#66: “What do Blackheath people do?” (a story about how not to do financial planning)

20th December, 2021

Welcome to the Idiot Money newsletter. This week, becoming wiser with money by understanding that peeking through the curtains isn’t the best place to look for financial guidance, including:

• if you don’t know what you want, you’ll never get it, even by accident;

• the trouble with ‘security and freedom’ as substitutes for thought-through purpose for your financial resources; and

• why the palliative financial planning you crave is not the profitable financial planning you really want.

If you don’t know what you want, you’ll never get it, even by accident

It’s taken about three months, and goodness knows how many last-minute rearrangements, but finally the wife has consented to our rule that we do not start properly planning – let alone implementing anything – until both halves of a couple are in the room.

Sometimes the female half is firmly in the financial driving seat. Usually they’re not. Always they appreciate at least being listened to. Well, until now.

Mrs B is not only reluctant, she’s positively petrified. If she were a tortoise, you wouldn’t be able to tempt her out of her shell for all the leafy greens or sensual neck rubs in all the world. She’s a perfect example of why, from a short-term business point of view, it’s better to ditch the rule, and why, from a doing-a-half-decent-job point of view, the rule is unbreakable.

Felicity with the family finances does not come from treating them like a gentleman’s club. Appeasement is anachronistic. Addressing insecurities around something so inescapable has inherent value. Especially as the importance of one’s relationship with money doesn’t fade, but grows in step with one’s bank balance.

‘Mr B has, I understand, set out the reasons for you being here.’

‘Yes. To do something with our savings. “Make our money work harder for us”, isn’t that what you said, darling?’ This is far too early to let Mr B say anything. I press on.

‘Good. At a high level, how do you feel about the general aims, the broad idea? Any reservations? Bits that are clear, bits that aren’t? Nagging doubts?’

‘Oh, I don’t know,’ Mrs B says, a little flustered. ‘I’m not built to understand such things. Mr B?’

‘No conferring!’ It’s an attempt at levity. It probably comes across as the height of inhumanity. Mrs B seems to be shaking a little. I attempt reassurance.

‘I promise you that you possess all the building blocks you need to understand all that’s worth understanding.’

‘What do Blackheath people do?’

I’m briefly taken aback by the beautifully unashamed example of something people usually dance ungracefully around. Delegating the decision making about how best to turn one’s resources into a good life is one thing. Delegating the understanding of the mechanisms to one’s neighbours – and not even a real neighbour, but some sort of Platonic form of the sort of people that live in a particular sort of suburb of London – is quite another.

Though it’s a story as familiar as it is frustrating. Frustrating because I know the delegation (or avoidance) problem will run much deeper still.

‘You’re a Blackheath person. You tell me. What do you do?’

‘Sorry…’ she says with the clipped middle-class polite perturbation that confirms she’s anything but sorry, ‘that’s why I’m here isn’t it?’

‘Not really. No. Blackheath is, I’m sure, a lovely place to live, but it’s not the best halo to use as a guiding star for investment decisions.’

‘I know it’s difficult,’ I continue, ‘but it’s really important. Like the cars along your road… there may be certain common qualities to a lot of them, but they’re not all the same. Because they’re trying to achieve different things. Here a couple that enjoy driving down country lanes hearing the exhaust bounce off the walls, there a junior football team in need of ferrying about, everywhere an emergency dash to stock up on avocados…’

You’d be hard pressed to interpret the look Mrs B fires back as anything other than irritated. I’m really not cut out for this, I think. But it’d be even ruder to resign in the middle of a meeting.

‘Let’s start from the beginning. You want to use your money to achieve things. It’s best to achieve important things, to the extent money can. So what’s important about money to you? How does having it make life objectively better than not? Most simply assume it does, but never break down how.’

‘Oh, I don’t know. A roof over one’s head. Food on one’s table. Holidays here and there. A comfortable retirement…’

The words may be calmly, methodically, automatically, delivered, but the space behind her eyes is screaming. Screaming something about status, or at least the appearance of it. Her knuckles are screaming too; gripping the slick surface of the boardroom table like the neck of an unruly child in a stress-laden sortie through a supermarket.

My silence is an encouragement to dig a little deeper beyond the surface of ‘stuff’. It works. Sort of.

‘I guess what’s really important is security and then aiming for financial freedom on top of that.’

Freedom and security. Security and freedom. You could turn this answer to the ‘what’s important about money?’ question into a mind-reading trick. Like guessing someone will say 7 when asked to pick a number between 1 and 10.

It’s what everyone says. No one ever says status, somewhat ironically because they’re embarrassed to do so, despite so readily using their income and expenditure to try to convey it. No one ever says health either. Yet when asked directly, all say they’d trade an eye-watering sum for an eradication of the health issues caused by the postural or stressful impositions they endured to earn those eye-watering sums in the first place.

And of course no one ever says meaning, despite the incessant existential bafflement caused by a failure of their spending decisions to bring it about, even though such decisions never really aim for anything else.

I want to ask ‘What if Blackheath people are unhappy?’

There’s no great evidence that Blackheath’s middle-class, middle-England, self-conscious peeking out of the curtains is a great inducement of either the Scandinavian stoic acceptance or Latin American joie de vivre that tend to characterise happy places.

I nearly do.

But I bottle it.

They’re not clients yet and history suggests they never will be if I go down that road. Plus, Mrs B’s nails are long; I’m not sure the table will survive unscathed.

‘The trouble with security and freedom,’ I cautiously opine, ‘is that they’re important feelings, but we think of them as pots of gold at the end of a checklist of things that can be purchased. When really of course they’re mindsets. And they’re cultivated by ways of thinking that often become clearer only when we dump the checklist illusion. As you can imagine, this job gets me close to countless people with what must be ‘financial freedom’ on any mathematical measure. Yet they often don’t feel free. And plenty, also, who find false security in narrowing the range of things they allow to bring themselves joy, rather than increasing them – be it modes of transport, or wine, or postcodes…’

I hope she doesn’t take the dig too personally.

‘Or,’ I continue, almost certainly injudiciously, ‘whose insecurity trumps their financial security so much that the more money and possessions they have actually decrease their feelings of security, because they’re always on alert to losing their castle, aware subconsciously at least that its foundations lay entirely outside of themselves.’

Mrs B mutters some words that translated from her tribal language, amount to ‘I’d rather appear to be rich than be rich’, ‘I’d rather my goals were set by other people’, and ‘If I spend only on what I really want, people won’t know I’m loaded!’

To which I don’t say: ‘Chasing a freedom that one already possesses in the name of living someone else’s life is a dangerous game. If Viktor Frankl could preserve his ultimate freedom to choose his reactions to circumstances while living in a concentration camp and if Epictetus could find security in his wisdom despite being a slave, I’m pretty sure we can achieve either without being in the world’s wealthiest 0.01% and living behind enormous gates. “If you learn to enjoy the scent of a thousand flowers you will not cling to one or suffer when you cannot get it.” ’

Instead, I say something about my job being to help people question the common patterns of thinking that lead to so many squandering resources on stuff that doesn’t work. Mrs B says something about train times back to Blackheath.