69. Lucy Mullins Gets On A Stairway To Housing Heaven

This week, I speak to Lucy Mullins, Co-Founder and COO of StepLadder, a fast-growing and award-winning FinTech company pioneering collaborative finance and revolutionising the home buying process. Through their collaborative lending circles StepLadder are supporting people to buy their first home faster, reach their financial goals, and championing financial wellbeing.

Lucy won the Female Founder award at the Unbound Innovation awards in 2019 and delivered the winning pitch for StepLadder in the Future of FinTech Battle. She got to the final of The Pitch in 2019, was shortlisted for TechWomen100 and won the Innovator of the Year at the Women in IT awards in January 2020.

Episode Transcript

0:05
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 invest in.

Hello, Jason here. Thanks for joining me on another edition of real money stories. In this week's interview, I speak to FinTech entrepreneur, Lucy Mullins, all about her money journey, and also about her current mission to make homeownership a reality for young people who perhaps might feel it's beyond their reach. So we'll get to that in a minute. But first, I want to share some insights from a groundbreaking new piece of research from Oxford University. Now, whether it's drink drugs, overspending, or gambling addictions can have a massively detrimental effect on our well being. And this new research analyze the banking transactions of millions of Lloyds Bank customers, and they found that high levels of gambling are associated with a 37% increase in mortality. And at the top 1% of Gamblers surveyed spent 58% of their income, and in fact, one in 10 are spending 8% on their habit. Now this study was led by Dr. Naomi Magilton and she's of Oxford's Department of Social Policy and intervention. And it highlights the financial damage the negative lifestyles and health of Gamblers who can actually move from social gambling to high level gambling in just a matter of months. And what really struck me was this that over 500,000 people in the UK are spending over 900 pounds per month on their gambling habit. And over 200,000 people in the UK spend over 1800 pounds on gambling. Unbelievable. Imagine how quickly you could build an emergency fund with that kind of money, or how quickly you could get out of debt, or how quickly you could build up wealth or overpay and get rid of your mortgage. It's just it's eye watering, that Dr. Martin said this, she said to me, the striking finding is the extent to which even low levels of gambling are associated with harm. For many years, there has been a focus on outcomes among the most extreme gamblers. And our work shows that financial distress, social ills and poorer health are more prevalent among low level gamblers. Now Dr. Rachel vole Berg is of the School of Public Health at the University of Massachusetts in the US, and she said this, this study represents a real leap forward in helping us understand gambling harms, that will influence thinking in the gambling studies field and beyond. Now gambling may be seen as an ordinary pastime, and advertising has really increased its visibility hasn't it in the last decade, and sport in particular has become dominated by gambling associations. And there was a quote in the report that said this one in six adverts shown during the broadcaster ITVS programming for the 2018 FIFA World Cup promoted gambling. So this is an example of what some in the public health research field have called the gamble ification of sport. And Dr. Martin said this she said it's unclear whether gambling causes negative outcomes, or whether already vulnerable people are disproportionately targeted by bookmakers, for example through advertising and locating betting shops in impoverished neighborhoods over these relationships is worrying and could have implications for public health policies. But what I find is a real tragedy also is that there's at least one gambling related suicide in the UK every day. Now if you or anyone you know is suffering from a gambling addiction, or you think you might have a problem, then you can get help at gamblers anonymous.org.uk do reach out do not suffer in silence. And if you or anyone you know is suffering from any other kind of addiction, then you can get resources and help from a brilliant website called genius. recovery.org. Please don't suffer in silence, nip it in the bud before it becomes a problem gambling only ever takes it ever gives. Now on a more uplifting and positive note, let's move on to this week's interview, which is with Lucy Mullins. Now Lucy gave up a well paid job in banking to co founder FinTech social purpose company, and they aim to bring home ownership within reach of all using a concept that actually has been around in one form or another for many centuries.

Hello, thanks for joining me on another edition of real money stories. Interesting guests this week are always interesting. Lucy Mullins.

5:09
Hello, Jason, nice to meet you.

5:10
Good, very impressive book collection there won't ask you to go through them all, but you clearly are someone who's got a lot of knowledge and wisdom. So we're gonna hopefully tap into some of that today. So, before we get into hearing about your sort of money journey, do you want to just tell us what you do for your day job?

5:26
Absolutely,

I have to just say, it's always a worry that when people notice the book collection, you don't know that I've read any say, so hold fire on the wisdom till we spoken. I'm co founder and chief operating officer of stepladder and we are a company dedicated to helping people buy their first home faster and achieving their financial goals by working together. I'm sure I'll tell you more about that. as we as we get into the chat.

5:53
Yes. And that was something that was very interesting to me, because as you know, I've been around a long time in personal finance. And since I retired from personal advice, I've made it my mission to try and just help demystify money and just help people feel a bit more confident and buying a home. For many young people seems like that kind of dim, distant is too difficult. I'm never going to do it and the victim mentality takes over and I can understand why doesn't it and they feel it's never gonna happen. So it's exciting to hear of a a startup that is trying to address that problem. So what was it that sort of inspired you to start that business? Perhaps we should start there, you know, what was it that really inspired you to sort of get this business off the ground?

6:34
Absolutely. So I can't take the credit for the brilliant idea that stepladder. That's my co founder, Matt, who actually saw this model being used in Brazil as part of his graduate work back in sort of 2005 six. And actually, this model, some of your listeners will recognize it has been used around the world for hundreds of years matter in Brazil, where people were coming together in groups, and pooling their money, and each month would take tons to take the total amount. So it goes by different names in Brazil, it's called a consorcio. It's called something like a chit fund in India, or a committee or a dough in parts of Africa and a partner in the Caribbean. And Matt was looking at it and thinking, gosh, this would be an amazing thing to apply to that huge problem of buying a first home and raising the deposit actually is often the hurdle that most people find just a bit insurmountable, really. So he set up step ladder in 2015. And I got introduced to him in sort of mid 2016, and just absolutely loved the idea buying my first home was a huge, I just remember being such a huge step Jason, and it just felt like a real grown up. But obviously back in the days when you could get 100% mortgage. So you know, it made it an awful lot easier. And then any money that I had saved wouldn't have been enough for deposit. But that went on, you know, nice things like sofas and, and things that you need to put into the house. So I felt very lucky to have done that and could just see the new generation coming through not being able to get that deposit. So I love the social mission of it. And I love this sort of collaboration cheerleader side of it, where you know, you're sort of motivating somebody on the journey. My my background is actually in personal training and health. And I sort of saw this idea which I've helped shape it stepladder now into being like a sort of personal trainer for your money, motivating you on the journey to put that money aside each month holding you to account and giving you some discipline.

8:21
It's interesting because I do hundreds of financial wellbeing virtual events every year, so I do hundreds of them. And the one that that what I really like doing is when I can share people's stories, because especially when I do the debt Buster session session when I talk about how you can get out of debt and get ahead. And as you say, sometimes you need that coach that friend that that that sort of sense of motivation and support that you're not alone and that you're going to do this because because it's a big, it's a big thing to do. So. Okay, so the business now, that was the sort of reason you got involved. You love the idea, you sort of had your own success with buying a house, you understood the difficulty. So take us back to, to your earliest kind of money memories. What What was it like growing up where you were, was it was the opulence? Or was it really tough.

9:10
So it's really interesting, Jason, because growing up, I never wanted for anything and didn't think I had any real concept of you know, which families or friends were from wealthy families in which one, we had a lovely home in Oxford and a beautiful garden. And actually, as I've grown up, I've realized that my parents combined income was a fraction of you know, what I was earning a couple years out of university. And that's not to say I've done amazingly well on some sort of investment banker salary. I haven't. It's just that my parents were both in fantastic jobs, but industries that don't pay well at all. And actually looking back I think, Oh my goodness, and I've spoken to them about I say, Oh my goodness, what you were earning and you bought us up and I got to go on the school ski trip and we had all these amazing things. How on earth did you do it? So it's a really sort of distorted view. I think my parents did an amazing job of making a little go a long way. And so one of my earliest money memories is my mom telling me about after they got married, they didn't buy anything. You know, they lived in a small village, and it was, oh, someone's got an old sofa, someone's got an old fridge, they just didn't buy anything. So this idea of kind of my generation coming through and buying a house and saying, Oh, well, I need to go to john lewis And get this, this this or, you know, even IKEA and buying something new was kind of horrifying. So why do you need new things? My parents actually paid off their mortgage in 10 years. Really? extraordinary. Yeah. And looking back at that, and understanding what I do about money now is extraordinary. And they'd kind of pushed themselves to buy a house that was bigger than the average couple of their age at that time, definitely well above what they were earning. But they said, No, we want to get this house and we want to pay off. And so they spent nothing, basically for 10 years. And then they and then they had me and my sister. So yeah, I grew up with a very interesting view of monies, how disciplined you can be.

11:02
I've got to get your parents on the show I sound are amazing. They sound rockstars with money. So let's just get this clear. They were modestly paid, but had good jobs. So stable jobs, there wasn't no breaks in income. They begged, borrowed and still not stole but begged and borrowed and repurposed and took anything that was going sort of, yeah, that's it. Yeah. Yeah, look it in skips, I know, we've all been there. And they their big priority was to own a home, they stretch themselves a bit, and then they paid it off in 10 years, I'm believable. So what did you learn from those early experiences? And the example of your parents about money? Did you go completely the other way? Did you just have good times for years? Or did you follow in their footsteps?

11:44
A little bit, it's really, it's really a mixture of the two actually, I think at the core, I've got good money discipline, but I do spend even now quite a bit of time feeling a bit guilty because I am far more extravagant than my parents, were or even are now. So I think I've got a really good grounding. And I even when I think I'm being bad if I compare myself, you know, which you shouldn't compare to other people, but you sort of naturally do when I look sometimes at how other people spend money, I think, Oh, actually, I am quite frugal, even though, you know, in many ways I will splash out on you My thing is blow dries or having my nails done when we're allowed out. clothes, shoes, that sort of thing. So yes, I think it's a bit of a mixture of the two. But I think that that core grounding in seeing how far you can make money go still comes through. So for example, so I'm wearing a really nice pair of beats today that I bought from a charity shop last week. And they are 600 pounds at the moment in john lewis that I've known this brand forever. They're beautiful. I would never spend that much time on a pair of boots. And I bought them for 30 pounds from a charity shop and clap them yesterday. Unbelievable. Yeah, I think that that shows my frugality. I love nice things. But

12:54
yeah. That's an interesting point, Lucy, because, you know, I've been I'm 51 right. So I've seen a lot of a lot of life and ups and downs. But one of the things that I think you're illustrating there is that there's nothing wrong with having nice things. Nothing wrong with having quality, nothing wrong with having fun, nothing wrong with having things that make you feel better about yourself, as long as I you can afford it. And be doesn't put you in a precarious position when the proverbial once it hits the fan, because it will do when it hits the shore as exits as you buy that house. The boiler goes wrong. You know, you've bought that brand new car and suddenly you lose your job, something will go wrong. So, okay, so when you were growing up, then you had this wonderful life, you remember the skiing holidays and stuff like that. But do you know how your parents did? How do they pay that mortgage off in 10 years and still give you things like skiing trips and stuff?

13:46
I think you know, So to be clear. The skiing trip was a school skiing trip. So it was paying it wasn't the whole family went skiing. So my parents, you know, never never went on holiday. never ate out. Never really drank. You know, I remember lots of conversations and I realized this now when I have dinner parties, you know, when you're entertaining and you do your shopping bill and you add alcohol suddenly, you know the money goes fast, actually. So that's quite interesting. You know, my parents didn't really drink mulled wine at Christmas. And that was it. You know, a steady tea, lots of tea drunk in our family. There's a lot of wisdom in a cup of tea. Yeah, so I think you know, it's absolutely there's something for me about being very content with what you've got been content with each other's company, being content pottering around the garden, you know, going out for a cup of tea and a piece of cake or garden center is still one of my favorite things to do, because that's what we do as a family and I'm looking forward to going home for Christmas. And obviously, we probably won't be going out and about this Christmas, but normally, we'll sort of bundled up in the car and go and do that. And actually, that's, that's an absolute treat. Really, you know, it's more about the company and the quality of the company. And I think, you know, I'm a I'm a coach, as well as my work at stepladder. I'm a professional coach. And I think you know, one of the things that we struggle to do as humans is if we've got unmet needs, we try and compensate for them in another way, right? And we're always looking for this and coaching you what is driving that behavior. And I think, you know, if you're lucky enough to grow up in a loving family, you've got those relationships. And actually, there's not so much need to sort of splashed cash on lots of things, you need a fancy holiday, because actually, if you're camping in your garden, you're gonna have just as much fun.

15:25
Well, I think the point you're talking about there is intrinsic versus extrinsic motivation. So we know that if our needs aren't met as a child, if we're not feeling secure, and loved, and that we don't feel enough, that will fill that with a need for acceptance by other people. And often not always, it can manifest itself in spending or overspending, and trying to do stuff to impress people who don't really care about this. And there's an interesting episode, Emmanuel Asuquo, who's just come out that episode. And he says, Those people I was trying to press with my spending me the money I didn't have you said they were not there when the tough times here, right? They were nowhere to be seen. But the people who love me and like me for who I am, they were there come walk by, they didn't care what was spending. So that's a really good point. So did you go to university? Or did you go straight into the workplace?

16:08
I went to university, I did a Sport and Exercise Science degree, many years ago.

16:13
Right? Okay, so we can't so basically is interesting. There's a lot of research that shows that people who look after their mental and physical well being tend to be better with their money than people who don't, and we don't know if it's cause or effect. So in other words, if people are good with money, look after their mental and physical health, or people who look after the mental physical of it, but there is some sort of connection with that, isn't there that, that that tendency to look after yourself?

16:38
I think it's one of the I think it's one of their personality traits of conscientiousness that comes from the kind of big five personality inventory. Certainly, from the stuff I've read around, if you have that conscientiousness trait for being able to schedule things, being able to do things, when you say you are, you know, you probably will go to gym, you probably will meet your friends, you probably will buy healthy food 80% of the time, it probably will put money into a savings calculator sort of organized. So I think that's sort of one of those underlying personality traits that, you know, actually, if you've got that underlying personality trait, in many ways, a lot of the things that give you a ticket for sort of well, being financial, emotional, psychological, and physical, and sort of all done in one go, you know, it's sort of for for the price of one isn't it and if you're if you're not as conscientious, you know, so many other great things that come with that. But it means you may be fighting a bit of an uphill battle on multiple fronts.

17:31
But just because you're being conscientious and self disciplined and self control doesn't mean you don't have some, you know, off the cuff fun sometimes or, or you have detours or things go wrong, that doesn't mean we're all goody two shoes and perfect just means that most of the time we're holding it together. Yeah.

17:45
I have, I have I have so many so many details and moments. I do want to give you or your listeners the wrong impression. Absolutely. Absolutely not, you know, I guilt is such a funny emotion. And, you know, I've, I've been feeling quite a lot of it this year, you know, with COVID, the fact that I still have a job, I feel guilty. And, you know, if I buy something, I think, gosh, what have I bought? I shouldn't have bought that at all. Should I really have bought that to say, No, I absolutely, I absolutely go off the rails all the time. And I think, you know, one thing I've learned with coaching is you should accept the emotion you feel so you accept the guilt, you don't try and push it away. But equally, you don't want to wallow in it too long. So let it come understand why it's been sent. And then work on threads. There's no point wallowing in it. But yeah, absolutely. I think you know, it's it's like all things in life is a bit of a it's a bit of a roller coaster, isn't it, the challenges come at you like waves, and you have to sort of overcome each one and, and then get ready for the next one.

18:42
And that's a good point that none of us are perfect. None of us get it right all the time. I think the key is to keep getting back on the wagon, or keep getting back into the center lane and keep stopping, you know, veering off on the verge or the center of reservation, but just keep in that middle lane. Yeah, I get it. Okay. So what did you learn about yourself, and your ability to control your spending and money and stuff when you were uni? And did you have a job there? Did you work part time? Or did you just eke out your grant or your mum and dad's support? or How did that work?

19:09
So yeah, I had got had a grant, which is great. I remember. I remember saying that, you know, so I did work. Yeah, I did work. I've always I love working. I've always worked. I trained as an aerobics instructor when I was 16, which was actually a great thing to do. So at university, very sporty university, I went to, I quickly set up I knew I didn't really want to work in a shop and I'd be a terrible waitress. If I worked in a shop. I knew I'd buy stuff. So I'd want to work in a shop that I liked. Like Karen Miller,

19:37
environment, Environment Matters. Yeah, got it.

19:39
Yeah, exactly. So I was like, well, then I'll just spend all my salary buying things if I'm looking at these lovely dresses all day. So I know I've got a weakness of that. So I think sometimes you get yourself in the right environment. And I thought, well, you know, why don't I teach aerobics? I've got that skill. So I hired the I hired the sports world has one of sports sheets. I think I could hire it for like five pounds is huge sports or, and then every Friday sort of early evening. Before people went out I have about 100 people in there you know literally all paying two pounds or something to do an aerobics class but you know as a student that's you know 100 200 pounds every week but an hour of jumping around with a microphone can fit

20:13
unbelievable

20:15
so live it living the dream I work at university was great and I actually I've always I've always taught aerobics up until you know up until I became a became a startup co founder and you know there isn't really much time for anything else so yeah that's I worked and then it consequently I you know I did spend my grant I did have fun I did go I did go on holidays you know i i think you know, work hard play hard is is definitely a motto for me.

20:42
So you didn't come out with an enormous overdraft you sort of you you spent the money it was a you had fun you did the earning you did the stuff that you knew which was the aerobics instructing you earn money there so you you kind of you had you enjoyed the whole university experience but didn't come out with a ball and chain around your legs. I mean

20:59
came out with a big student student debt student loan I took the maximum student loan I qualified

21:03
for graduate tax deferred graduate tax please Thank you.

21:07
Yeah, exactly. Yeah, just pay it off when you when you when you start earning so it didn't feel like it didn't feel like a bull in China. I didn't take any extra loans off the back of that.

21:18
So when you first went into the sort of workplace then when did you feel that you grew up? As an adult? If I can say that with money? Was it at uni? Or was it when you first started working on only what I call a more substantial amount of money did you go Did you ever grow up? I don't know.

21:33
I'm not sure I am I wonder if coming I Rhonda is coming on the podcast and talking about money is growing up with money I don't know as a co founder of FinTech and financial yes

21:42
therapy, serious therapy just you and me and all the listeners

21:46
knows who I am growing up with money.

Yeah, I think getting getting my first salary getting my first proper salary was very exciting. I still remember I banked it at HSBC, cornmarket in Oxford. And I know that I know the address and the SOC code because that was actually where my first job was, as well. So I got graduate banking job at HSBC on a you know, what for graduate was a good salary, not crazy investment banking salary, but you know, solid salary and a golden handshake to join their graduate program. I remember with that lump sum of cash landhuis asked, like, wow, this is the best my bank account has ever legs. So I do remember getting that first salary, and then thinking, Oh, my goodness, this is coming into my, into my account every month, and at the time, I was still living at home. So that was, that was quite exciting. But you know, obviously, having grown up in the household that you've heard me talk about, my parents were like, obviously, make sure you're putting a lot of that away for when you want to buy a house. So I lived at home for six months when I had that job before I moved to London. And then i'd i'd managed to save up enough to sort of get a house with my friend. And we bought our first house in tooting.

22:50
So that came from that original, the golden Hello, and the surplus and and so you actually made living at home work for you. Because obviously your costs were lower. And your mom and dad gave you a bit of guidance. And you still had fun but but you managed to get that deposit together.

23:03
Yeah, well actually wasn't really deposit that was needed because it was 100% mortgage. So you know, just give you an idea of how old I am. It was 100% mortgage. But obviously you do need as we listen to now. And if they don't know, they should come and chat to us that stepladder that you know you need money to pay the conveyancing solicitor to pay the stamp duty to pay the moving costs, there's a lot of costs associated. So yeah, I knew that I needed a little pot of money to kind of do up the house and pay all of those costs. So yeah, didn't actually need a deposit, which was which was great. So it's much easier to say no, it's a much more realistic amount of money to save as a 24 year old. Hmm. And of course, what you need is an emergency fund wherever you buy a house because it's not just a deposit and all the money for the thing, if you have not got an emergency fund of at least three months use core living costs, then you're in the pool, you're gonna, you're gonna end up taking on debt, because something will come at you that you don't expect. Even if it's not losing your job, it could be just an expense. And that's what a lot of people don't realize, and you've got to be in that position, you've

23:58
got to be ready to buy a house. So that brings us on really so how did you get what made you what possessed you to give up the cushy hspc job if I can use that term, not cushy, perhaps but you know that there's solid, you know, blue chip job to go and work in a financial startup. I mean,

24:15
corporate life is not for me. You know, I look at some of my friends that stayed and oh my goodness, they own a lot they earn a lot of money they've done really well. It was a really good graduate program and they you know, some of them are very very senior in HSBC or other organizations have poached them they've moved and and so you know, I have these moments where I look and think oh my goodness, he could be earning so much money but I also look at the lifestyle they lead and you know, they're slaves to the the corporate logo and the corporate life and I like to create things and also see the impact of what's being done and I think at stepladder. What is so lovely is you know, I call our members when they get drawn I say hey, here's 10,000 pounds for your property deposit Now, obviously not giving it to them. They They have saved that themselves in a stepladder circles. But Wow, how lovely to be that close to the front line. And actually, you know, when people write trustpilot reviews, you know that you've played a part in helping them directly. Whereas I can't honestly say if I said HSBC and somebody writes their customer view, a, I don't think they'd be as nice as our stepladder reviews. Because I think, you know, people don't generally tend to write nice reviews about big banks, but also, how would you feel as a senior manager that you don't feel that close? You probably wouldn't know that, that customer. So yeah, I'm definitely a small organization person. And I love I love innovation. And I think, I think what we've created and you know, this is really testament to sort of Matt's brilliance at taking a model, which has been used around the world and turning it into something that works in the UK, is we've created a genuinely innovative financial product that can really help people

25:54
just want to explore if I can just a little bit about you clearly a very animated when you talk about the product or the service, the company, the people. And I want to say people, I mean the people you work with and the customers that you interact with, I see in your eyes. And as you know, I've interviewed well over 1000 people in my career. And I dealt with wealthy people all the time. And I can still remember the very senior HSBC guy, he told me that when I get to two and a half million, I'm out of here, I hate them. When he got to 5 million, he was still there. And I couldn't convince him that he was ladder was leaning against the wrong wall, because it was always unhappy. But what can you do? So here's the thing here. You clearly like what you do, what would be your message to someone out there who's doing a job that they think they need to do it for the money, but they're feeling drained emotionally, mentally? In other words, what what is doing what you do done for your overall well being not just your bank balance?

26:46
Oh, such a good question. Jason, this is absolutely my my passion in life is people should enjoy what they do spend so long at work. It's I'm just aware of sort of caveat I want to say is, it's just not that easy. I understand if you've got a family and children. And I think I was very lucky. When I left my well paid stable job in the, you know, I didn't have a family didn't have children. And also had had little back pocket of skills like oh, you know, what, if nothing works out, I'll go back to teaching aerobics. So I think having something in your back pocket. So you know, you're never going to starve is a great thing. But also, you know, this is said, it's sort of easy to say when you don't have dependents. So yeah, I think life is too short not to, I mean, at least like what you do, if not love what you do. And I can see how when you get on that corporate ladder, you think, oh, I've just got to I've just got to but it's like a treadmill, it's only gonna get faster. So think, you know, it's about just having reflecting back and thinking, Well, you know, maybe, maybe, maybe this treadmill needs to stop and, and it might be time to enjoy life.

27:51
But the point you make there is very well made is that if you are young, without any attachments, or dependence, and I speak as a father of two reassuringly expensive daughters, they would say they're a great investment. That you've got to do it. When you can, you know, when you while you can, if you're young is the time when you can take lots of risks, you can still take risks when you're older, if you get it right, but you're absolutely right. You grasp the nettle. You thought this is not for me, and you change courses. So do you want to just explain very simply how, what stepladder does, how does it work? In really simple terms? How does it help people go from I've got no chance of buying ever buying a house to you can potentially do this.

28:34
Love to. So let's take a really simple example. Probably your listeners in London will say Hang on a minute, that's not a real number. But let's just go with it for a simple number. Say you need to raise 10,000 pounds for your property deposit. And you decide you can put away 500 pounds a month, that would take you 20 months saving on your own. What we do at stepladder is we've matched you to 19 other people in the same situation. So you join a step ladder circle of 20 people. And then each month and every month for 20 months, you put aside 500 pounds each month, so that gets you a total of 10,000 pounds. What we do though, is each month from the second month, we award the total so the 10,000 pounds to one member of the circle. So in that way 19 out of 20 people will receive their 10,000 pound property deposit faster than if they saved alone.

29:24
Awesome lesson genius, isn't it?

29:27
I saw blew my mind when Matt first explained it as like, what is this magic. But of course it's not your saving, putting aside 10,000 pounds and I must just sort of correct myself there. You will feel like you're saving technically step by step that is peer to peer lending. And so under our regulated status, we're not allowed to call it saving so you will hear me saying putting aside but so you're putting aside 500 pounds every month for 20 months and of course that sounds simple, but if you do it on your own, you might stop or you might give up for a month or you might dip into the pot. I think the magic of stepladder. It provides you that discipline and that structure and an accountability partner to say, you know, we have built in flexibility. So you can bring up Jason and say, Oh, you know what this has come up, that's come up, I actually need to drop out, we've built in some flexibility. So that all works. But the reality is, if you've got to do that, it's a barrier to you doing it, which you'll only do if you really need to, you won't just think, oh, Lucy, I really want to go on holiday I'm going to give up.

30:23
So what we call putting friction in the way of, you know, anything you can do to make it hard to spend, right, and easy to save is good. That's why you know, I always say, one, never have a credit card and be if you've got one always leave home without it. So that's, that's the old one there. So, okay, that's interesting. So it's really, it seems to me, it's a very similar concept to what to what many, many families, particularly immigrant families in the UK, and I've got lots of friends from lots of diverse backgrounds, they are particularly Asian families are very collective like that. So this has been going on, as you say, in church groups, in different cultures in different countries all around the world. This is nothing new. And as long as Obviously, I'm sure that there's this small print on your website about the peer to peer lending and the potential risk or something and how the money's held. And I'm sure that you know, people can look that up in their own time. But what do you think is the single biggest barrier? Do you think, to people making use of this kind of concept? Is it because they don't know admit that they can't do it on their own? Or do you think it's because they think it's too good to be true? Or what do you think would hold people back from making use of this?

31:28
Great question. I think the first thing that popped into my mind was awareness, which is why it's always fab to come and talk to people like you on these podcasts it because a lot of people don't know about it. I think secondly, if you do know about it, I think too good to be true is something I've heard so many times, or in certainly in the early days, I did a lot of work on the phones, talking to people and getting feedback. And there's it sounds like a Ponzi scheme. And so it was fantastic when we got our FCA regulation, because I could say, well, actually, you know, the FCA didn't regulate companies that are Ponzi schemes. And you can sort of direct people to how you're regulated. And as you say, that's all on our website explains exactly how we are regulated, and how the money is held. And the reality is a Ponzi scheme is open ended. And these are closed circles. So this couldn't be a Ponzi scheme. It's it's 20 people, or 10 people or 15, people, whichever sort of size you join, and we actually run circles from smallest 25 pounds just to help people get going. That's obviously not going to get your property deposit. But it does get you used to this way of putting money aside each month. So I think I think it's that I think, is that idea of, you know, is this too good to be true. And I think, you know, we're also a new brand. People don't necessarily know the name stepladder yet. And so it's a sort of new product and a new brand, which makes it, you know, a bit harder for people to come in and say, Oh, you know, what is this and how you doing it. But the great news is, as more of our members buy houses, we've been featured in The Telegraph and the sun and various other national newspapers. And we always see a little peek in people applying after that, because that's what people people love stories don't know, which is I think your podcast is great. If people want to hear a story, not just this is how it was.

33:08
No, okay. Well, I mean, I think anything that's new, I mean, like, everyone, you have to check these things out yourself. It's early days for you. But I think the concept sounds interesting. And I think that certain seems to me that you hit with some principles, and let's hope it goes really well for you. But before I let you go, I just wondered if you could reflect on and you seem very young to me, but you said you know, you've been working for some years, but I just wonder what you wish you'd known. You know, 18 that you know, now with the experience you've had of life and that you can share with people because that's always an interesting one, isn't it? Just to one or two points about money?

33:41
Oh, yes. specifically to do with money.

33:44
Well, money and you know, careers and stuff. Yeah,

33:46
gosh, to do with money, I think make sure you've got some WISE WISE people you know, that will will advise you. I think that was really important. Don't be afraid to talk about money. I think certainly when I was sort of 18 to kind of 30 people didn't talk about money and it's you know, it's becoming more popular I think to talk about money. It's not such a debate I think it's really good to talk about these things don't sort of suffer suffer in silence. And in terms of Korea if you don't like what you're doing change change the change the war, the ladders leaning against usual metaphor from earlier you know, life is too short not to enjoy yourself.

34:23
Good. Lucy's been lovely speaking to you. And thank you for taking the time out your busy schedule, talking to customers and changing the world. One one stepladder at a time but thanks for coming on. We'll have you on again soon. Here's some more super stories. Really appreciate your time.

34:38
Thank you, Jason.

34:44
I love interviewing people who give up well paid jobs that they don't find fulfilling in order to pursue a business that has a real social purpose. And Lucy is clearly a lady who really believes in her business mission. I love the idea that her business harnesses the power of collaboration, community and cheerleading to help people build their house purchase deposit, and I wish them well with that. And wasn't it interesting that her modestly paid parents paid off their mortgage in 10 years by being very mindful on what they spent or rather what they didn't spend their money on. So that shows the power of being crystal clear on your values and your priorities. So when you know your money, why you can go the hard yards and make the necessary sacrifices to make it a reality. And being conscientious in one area of your life seems to have benefits in other areas. That's why looking after your mental, physical and financial health are so interlinked, lovely lady trying to help other people help themselves really. Well. That's another episode finished. Thanks for listening. See you next week.

Thanks for listening to real money stories with me Jason Butler. If you like what you hear, please do tell your friends. And more importantly, 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

Transcribed by https://otter.ai