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Get your finances into shape for 2021

The fallout from Covid has shown how financial wellbeing is vital - and too often overlooked. Muddy limbers up for a money MOT in 2021.

January is our annual ‘Wellbeing month’ on Muddy, and frankly after the 2020 and Christmas we’ve all just endured it’s never been more needed. But this year, with so many jobs and livelihoods affected by COVID, ‘New Year New Me’ isn’t just about fitness, mental resilience and resolutions – it’s also about giving an overdue health-check to our finances too.   

Money management is a massive blind spot for me personally and women generally (annoying fact: 30% less women than men invest – 30 per cent!!– according to a 2018 report by YouGov). So, with a quiet January and February on the cards, it’s a brilliant time to work on our financial wellbeing, whether that’s working out how to afford a change of career or sorting out kids’ school fees.

I’ve picked the brains of Jo Perry-Taylor, Regional Director at Schroders Personal Wealth, on how you might get control of personal, family and future finances, and truly it’s been a total revelation – many of us feel like we’ve missed the boat on smart financial decisions but… apparently not! (just, you know, ease off on the net-a-porter addiction and monthly gin subscription). Anyway, I hope the info below helps you get your 2021 off to a good start. Over to you, Jo.



Planning for school fees feels particularly relevant in the wake of COVID where so many frustrated state school parents are turning their attention to private education. But, of course, it’s a very expensive business. It will all depend on your individual circumstances. However, ideally, if you can afford it, you could start saving for school fees from when your child is born.  A regular premium may make a big difference, even better if you can add a lump sum. Perhaps also consider asking grandparents whether they could spare a small amount each month. For this longer-term planning (more than 5 years away) you could look for Junior ISAs and invest the funds – the income from these products are tax free and so have the potential to grow tax efficiently.  Remember though that tax treatment depends on individual circumstances and may be subject to change in future.

When invested, any potential returns have the opportunity of beating inflation in the medium to longer term.  Make sure you diversify your investments to help reduce fluctuations where possible – not all eggs in one basket! However, you should always remember that the value of investments and the income from them can fall as well as rise and investors may not get back the initial investment.

If you’re trying to save in the short term, it’s not too late – think Secondary School education or perhaps even the two years of Sixth Form entry to allow you time to gather funds. For this shorter-investment route you may need to seek professional advice that can look at your circumstances and assess the best strategy for aiming to keep risks under control. It’s also worth remembering that many schools also offer scholarships, bursaries and in some cases fully funded places that will knock thousands off your annual bill.


It’s been a particularly brutal year for relationships, with divorce enquiries coming second only to redundancy advice at the Citizens Advice Bureausince June this year. And of course the new divorce laws are making it easier for people to escape unhappy marriages – a request for divorce on the grounds of irreconcilable differences, for example, can no longer be contested.

If you’ve reached New Year and decided to call time on your relationship, the first thing you need to do is understand your current position. Get informed by asking questions about the mortgage, savings accounts, pensions and any other assets and what you are entitled to. Also start gathering information on any personal financial assets you hold, such as your workplace pensions. 

Tempting though it may be, it’s never a good idea to ‘snoop’ personal accounts. If you can’t find details on any mortgages or savings/investment accounts without using normal methods just make a note of what you think is involved and flag it with your solicitor to ask the relevant questions when financial disclosure is requested.

Most couples will have less financially after a split, as the household income now needs to sustain two households rather than one, but if your case is needs-based, your solicitor and the judge (if involved) will make sure your financial needs are met through the appropriate assets or maintenance payments.

Conversely, if you’re the main bread winner and the children live part week with your partner, be prepared that it might be you who contributes. Divorce is a very difficult and often painful process to go through, so when you eventually come out the other end, even if you’re less flush financially, there’s a good chance you will feel emotionally better off.


This should be an exciting subject – freedom and fun awaits! – but for women in particular thinking about retirement can feel fraught. The cause? There’s a real pension gender gap in the UK – the Pension Policy Institute(July 19) found that women have on average £51,000 in their pension pot, while men have around £157,000 – so over three times as much as us. No surprise it’s due to a heady cocktail of factors that includes women earning less than men; career breaks to look after babies and parents resulting in reduced or stopped payments into pensions; more cautious investment behaviour than men; and a female reluctance to seek financial advice for pension planning. 

The big question of course is ‘How much you need to retire?’. The short answer is that it depends on the lifestyle you want and how long you’re willing to work for it! But do the maths – if you want the average of £20,000 to live on per year (source: Prudential 2018), want to retire at 60 and think you’ll live until you’re 85, what does that tot up to? Figures according to Which 2020suggest a comfortable retirement (think European holidays) will cost £27,000 per year, and a very comfortable retirement (think long haul and cruises) will set you back anywhere from £37-42,000 per year. So if these figures talk to your lifestyle, factor it in! Don’t forget to consider the often-positive financial impact of releasing equity in your home if you downsize to help with the sum needed.

To make smart decisions on your pension and retirement, you need to understand your current position, so gather details on your existing plans – you may be able to reduce costs or potentially improve returns by making changes to them. Also check that you are maxing out what your employer will pay into your pension through your employee benefits package, if you can afford to do so. If you are divorcing, think through division of assets. Women tend to want to keep the family house, but this means you’ll get less of your ex’s pension and potentially damage your long-term financial wellbeing. Finally, review your budget to check what you can afford to pay into a pension – if payments are made via salary sacrifice you might be surprised at how insignificantly pension contributions impact your take home pay. The important thing to know is that it’s not too late to take control of your money and execute a plan and how getting smart with your pension can make a huge, positive impact on your future quality of life. 


More of us are changing careers than ever before, and the pressures of COVID has accelerated that process further. If you’re seriously rethinking your work life, try to plan as much as possible before you make your move. Firstly, you could cut back on spending – save as much as you can from your salary for the time when you make career change. You want to build up a financial buffer so, for example, try to create 6-12 months of living expenses so you don’t put too much early strain on yourself in what will be an exciting but stressful time. If you don’t know what money you need to live off, use a budgeting tool like Money Advice Service Budget Planner or speak to a professional who could help you to build a sensible financial plan. 

With such a seismic change on the horizon, it’s really important to take the time to do your research – know what pay range to expect, work out cash flow and what impact it will have on your current lifestyle and acquire as many new skills and qualifications for your new future whilst at your existing job (even if that’s using your holiday leave to get ‘intern’ job experience). It’s also worth thinking carefully about whether you can step into a new career at an intermediate level rather than starting from scratch to reduce what is often a financial shock. 

Want to get a better grip on your finances? Contact Jo Perry-Taylor, Regional Director at Schroders Personal Wealth across Bucks, Oxon, Northants, Berks, Beds, Wilts, Hants and Herts at don’t include any personal information in the email as sending information via e-mail is not secure and could be read by others). 

Or visit more information and to see Schroders latest webinars and insights. 

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