The what and why of my wallet
I haven’t posted (on Medium) for a little while but I was encouraged to write a post about how I handle my personal finances as someone who runs their own business and spends a bit of time researching such things.
This is sort of like when I wrote ‘being safe on hostile WiFi/mobile networks’ — how I live as opposed to just about what I think.
I am mainly writing this so I can point friends etc to it. If you happen to stumble across and it turns out to be useful to you… excellent!
A relatively obvious disclaimer:
This post does not constitute financial advice or guidance.
I like travelling (the journey as well as destination) and don’t do it as much as I should so when I do so I aim for comforts.
I balance Business/First class flights against a nicer hotel (grit my teeth on the travel, have a nicer time when I am at my destination).
Within Europe, Biz/First travel has limited benefits so I stick with budget airlines (EasyJet, etc) just to haul me to my destination.
I prefer Airbnb and short stay apartments over hotels if travelling with someone or if a single location is over 3 nights.
I usually pick a Marriott (see below) but will spend a brief amount of effort shopping around within the hotel perks I have (Hilton, Marriott etc).
I slide the risk gauge all the way to 11/10.
I only use managed portfolio investments platforms/services I can check up on any time (online banking, mobile app etc) and the maximum lock-in I will accept is 7 days.
As much time as you think you have, unless you have a handful of pet stocks to go to, you will want a managed service so you’re paying someone to do the hard work for you. While you may have made better choices yourself on the odd occasion, overall, it takes the pressure off and tends to keep your money a little safer.
Standard bank savings/ISA accounts are quite boring. I haven’t used such an account for many years.
Investment over savings, even in the short term.
Investments in ventures (start-ups etc) are a different ball game and this isn’t for many people so will skip over this.
I will generally pay/absorb a higher fee — such as the UK AmEx Platinum’s 2.99% FX surcharge — for the corresponding points and insurance cover.
I pay for premium bank accounts as they come with benefits (mobile phone/gadget insurance etc) I think are generally worthwhile and play a very small part in your value to the bank — if/when you need something from them.
I want to be free (of humans)
I prefer to avoid human contact for my traditional banking needs.
I will use comparison sites to check that I am receiving an OK deal for a commodity product (insurance, broker’s fees etc) but otherwise don’t need/want to talk to anyone.
I do benefit from private banking relationships but I keep these chats relatively irregular.
I have professional advisers for niche tax and investment advice because left to my own devices I would have almost certainly made a mistake by now.
My actual wallet
What is actually in my wallet — usually, but also when travelling. I use a card wallet (coins are rare, notes in a money clip).
Slot 1: American Express Platinum (referral link)
I use this to earn Membership Reward points (over my lifetime of usage, I suspect nearly 800,000 points) which I then convert to specific hotels/airlines when I want to redeem them to book something.
AmEx Rewards offer various perks such as cashback on key spending (£5 on Deliveroo, for example) but generally is travel orientated.
The insurances and hotel tier benefits are key for me. The metal card with new laser etching is also quite nice.
Slot 2: Curve (MasterCard Debit) (referral link / M0SB4)
My non-AmEx go-to.
Curve does have some cashback/reward options and various tiers such as insurance but this generally overlaps with what the AmEx Platinum already gives me.
I paid for Curve Metal because… vanity — the 18g red card is very pretty and has an excellent weight/feel to it.
My main issue with Curve is the turnover limits (day, monthly and yearly) and that they have struggled with supporting American Express at the backend (start/stop failed twice now although I very much suspect this is AmEx calling the shots as opposed to Curve error).
Edit: Within roughly 2 hours and 15 minutes of this post Curve got in touch and generously increased my Curve spending limits to a point where I will still carry the NatWest Black but will use it even less, and no longer have to balance direct transactions versus what I put through Curve (subject to transaction risk profile).
Slot 3: NatWest Black (MasterCard Credit)
I use this ‘behind’ my Curve but I carry it as well.
Uncapped 0.5% cashback is very attractive when paying HMRC bills and small normal cash withdrawals (behind Curve).
I use this directly for high-value transactions where I would like the consumer credit card protections to apply which are offered by Curve not perfectly aligned and guaranteed or where Curve does not recommend using it (for example, when the merchant is going to authorise sizeable funds and hold them, as opposed to make an actual charge)
Slot 4: Driving License
Middle slot: Nectar card
I churned the American Express Nectar card a few times in order to get the sign up bonuses and Sainsbury’s is right next to my home train station so it’s my go-to for the non-weekly shop.
I keep the points for a ‘rainy day’ so I can buy food/drinks incase I do not have any cash or line of credit.
No debit card
You will have noticed I do not have any other bank ‘debit’ card. The Curve acts as a Mastercard Debit and I use it to take out money from ATMs should I need to.
If none of my cards work, a debit card will likely not have saved me.
I can use my bank’s online banking app to request card out of their cash machines as a last resort.
American Express British Airways Premium Plus (referral link)
I use this for paying British Airways and earning the British Airways 2–4–1 voucher (which is arguably the best UK credit card reward perk there is). Once I earn the voucher for the year, I don’t spend on it any more.
Over the years I have flown British Airways less and less (they have mediocre products, a relatively lax ‘follower’ in terms of seat innovations etc and high taxes/fees for Avios redemptions) and as a solo traveller the 2–4–1 voucher has gone unused for years in a row, but I earn it anyway because if there comes a time I use it, it will be worth a fair amount in savings.
I don’t use it for much else unless there is a particularly attractive AmEx Reward.
American Express Starwood Preferred Guest (referral link)
Starwood and Marriott merged, so this actually earns additional points across the entirety of the new Marriott group.
I only use this for paying Marriott (whether online or in-hotel). Again, maybe if attractive AmEx Rewards.
Revolut (referral link)
I use this far less now given my Curve, but I do have a Revolut card (base level membership) because I can open/close select currency accounts if I am going anywhere particularly exciting with predictable spend (worth converting funds in advance) as opposed to FX-on-the-fly.
Hitting spending limits
Reward cards (AmEx or otherwise) generally come with a spending target to trigger bonuses when you first get the card.
Look for things that charge the card as a purchase and bring forward spending from future months if you’re struggling to hit the target (this may have cashflow issues though):
- Buy gift cards / pre-paid vouchers
- Order currency
- Load TransferWise Borderless
- Load Nutmeg.com (referral link)
- Load Revolut (referral link)
Will I get one when it is available in the UK? Yes.
Why? Because it is pretty.
For foreign banking transactions outside of the plastic world, I use TransferWise Borderless to maintain various currency accounts and send/receive non-sterling (GBP) payments when I need to do so.
You can load TransferWise Borderless in quite a few ways, including debit/credit cards. I’d keep an eye on your credit card agreements etc however this should charge your underlying credit card as a purchase — for 0%/£0.
At the moment its just Nutmeg.com (referral link).
Their minimum recommended investment period is 3 years (to balance macro financial events) but you can withdraw with a few days notice.
I have used my entire ISA allowance with Nutmeg. I do not use a Lifetime ISA or Pension with Nutmeg.com. The ISA wrap is very handy, if you’re saving/investing in the UK, try to max it out first every year to tax shield your returns.
You can load Nutmeg using a Curve given it is a Mastercard Debit. I’d keep an eye on your credit card agreements etc however this should charge your underlying credit card as a purchase — for 0%/£0.
I check my Nutmeg activity once a day.
Since 1st July 2017 until now (end of August 2019) my first Nutmeg.com ‘pot’ peak was +13.98% (2019–07–29) with a low of -4.74% (2018–12–24) and currently resides at +8.18% at the time of posting.
+8.18% in 25 months is multiples better than any regular savings account. The key is not to withdraw when you’re ‘down’ and crystallise your losses.
I am tempted by the NatWest investment account but by all accounts this seems comparable in returns. I’ve had other recommendations over the years but for perhaps an extra 0.5%, I don’t want to email an account manager to query my balance etc.
I do not have a pension at the moment.
Lifetime ISAs aren’t not for everyone (I do not have one) but I bring them up as they can be a good choice for first time buyers.
I’ve recently pointed some cyber security apprentices at them who are in their early 20s and able to save a significant portion of their salary each month and do not need immediate/early access, so +25% (£1k/annum cap) is a good deal — if the money is ISA wrapped but also investment (not savings) led.
I played this game for a few years and have some money left in various core chains such as Bitcoin (BTC), Ethereum (ETH), Monero (XMR) and Ripple (XRP).
I use a variety of exchanges but I would encourage you to do some research to balance fees / altcoin availability against stability in the exchange itself. Coinbase is a good choice for entry/stability.
This is not for the faint of heart. If you can run an arbitrage bot or keep a very close eye, you might make a little bit of money in swings but otherwise… quite risky for the taxable upside.
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