Derek lives with his wife in Lancashire where he volunteers for the Citizens Advice Bureau. He’ll soon be turning 60 when he plans to retire.
Moving from full time work to semi-retirement requires careful planning. Learn how Derek stays in control of his money by using Moneyhub Projects to balance his income
and expenditure.
““It’s become so important for managing my pensions. I have all my investments, bank accounts and pensions connected””
You might think that a semi-retired financial advisor and former volunteer at his local Citizens Advice Bureau who has built a career helping others manage their money would need little support navigating the tricky period between full time work and retirement. Which is why the fact that this 58-year-old, Lancashire resident Moneyhubber relies on (and is an advocate for) Moneyhub and open banking comes as a bit of a surprise.
About 3 years ago this Moneyhubber started the process of winding down toward retirement. He explained to us that both he and his wife have pension savings and that he had decided to sell his business, gradually reducing his involvement in the business before retiring at 60. We sat down together over Zoom (he joked that, being semi-retired, Zoom meetings were still new to him) to find out more about his journey to Moneyhub and how he uses Moneyhub to balance his income and outgoings today whilst tracking the value of his pensions to avoid an unnecessary tax charge in future.
He started by telling us how his journey to Moneyhub began in 2009 when Microsoft withdrew its money management software. He embarked on a search for a replacement explaining that after trying quite a few money management apps, he eventually joined Moneyhub “because it looked more professional.”
He continued by explaining that “today it’s become so important for managing my pensions. I have all my investments, bank accounts and pensions connected there so I can check the values because I’m at risk of exceeding the pensions lifetime allowance, so I need to keep on top of when to draw money out.”
Our semi-retired Moneyhubber is in quite a unique position. The FCA’s 2017 Financial Lives survey reveals that just 3%1 of 55–64-year-olds semi-retire by taking a mix of pension and other income whilst continuing work in some capacity. This creates an additional problem as he tells us “My business is a limited company, so I have been paying myself a mixture of salary and dividends each year. As I stepped back from the business, I needed to make sure that I didn’t spend more than £4000 a month, that was my target.”
We asked him to explain to us how he uses Moneyhub to stay on track with his spending and he told us how he uses the Projects feature to create a household expenditure target with everything he expects to spend each month. He further explained that he uses Moneyhub’s Transactions Inbox to check his transactions and ensure they are allocated to his project. That way it ensures that he never spends more than his target.
He continued by saying that “I know how much I can spend each month and I can see where I am going, and where I am going wrong if I spend too much. It’s interesting to see where I am over or under. The projects feature is really brilliant, you can see at the click of a button where you’ve overspent. It’s a really good app and Moneyhub is adding stuff to it all the time so it’s just getting better and better.”
He gave the example of (the recently added) connection to Zoopla that homeowners can use to track the value of their property in Moneyhub, which is useful for those fortunate enough to be worried about inheritance tax.
Whilst technology has clearly made a difference to this Moneyhubber we briefly talked about open banking and reminisced about the challenge of managing his own, and his clients’, finances before money management apps existed. He told us that before MS Money he had to write everything down and that whilst he did build a spreadsheet once to keep track of things, that got a bit complicated.
He added, “Moneyhub really is a very good app. I use it mainly on my phone and iPad. In fact, I can’t recall when I last used it on my desktop because the app is ideal. I don’t use the budgets or subscriptions features, and the Support team is excellent. It’s very rare that I have a problem and it’s easy to work things out for yourself but if you need help you just go into Support and send a message and you get a reply on the same day or often straightaway. They are always very thorough in closing things down and replying to say that your query is sorted. It’s a really good way to run a business because then you know your query has been dealt with.”
Whilst our Moneyhubber is a convert to open banking we asked him what advice he’d give to someone considering using open banking or Moneyhub for the first time to which he replied “Just do it, it works. I tell people to do it and I say that I use this app. I’ve put quite a few people on to it. I would advise to just do it with open banking. If you bury your head in the sand you're going to miss out on loads of things. You’ve got to go with the technology.”
1. https://www.fca.org.uk/publication/research/financial-lives-survey-2017.pdf
