What they don’t teach you about money 

This is an audio transcript of the Money Clinic podcast episode: ‘What they don’t teach you about money’

Isabel Berwick
So, Claer, what’s your earliest money memory?

Claer Barrett
Aged about three or four, eavesdropping on the stairs, looking through the banisters, watching my Mum and Dad manage their money around the kitchen table at night. You know, all the statements, putting cash in envelopes, knowing that they were so diligently working the budget so that we wouldn’t run out of money. There’s something I found really comforting. How about you?

Isabel Berwick
I saved up week by week for a dollar called a Sasha doll, which is now worth a huge amount of money.

Claer Barrett
And you still have the doll?

Isabel Berwick
I still have the doll. (laughter)

[MUSIC PLAYING]

Isabel Berwick
Hello and welcome to the show. I’m Isabel Berwick, host of Working It, the FT’s Work and Careers podcast.

Claer Barrett
I’m Claer Barrett, Isabel’s colleague and host of the FT’s personal finance show, Money Clinic. And this week, a double billing: Working It and Money Clinic have joined forces.

Isabel Berwick
And it’s all because of your newly published book, Claer, called What They Don’t Teach You About Money.

Claer Barrett
Yes. My first book, you may have heard about it on the show. And this is a recording of a webinar that we did to mark the event organised by the FT’s financial literacy charity, FLIC.

Isabel Berwick
So in the webinar, we delved into the ways that your financial personality, as you call it, can affect the ways you handle money.

Claer Barrett
Yes. And importantly, how you can change that and shift your money mindset.

Isabel Berwick
We had loads of questions from webinar viewers on everything from how to handle debts, to what financial advice young people should be getting. So let’s dive straight into the recording. A question the viewer put to you, Claer: why did you write your book?

Claer Barrett
Well, I think the reason I wanted to write this book is because I feel that a lot of us have got emotional barriers — which we might acknowledge, we might not acknowledge — that are preventing us from getting to grips with our money. You know, anxiety is the biggest one, especially at the moment, and I’m really, really glad to see that people who’ve, tell me that they feel anxious about their money have tuned in today. So, you know, keep watching. We’re gonna tackle lots of these issues, but also the fact that we have to manage our money with other people, with other family members, with our partners, with our children, who we need to teach good money habits too, as well. So there’s a lot of emotional constructs that exist around money. I’ve come up with the concept of a financial personality in the book to help us think a little bit more objectively about our good and our bad habits when it comes to managing money. I’m sure we’ll mention a few of them later on. It’s possible for your financial personality to change, and the biggest way I think that you can effect change is by educating yourself, which is what we’re all here to do, but also by talking about money more with those closest to you. So wonderful to break down those taboos and start lots of money conversations.

Isabel Berwick
Yes, because a big part of your book is encouraging honesty and openness. And we’ve both talked about our biggest money mistakes...

Claer Barrett
Yes.

Isabel Berwick
Which is brilliant. Can you tell the viewers what that was?

Claer Barrett
(Chuckles) OK. Well, I mean, the theory is what my biggest money mistake was not starting a pension until I was 30. We’ll talk more about pensions later because there is free money on the table from your employer. And I’ve done a whole chapter on that in the book. But one of my earliest money mistakes was taking my eye off the ball when it came to a store card from a certain Swedish furniture retailer. And I tell the story. I broke up with a boyfriend. He took half the furniture with him, went down to the shop and it said like, “You can get 20 per cent off today if you sign up for our store card and buy furniture.” So I did, but I didn’t look at the repayments. I got defaulted onto the minimum repayment and like about four or five years later I thought, why am I still paying for these things? Which included a coffee table not unlike the one in front of us. And I particularly like this coffee table. So I used to come home from the pub as a single woman and lie on the floor and hold on to the legs of the coffee table in a futile attempt to stop the room from spinning round. You remember, like when we were younger?

Isabel Berwick
Oh, yes.

Claer Barrett
You get really pissed then, it’s like the broom that spin around and so my luxury at the time, I would often come home and find me lying on the floor, (chuckles) past asleep. So I ended up overpaying about £200, I think, for this coffee table more than I should have done because of all of those interest payments getting charged on that card. And when I woke up to this, I was so angry with myself and I sort of resolved — it was a bit of an epiphany moment, I thought — I need to take much more careful attention to what’s going on. It could have been a lot worse. Frankly, I didn’t build up bigger debts. This is very easy for people to do nowadays. But the moral of the story is 20 years later, I still have the same coffee table, although I don’t hold onto the legs as much anymore.

Isabel Berwick
So it was worth it in the end. So keeping on that sort of credit theme, we’ve already got some questions from viewers about credit cards.

Claer Barrett
Mmm.

Isabel Berwick
“What would you recommend regarding your first credit card?”, which I’m gonna take, is taking one out or choosing or getting one in the first place.

Claer Barrett
Sure. This is a really common question that listeners of Money Clinic podcast ask us a lot. And one of my favourite Instagrammers, Debt Camel — follow her if you don’t already — was a guest on a recent episode. And there’s a lot of pressure on young people to get a credit card because they know that to have a good credit score, which is gonna unlock things like mortgages and other financial products, even phone contracts, to you later in life. Having a credit card can be a good idea because you’re building up a history of being able to borrow money and pay it back, borrow money and pay it back. That’s the crucial thing, the paying it back. Now, if you are gonna open a credit card, there are lots of different ones that younger people with less of a credit history can open, but they tend to have higher interest rates, like 25 per cent, 30 per cent, even higher. Not uncommon, they’re called credit builder cards. So if you’re buying one thing a month on it, paying it back in full when the bill comes in, maybe even set up a direct debit to pay the amount off in full — that’s a good habit to get into. But Sara, the Debt Camel, says, you know, you only really need to get into credit cards a couple of years maybe before you’re applying for a mortgage. There’s no rush. It’s not something that you have to do, although obviously there are advantages when you’re buying, you get more protection. It’s easier to pay for things like hotels and higher calls if they want to do a swipe. But you must treat that responsibly. And when you take a debt on, be thinking from that moment: how am I gonna pay it back?

Isabel Berwick
Yeah, so that’s an interesting point. So you take the credit card out, make sure you can pay it back. Don’t get out of your depth. What’s your advice to people who’ve already got out of their depth? 

Claer Barrett
Yeah.

Isabel Berwick
Of credit card and are carrying a balance?

Claer Barrett
It’s really interesting that I’ve done quite a few book events and sometimes people queue up afterwards to talk to me, which is a lovely, a lovely, lovely thing. Often someone will hang back at the back and they always know that they want to talk to me about debt when everyone else is gone because there is this huge sense of shame. No shame shield solutions is the mantra of Tiffany Aliche “The Budgetnista”. She’s one of the people who I quote in the book. She is a US blogger. She’s got a Netflix show and she has paid off huge amounts of personal debt in her time. So she’s become a financial expert basically through her own life experience, which makes her the budget meister if you want to follow her. A really, really powerful person. And she says, you know, you’ve got to ask for help if you’re in problem debt.

Debt call centres, typically the kind of calls that they’re getting from people, they’ve been struggling with problem debt for more than a year to two years sometimes. And during that time problem debts can spiral. What starts off as a small problem or a small debt can often get worse, particularly if you have a sudden change to your life circumstances. Like maybe you’re made redundant or you get ill and you can’t work, you’re self-employed. The pandemic obviously has caused lots of issues. So, you know, talk, communicate, get advice. Those free debt charities, that’s what they’re there for. They do online appointments. It’s much better to speak to an independent person, a charity, than do what most people do is just go online and try and sort the problem out. And so we have this feeling of like, “Well, I got myself into this mess. so I’m going to get myself out of it.” There are a lot of predatory companies online that will try and sell you a debt solution, but they’re not independent and they’re thinking about their profits and their bottomline and not whether something’s good for you.

If you take one of these so-called IVAs, you could end up in a worse position than you started off in. So if the debt advice is free, confidential and available, which it is, then always take that option. And as I said before, do follow Debt Camel, she’s a registered debt adviser and she does a brilliant job on Instagram of just making it more normal to talk about living with debt, which most of us are, let’s face it, especially during the cost of living crisis. But we mustn’t let it ruin our lives, educate ourselves, and empower ourselves to get into a better place.

Isabel Berwick
Yeah. And when it comes to goals, how do you set them? I mean, we’ve talked a little bit about, you know, setting intentions and things like that.

Claer Barrett
Yeah.

Isabel Berwick
Do you write them down? Or is it in your head? What would you advise?

Claer Barrett
I do write things down. I tried manifesting...

Isabel Berwick
Yeah (laughter).

Claer Barrett
At the beginning of this year because Mr MoneyJar, another person who I, who I follow on Instagram. He said like there is something in it...

Isabel Berwick
Yeah.

Claer Barrett
Saying, you know, I want to write a bestselling book or I want to start my own podcast or a side hustle, just sort of if you say it to yourself enough times. I can do it. I can do it because well, too often I mean, you know, with the Working It podcast, there’s a lot of imposter syndrome and lack of self-belief, especially if we’re trying to do something different in our lives, change our relationship with money.

So I think that tracking things is really important. I’ve always had a financial to-do list. I’ve always, I mean, I found it quite difficult to manage my money when I was in my early twenties. You’ve already heard the story about how I took my eye off the ball with the credit card repayments. So you need to be really organised. You need to have a system for filing your either physical paperwork or digital paperwork, so you can find things, you know what’s coming up.

I like to sit down in twixt Mr Pitt between December and January and think, well, what are the big sort of points of expenditure that we’re gonna have over the year? You know, what home improvements are we gonna try and do? What holidays are we gonna budget for? How much do I need to be saving up a month to go into those different pots? Because I like to use internet banking where you set up different goals and automate direct debits on payday so (imitates typing sound) you know, automate automatically, fill them up. So you don’t need to think about things more than once.

And I like to have nice stationery. It’s a really small thing. I’ve got a lovely message from somebody on Instagram who said, I heard you talking about the importance of having nice stationery. If you’re anxious about dealing with your money on a podcast. And I felt really affirmed by the fact that you as an expert said that something so silly almost could make a difference. I had a Hello Kitty folder when I was in my early twenties, which I confessed to on a new Money podcast that came out this week called Making Money. And it just made me feel differently about money. You know, I this sort of thing, this is something friendly and I’m not gonna be intimidated by it. And the feeling I’m gonna hold onto is the feeling when I shot the Hello Kitty folder, having dealt with all of the things or some of the things with my financial to-do list, that feeling of like I’m getting on top of this, I’m taking smaller steps towards becoming a better financial me. You know, I’m paying off the credit cards. I’m looking at what’s coming up. I’m saving money. I found out about my company pension scheme.

All of these things suggest lots of ways in the book that people could, you know, just take those, put them on their financial to-do list and get going. Just try and do one thing with your money if you can every week. Don’t feel like you’ve got to sort it all out in one go because that’s just totally overwhelming. Just be realistic and say, “OK, this week I’m gonna look at that. Next week, I might have a look at what credit card I could apply for.” Don’t try and do it all at once.

Isabel Berwick
Similar principle to decluttering, isn’t it?

Claer Barrett
Mm-hmm. (chuckles)

Isabel Berwick
You just do one thing at a time. (inaudible) on that.

Claer Barrett
Ugh. I’m always decluttering. (laughter)

Isabel Berwick
Yeah, I’m sure you are. So someone’s asked what factors should I consider when deciding how much to keep in cash for an emergency fund? For example, I aim for six months fixed outgoings, but with no real rationale.

Claer Barrett
Yeah, I mean, it’s one of those things that financial advisers kind of pluck out of the air and say, “You need to have six months.” I think a lot of it depends on your individual circumstances. Like if you’re a freelancer, for example, I think you definitely need to have more of a financial cushion because your earnings are gonna fluctuate. That’s just a fact of life. People paying you late, you know, is a huge problem. Subsequent governments have just never really properly addressed something that I write about with my small business hat on.

But if you’re in a regular paid job and you know that if you do get made redundant, you’re gonna get a redundancy pay-off, then maybe you don’t need quite so much. But I think looking at the overall proportion of cash that you need is a really good idea because obviously we’ve got emergency fund money. If you own your own house, then you’re gonna need to have home maintenance money because you know things will do go on. If you don’t keep spending on maintenance, then you’re storing up problems for the future. You gonna have, you know, a real emergency on your hands. And then you’ve got like things like travelling, investing in your, you know, ongoing training and development. As we’ve said maybe you’re saving up towards having a baby, paying for childcare. The obvious one is house deposit. So I think we’ve had a separate question on that. So you don’t want to be investing money that you might need back in a couple of years’ time because if stock markets fall and you can’t leave your money in there sequentially, reinflate as they get better over time, then you’re gonna be taking your money out and crystallising that loss. So it does take a bit of time working out, as I said, with your partner or you know, even a like-minded friend who might have a similar kind of shaped budget to you, how much cash, what your goals are, what you’re working towards.

Isabel Berwick
So I’m gonna move on to some stuff about the Internet, which I think is huge. I mean, you’re a very expert user of social media. There’s a lot of finance on TikTok and Instagram. How do we know, you know, who to listen to? A lot of these are untested schemes or crypto investments.

Claer Barrett
Yeah, I mean, the answer is we don’t know. But let me say some positives about TikTok, Instagram and social media. YouTube is a huge platform for the personal finance information. We can now go and educate ourselves online in a way that I could not when I was growing up. So we did a podcast recently saying “Who did you learn the most about finance from: your mum or your dad?” And actually all of the young people answering my poll on social media was saying, “Er, the Internet. Why isn’t the Internet an option?” And you know, this is why I love being on social media because you learn, you’re not just there to teach them. I’m there to learn and to absorb as well.

So I think one of the problems that doesn’t get talked about very much is that some of the most high-profile people on TikTok especially are American. And if you’re watching things in the UK, there are certain things that cross the transatlantic border, like, you know, investing regularly, you know, little and often small amounts, compound interest, the miracle of how these investments into index funds, in particular, where you’re buying a slice of the whole market is cheap and your money can grow quite substantially over time. If you take a long-term view, things like FIRE — financial independence, retire early — that’s very US concept. But lots of people in the UK are a very faithful followers of that. So all of those things are fine. But then a lot of the terminology in America, like, you know, general investment accounts. Yes. You know, you can open an investment account in America with a stockbroker, but if you open a general investment account over here, it’s probably not the right thing to do because we have something the Americans don’t. The Isa system, stocks and shares Isas, which means that if your investments grow within it, they’re protected from all different kinds of tax, whether that’s capital gains tax, if they’re growing in value, dividend tax, income tax, when you take money out. So it really, really pays to and student loans is the other one the US student loan system, the UK student loan system completely different. Lots of people want to overpay their UK student loan debt. Again, we made a podcast on Money Clinic about that. Not a good idea, but in the US in some circumstances, obviously it can be. But there are some, there are some things that don’t translate.

The biggest, biggest thing to watch out for: red flag alert on social media, anyone asking you for money, anyone telling you to invest in a particular thing, especially if it’s cryptocurrency, because I get people who cloned my account on Instagram, copy all of my posts. They add like a one to my handle @ClaerB1 or @ClaerB_. So it looks like it’s me and then they’ll message you knowing that you’re one of my followers and just say something really innocuous like, “Hi, how you doing?” And you think, “Huh! Claer’s messaging me? Oh, hi Claer, how are you? Nice to hear from you.” And I say, “Do you want to make some extra money on the side?” Or, “I’ve got a great side hustle idea.” You can imagine where it goes. It’s basically a request for money, saying buy some unregulated crypto. It may not even be crypto at the end of it. They’re saying it’s crypto, but you transfer money to them and then bang, the money’s gone and your bank will say well, you didn’t take enough care and attention. So we’re not refunding you and this kind of stuff happens again and again and again. Martin Lewis, the patron saint of personal finance in the UK, he was talking about it on Wednesday on ITV, how people are copying him. So you never really know who anyone is online.

Isabel Berwick
No, I think that’s a great point, actually. Something we learn in journalism is that don’t be afraid to ask the stupid question. Because people, there was an element of shame of not knowing in the first place, but there really shouldn’t be. And now we’ve sort of moved on to investing. And I wanted to talk a little bit. You’ve mentioned the magic of Isas,

Claer Barrett
Oh, yes.

Isabel Berwick
So we’ve got some questions about, you know, starting an Isa when, where do you start with that?

Claer Barrett
OK, so you can start doing a regular investment into a stocks and shares Isa from £25 a month on the big platforms that don’t need any more publicity. So I won’t name them all. But then there are also smaller platforms, app-based ones where you can start from as little as a pound. Now the fees are marginally higher on these funds where you can invest very, very small sums and put them into an Isa. But as a way of getting started, dipping your toe in the water, I think, you know, absolutely fine.

There are lots of apps that don’t offer direct investment, but will offer you kind of like coaching on money. They’ll run different courses. So, you know, you’re paying a small subscription and they’re doing lessons about the basics of investing. Now, there’s lots and lots in my book as well about the basics of investing, but a couple of things to mention. Be diversified, you know, don’t put all of your money in one particular thing. Index funds, the way that lots of people do that where you’re buying a slice of the market. There’s a lot about index funds in my book. One of the most downloaded Money Clinic podcast episodes this year is an interview I did with two other authors, Jonathan Hollow and Robin Powell. They’ve written a book all about index fund investing. That episode is called What’s the cheapest way to invest, which is why it’s popular with so many people. So I would suggest you have a listen to that.

And then you’ve got to be confident that you’re prepared to take a loss on this money. Now, so far this year, my own stocks and shares Isa hasn’t made any money for me. It’s lost money because I’m looking at the long-term picture. I’m thinking: I’m 46 now. I don’t mind admitting this to you. My son put the birthday candles in my cake the other way around. So it’s at 64. (laughter) I’m not intending to withdraw any of the money in my stocks and shares Isa until I am at least 60 years old. I’ve got cash savings as well. I can draw on them, in the meantime, if I have an emergency. I’ve got money that I’m building up for short-term expenditure. So when I look at the balance and it’s gone down a bit, I don’t panic and want to take the money out, which is the number one mistake that new investors make “Oh, I’ve lost money! I’m gonna take it out.” And unfortunately, the double-edged sword of the apps is like, yes, it’s easy to get started. You can set it up in the back of a taxi kind of thing, but you can also look at it all the time and fiddle, and fiddling is not good for investing. Having a long-term plan and sticking to it is definitely the way to go. But it does take nerves and it does really help me to think I’m not gonna need that money until I’m 60, so I’m gonna leave it alone.

Isabel Berwick
And we’ve got masses of questions about investing. But there’s one here. You know, should you think about paying down your mortgage rather than taking out an Isa?

Claer Barrett
Yeah, lots of people are looking at this at the moment. Mortgage interest rates hovering around the 5 per cent mark. If you wanted to do 4 to 5 per cent, if you wanted to do a new five-year deal today, they could fall in the future, they could rise. We don’t know. If you’ve got a very large mortgage, then obviously people are thinking, well, that’s a guaranteed return on debt. If I’m paying that off, it means that when I remortgage in the future or have less debt so I might be able to get a better rate. It’s you know, it’s a very personal decision.

Isabel Berwick
Yeah.

Claer Barrett
Again, in terms of what you want to do. The alternative is, if you’re investing in the stock market over time, looking for a longer term, if we are gonna be living with higher inflation for longer, then the value of your debts will be deflated away. And you would hope that the value of your investments might have a better chance of outperforming inflation. So lots of things to talk to —  whoever you own your house with — about. But the other thing that people overlook, which they often did in the pandemic, because there was all of this talk of investing apps and trading in crypto. So it’s like, “I want to be an investor, I want to be an investor.” But actually anyone who works for a company already is an investor through their company pension. That’s something that I talk about a lot in the book. Your first port of call should always be, “If I pay more into my company pension, will my employer also pay in more?” It’s called matched contributions. And if anyone’s got a job interview coming up, it’s a brilliant question to ask at the end of the job interview. “What’s the level of match on your staff pension scheme?” The bare minimum you’re looking at, you know, you’re paying in 3 per cent of your salary. I think with auto enrolment, your employer has to pay in about the same. And then you’re also getting the benefit of paying less tax because money that you pay into a pension you don’t pay tax on, it can grow tax-free until you retire. And then when you take money out of your pension, yes, you will pay some tax, but you will also get a quarter of it, your tax-free lump sum, free of tax. So it’s a very tax-efficient way of putting money aside for the future. That’s the incentive from the government, from employers for us to do that. But unless we understand it, we may not be making the most of it.

Isabel Berwick
So it’s sort of magic, but many people are not too aware of what’s going on.

Claer Barrett
No. When you describe pensions as free money, which I talk about in the book, people get more interested because pensions you think pension are years away, tomorrow’s problem. Especially right now, people saying, “Well, can I stop my pension contributions? Because I could do with an extra 50 quid in my pay packet.” Well, if you understand that you’re actually gonna get a pay cut, It’s not the 50 quid that you’re losing, it’s also the extra cash from your employer, which could be, as I said, you know, quite a substantial sum. Then you can make a more informed decision and if you do need to cut it, if that’s the only lever you can pull, then try to resolve to start paying in again as soon as you can.

Isabel Berwick
But I think there’s a big piece here about mental health. You know, should you stick in a terrible job because of the money?

Claer Barrett
Yeah, well . . .

Isabel Berwick
That’s a question a lot of people ask. I think they get worried about leaving, but they’re actually being made sick by their job.

Claer Barrett
Yeah, well, I mean, I think a lot of people feel that they have no choice. You know, especially if you’re the breadwinner. I mean, people talk about lifestyle creep and about how when you start to earn more, all of these things get added on to the list of expectations. And certainly it’s quite hard for couples especially to say, well, if you did leave your job and if you did retrain to be something else, and these are all the things that we would have to go without. And it’s a really tough situation to be in. But certainly burnout, corporate burnout, is a big topic for the FT. And whenever we write about it, I always spend longer looking at the reader comments on our scoops often than reading the articles themselves. Because seeing how people react to this, it reminds you this is a real thing. This is a real thing. And money worries and the link between mental health and money problems is something that everyone has become more aware of, largely because of the pandemic. I think, you know, that made it acceptable to say, actually, “I’ve got money problems. It’s not me. Look at what’s happening in the wider world.” And, you know, do talk to people. Don’t bottle things up. If you’re worried about your job, worried about money, any of these things, they do say a problem shared is a problem halved. And I do think that there is a lot of truth in that.

Isabel Berwick
Definitely and I think a lot of employers are starting to offer money advice to staff now.

Claer Barrett
They are.

Isabel Berwick
People watching might not know that and it might be on offer.

Claer Barrett
Yes, it is on offer in many bigger workplaces especially. And if it isn’t, you know, money coaching, it gets a bit of a bad rap sometimes because money coaching, it’s one of these catch-all terms you need. It technically needs to be qualified although some people are, but firms are offering it because they can see there’s a firm of accountants I know quite well because I often speak to them about FT Money articles. They could see that their female partners in particular were so frazzled and so busy trying to juggle all the different elements of life that actually their personal finances were being neglected. And it wasn’t that they didn’t know what to do. They just kind of like needed a bit of help to get themselves organised and actually put some of the plans in place for themselves that they were doing for their clients. And I found that extraordinary in a way, because if you were an accountant, you think that you would look after yourself first and others next. But even I know that’s often not the way.

Isabel Berwick
No, when I was a personal finance journalist, my credit score was absolutely appalling. So I totally get that. (laughter)

Claer Barrett
Well, let’s quickly squeeze in your biggest money mistake, (laughter) because I think it’s really important to admit your mistakes.

Isabel Berwick
Yeah. My biggest money mistake was when I was a personal finance journalist. In fact, I think I was the personal finance editor of a national newspaper at the time, and I had a fling with someone that lasted about six weeks. And not only did I go overdrawn, I busted my overdraft limits. I, we flew around London taxis. We ate in restaurants all the time. It was a “devil may care” time. And it took me years and years to pay off.

Claer Barrett
Wow. But you’ve still got the memories?

Isabel Berwick
Got them. (laughter) Let’s hope he’s not watching. Right? So loads of questions about couples, families...

Claer Barrett
OK.

Isabel Berwick
This one has touched me. How do you handle when your partner’s spiralling into debt and he/she is not ready for a debt advice or counselling? Even if you’re resisting paying off the debts, you have no clue about what’s happening.

Claer Barrett
Mmm. I mean, that is a really, really hard situation. I mean, you’ve got to work together as a couple on your finances. I think often, you know, when people get together, they didn’t realise that the other one has debt problems. Exactly the situation that you mentioned is, “Oh, you know, let’s do this, let’s do that.” You know, you’re in the first throes of romance. Let’s go on holiday together. Well, you know, we’ll use the credit card. And sometimes there’s an expectation that people — it doesn’t have to be the woman, it could be the man, you know — needs to be treated. And that one person must pay for everything. And, you know, gifts, jewellery, flowers, you know, the expectations around things like Valentine’s Day. You know, this requires a lot of financial keepy uppy. And then to find out actually that your partner’s in debt because of all of this can be a big shock. I mean, some gold digger (inaudible) might, you know, dump them and move on. But it sounds like the person who’s answered this, he’s asked this question is in a serious, committed long-term relationship. But ultimately, you are one half of this relationship, your partner’s debt problems, whilst they impact on you as a couple are their debt problems and you can help them to solve them, but you can’t solve them yourself. You know that has to come from within them. It’s the same for all kinds of other addictions because I think, you know, spending can be an addiction.

Isabel Berwick
Yes. Overspenders Anonymous, Debtors Anonymous, and these are really helpful organisations, but I guess the partner has to admit that they’re powerless. You know, that’s the step one.

Claer Barrett
Yeah. They’ve got to weigh in the debt and say, “You know what, I got myself into this situation and this is how it’s happened.”

Isabel Berwick
So we gonna . . . quite a lot of questions about children. We’ve got to. What would be your top tips for teaching financial knowledge to children? Should it be on the school curriculum?

Claer Barrett
Yes.

Isabel Berwick
What about the fact we don’t use cash anymore?

Claer Barrett
Yeah.

Isabel Berwick
How do we . . .  you know? Because you’re involved with the Financial Times’ FLIC campaign, financial literacy and inclusion. Can you tell us a little bit about how that fits in?

Claer Barrett
Yeah, absolutely. So number one: FT and FLIC, which is an FT-backed charity, we absolutely think that personal finance should be on the school curriculum in a big way. We’re lobbying more for that, both within maths but also within English, within PHC sessions, and we’re making lots of material that teachers can use. Because the biggest problem is teachers don’t feel qualified to teach about personal finance. So by giving them the best materials, Amy, the director of the charity, calls it a bento box. You know, you can pick the resources you want and also the FT FLIC website. There’s lots of free articles, sources and information videos because, of course, videos could do a much better job of teaching people than necessarily written materials can. So when it comes to teaching kids about money, yes, the physicality of money is hard to replicate. They know that you’re paying for things, when you stop a cab . . .

Isabel Berwick
You see babies going like this now, don’t you?

Claer Barrett
Well, when I take my four-year-old niece anywhere on the Tube, she says to me, “Credit card, Aunty Claer”, because she wants to be the one who taps to get out and in on the Underground. So it makes her feel, you know, a million dollars. So, you know, I give it to her and tap it, and then she’ll walk off. I’ll be like, “Esthel, come back. Give Aunty Claer her card.” But nevertheless, you know, they know that it’s a transaction, but they don’t see the value. Now when they start to get a bit older, the thing that taught me the most about money as a young person was working. I started a day job at the age of 15, I worked in the local meat shop, and at the end of the day I got 20 quid out of the till and that meant, “OK, I’ve got 20 quid I can go and spend it on, blow it all in one go in the pub across the road after.” Don’t tell anyone, (chuckles) underage drinking after I finish work but it’s gone and I’m not going to get any more. And I think that with the demise of things like paper rounds and sassy jokes housing your kids towards passing their exams, this is unfortunately part of learning about money that everyone is missing out on. So you need lots of things. You know, you need information in school, you need better numeracy, being more confident with maths and the national numeracy campaign, which FLIC works with a lot, it’s doing a great job on that. But you know, every time you get an opportunity to give your child a little ad hoc maths lesson, you know, like you’re paying for the bills somewhere, challenge them to do the math. So say like if we were to split between us, what would it cost? What would it cost each? Show them your bills if they’re a bit older, if they want to get a mobile phone, say, “OK, you go and do a costing, you know, like what would it be? What would what’s the best way of doing it? Buying a handset? Getting a contract? Even telling them, you know, could we get a better deal for this particular bill if we switched online or something that we buy regularly, if we bought in bulk, could we save money? Lots and lots of ways you can get them thinking about it without sort of making them money mad, which I think a lot of parents are also worried about, and the cost of living crisis getting them to be worried because they see on the news all the time, you know, inflation is spiralling. You know, pay isn’t going up at the same rate. Mortgages. So there’s lots of things for young people to be worried about and fearful when it comes to money. But we need to kind of share information with them to sort of desensitise them a bit, but not too much to make them feel insecure.

Isabel Berwick
It’s quite hard. They can teach us. I mean, they’ve led the way in things like Depop Vintage. Selling stuff online.

Claer Barrett
That’s a fantastic . . .

Isabel Berwick
You know, that’s something that older people can learn about.

Claer Barrett
“I want this for my hobby.” “Well, OK, you’ve got to sell the roller skates first.”

Isabel Berwick
Yeah, I think that’s been a huge thing. We’ve got time for one final thing, Claer. Is there a point we haven’t made that you want to tell the viewers?

Claer Barrett
Oh, that’s a very good one. I mean, there was a question from a university professor that I saw in the list earlier on about like, what’s the single most important thing that I should teach, you know, really young people, teenagers, often about personal finance? And I’m going to throw it back to you a bit because I think it’s thinking about careers now, thinking about careers and how you can earn money for the rest of your life. That’s something that teenagers, before they go to university, really in this day and age, really needs to think carefully about. I took two years out and I worked full time before I went to university. It wasn’t, you know, some brilliant world dominating plan. I was trying to get in a band and get a record deal, so I didn’t want to go straight away.

Isabel Berwick
It could have been very lucrative.

Claer Barrett
It could have been so different. But it did give me time to think about what I actually wanted to do. You know, how I was going to earn my living. And nowadays with the cost of student debt, the extra costs that you’ll rack up if you start one course and then switch courses and move to another one. It’s really, really important. We’ve got any people who are teenagers watching. Then I would say, like, talk to as many people as possible about their job, what they like about it, what they don’t like about it. Obviously, you know, you’ve got links within your family, your parents, friends, if you can be bothered to talk to them. But like even on LinkedIn, like people often send me messages as a journalist on LinkedIn and ask me what a career in journalism is like. If I’ve got time, I will reply to them. But often, if you’re trying to get into a particular career or pivot as an older person, it’s amazing. If you reach out to people who are who you follow, they are willing to give you a bit of time and advice and the benefit of their experience.

Isabel Berwick
Yeah. I think that’s a that’s a brilliant point. People are kind generally if you don’t ask too much of them. Yes. I think we’ve asked a lot of you today. (laughter) It’s just been fantastic. Thank you so much to Claer. Her book is What They Don’t Teach You About Money, available in paperback from all good online and in real-life bookstores. And Claer, thank you so much. It’s been great. Just to reiterate, Claer’s Money Clinic podcast is out weekly. My Working It podcast is out weekly. If you want that career advice. And it’s been wonderful and thank you so much for joining us.

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Claer Barrett
Our thanks to FT Live and to FLIC, the FT’S charity promoting financial literacy and inclusion, for organising that webinar on what they don’t teach you about money. We’re always looking to chat with people about their money issues for the Money Clinic show. So if you’re interested in being part of a future episode and want some expert money advice, then email us. Our address money@ft.com. You could also take a peek at our website, ft.com/money. Grab a copy of the FT Weekend newspaper or follow me on Instagram. I’m @ClaerB.

Isabel Berwick
Or get in touch with Working It. We’re at workingit@ft.com. Or I’m IsabelBerwick on LinkedIn.  And if you’re an FT subscriber, please sign up for our Working It newsletters. We’ve got the best workplace and management stories from across the FT. Sign up at ft.com/newsletters.

Claer Barrett
And finally, Money Clinic’s usual disclaimer. Today’s podcast is a general discussion around financial topics and does not constitute an investment recommendation or individual financial advice. For that, you’ll need to find an independent financial adviser. But conveniently, that was also the topic of last week’s episode.

Isabel Berwick
That’s all the small print for now. See you back here next week. Goodbye.