The Queenager: Eleanor's Letter (August 20th 2023)

Dear Queenagers

Hope you’ve all had a great week – when you read this I will be in a field at a festival (we’re going with a gang of 30 mates, old uni friends plus their kids, our kids, my sister…) maybe the sun will shine.

It was a good week for Queenagers, we got a mention in the Washington Post and a great plug for my platform noon.org.uk (home of the Queenager) and thanks for your kind words about my grumpy rant on the Vogue cover… gendered ageism is all too real; the statistics in this article from the Harvard Business Review chime with what we hear from all of you. Women go from being ‘too young’ to be taken seriously, to being on the ‘mummy track’ and then ‘too old/menopausal/difficult’ – while men are seen to come into their peak years in their 40s/50s and even 60s.

Anyway, one of our passions at Noon is trying to help you live your best life in your Queenager prime, and one of the things that really gets our goat is how many financial institutions really aren’t thinking about midlife women and their financial needs. Just pink-washing a whole load of financial acronyms won’t cut it. Queenagers deserve better.

So we have put together a whole series of articles about Queenager finances, we’re calling it Financial Spanx for Queenagers because it is about the financial underpinnings you need to set yourself up for a great next chapter and you can sign up for a free webinar about it all here.

I know that with all the money pressures on all of us right now it’s tempting to just put our fingers in our ears and try and ignore it all. But we’re better than that.. Spiralling bills, sandwich generation-related aggro from both ends, salary failing to keep up, can all drive us into denial about the long term.

But as AJ Bell Chairman and Noon Advisory board member Helena Morrissey always says: “when it comes to finances, the watchword is get your house in order and then, like exercise, do a a little, quite often.”

So what does pulling on your financial Spanx to underpin your plans and dreams for the future look like?

Where to start

Our Noon research shows that over half of you feel like, for the first time in 25 years or so, “It’s finally all about me, this is my time, after year’s of looking after everyone else”. Or to quote Cynthia Nixon from And Just Like That, “I feel like the fifties should be, frankly, a really golden time in a woman’s life. It has certain things in common with adolescence: you can return to yourself and ask, ‘Who am I? What do I wanna be?’ There is a chance to look at your life and make some changes or draw some boundaries.” That goes to the heart of being a Queenager!

And at Noon we want to help women in their 50s to a more optimistic and positive future and change the narrative. Women in their 50s can’t move into their best life if they don’t do the financial underpinning. The good news is, it’s not rocket science. According to Laura Suter, Head of Personal Finance at investment platform AJ Bell, it’s not too late, you absolutely can turn around your financial future. And the sooner you start, the better the outcome. Even if the cost of living crisis means battening down the hatches for a while, you can still plan for those future sunlit uplands.

The bad news is, many of us have a high mountain to climb. Government statistics show that the pensions gap between men and women is a shocking 49 per cent, in the 45-49 age group. Spells out of the workplace, part-time work and lower pay, plus a tendency to prioritise everyone else in the family except ourselves, all conspire against us.

The first step is understanding your current position. What have you already got in terms of pensions, savings, debts, mortgages, insurances? Break the task down into chunks if this all seems to much. Track down your old pension pots one day. Peer into the debt abyss another. With a stiff drink if necessary!

Next, put some numbers on those future plans. As in, how much you will need to fund them. For a starting point, the Pensions and Lifetime Savings Association estimates a single person needs £12,800 a year for a very basic standard of living in retirement, or £37,300 for a comfortable one (it’s £19,900 and £54,500 for a couple). The State Pension will provide a decent amount of this (currently about £10,600 a year), but the rest is down to you. Once you know your target, it’s time to start planning how to get there. And fill in some gaps. If you’re time poor, have spare cash or require guidance, a good IFA could coach you through. The Government offers relatively basic mid-life MOTs at https://www.moneyhelper.org.uk/en/everyday-money/midlife-mot, and a free pension advice one-to-one session, at https://www.moneyhelper.org.uk/en/pensions-and-retirement/pension-wise?source=pw.

Addressing any debt should be your priority. There is no point saving zealously, when you’re haemorrhaging huge interest repayments. The last thing you want to do is get to retirement beset by credit card bills and loan repayments. Similarly, you’ll have a bumpy ride stopping work whilst still paying off the mortgage, so think about over-paying the loan, to try and free yourself by then. [ I know that’s hard at the moment, I’ve been doing it as I’ve been wanting to be mortgage-free forever, but at present it is particularly crippling]. Sam Secomb, a chartered financial planner and founder of Womens Wealth, says women are well advised to tap into their housing wealth by trading down the family home, to pay for their future. She warns against sticking on to the four or five bedroom property merely for the sake of hosting Christmas dinner – so-called “dining room table syndrome”. [She may not have Gen Zs who are equally passionate about them not wanting you to sell the family home! When I mentioned to my kids that me and their dad might downsize to get that house by the sea I’ve always wanted, ooh, the wild swimming – there was a serious rebellion! The definitely think that post-uni they have a right to return to the family home in central London… we’ll see!]

Other sources of wealth are pensions savings in workplace or private pensions, property income from a buy-to-let portfolio, the state pensions, and savings in tax-efficient savings vehicles like Individual Savings Accounts (ISAs).

Beware leaving too much in the bank, if you can avoid it. With current ruinous inflation rates and savings interest failing to keep up, the value of your savings is shrinking in real terms. Anyone with more than five years left until retirement will probably do better keeping just six months’ money in cash, plus funds for planned expenditure in the next five years (like a kitchen), and put the rest into stocks and shares, within pension or ISA wrapper for maximum tax efficiency.

You will need to learn about stocks and shares at this point, and/or consult an IFA. Secomb says beginners might put funds into a cheap global tracker fund (a fund which tracks a broad range of share indices across the world) to start off with, and go more diverse later on.

Make sure you check your National Insurance record – 35 years’ contributions is the threshold to qualify for the full pension, which currently pays out £203.85 a week for those retiring today. Individuals with shortfalls should explore buying extra years – it will come at a cost but could pay off in the long term. Secomb also encourages women clients who have missed out on wealth accumulation because of family responsibilities to get husbands to contribute to their wives’ pensions before their own.

Consider “term” life assurance if you still have dependent children or a large mortgage – workplace pensions usually offer some protection. Or income replacement insurance in case you fall ill. But only where you can afford it, and don’t if you already get cover through work. And read through the small print very, very carefully.

Finally – of course finally – wills. Please do get one. When your circumstances change, do another one. Or risk intestacy laws messing with your family. For example, without a will, most of your assets go to your husband – not great if you’re divorcing. In a second marriage? A will can protect your kids from the previous relationship. Everyone with children under 18 must use the will to appoint a guardian, or the courts will decide for you. And remember, if you’re not married to your partner, they won’t receive a penny should you die without a will. [ I am a disaster on this front – we had wills drawn up, and they sat, unsigned, on the dining room table for about a year… but last week I was sitting reading Instagram, while I was supposed to be writing my book, and a friend posted that her husband had just died at 58 while out walking the dog. That kind of thing can happen to the best of us, so please sort, and sign your will.. it will make everything so much easier for those you leave behind should the worst happen].

Your Queenager financial Spanx checklist:

What do you definitely need to do?

• Start putting yourself first
• Set clear financial goals, for short, medium term and retirement
• Set a budget for now, plan savings and pensions for the future
• Pay off unsecured debts
• Consider clearing your mortgage as soon as possible by overpaying
• Too much money in the bank means you’re losing money in real terms, consider what savings and/or investments you could put it into
• Learn how to invest if putting money away for five plus years. And think about investing in a female entrepreneur, women Founders are more likely to be successful but receive only 2 per cent of all Venture Capital globally. Payit forward if you can
• Get the right insurance to secure your finances
• Make a will

What should you think about?

• Your partner [if you have one, 40 per cent of Queenagers don’t] could consider funding your pension to fill any gap you might have from taking time out of contributions with family duties. Get advice on this
• Sharing care responsibilities for ageing parents equitably between siblings. It’s often the case that daughters end up with most of the duties, or paying a disproportionate amount for care out of guilt.
• Beware over-generosity with kids. Explain the bridezilla wedding will see them looking after you in old age!
• Downsizing to free up cash

What are the nice-to-haves?

• Retire early
• Buy a holiday home/relocating
• Helping your kids onto the property ladder, if you have them and you can
• Further study
• Treats… good dinners, holidays, shoes.. whatever you like to spend your cash on!

What are the red flags to beware of?

• Ignoring your finances
• “I feel stupid about this so I’ll pretend it’s not happening”
• Large debts
• Whopping gaps in retirement savings
• Keeping it all in the bank as it’s “safe” – inflation danger
• “I’m not going to worry about this because he’s got me” Don’t assume anyone else will take responsibility for your finances. A man, as a friend said to me, is NOT a financial plan

What about Childfree Queenagers?

Now at Noon we are really aware that a quarter of midlife women are childfree. We also know that while that gives them a bit of a financial advantage in some ways, it also means different priorities. And also that they are even more invisible to financial brands.

Childfree Queenagers are wealthy, educated, independent and looking to the future. How do we leave a legacy that reflects our passions? And how do we plan financially to make our dreams a reality?

If that is you, don’t miss our brilliant piece about your finances, here on Noon

If you’d like to find out more about Financial Spanx for Queenagers – book a place at our FREE webinar on the subject, supported by AJ Bell (who are prioritising Queenagers) and hosted by me, Eleanor Mills. Do send me your questions to eleanor@inherspace.co.uk and I’ll make sure to ask them. I need all the help I can get!

If you would like to educate yourself about your finances for the future sign up here for the AJ Bell newsletter

We are grateful to AJ Bell for partnering with Noon to focus on financial provision for women in midlife

Sorry to make you think about your finances on a sunday… promise something more jolly next week!

Love

Eleanor

x

ps the Washington Post lady hates the term Queenager. I like it because it feels different, fun, a re-brand, sums up that sense of being in the foothills of the second half of our lives… but what do you think? Tell me in the comments or take this quick survey

By Eleanor Mills