79. Caroline Hughes Makes a Plan For Money

This week I speak to Caroline Hughes, tech lawyer and co-founder and CEO of award-winning fintech start-up Lifetise.

Caroline began her career as a solicitor and was well along the path towards becoming a partner in a big law firm. But she decided to change career and co-found Lifetise, to help consumers under 40 to plan how to afford their most important life goals.

You can check out more of Caroline’s work at Lifetise here.

Episode Transcript

Jason Butler 0:00
Hello, coming up in this week's episode, a quick reminder of credit cards and how they can keep you poor. We look at how much you should be worth giving your earnings and your age. And I have a fabulous interview with the founder of life tease, Caroline, who's from. Hello, and welcome to the real money stories podcast. I'm Jason Butler. And I invite you to join me as I have intimate money conversations with people from all walks of life. Whether you're just starting out on your money journey, or well down the track, there's bound to be something you can learn from these stories about taking more control of your money, so you worry less and enjoy life more real money stories is sponsored by Vanguard bringing value to 30 million investors worldwide. Visit Vanguard investor.co.uk for more details. And remember, the value of investments can go down as well as up and you may get back less than you invested. Every month, the money charity issues, a lot of personal finance stats. And I find that fascinating reading because they give you a really good sense of where we're going with different elements of personal finance, whether that's borrowing, saving, investing, property ownership, and so on. And I just don't focus on the personal debt side of things, because it's quite a mixed picture. And there's also a timely reminder in those statistics as well, which I thought was quite useful to share with you. So what the money charities say is that to the period at the end of March 2021 people in the UK owed 1000 700 billion pounds, that's up 20 billion pounds from the same from the period end of January 2020. or equivalent to another 379 pound per UK adult over the year, which is interesting. So they they sort of break this down into secured mortgages against homes, that's 53,845 per household, or 28,324 per adult interest in the unsecured consumer debt. They worked out to be 7154 pound per household or 3763 per adult, of which, within that consumer debt credit cards make up 2009 pound per household, or 1057 pounds per adult. So that's quite a lot, isn't it for consumer debt and particularly on credit card. So it was quite interesting to remind ourselves how dangerous credit cards and also in the same thing overdrafts are. So let's just think about that the credit card on the average interest rate would take 24 years and seven months to repay. If you're making only the legal minimum repayments, which is the interest plus 1% of the outstanding balance each month. Now, the minimum repayment on the first month would be 52 pounds, but reduce each month. So if you kept the 52 pounds a month, that was the starting repayment, and did that every single month, that credit card debt will be cleared in five years and two months. And obviously not only is it going to be out of your life in a fifth of the time, but you're gonna save a fortune in interest. That clearly five years and two months is even far too long. And as we all know, when we're trying to get rid of non mortgage debt, we really need to get really focused, we really need to get a plan together. And we got to get out of that debt as quick as is humanly possible. Now Dave Ramsey in the state says you've got to eat beans and rice and never go near a restaurant unless you're working there or delivering. My view is a bit nuanced, I do think you've got to be very serious to get out of non mortgage debt. And I do think you have to make some sacrifices. But a bit like diets or exercise, if you don't build in some wriggle room, you're probably not going to keep with it. So perhaps it's a small treat at the end of the week. But really getting intentional. So if you've got non mortgage debt, you've really got to get a plan together to get out of it. If you're suffering really serious debt problems and you can't keep a roof over your head or you can't buy food, then you need to get help with both problem debt advice from the Citizens Advice Bureau step change or the national debt line, because they will provide free help. And also speak to your local authority. But if you're not in dire straits, then you just need to get really serious again about getting rid of that debt. So I thought that was interesting. Okay, now, how much should you be worth? Now? That's an interesting question, isn't it and we won't go into the whys and wherefores of non financial wealth but for the purposes of what I'm going to say now, I'm just focusing on financial assets, property investments, pensions, etc. Now, there was a book written in 1996 I think it was it was called The Millionaire Next Door and they came up with really, really simple formula of, of taking your age times the amount you earned it. By the by 10 to work out as a benchmark, what you should have,

have accumulated by that age. The problem with that formula was it didn't really take into account for younger people. The fact that they probably were coming to the party, the savings party with negative net wealth in terms of student loans, etc. And it tended to favor more older ages. So it didn't give a really a true reflection. So the guy called Trent Payne, who is a US writer, he came up with a different sort of a nuanced version of that net worth benchmark formula. And I thought I'd share it with you today, because it's quite interesting. So what he says is you take your age, minus 27, and times that by your household annual income, divided by five. So let's run through a few sort of scenarios to see what that would give us. And then you can do this after today's episode, you can work it out yourself to see why it's nice to get a benchmark, just it's just a just a benchmark. So a 25 year old, let's say we've got a 25 year old, earning 25,000 pounds a year. So what we do is we take 25 minus 27 is minus two times 25,000 divided by five, that's five. So minus two times five means that their net worth should be minus 10,000 pounds, great if it isn't. But if they've still got student loans and haven't saved anything, that's fair enough, that's a reasonable benchmark. Let's take a 37 year old earning 40,000 pounds, so that will be 37 times 37, minus 27, that's 10 times 40, divided by five, that's eight. So 10 times 8000 gives you a net worth of the 37 year old, that should be 80,000 pounds seems reasonable, especially if you've been putting money in pensions and stuff, and a bit of house growth or what have you. Let's take a 50 year old so 50 year old earning, say 60,000 pounds that 50 minus 27, that's 23 times 60 divided by five, so that's 12,000. So that's 23 times 12,000, that 50 rolled earning 60,000 should have a net worth of 276,000 pounds. So bit of fun there, but interesting, useful benchmark, I've got that in my new forthcoming book, the money miracle, which is almost finished, should be out in the summer, got lots of little rules of thumb like that, that can help you win with money and master your money. But I thought that was interesting. So just check out your net worth score and where you should be. Okay, this week's interview was a with a very, very interesting lady, Caroline Hughes, who is a kind of a reluctant entrepreneur, fin tech startup founder. She is one of the founders behind a company called Life tees. And what they're all about is helping people make the lifestyle and financial goals, more tangible, more achievable. And help them build a plan towards it. And as you know, I have a financial planning background. So I love anything to do with structure and a process. And that helps us get the results we want. So far reaching interview, lovely lady, I think you're going to enjoy this. Hello, and thanks for joining me on another edition of real money stories, the podcast show where we talk about money and we break that taboo of money. And today, I'm really excited to be joined by Caroline Hughes. Hi, Caroline.

Caroline Hughes 8:16
Hi,

thanks for having me. Jason.

Jason Butler 8:19
Good. Absolutely. Well, again, someone said to me, you're everywhere on social media, Caroline is is got a brilliant podcast show. So tell everyone what you do, and where they can find out more about you. And then we'll go into your backstory.

Caroline Hughes 8:32
Right? So I am CEO of a company called Lifetime's and we help people achieve their life goals. So all of these big things that you want to do in life, buying a home, having kids, all the stuff that for our parents generation seemed a lot easier to do. And now for anyone under the age of 40. They're thinking How the hell do I even start? We provide all the tools calculations, and step by step plans for them to actually do the things they really, really want to do.

Jason Butler 8:59
Bloody here, what's not to like? Where were you in? I was 21. Hey, where were you? Yeah, to figure this stuff out yourself? Look, I love what you're all about. And obviously, we'll come back to that in a minute. But I'm fascinated to know how you ended up here. But more importantly, well, let's go back to kind of like your first experiences and your early thoughts and feelings and beliefs about money. How was that for you? And what was it like growing up?

Caroline Hughes 9:22
Yeah, so money for us growing up was difficult, right? My dad left us I'm one of four girls and my dad left us when I was eight. So we went from being relatively comfortable to suddenly having very, very little money. And I think that has completely shaped everything for me. So it definitely influenced my choice of career. I became a lawyer. I'm the eldest daughter so I became a lawyer to make sure I have enough money for me and the family and potentially for generations

afterwards.

Jason Butler 9:53
The small print and the contracts and the deployment of payments to the family,

Caroline Hughes 9:57
that I'm that person. I'm also known and My family as Bank of cars, right? Because I was the one that was able to earn money relatively quickly right out of university. So yeah, it was Bank of cars. But I didn't grow up in an environment where we really knew, like a, we didn't have enough. And B, we weren't in a position to grow wealth or do anything, it was much more of a survival thing. So my mindset was always must have enough money, month after month, day to day, week to week, instead of now, it's only kind of in my later years with running this business, that it's been about, what actually what should I be doing with my money to make sure that I'm financially stable over the long term.

Jason Butler 10:39
And that's a very good point you made there, Caroline, because there are many people out there, including some listening to this show, who will be in survival mode at the moment, and it's what I call getting the oxygen mask on and there is nothing wrong until you've got the oxygen mask on until you can sort of literally get day to day sort of sorted and that's a roof over your head, that's food in your belly and making sure that you can stay well and healthy. That takes precedence. Don't worry about if you can't do long term goals, right? Once you've got the oxygen mask on, then you can start thinking longer term. So carry on. Yeah, so so so they really shaped you Tell, tell us about your, how you transition from from that, that difficult situation and big change in your childhood, to going through university into the workplace.

Caroline Hughes 11:24
Yeah, so I mean, I picked being a lawyer, because I knew that I could make enough money. I was quite academic at school. So it was an option that was available to me, and it kind of represented but even interestingly, in this, this is where kind of childhood mindset often comes in, I probably would have preferred to be a barrister, rather than a solicitor. barristers are self employed, you know, you have your, you're only as good as your last case, you know, you this is a you're self employed. So it's harder in many ways, you don't have the safety net of a law firm behind you. And I decided in my situation that that wasn't really an option for me, that felt too scary, too unstable. So I became a solicitor and then worked for big city firms, because that represented the ability for me.

Jason Butler 12:10
Now, that's a really, really good point. You, you thought that you'd love intellectually. virus thing and I can see that I can see because I, I know some barristers and they are completely nuts, but they are brilliant, brilliant, but mad. But But I can see it's there's a small number of barristers there and a lot of money and most of the rest of them are just scratching around that they're not really earning huge amounts. So so the allure of a city law firm or big law firm kind of job as a as a solicitor lawyer sort of appealed. Did you come out of you? Were you very very organized at uni were you solely You know, every pound was a prisoner or were you studying Unitas you know, let's crack on.

Caroline Hughes 12:54
There. I was, I was the last year to get a grant at uni. And it was the only reason that I actually got to go to university because so I'm, you know, I'm before tuition fees.

Jason Butler 13:05
You do not know that something's going wrong,

Caroline Hughes 13:07
and why I'm old enough to know I snuck in on that grant, because otherwise I wouldn't have been able to afford to. And so I got a grant to cover it. But I still didn't have enough money. So my grant, just about I think from every covered accommodation. But then I had to obviously eat and I quite liked going out so I needed something. So I worked two time time jobs. So I would cycle like seven miles each way. I was in Manchester and I'd cycle out to the Trafford Centre shopping center and work for h&m. And then I taught aerobics. So I was the person that had like the little Britney Spears Mike. Teaching aerobics. Yeah, so I was mega mega fit. But I was exhausted all the time. Because he I was doing a law degree plus two jobs. And then every holidays, I would, I would do temping work like secretarial work all holidays, so that I could afford to pay my way through uni. Yeah, yeah, I've always worked on complete workaholic so it is ever going to change. Probably gonna not make it past 65

Jason Butler 14:12
don't worry about that. Go pick up

Caroline Hughes 14:13
all right. All right. Um, but yeah, so I think I've always had, I've always had an attitude that I know that I can make money. But it's always going to be tied to me working hard. Instead of being in a position where I make money and then my money works for me. That came much much later for me. interesting ways. Yeah.

Jason Butler 14:36
So so I'm just trying to think now you clearly what did you learn about yourself and your relationship with money as you came out of uni, having had to that whole approach of Yes, you did have a grant but you never had enough and you did all these jobs and you're making people fit and helping people buy stuff they didn't need and all that stuff. I mean, what did you learn about your role, their relationship with money.

Caroline Hughes 14:57
I learned that I wanted to make sure that I had enough that I didn't have to do that anymore, the choice of being a lawyer. And interestingly, so that was how I felt at uni. But actually, if you look at the choices I've made, since then, I have been willing to take quite a lot of risk, compared to a lot of other people. You know, I was a lawyer, a big law firm. So I was on that kind of trajectory towards making partner, you know, whatever, half a million a year. And then I stepped off, I wanted to do something different. So I took a 25 grand pay cut, to go work in the fashion industry, because I thought I believed it would be more interesting. And it was. So I've always, even though money is so important to me, and that needs to have that stability. Equally, there's another part of my brain that's very, very comfortable taking risk.

Jason Butler 15:46
Yeah, it's fascinating, because, you know, I've got a new book coming out later in the year. And then there's a whole section on mindset, money mindset. And some people see risk is opportunity. Some see it as danger. Some people see see stability, as being able to control their income by whoever they work for others see it as a regular paycheck. And we're all different, aren't we so fascinating that you then made the point that you hadn't quite made the transition of realizing that working hard, and obviously your biggest wealth, creating tall is your income, but it's what you do with that income, which determines it. So you've got part of the equation working hard and bringing money in, tell us about how you how you how you went on the journey, then of changing the way that you dealt with the money that was coming in?

Caroline Hughes 16:29
Yeah, so I think I was pretty slow on that. And it's partly why we set up this business because I don't want people to be as slow on the uptake on that as I was. And I think so much of it comes down to environment, like who is surrounded by? And what are they doing with their money. So if you don't grow up in a family, where people are investing, and actually my grandparents did, they had a financial advisor, my my grandfather worked in life insurance. So within the family, the overall family, that was a thing, but because in my immediate family, we didn't have the money to be able to invest or to do anything that would build wealth. I didn't have personal exposure to that, until I worked in law firms have worked in professional services. And, you know, people were made available to us. So you could go and see a financial advisor, or you could, you know, they would explain to you things around pensions, and I just hadn't had access to that until probably I was in my late 20s, early 30s. And then I didn't start personally investing any of my own money until I was 39. It didn't feel safe to me, I was that classic person that kept it all in cash. So I had savings, but I wasn't comfortable putting it into stock search.

Jason Butler 17:44
Okay, so is it fair to say that as you got into the law firm career that started going and then your income does go up quite quickly? In the legal professionals? Certainly, if you're in big firms, city based firms? Did you quickly get into the habit of making more than you spend? Even if you weren't doing wise things with investing wise? Were you always spending less than you earn in consumption and lifestyle? Yeah,

Caroline Hughes 18:07
I look, I did have a shoe habit, particularly when I worked in fashion. But the flip side of that is that I worked a lot of fashion designers, so you got an incredible discount. So I almost never paid full price. And I am not a huge consumer, I've never been a huge consumer. I like certain things like I like nice wine. I like traveling. But I am not a fancy person.

Unknown Speaker 18:32
Fancy person.

Caroline Hughes 18:33
I'm not really bothered about having a car rent and the older I've got the kind of the more frugal I become more just more sort of conscious

Jason Butler 18:42
around mindful. I call it mindful spending. Yeah. Round spending.

Caroline Hughes 18:48
Yeah, always, from the very, very beginning, always saved. And in the earlier days, you know, I was very careful to use up like ICER allowances, I'd read the money sections of the paper, and try and kind of educate myself in that way. But the bit that was always a bit out of bounds for me was investing, right? Yeah, I didn't know enough. I didn't feel safe.

Jason Butler 19:12
But that's really good point. Once you've, you've got to figure out the first we got to be able to earn the money. So you figure that one out. And the second part of that was you figured out you had to spend less of it on consumption, whether that's shoes or just eating or whatever. So that was good. You had surplus, and it was this third leg, which does hold some people back. So you did the first two really well, absolutely essential, but you hadn't quite figured out the investing in accumulating and building you know, making money work for you so that you didn't have to work eventually. So tell us about your journey on that that front, then did you buy a house? Did you do anything conventional like that, or did you just rent and just keep accumulating cash?

Caroline Hughes 19:46
So I rented and I still run actually so instead of buying a house I've founded a business, so slightly less conventional, but what I would have spent on buying a house has gone into it. So we bootstrap lifetimes. So lifetimes until we took on our first external investment last year, like ties was funded mainly through my activities. So well, warehouse shaped thing might be is a business shaped thing instead. And that's kind of where most of my savings have gone. Although I still have a nest egg and I still have money put into investments now that I've figured out that piece of things.

Jason Butler 20:27
But here's a really important point, I'm really pleased that you raised that point. I've got a blog called the truth about renting versus buying, okay, on my website. So if you're listening to this, go and check that one out. Because actually, I've interviewed people, seriously wealthy people on the show, who are real estate investors, or they buy businesses, distressed assets, and they rent their home that they live in, okay. And what they say is, why would I want to have whatever the figure is several 100,000 millions, or whatever it is, in our home, when Actually, yes, it might make sense for some people at some stage in their life. But renting is the smart move for them. So I love that unconventional thinking that in other words, it's not necessarily right for everyone, because there's other things about feeling comfortable, you know, this person has a 22 and a half years, it's all bought and paid for it's not a good use of capital. But my wife says it's ours. And there is a there's a several primeval desires in there to want to sort of have shelter, so I understand it. But I love that idea that you said Hang on a minute, renting of a home is just using something, putting the capital here into something that makes a difference and can build wealth, that's a separate issue. They may be linked for some people who are very undisciplined, who don't want to start businesses or don't invest elsewhere, buying a home could be in for savings. So I love that. So thank you for sharing that. So tell us about the madness that was going from becoming a lawyer to being an entrepreneur or a sort of a startup person. I mean, what's the western was just woke up on a Monday and changed your life? Or was there a gradual transition?

Caroline Hughes 22:01
Like I always say, Now looking back, it looks like a very clear pathway to it. But I've got at the time with all the jumping around of different things that I did in my kind of 20s. And that is, each of those moves that I made. Were not obviously links to the previous one. But now that I look back on it as like, Oh, that makes total sense. And now everything I did, has brought me to this point. So when plain sight, perfect, perfect pathway. And as a lawyer, I was too stifled. It wasn't creative enough. I couldn't get close enough to the businesses because I was external to them. And I realized that I was incredibly commercial, and incredibly good. Problem Solver. But the legal side is off is just too formulaic. Right? It was, you know, contracts and stuff. That's nice. But I want to get in and start running the businesses. And so the first move I made in was a quasi commercial one. I set up like a licensing division for a company that represented fashion designers and celebrities. And so I was there trying to get them deals for perfumes for home decor,

Jason Butler 23:14
doing a bit of hustling, right?

Caroline Hughes 23:16
Yeah, it was, and you know what it was in the last financial crisis. So I took that job in 2008. And overnight, marketing budgets got absolutely slashed. And it was my first experience of failure,

Jason Butler 23:30
baptism of fire,

Caroline Hughes 23:32
going and talking to these enormous companies, you know, going to Coty and saying, look, I got all of these amazing designers that we represent. And, you know, do you want to do a perfume deal? And I'm saying to me, Look, if you're not bringing me Beyonce, or Balenciaga, we can't do it. You know, we just can't, we can't, we can't do it. Unless you're bringing like the top of the top. We're not interested because we need this time, we can only do do things that actually make us money. And that's, and so that was my first kind of real experience of doing commercial stuff. And it didn't work out. Right. It didn't work. It didn't work out that licensing division did not take off because the timing was wrong. But what did work was different aspects of the business as I stayed with that company for four years, and we grew it out. And we we went from 5 million US to 20 million US in a couple of years during the last recession. So it taught me that you can scale a business during a recession. If you target the right things. And that really kind of gave me I got to play it being an entrepreneur on somebody else's money. And not all of the responsibility, not all of the sleepless nights. And it kind of gave me the bug.

Jason Butler 24:45
But here's the fascinating thing. I know because I've been through various recessions, I'm 51, nearly 52. So I've seen a few things and the best time to ever build a business and it's not for one minute decrying the fact that people don't get hurt and there aren't problems in recessions and fullbacks and difficult times. That is to build it in tough times. Because all the Johnny come lately is and the people that want it easy, they're nowhere to be seen. And you've got a good idea. You've got to have a really smart people, and you've got to work hard. So I think you're absolutely and here's the other thing is you will use that word a lot on a pivot, but you adapted, you are flexible, you change the business, you didn't keep doing the same thing, because the environment changed, right?

Caroline Hughes 25:21
Completely. And it was it was such a good lesson for me because, you know, I am classic high achiever. perfectionist tendencies, you know, really standard

Jason Butler 25:35
thing. never get anything done, because he's got to be perfect. Yeah.

Caroline Hughes 25:38
Perfect. You know, and

Jason Butler 25:40
you can do it no one else can possibly do it. Yeah.

Caroline Hughes 25:43
Yeah. And going. That was so so helpful for being prepared. You know, you know, like they say, with writers, that phrase that you have to be prepared to kill your darlings. Famous thing, if you're writing a novel, you've got to kill your darlings, no character is above the above the story. And like, it was a really good experience of, if it's not working, you go with what the data shows you, then you iterate and iterate. And if it's not working, you shut it down, and you move to do something else. And that was my real first sort of whole face experience of that. And it's so valuable.

Jason Butler 26:24
But what you illustrate there, Caroline is the very important part of what we call growth mindset. This is not woo woo, or we are your any of that business sitting there chanting rebels, that may be good for you great fun. What this is, is about when we have failures in life, and particularly in relation to money spending, business investing, is that as long as we learn from it, and as long as we realize that making mistakes is part and parcel of is growing as a person, and as getting where we want to go and that life doesn't go in a straight line, okay? Is that what you've demonstrated was, you've got you realize you Oh, I'm learning how not to run a business or I'm learning how not to be an entrepreneur. I'm learning what's not working. So that was fantastic experience. So then after that, what made you then move on? And where were you in your personal lives, you still renting, you still had your savings? What were you personally sort of still in what I call holding pattern wealth creation wise, what you learn to be an entrepreneur?

Caroline Hughes 27:19
Yes. And that was really the decision that I had to make it was, you know, where is where does this money go? If I buy a house now, that is going to require me to have a very steady job that will pay that mortgage. So I had that real sort of pivotal moment that if I wanted to start something up on my own, now is the time because I had this capital amount in the bank

Unknown Speaker 27:45
that

Caroline Hughes 27:46
I knew would tide me over for a while and could be used as capital, you know, working capital for the business. And either I deployed that for the business, or I was going to end up tying it up. And I wouldn't necessarily have the opportunity again. So it was a real sort of sliding doors moment of, if you buy a house, you're probably going to remain employed for a while. Or you can make the money that you would put into a house. And let's let's run the business. Let's let's do it, and business one.

Jason Butler 28:20
But I love that idea that see. And this isn't every issue if you it's often difficult if you're in a partnership, or you're in a relationship, or you're married to someone who's got different ideas about what it is to be secure, you actually took the view that that actually I've got to go, it's bit like the matrix, isn't it red pill, blue pill, or left road or right road, or whatever it is, you took the view that I need this capital, and I need the ability to not earn a great deal for a while to build wealth and build my dream and also fulfill me personally. Whereas if I buy a house and do the conventional thing and do the normal thing of actually closing off opportunities, that's a bigger risk, because you get the business, right, you can buy as many houses as you want. Right. So yeah, tell us then about the process of actually now transitioning into that next stage.

Caroline Hughes 29:04
Yeah, so I mean, one thing that made that easier. And to go back to your point about you know, if you're in a partnership, my co founder in the business is my partner, Nick. So that so here you have two people. And the time that we met was when we were sort of when I was weighing up all of these options, and he is naturally entrepreneurial. And he's, you know, he's a man who's sort of been waiting for the person to come along, who can, you know, work with him on it. So I think some of those things kind of combined as well. It was quite serendipitous in that respect, that here I was with a new partner and he had the same kind of drive. He has a lot of knowledge in this industry that we're about to go into. And so in some ways that made it a safer bet to go down that route.

Jason Butler 29:51
So I'm interested to know I'm interested to know, did you fall in love with each other emotionally first, or did you fall in love with each other's business plans which came First.

Caroline Hughes 30:04
We don't know because we do say now we're like, what are we? What are we like? What? Are we co founders? First off we business? I mean, and absolutely I know anybody listening to this, who runs a big business, particularly if they're in scale up mode knows that, you know, if you're going to rank anything, then absolutely the business is here, and everything else.

Jason Butler 30:28
Yeah, I've been involved in lots of businesses, you know, and I'm an angel investor, and what have you, and I've had varying degrees of success, and I have had some success. But what I do know is that your business becomes almost like, like, my, my, my wife is absolutely obsessed by our black Labrador income, okay. It's like the sort of the third child we never had pinkies like a baby, it's like you give birth to this thing? It's not the same as a human. But it's actually it is part of your family, isn't it? So how is that developed to develop the business? So? Do you find it easier to work with your partner versus Yeah,

Caroline Hughes 30:59
so we have, I will say that we have gone to great lengths to make it as easy as possible to work with one another. So, you know, we were both them were both our partner, you know, alpha type people. And we knew that by Friday was wrong. But we, we were quite sensible, actually going into it, that we we've tried to be quite conscious, again, a mindful going into it that if we were going to do this, we knew what that meant, we knew that this was a 10 year project, you know, to grow, the type of business that we are growing is at least a 10 year project. So that level of commitment is required that level of resilience, and grit and the termination. And yeah, so we were very conscious about it. We, you know, we, we had therapy, we have coaching, we treat it like Nick's background, he's done a lot of sports coaching. And that is incredibly helpful. Because if you're if you're in elite sports, you know, he used to coach, Team GB American football, right, so elite athletes, and you wouldn't dream of putting elite athletes out on a pitch without having physios and without having psychologists now nutritionists, they have a whole team around them so that they can perform an incredibly high level. And that's kind of how we have gone into it. I have to say, you know, we are the pandemic has intensified everything in the sense that we work together all the time in the same house. We barely get to see anybody else. But you know what, our productivity levels are insane.

Jason Butler 32:45
Yeah. Yeah. Interesting. So here's the thing, you can work with your partner, it's not easy, you have to navigate it in on whatever turns. But the point I get there, and I think it's such an important point, Caroline, you've made real performance. People who want to get ahead get a mentor, or coach or helper or confidant, someone in there doesn't even have to be formal. It can be just a friend of yours, who's whose intentions are honorable, and who cares about you, and will tell you the truth. I've got an architect guy who works for me on projects, and I'm trying to do something I want to build. And he said, Jason, yes, you can do that at 25,000 will be worth 120,000. If you do it, I don't think you should do it. Because you'll mess the property up. I don't think you I think you could put that money into something else. So as an example, he's someone I trust. He's someone who will tell me the truth. And he will, I can reject it or not. But the point is, I value His judgment. So you've made the point that whether it's your partner, your emotional partner, or your business partner, having people in your corner is so important. So tell me now, where the idea for life to your current business where that came from, and what you're hoping to do and the difference you're making in people's lives and, and where that came from?

Caroline Hughes 33:51
Yeah, so I mean, it came from personal experience, really, you know, we, Nick and I looked at our situation, we looked at our friends situation, everybody was doing okay, you know, life wise, financially. But at the same time, they felt like they were behind, they felt like they weren't quite able to grasp for the things that they'd almost been promised, you know, said that maybe they were trying to buy their first flats or thinking about starting a family. And it just felt a little bit out of reach, or, or just a little bit harder than they'd expected. And that they kind of society had sort of said, this is the path that you're supposed to be on. And they were trying to do it but it felt a little bit like going off the travelator and somebody else can turn. gladiators. Yeah, turning up the speed and you're running extra fast, but you're getting there. So as we got to checked in with all of our friends as we realize this and then we went wider and spoke to you know, in the first kind of six months of thinking about this as a business. We must have talked to a few 100 people. And the same messages were coming back, that people still wanted to do these things, they still wanted to buy homes, obviously, they still wanted to have families, they still wanted to think about changing jobs or starting their own businesses. But there wasn't a blueprint back. Now, they should do it in the same way that their parents set out a blueprint because things were much simpler. You know, the blueprint used to be you leave school, probably not even necessarily University, you get into a job, you maybe do one or two jobs for life, you have that steady income, house prices aren't nine times whatever salary you can get on the property ladder, you move up, you move up. doable, and with the opportunities that we have now, you know, you can, you can work part time, you can have multiple jobs, you can do all of these different things, but it increases complexity. And it's that complexity that creates the overwhelm. And it's the complexity that stops, people even starting to take action, because they don't know what they're supposed to be doing. And so lifetimes came about because we want to create the blueprint for people. But we want to do it in a very, very human way. So we don't start products fast. We don't think about Alright, we're going to try and sell you a mortgage. Now let's work the customer journey back for mortgages. We start with what what are the fundamental things that people are trying to do in their lives? And what are the financial and other products and services that enable them to do that? So we build out from the person. And I think that's really what's differentiated us. And it shouldn't be revolutionary, but it feels a little bit revolution.

Jason Butler 36:41
Well, you know, I qualified as a certified financial planner in 1998, when I was 29. And no one had ever heard of it right years, I had all the advanced qualifications. The reason I say that is because I, I was taught to sell people products as a financial salesman. And I never felt right with that. And I always said, Look, let's start with what people are trying to achieve. That's look at the resources they've got. And that's map out the steps they can take, starting with small steps now that eventually will snowball into things. And that was seen as revolutionary and they said, no one was ever gonna pay you for that no one. But actually, I took my first I had a first financial plan. I share this with you just so to endorse what you're saying. When I was 30. My wife and I sat down with the late great David Norton, who is who was one of the very best financial planners, he died in 2000 for a brain tumor at the age of 54. He sat down with us and he helped us do our own financial plan, and I pay 5000 pounds to work with him 5000 pounds 21 and a half years ago, that's a lot of money, isn't it? Right? So I spent the money. And he said, What do you really want out of life. And I said to him, we want to be debt free. By the time I'm 50. I want work to be option. But optional. I work because I want to know because I have to by the time I'm 50. And we want to give our two kids that we hadn't had at that stage where one one, I think one or two kids and we want to give them a great start in life. But we don't have so much that they go berserk. And he said, right, let's work backwards to what you need to do. You've got everything you need. Here this is and we just built the plan together. And you know what, you didn't go in a straight line. We had lots of knock backs were few wobbles in the marriage when we weren't sure if we could do this together. But we came through it. And we pretty much achieved all of that pretty much by the time I was 50. So I think I totally agree if you if you've got a blueprint, if you've got someone in your corner, if you've got a series of steps you can take and you're clear what's important, you can do it. So tell me tell me now, what are two key sort of what I call life plans that you have out there? The two ones that are very whichever one I just mentioned those before we one yeah.

Caroline Hughes 38:36
So at the moment. So we started with the two that are most important, the most number of people still write the to the mega ones. Because of what they represent for humans, so it's buying a home and then starting a family. And buying a home, particularly in the UK, as you know, is such a big deal. But so many of us we have a homeownership rather than a rental culture. And again, from a human perspective, as I think you touched on earlier, it represents security for a lot of people,

Jason Butler 39:05
and then find a sense of achievement and achievement. Yeah,

Caroline Hughes 39:09
yeah. And it's yours, right. It's something and it's yours and it feels solid. And then we tackle childcare next because after rental mortgage, childcare for most people is the biggest expense that they have.

Jason Butler 39:25
It's the income often in the household income because the ability to earn inevitably is affected as well as the expense. Right?

Caroline Hughes 39:33
Completely. And it's one of those costs, I think that people aren't necessarily prepared for. But you know, it's because you're very focused, you know, I want to have a baby get pregnant, you know, obviously maternity and then yeah, absolutely wallet to block in the cost of childcare. And, again, for a lot of couples, particularly heterosexual couples it it creates that imbalance in time. of sacrificing salary or who's sacrificing career progression potentially. And we just felt that because there's no obvious there's no us. But so to the wider market, there's no obvious sort of commerciality behind childcare, and planning childcare. But for us, we felt that, again, from a human's perspective, it's an enormous step that people take. And the fact that there's just this absence of information and absence of ability to kind of capture gravity and advance, it does, it doesn't make sense to me doesn't make sense, because it's the kind of, and also, it's, there's such huge triggers for other types of financial products. So when I look at, you know, protection insurance, for example, you know, and people being underinsured, and I look at, you know, what are these triggers for things, but if, you know, what is the biggest issue that people selling life insurance and protection insurance, have it? How do you how do you explain it? How do you explain the need to people? How do you help them understand why they might need it, and for us, rooting it in people's lives, and helping them visualize and make sense of it means that that product sale, if it's the right one for them comes very naturally.

Jason Butler 41:09
But it's funny should say that I do, I've been starting to do a series of explainer videos under five minutes. So I did the first one was a couple of weeks ago, it's called everything you need to know about human insurance. So it's income protection, life insurance, critical illness, where it's very simple. And under five minutes, that video had one got to 1200 views in six days, we had done no promotion. So it just shows you people, if they can engage with material, if they can see it on their own terms, they then get it, I get it. So look, here's the thing, I think, what how do people get to try out these life plans? Because they can go to your website, can't they? And they can kind of try before they buy? Or what's the How does it work?

Caroline Hughes 41:48
So we try to keep everything as accessible as soon as possible. So you just come onto our website, it's free to use our tool. So our home finder tool helps you figure out how you can afford to buy a home. So it will do all the calculations on how much is it going to cost? How long will it take you to say helps you work out if certain products might help get you there quicker, like if you take a lifetime, eisah, things like that. So and then it spits out a little plan for you, which shows you all of your numbers. And then if you take a paid membership, then we do what you kind of described, which is we walk you through each of the individual incremental steps on how do you actually get there for saving your deposit through to how do you apply for mortgage, because I think we just have an assumption that everybody knows

Jason Butler 42:31
how to do. I love it. I love it. I love it. I love it. I love it. So what we're essentially saying go to the life T's website, and it's in the show notes. If you go to the website, try it, I tried both of them out, okay, they are very, very easy to use. You don't have to pay anything, they're not going to try and sell you anything. But if you want to pay some subscription money, a modest subscription to have some help, they've got it there. So I'd love that idea that letting people decide how much or little and there's room for everyone here. And obviously, if you've got very complicated affairs, and you've just inherited a million quid, perhaps you need to get a proper fee based financial planner, or tax advisor, we're not saying this supplants that, but if you're trying to make you're trying to make the starting your life with perhaps one of those two goals, and there are going to be other things added over time isn't going to try and get those better. So definitely worth watching. So before we let you go, Caroline, you've been very generous with your time, what words of wisdom about what you've learned about money? Do you want to leave everyone with?

Caroline Hughes 43:28
Two? I think one is, it seems complicated, but just find the starting point, just find the starting point view and then just take and then the second one is take action. So where we lose confidence is a little bit of analysis paralysis, I think we if we don't feel confident, we don't know where to start. And then if we don't start, we never build confidence. And so where we've tried to come in is we will help you build that confidence. You put in some numbers will show you what's possible. And there's something extraordinary about that, that people tell us that once they see possibility. That's where they start to build confidence. Because at the beginning, they're thinking, I don't know how I don't know if this is even possible for me. So they take themselves out of the equation. And what I want to tell people is most things are possible for most people. It genuinely just needs a plan. And you genuinely just have to stop

Jason Butler 44:22
see it to believe it. That's it. Well, I'm really pleased that you met Nick. And I'm really pleased that you gave the legal career a cold shoulder and moved on to become an entrepreneur. I know there's going to be great things happening with you. I love your energy. I love the honesty of the two of you. I wish you all the very best of luck with the business do check them out life tes we've got it in the show notes, lovely people trying to change the world, one person at a time and we love that. Thanks for being on the show. Caroline.

Caroline Hughes 44:45
Thank you so much, Jason. It's been a pleasure.

Jason Butler 44:51
Thanks for listening to real money stories with me Jason Butler. If you like what you hear, please do tell your friends and more empowered Ultimately, please rate us on your preferred podcast app, because it really does help us get the message out there. So until next time, good luck with your money journey. Real Money stories is sponsored by Vanguard bringing value to 30 million investors worldwide. Visit Vanguard investor.co.uk For more details, the value of investments can go down as well as up and you may get back less than you invested

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