Remove Unnecessary Spends in Business During the Coronavirus Crisis with Damien Fogg

Foreign.

We are in Season 8, Episode 11 and this is Friday 27th March. This has been recorded as last week, Friday Drinks with Damien Fogg. And as you may be aware, hopefully we've invested in a little bit of sound equipment. We have got the amazing Yeti blue microphone. A lot of people were commenting on how the first 10 episodes of this season the sound sounded like it was coming from an Apple headphones microphone, which it was. So this arrived today. Seeing that we don't know how long we're going to be in the UK for, we have just. I decided to get this which is. Which is a good investment. It sounds a lot more clearer today. What are we talking about? Today we're talking about finances with Damien Fogg. We're talking about proactive and practical ways to cut down on your outgoings, increase your incomings so you can help your business survive through the coronavirus crisis. It was a really good episode because Damian gives practical advice on ways and means. He shares a couple of apps on how you can get started when it comes to tracking your finances. We which we will explain more about. And I also talk about his book. His book is a great way of saying getting started with all of this. It taught me a lot. I now work with Damien on a one on one basis. He helps me with my finances and he's a. He's a great guy. And the. The Money Shot book is one that I recommend everybody go and pick up. I mean you've got a lot of time on your hands. You might as well learning more about finances and this is a great place to start. Throughout this interview I talk about sharing your drink picks. Now this is expired. If you're watching this back on the replay, this is expired. But it was just for basically people to share whatever drink they are consuming while listening to the live video. This expired. So don't please share it and expect to be put into the. Into the prize draw. I did pick a winner and that person did win as a copy of the Money Shot, but that is not finished. But you can still go on to Instagram and you can still let everybody know about the boosted podcast at Boostly uk. Let us know where you're listening to this from. Please do. And please go and leave a review on the Apple itunes. We are getting more and more people tuning in. We're getting more and more people discovering this podcast because of people like you leaving fantastic reviews. Right. I much appreciate it. Today is going to be a big episode about finances. So please sit back, enjoy. But most importantly Implement the advice into your personal life and to your business and I will hand you over to the one and only Damian Fogg. Hello, everyone.

So I'm Damian Fogg. I'm a former financial advisor and property investor. Well, I'm still a property investor, so that's not former. I've been involved in the financial services industry for decades. Decades. I'm now a full time investor. So I managed to retire about six years ago and live off the money that my investments make me. So now as Marcus, I just geek out on markets and numbers and money and that's kind of what I do. I help other people manage their finances a little bit better and get started with investing. People like Mark, who've been working with me for a while now, have kind of been prepared for something like this. Not necessarily this and certainly not of this scale, but. But it's something that has been on the horizon for a while and so we've talked about prepping for it. That sounds like I've turned it all into preppers. But from a financial point of view, getting ready for something like this to happen and being in a position where it doesn't end, that's kind of what I do. I'm currently based up in York. I'm stuck here in quarantine now. I'm originally from the northwest in Liverpool, way near the Wirral and I should be in Bali right now, but I'm stuck here.

Let's get on with it. And like I put in the title of this live video. I want everybody to share your drink, pick on Instagram. So what I mean by that, Go to Instagram. Make sure you tag in Boostly uk, everybody that does. And you've got until, let's say tomorrow to do this. So everybody that goes in, put your picture on Instagram with what you're drinking this evening. Make sure you tag in Oostley. Let everybody know that you're watching and watching this live video. And I will pick one person at random. You will get. I will buy you a copy of Damien's book, the Money Shot. It is a fantastic book on finances. It's definitely helped me. He explains it all in real simple terms, which helps for somebody like me. It was probably the start of my journey into figuring out more about finances. Definitely helped me reduce a lot of my outgoings and, you know, it's definitely helped me get a little bit more knowledgeable on all of the assets. We're not going to really talk about assets as such, like investment and whatnot. We're going to we're going to really focus on cutting costs. So I guess the best place to start, Damien, and if you could just walk us through some actionable sort of easy ways that somebody could really make a start and a dent into helping them with their finances at the present moment. In times like how do you recommend people go about making a start on looking at where their high outgoings may be and how could they look to make a start in trimming them down? What's some of the ways that you recommend when you're chatting to somebody for the first time about something like this?

I think jumping into the expenses side of things. Easiest way to start is to use your bank statements. So everyone uses banking now, but basically look at all of your direct debits and all of your standing orders and just go through each one of those and figure out what it's for. So there's a three stage process I tend to go through. Reduce, remove or replace. That was the third one. And basically you're looking at everything that's on your direct debit standing order list and just questioning whether or not, first of all, do you need it? If you do, can you reduce it in any way, shape or form or can you remove it or can you replace it? And so usually in normal circumstances, there's a few things on there that you can possibly like, do you need Netflix and Amazon prime and Disney and YouTube? You need all of them. You could probably cut one or two or all of them maybe, depending on how tight you need to make your belt. So in normal circumstances that's the sort of stuff that you'd be looking at. With what's going on at the moment, though, we can get a bit more dramatic with it. So obviously a lot of people are going to have mortgages that they need to pay. The government's already come out and said they've pretty much insisted all mortgage lenders have to give you a three month holiday if you want one. So speak to your mortgage lender and just say, look, I don't want to pay my mortgage for three months. You're not going to get away with not paying it. All you're going to do is roll it up. So you will have to pay it back in the. And you'll probably be charged interest on that. But from a cash flow point of view, in the interim, it's not a bad starting point. Also, if you've got any loans that you're paying back or credit cards that you're paying back, things like that, speak to the people, the lenders that have given you the money in the first place and see if you can negotiate either a payment holiday or if you're on a standard credit card deal and you're paying back at 19, 29%, speak to them and say, look, can I drop this to a 0% for the next three months because that's more breathing room and you can actually clear your debts a little bit quicker. Times are a little bit weird right now, but it's given us the opportunity to be fairly aggressive with any sort of debts that you've got outstanding. And really you're in a strong negotiating position. Say, look, I don't want to pay this right now, so give me some wiggle room. So that's probably a good starting point, just getting a list of all of your DD's, all of your standing orders, and then going through line by line, each and every item and just saying, do I really need this right now? Is this something that's going to add either massive amounts of value or is it going to help me generate some sort of income? And you can do that both personally and as a company, as a business. And so all of the different things that you're looking through, just be looking at them and think, is now the time to be having this and to be subscribing to this. That's kind of the mindset you've got to go into this situation with.

For those of you who are thinking, well, is there something out there that could help? I use on back of Damien's recommendation, an app called MoneyHub M O N E Y H U B and that has really helped me. It helps me keep accountable and helps me keep on track every single month on what we are spending on a personal and business level. And you just hook it up, load in your, your, your accounts, load in your bank and it just keeps you a real nice track of it and you can split it into categories. So what I do for mine is we've got petrol we're not using at the moment, obvious reasons. We've got groceries, expenditures, eating out, entertainment, and we've got them split into those different categories. And every single month we've been able to do that and you can, you can backdate it and it's a really cool little app that you can get started on. But yeah, the most easiest way, like Damian said, just log on to your online bank and print off statements and just go and ring each one. I'll let you know what I've done this week. I've looked at everything that we've been spending on money coming in, money coming out. Finally bit the bullet on mailchimp. So mailchimp's just always been sat there in the background. We've been paying for it, but I've never really been using it. This week used it as an opportunity to get rid and that has saved over 350 pound a year investments. So I'm still investing but I've just cut that down a little bit. And again We've saved over 125 pounds so we saved over 75 a pound a month that what we were paying for our investment. So we've cut down on that. And credit card repayments, we've saved a lot here. So just again having phone calls, having the conversations, explaining obviously the current situation, they know about it. We've been able to save over 1,500 pound on credit card repayments by just lowering the payments and just stretching it out. So we're really at the moment trying to get cash in the bank, a war chest as people call it. So just in case, for however long this goes on for, we've just got it there. When things do go back to normality then we can just put that back in. But that's what we've been doing. Expenditures, we've sort of covered that. Let's just sort of go on to what has been happening. And now this will obviously gear up to be more UK centric and I know we've got people tuning in from all over the world and whenever we do one of these people always say well what about here? But I just want to talk about what has come out from the Chancellor, what has come out from the sort of the budget and the relief and the help that is going to be here for support on the businesses. Now you've obviously had a chance to look at it, you've obviously had a chance to have a look at what's being said for businesses out there that are watching this and sort of thinking, well what happens next? How have you sort of taken on board from what the Chancellor said specifically when it comes to self employed businesses? How have you seen that? How have you broken that down? And again, what, what sort of feedback or like sort of feelings that you have on what has been said this week from the Chancellor and with the relief he's got for self employment, he's.

In a fairly difficult position, isn't he? Because he was never going to please everybody. And obviously you guys in hospitality industry, I've got the business rates stuff, so there's an awful lot of Stuff that's already been put out there to try and help people out when it comes to more the self employed side of things. I guess specifically at the lowest end of self employed people, predominantly sole traders, when he's talking about, you know, submit your account. So very briefly what he's basically said was what is your average net earnings, net profits over the last three years or over the last 12 months. If you've not been running that long, they'll take an average of that and then pay you 80% per month of whatever your net monthly salary profit was. And you're not going to get that until sometime in June and it'll be three payments all wrapped up in one. So that's roughly what the offer is, which as Mark says is probably out of date now already by the time you listen to this, if it's Monday next week, probably out of date, you will look up something else. But right now that's the offer for self employed people. They've specifically targeted and said if you earn more than 50,000 a year, you're not getting any help. So and their argument I think has been, well, people earn over that. The average is 217,000 I think they've said, so you guys should have some savings, so go live off that. The only other option you've got if you're in that position is to go on to universal credit, which is what, like 90 odd quid a week or something. So it's not going to cover most people's expenses by a long shot. So they've taken the view, I think of let's support the people that are at the lowest income brackets, which is, you know, the right thing to do on the basis of if you're earning a decent wedge of money, you should have been financially more intelligent over the last several years and you should have built up three to six months worth of contingency fund. You should have other passive sources of income or at least another source of revenue somewhere. And so the Chancellor's kind of, from my point of view, he's kind of proven my point that I've been talking to people for a while. But when you get to a certain stage, having all of your eggs in one basket can be quite dangerous. I think going forward that's definitely something people need to take from this. If you are a limited company, you're incorporated, then it seems very mean because from a tax efficiency point of view, people have been paying themselves paye a small amount so that you get your full national insurance contributions and then the rest have been paid as dividend. From what I've read they're just completely ignoring dividends now. So all you can then do as an incorporated self employed, owner, manager, whatever you want to call it, all you can apply for is 80% of that 720 odd pounds a month or whatever it works out at, you're very much being disadvantaged if you've tried to be tax efficient in the past, if you are set up in a way that is more tax efficient. So if you've incorporated rather than just being a sole trader, it seems like a bit of a slide dig that the government's given. And even in the press conference where he came out with this self employed stuff, I think he finished off with oh, and by the way, we're going to review how this works going forward and we'll make sure the self employed people pay just as much tax as paye people. It seems like a bit more of a left wing almost, I mean relative obviously to conservatives, but it seems like it's a bit more left wing leaning in the budget side of things. So I mean that's I guess a general take on it. But if there's anything specific you wanted.

To talk about, that was a good sort of sum up and you're right, there's definitely. And I think this has been the problem, I think since when he first came out and mentioned about the relief of what he was going to do is that there's no real details. It's all a bit headline sort of grabbing at the moment. But I think that the problem as well is that because everything is moving so fast because we've never had a coronavirus before, he's never been around and so people, the government come out and say all these things and then the banks just go, hang on a second, what? The next day they get all everybody calling admin. I don't know if anybody's tried calling Barclays Bank. I was on hold for two hours today and then it just hung up on me. So it was insane. And I only wanted to ask a very simple question, you know, it wasn't even something like big. So everybody is just sort of playing on the catch up. And like we keep saying this has been recorded on Friday the 27th and by the time you come to listen or watch this back, it may have all changed. But the present moment in time, I think this is where a lot of the time you can, you can just see it on online, you can see it just on the groups and whatnot where everybody's just sort of scrambling for information and, you know, as much as we can do these live videos and I'm trying to do these live videos every night and we try and give proactive ways that you can bring in income and not wait and rely on whatever funds are going to come. It'll be good to know exactly what is out there and how it can help. And this is why I wanted to get you on tonight and sort of start to make sense of it all, if we can, while drinking cider from a can from a bottle, but at the same time have like an online portal where you can sort of share this and whatever you've been doing this week again, whether you're watching this live, whether you're watching a replay, whatever you've been doing to cut those unnecessary costs, just let us know, put it in the comments and sort of share what you've been doing. Because I definitely think that it helps because there's something that you think is so simple and somebody else isn't doing as far as proactive ways to cover yourself for the future. Obviously everybody out here has got different ways they go, a means of bringing in. Bringing in their income. Obviously we're talking to the hospitality world, so a lot of it is via that business, bringing it in. What I like about with what you teach and what you show in the book, but also as well in your Facebook group and the things that you're showing people is that you show there's ways and means to bring in income in many different forms. And one of them is the investing. If anybody hasn't really gone down this sort of road before and somebody's thinking, well, I want to now start to look at other ways of means of bringing in income over the long term. And obviously you cover this in your book, but where do you recommend could be a really good place for someone to get started if you wanted to find out a little bit more about the stocks and shares and ISAs and whatnot. Is there any, obviously apart from your blog, is there any things that people can start to look and do over the course of the weekend and sort of figure this out a little bit more? Is there any sort of ways and means that you recommend on that you.

Could find literally every thought anyone's ever had on the Internet, so you can just research to your heart's content, play on YouTube for years and years? Yeah, as you said, my blog, my book, they're not bad places to start. One of the places you can start, it's a bit of a weird cheat, but if you actually look at some of the online trading platforms. So Hargreaves Lansdowne is one that I always talk about. There's a bunch of other ones out there, but you don't need to. You don't need to sign up with them, you don't need to give them any money. If you just go onto their website, which I think is hl.co.uk they'll have a crapload of guides of how to get started in investing. What does the stock market even mean? They've got loads of beginner's guide because obviously it's their job to get you to give them money. But it's not a bad resource and a bad starting place to find out about all the different options out there. And now, obviously that is very UK specific because they talk about SIPs and ISAs and junior ISAs and all these different things. Even if you avoid the specific vehicles you can use in the uk, the general guides to. Well, how do I invest in real estate investment trusts? They talk you through, well, what is a real estate investment trust and what's the difference between that and a property company and blah, blah, blah. So they've got loads of different guides. That's probably not a bad way to start or give me a crap load of money.

And I'll tell you, that's always a good start. I mean, the Money Shop book is available on Amazon and is it on Audible as well or is it just.

I think it's on Amazon as a physical and a digital and audible. I did the audio narration for it as well.

I mean, I say this is the. This is the book that I got started on in my journey and it's definitely helped me because it's gone on from there to doing one of Damien's courses and now, like I say, working, working with him, do on a monthly basis with the lovely Laura to just basically make sure that everything just stays on track, which is always a good thing. But I think if we can just give anything as we sort of wrap this up, is just to say this is the perfect time. You literally cannot leave the house, you are on lockdown. Depending on where you are in the world, you're gonna have time. And so it's a good time right now to get on track of your finances. Where we should traditionally be about to go into our peak seasons, where you are running around like a blue ass fly, just making sure that everything is in the right place, looking after your guests. You've now got a lot of spare time on and obviously there's Loads of proactive things that you can do with marketing. There's loads of proactive ways that you can make sure that you can build your email list and all of those things for your hospitality business. But as well you can use this time now to really be proactive on your finances. And you know, I can't speak highly of it enough. The money shop book is a great place to start. What's your website again? Is it ET? It's one of the two. The AP investor.com go on there. There's loads of blogs. There's actually is a full blog about COVID 19 Coronavirus Practical Advice for Entrepreneurs. It's got a nice little 20 minute video. So if you've. If you enjoyed seeing Damien's face and you want to see 20 more minutes of that, then head over to there. It's definitely something that is worthwhile and something you should also should do obviously as well. He's got a Facebook group. What is your Facebook group again? I keep forgetting something along EP investor.

That just the EP investor as well. I'm not thinking about consistent.

Very, very consistent. But yeah, go and check out more. It's something that I think is important. That's why we wanted to do this tonight. Don't forget if you want to win a free copy of Damien's book, I will buy a book for one person over this weekend. If you go onto Instagram, take a picture of the screen of this live video now or take a picture of the drink that you are drinking. Doesn't matter whether it's alcoholic or not, go post it on Instagram, tag me in Ostleruk. I'll share them all and I'll pick one person and I'll buy and I'll post it over to you or just send you the digital copy. That's probably easier over the course of the weekend so you can get started on your finances. But for now thank you very much for tonight Damien. Do appreciate it. I would like to say you're a busy man but literally where have you got to go? Nowhere to go. I will be back on Monday for another one of these. Got a full week of live videos lined up for next week. Just giving you actionable advice on what you can do to bring in bookings for the most part. Have a great weekend. I hope that the audio was a lot better today. I've got an microphone came in. Everything else is in Spain. So I mean I literally don't know when we're going to be back in Spain, wherever that time may be. I've managed it to get a bit of kit to make this a little bit easier to listen to. But for now, thank you so much for watching and we'll be back on Monday with another live video. Before you leave, please just say thank you to Damien in the comments. And as always, the money shot is the book, the epinvestor.com is the website. Go and check all of them out and I shall see you on Monday.