots.

Yours pay £10 in gift vouchers per poem. The vouchers can be spent practically anywhere. They pay a £10 gift voucher for a normal published letter too.

Yours regularly publishes call-outs in the mag for specific reader’s memory/nostalgia experiences. They sometimes require photos to accompany the feature, so you’d need to scan these in and send them with your article [or of course send digital photos – Nick].

Don’t forget that fillers such as top tips, funny photos, a ‘pet of the week’ type of feature, puzzles, jokes, beauty queries, travel articles (think about what’s interesting about about your town/city – photos required) and ‘items to be valued’ pieces are high in demand, too.

I’ve had my childhood teddy valued in Real People magazine (I earned £25). My cat has been featured in My Weekly (another £25) and I’ve had beauty questions featured in Take a Break. (They pay £25 for this.)

I’ve also made it to the TAB letters page, with their ‘What a laugh!’ slot. I was £50 richer for just a few lines of text!

A writer friend of mine likes to create her own word puzzles (not necessarily crosswords) and she has these published regularly in Real People magazine. If published, the fee for this is either £30 or £50.

I’m not a gardener, but my writing friends who are have hit the jackpot with letters and hints in gardening magazines. Prizes and cash are up for grabs.

Although you won’t be able to earn a regular salary with letters and fillers, the odd £10 here and there soon adds up.

Bear in mind that no matter how many letters you submit, you won’t be chosen every week. Consider the fact that the editor or team will become familiar with your name. However, saying that, they do appreciate regular contributors – just don’t swamp them!

Publications are always looking for well-written, entertaining, intelligent letters that fit in well with the editorial style of the magazine.

Always be cheerful and polite, don’t waffle, and make sure you follow the magazine’s submission instructions. It’s all done via email now.

Your subject heading should be: ‘Letter for consideration’.

Work can be edited, changed or even added to – to me, this doesn’t matter as I want to be published and I want to be paid.

Some magazines let you know beforehand if your letter/filler/poem has been selected, and some don’t. If you submit material regularly, this means a weekly scan of the magazines in newsagents or the supermarket to check if your piece is in.

Some prizes arrive completely out of the blue. One Christmas, I won a prize of a large jigsaw puzzle, yet I hadn’t a clue who had sent it or what publication my letter was in. All I had was a snail mail letter saying ‘Congratulations!’ from the makers of the jigsaw, which didn’t really help.

Later, I realised I must have been awarded star letter in Down Your Way, a Yorkshire-based nostalgic magazine. I quickly emailed the Ed and he confirmed it. (Update: I’ve won this prize a second time with a piece about phone boxes.) As it was approaching Christmas, it came in very handy as a gift for a family member who loves jigsaws.

So, what’s stopping you from having a go?

If I can do it, so can you! Get writing and good luck!

S. Bee

 

Thank you to S. Bee for an interesting and inspiring article. Paws For Thought

I would just add that you don’t need any special writing skills to win cash and prizes this way. It’s really just a matter of keeping your ear to the ground about current events and issues, and coming up with positive, upbeat angles on them.

S. Bee isn’t being paid for this article, but she asked me to mention a charity ebook she is promoting on behalf of the RSPCA (who receive all profits). It’s called Paws for Thought – 27 Tail Thumping Stories (see front cover, right). It’s for a great cause and only costs £2.99 from Amazon as a Kindle ebook. If you enjoy short stories – and especially if you love animals – why not check it out? 🙂

As always, if you have any comments or questions about this article, please do post them below.

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How to Save Money After You've Retired

Guest Post: How to Save Money After You’ve Retired

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Today I have a guest post for you from my friends at Suttons, a leading seeds, bulbs and horticultural products company.

There is a lot of discussion about saving money before you retire, but not nearly as much about saving afterwards.

But in reality the great majority of us have to survive on a lower income in retirement. While nobody wants to spend their golden years scrimping for every penny, saving money in retirement is important and helps us to afford things such as holidays that can enrich our lives.

So this guest post sets out some great ideas for painless ways of saving money in retirement. I hope you enjoy reading it.

 

For many of us, we dream of retirement. The ideal age for packing in work is 57, according to studies, with 32% of respondents planning to quit the working world at this age. However, for some, the thought of calling it a day before they’re eligible for their state pension isn’t feasible. It’s been estimated that the British public will need at least £260,000 to retire without money issues. Unfortunately, research has found that the average pot of money held by those aged between 45 and 54 is £71,240 — way off the final required total.

While this final figure sounds extremely high, there are ways to prevent overspending in your later years. Here, we take a look at some great ways to save money after you’ve retired.

Sell your clutter

We are a nation of hoarders. Whether it’s old equipment or new purchases, we don’t like to get rid. In fact, over half of the UK’s adults claim to have between one and 10 items hanging in their wardrobe which have never been worn. However, one man’s junk is another man’s treasure, right? Therefore, clear out any unnecessary clutter you may have acquired over the years.

Have a huge clear out and you’ll be surprised at how much stuff you don’t actually need if you’re ruthless. This can help to provide extra funds to go towards your retirement pot. It means that you’ll be increasing your income, and you won’t even have to make too many cuts from your lifestyle. You can sell your stuff via online auction houses such as eBay and local Facebook groups.

Grow crops

Growing produce at home has many benefits. We all know that eating fruit and vegetables is good for you due to them being full of vitamins, minerals and nutrients. However, have you ever stopped and thought about how much money you can save if you grow your own veg? If your garden is big enough, you should create a vegetable plot. This can include cabbages, lettuce, onions, sweetcorn, leeks and the likes.

You should also look into companion planting. For example, grow Swiss chard in the same space as onions, beetroot and cabbages and you’ll make the most of your space while also deterring pests. A patio garden can also grow smaller produce, including mange tout, radish and French beans.

Some of the most cost-effective vegetables you should look to grow in your garden include tomatoes. As they don’t require much space to grow, you can even place these on balconies. Usually, they take 12 weeks before they are ready for harvest and each plant can create fresh produce daily for up to six years. Based on a shopper buying one box of tomatoes per week, this can help you save £52 each year.

Potatoes are another money saver. The average Brit eats 429g of potatoes every week and the average four-pack costs £1 in a supermarket. However, for a pack of five seeds, you can grow up to 45 potatoes for as little as £1.50.

Of course, there are many other examples that can save you money, and it all tallies up when put together to make great savings.

Adjust the frequency of luxuries

You don’t have to stop enjoying yourself to save money in retirement. It’s no use retiring just to sit and be bored. However, it’s important that you plan properly and adjust your lifestyle to suit your budget. We all like the occasional blow out — whether that’s on a holiday, fine dining or on new items. However, it’s crucial to live within your means. If you were used to eating out every other night when you were in employment, chances are you won’t be able to once you’ve left the workplace. However, you shouldn’t cut it out altogether. Simply adjust the frequency you do so and you’ll still be able to have that luxury that you long for.

Set priorities

Having a budget doesn’t mean removing the items or adventures that are most important to you from your life. However, it is important to set yourself priorities. Decide what it is that you really want in your life and what are just added bonuses. Doing this can help you to prioritise your money, while ensuring you don’t miss out on what you really want in your life.

The above are all examples of how to save money once you’ve retired. Of course, there are many other opportunities for you to make the most of your retirement, but by focusing on these points, you’ll be well on your way to enjoying your relaxing time after finishing work for good.

 

Thank you to Suttons for an interesting and thought-provoking guest post.

I definitely agree with the advice to grow tomatoes. I have been doing this for a few years now, in growbags and/or hanging baskets. Despite my distinctly un-green fingers, they never fail to produce a bumper crop of tasty toms, and save me having to buy any from the shops for months on end. Suttons have lots of varieties of tomato seeds available. Or if you prefer you could visit a garden centre such as Dobbies and perhaps take advantage of their Over 60 Meal Deal as well!

As always, if you have any comments or questions about this article, please do post them below.

Cover image by Lukas Bieri from Pixabay

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