Nic Cicutti - Get a Financial Life: Your Money in Your Twenties

Get a Financial_Life

Your money in your twenties

First published in the United Kingdom in 2009 by

A & C Black Publishers Ltd
36 Soho Square, London W1D 3QY

www.acblack.com

Copyright Nic Cicutti, 2009

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A CIP record for this book is available from the British Library.

eISBN: 978-1-408-10565-8

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Design by Fiona Pike, Pike Design, Winchester
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Printed in the United Kingdom by CPI Bookmarque, Croydon

Contents

One thing you learn when writing a book is that it really is a collaborative effort.

So I suppose the first person to blame for what you now hold in your hands is Sarah Pennells, who suggested me as its possible author to the publishers, A & C Black. Then theres Lisa Carden, who was brave enough to commission me. Camilla Garton and Kate Stenner picked through my wordy prose, grammatical errors and stylistic non sequiturs. My apologies to them all.

When I started out as a journalist, I was taught always to have a firm picture in your head of who you are aiming your copy at. For me, that person is my nephew Ben, university student and perennially deluded West Ham fan, whom I rate as a special friend along with his brother Dominic. Cheers, lads.

A special thanks goes to Ann Fannin and Joyce Woods, who offered friendship and sympathy during the writing process. Thanks also to Sally, our rough collie, who looked on dolefully as I swore at the computer screen.

My most important debt of gratitude goes to my partner Tina Cambell. She has always offered me love and support during our journey together. I dedicate this book to Tina, with all of my own often inadequate but everlasting love.

Every year, more than 300,000 graduates in their early 20s leave university, armed with a degree and a determination to lead successful lives although how that success is measured ultimately depends, as always, on the individual concerned.

As one of these recent graduates, the new world you are entering is vastly different to the one you have just left. Whereas until now it was perfectly possible to muddle through, safe in the knowledge that whatever happened good or bad it was only a temporary phase in your life, the minute you leave college everything changes.

In the real world, you will face a completely new set of pressures. The first and most obvious is that without money it is very difficult to survive easily. You will be expected to find a proper job, to get to it on time every day, to live in relatively decent accommodation, to pay for things without constantly having to borrow money off your parents or your bank.

Of course, none of this is obligatory. At the end of the day you are free to live your life how you want. But most people in their 20s broadly feel that these new rules governing the way they are now expected to lead their lives are acceptable, at least in general if not in every specific detail.

Either way, another of the big discoveries made by many people in their 20s is that money is neither easy to make nor to keep hold of.

There are hundreds of temptations out there, decisions to be made or avoided, all of which involve the potential for huge errors. Of course, theres nothing wrong with making mistakes: if we didnt make them, we would be much poorer for it in lots of ways.

But some of those mistakes, particularly the financial ones, can have pretty devastating long-term consequences. Moreover, if there is one thing that marks out todays generation of 20-somethings, it is that the world they are entering is immeasurably less hospitable than it has been for decades.

Finding a job is much more difficult than it used to be, while credit essential to many graduates for the first few years of their working lives is now much harder to obtain and more expensive for those lucky enough to be offered it. Getting through your 20s is probably more of a challenge than it was for your parents, certainly on the money side of things.

Every penny counts, therefore: spending what you have carefully and saving what you can spare more effectively matters more today than it has ever done.

This book aims to help you do that. Like any other book on finance, this is most definitely NOT meant to be something you read through in one go. What it tries to do, in fairly shorthand format, is address many of the key issues you are likely to face in the first few years after leaving college. If and when they do crop up, it will hopefully provide some pointers as to what you can do next, or mistakes you may want to avoid.

None of whats in here, however, is a substitute for your own decision-making abilities. All of us have those skills within ourselves; apart from anything else, they are often simply an extension of basic common sense.

What this book tries to do is marry that common sense with some additional information and tips you may need. Hopefully it will save you more money than its purchase price over the course of the next few years.

Financial websites and consumer forums

You will find many relevant and useful websites mentioned in each chapter. One of the fantastic things about the Internet is that it allows for discussion, debate and advice to be exchanged.

If you know your way around the Internet even just a little, you will almost certainly have come across the websites of the main newspaper groups in the UK. All of them carry content from their own personal finance sections. In some cases, they carry additional online content too.

Debate and in-depth sharing of information is a cornerstone to the ability to make good financial decisions. Several excellent websites allow you to do that. They include:

Money Saving Expert: www.moneysavingexpert.com

Interactive Investor: www.iii.co.uk

Motley Fool: www.fool.co.uk

Which?: www.which.co.uk

All facts and figures were correct at time of going to press.

Every year, more than 300,000 new graduates hit the jobs market, joining thousands more who may have spent a few years with their first employer but are now looking for a fresh challenge.

Unfortunately, if ever there were a wrong time to be looking for work, today is it. The financial crisis that has engulfed not only the UK but all Western economies since late 2007 has made life immeasurably more difficult for many new graduates.

Unemployment has grown sharply in the past 12 months and many experts believe it is likely to rise to more than 3 million. In January 2009, a study from High Fliers Research, a market research firm, found recruitment targets among the 100 top UK companies had been cut by 17 per cent.