June 26, 2025 • 17 mins
Digital payments have become the norm in managing our money but why has there been a boost in cash spending?
In this episode, our host Iona Bain sits down with financial advisor, author and content creator Emmanuel Asuquo to unpack our evolving relationship with money in a cashless world.
Emmanuel explores the psychological impact of contactless spending, why so many are returning to cash, and how to create ‘friction’ in your finances to avoid mindless purchases. They also dive into emotional spending, creating strong financial habits and how tech can help you take back control.
Get ready for some practical and empowering advice for modern money management.
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Iona and her guests share their own personal thoughts and opinions in this podcast. These might be different from L&G’s take on things. They give financial guidance for a UK audience that’s relevant at the time of recording. It’s general best practice, not the kind of personalised advice you’d get from a financial adviser.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
This series is brought to you by LNG, helping you
build a future that's a little bit richer.
Iona Bain (00:06):
Hello and welcome to A Little Bit Richer, brought to
you by LNG with me, Iona Bain. In today's digital
world, our culture has shifted from cash to cashless and
it's affecting how we manage our spending and future finances.
Today, we want to talk about the role of cash
in society and what we can do to put some
friction back in our finances when our money is increasingly
(00:28):
digital. Here with me to discuss all this is friend
of the show, Emmanuel Asuquo. Emmanuel is a financial advisor,
TV presenter, motivational speaker, best-selling author with 15 years experience in financial consulting.
Welcome back, Emmanuel.
Emmanuel Asuquo (00:45):
Hey, Iona. How are you?
Iona Bain (00:46):
I'm good, thank you. Eman, we're seeing a lot online
now about people returning to cash.
Emmanuel Asuquo (00:52):
Yes.
Iona Bain (00:52):
Why do you think that's happening and what are the
benefits of using cash?
Emmanuel Asuquo (00:56):
Yeah, I think the reason I'm seeing people return to cash
is just the fact that contactless is such a disconnect.
One of the hardest parts about money is the fact
that every day you step out of your house, somebody's
trying to take money from you, not in a bad
way, but just, " Here's a service that you can take," or, "
Here's a product that I think you'd like." When you
(01:17):
can tap that away, you have all the access to
all your money. Money just continues to go, and I
always tell people, " Money flows. It comes in and it
goes out." If you don't find blockers or you don't
find ways to put your money in certain places, it
will just leave your hands no matter how much you
make. If I have 50 pounds and I'm only using
cash, I can only spend the 50 pounds I have.
No matter how much I want to spend 100, I
(01:39):
have access to 50. It helps you stop yourself when
that impulse comes in because you're limited. Then, if you
want to go and spend more, you have to go
to the cash machine. When it's just tap, it just
so simple, so easy, and it goes so fast. That's
why so much more people are coming back to cash
as a way to fill that connection to money because
there's a pain. There's no pain when you're tapping away.
(02:01):
I think that's why people are coming back to cash.
Iona Bain (02:04):
Do you think that that shift in mentality can also benefit
you if you're shopping a lot online? What you were
describing about leaving the house and having commercial pressures, you
don't even have to leave your house now. It's all
there in your pocket on your phone, constant inducements to
spend money through social media and internet shopping.
Emmanuel Asuquo (02:20):
100%. I do this thing with my clients where I
tell them, " Look, we've got a 48- hour rule," so even
if you see the thing you want to buy and it's
on sale and you're just like, you got to wait
48 hours. Do you know that with my clients, something
like 75% of the time, they do not end up
buying it when they're back in their right mind. There's
something about when you're online and you're spending and the
deals are there and you think about, " Oh, I'll do
(02:41):
this there and I'll do this there," and when you
walked away and come back, you realize, " I got something
similar in my wardrobe already," or, " I don't actually need
that," but in the moment while the adrenaline is pumping,
you feel like, " I need this now. I can't live
without it." Just giving yourself that gap. You could go
to every shop you want to go to without ever
leaving your house, and it becomes dangerous. There needs to
be a delay. We've got more stuff than we actually need.
Iona Bain (03:02):
Delays are good for us sometimes.
Emmanuel Asuquo (03:04):
Exactly. There needs to be a delay. There needs to
be a pause to actually say, " Do I need this
right now, or am I just buying this because I
have the ability to?" Again, sometimes we are emotional spending.
It's the, " I don't feel so good today, I'm going
to buy myself something." " I've had a great day. I'm
going to buy myself something." Whatever mood you're in.
Iona Bain (03:19):
Spending is the answer.
Emmanuel Asuquo (03:21):
Yes.
Iona Bain (03:22):
Two things that have really helped me in terms of controlling
my online spending. One is not having a digital wallet,
at least for a period of time. If I have
Apple or Google Pay, then it just makes spending too
easy. Whereas, even if it is a case of having
to get a card out of my purse, that puts
a bit more friction into my finances. Then, the second
thing is removing automatic credit card details. When you are
(03:46):
shopping online, the way it just fills all the forms.
You know what?
Emmanuel Asuquo (03:50):
Magically.
Iona Bain (03:51):
Yeah. Magically. Oh, well there we are, and there's no
reason not to spend now. Not ticking that box to
also fill my credit card details has definitely made a
bit of a difference.
Emmanuel Asuquo (03:59):
Yeah, I'm the same. I'm a big fan of using
my chauffeur service through an app that I'm not going
to mention, but also, I use that app for eating
as well. If I know I've ordered a bit too
much, then I'm going to uninstall for a period of
time, so I have to get back on the bus,
back on the train and back cooking in the kitchen.
Iona Bain (04:17):
Yeah. Do you think that also there's a correlation here between
cash, helping you keep on top of your budget and
being on a low income in the first place and
really having to watch every penny? It's interesting. When I
go to my local discount supermarket, the queue for the
manned checkout is always really long, and that's because it's
the only checkout that accepts cash.
Emmanuel Asuquo (04:36):
Cash. Yeah. I think businesses are missing a trick. I
get it. It feels great. You can go and just scan it and
pay and go, but the reality is that for a
lot of people, especially when money is tight, I can't
afford to pay the wrong amount. I need to make
sure that what I'm spending is I can actually afford.
I need to give myself a budget. I think we don't
think about it in that way, like you said, watching
(04:58):
every penny. I've seen my mum pour out her purse
and count 5 Ps and 2 Ps to make up enough
to buy what she needs to buy because that's all
the money she has. Sometimes, when you're tapping, you don't
have that and then now, with overdrafts and all that, you're just
getting yourself into more trouble and actually, coming back to
cash and limiting yourself, it can feel negative, but actually
(05:19):
can have a much more positive impact because you are
living within your means. I think we have to go
back to get into a society where actually it's okay
to say no.
Iona Bain (05:28):
It is hard using cash now. A lot of shops
won't accept it. You can't pay your bills with it.
You can't save and invest with it. What are the
difficulties of using cash?
Emmanuel Asuquo (05:36):
It is so hard to use cash. I mean, I
used to be a cashier in a bank. People would
come in, they'd have their energy bill, they'd write how
much they're going to pay, and we'd scan it through.
We'd take the cash and pay their bills. Now, everything
is direct debit. Everything is online. Again, you can't keep
that control.
Iona Bain (05:55):
There are some big drawbacks to cash and I think
you're going to feel very passionately about one of them,
which is that sometimes people will say to me, " Well,
can't I just put my money under the mattress," because
that's clearly the safest thing to do, and yet people
will be missing out on growth. Talk to me about
why cash can't be the answer to all our financial problems.
Emmanuel Asuquo (06:15):
Exactly. If you've got your life savings under a mattress,
I totally understand that, but if you do get burgled
or if there's an accident, all of a sudden, all
your money's gone. No security, no safety, there's no protection
on that. Whereas if it was in a bank account,
you have protection. You have people that you can talk
to say, " Look, this is my money and something's happened
to it." That's number one. Number two, inflation. We all know that 1,
(06:38):
000 pounds five years ago is probably around 600 pounds
today. If you would've left it under the mattress, you
might have gone back and said, " I've got 1, 000 pounds,"
but money is only valuable when you use it, and
I don't think people understand that concept. What we do
is we look at money and say, " I've got 1, 000
pounds today. Five years later, I've got another 1, 000
pounds. I still got 1, 000 pounds. I haven't lost anything,"
(06:59):
but actually if I go to spend that money and
I can buy it less, then I've lost money in
real terms. If we think about it, 50K used to be how
much to buy a house. 50K is now not even
enough for a deposit in some places. If I've gone
from a place of being able to buy and own
a house to now only having enough for a deposit,
(07:19):
I've lost money in real terms.
Iona Bain (07:21):
It's really hard for people to get their heads around
that concept though, because it's quite abstract.
Emmanuel Asuquo (07:25):
Exactly.
Iona Bain (07:25):
Once you grasp it, actually, you can never unknow it.
Emmanuel Asuquo (07:28):
Never ever know it, and you just see it all
the time. Then, like you mentioned, interest. Again, banks pay
you interest for leaving your money with them so you
get that growth.
Iona Bain (07:37):
How can we manage our money better when it would
just be otherwise so easy to tap our money on
that card reader and see it leave our account?
Emmanuel Asuquo (07:47):
I think the main thing is your money mindset. When
we talk about money being the root all evil and all that,
it's people. It's all us as human beings, how we
use money. Money is not the problem. Money is there
to be used. It's how we use it that becomes
the problem. For me, it's about understanding your money mindset
and how you look at money and dealing with your
money trauma and the things that you've been through and
(08:07):
how you express yourself when it comes to money. That
is the first place that people really need to work
on themselves on in regards to how they look at
money, how they use money, what is their attitude to
money, and that's really, really important. Then it's about budgeting
and for me, one of the best ways to budget,
I know we've got all these online banks. For me,
envelopes, I don't care what anyone says.
Iona Bain (08:29):
Really?
Emmanuel Asuquo (08:29):
Going back to the envelope is the best place to
get started. I have clients today that I made envelope.
You have X amount for this week because you've got
to teach yourself the discipline. Money is a habitual. If
I build a good financial habit, that will continue.
Iona Bain (08:45):
You mean to say, withdraw cash, put it in an
envelope that you need for that particular area of your
life that week, and that's it.
Emmanuel Asuquo (08:50):
That's it.
Iona Bain (08:50):
Right.
Emmanuel Asuquo (08:50):
That's it. If you've got 100 pounds for the week.
If on Monday you decide to spend 80 pounds, it's
going to be a tough week. Do you know what
I mean?
Iona Bain (08:58):
Yeah.
Emmanuel Asuquo (08:59):
You need that experience. That's how I learn money. People ask, "
Well, how did you get this mindset about?" No, I
learned the hard way. I come from struggle. I come
from not having a lot and having to look after
it. It's one of the things I always worry about
with my kids is that now they live a life of
privilege. How do I make sure they understand the importance
and the value of money? For me, having the envelopes,
now again, once you've done that, you can evolve. A
(09:21):
lot of these other accounts now allow you to have
pots and all of that, and that can be great, but
until you can do it in the physical, I don't want you to do it in a digital.
Iona Bain (09:29):
Right. I see. If we follow the envelope approach and
we can stick to only spending 100 pounds a week
and we've passed that test, Eman gives us a big
tick, then we can progress and graduate to digital ways
of putting friction back into our finances.
Emmanuel Asuquo (09:46):
Yes.
Iona Bain (09:47):
Have you got a few favorite strategies here?
Emmanuel Asuquo (09:49):
My favorite is splitting your accounts up. One of the
biggest mistakes I see people is that they have all their money in
one account. It is a problem. It's a nightmare because
Friday night, you look at your account, it's fit and
healthy, and you think, " I'm going out. I'm going to have a good
time." Monday morning, the direct debit's come out and you've
messed yourself up, and it repeats every month. For me, have
(10:10):
an account for your bills. Number two is that there
are banks that will pay you cash back for paying
your bills from those accounts. You can actually make money
paying your bills, and that way you can monitor. What
I do with my bills account, every six months I
go in, I love football, and I renegade. I list
them all, and the bottom three, I either get rid
of or I call them up and ask for a
(10:30):
better deal where possible.
Iona Bain (10:33):
That's a pretty ruthless approach you're taking there.
Emmanuel Asuquo (10:35):
The thing is, what I've realized is that a lot
of the time you have these subscriptions, I'm actually using it.
I'm actually getting value from it. Why do I still
have this? I might have a subscription, especially with kids.
I might have a subscription. They used it for that
period of time, but they're not using anymore. Because it's
five pounds and it comes out monthly, I don't feel
it. I don't see it. It's just coming out. Actually,
that's 60 pounds a year.
Iona Bain (10:55):
Whereas if you had to actually hand over that fiver,
would you do it?
Emmanuel Asuquo (11:00):
You wouldn't. You wouldn't, and you would've realized a long time ago. It is
really important to look at your subscriptions and have an
account for that. Then, I have a second account where
I put myself on a budget. I have an account
and I say, " Look, this is how much I have
to spend," because one of the biggest problems with money
is when you have access to all of your money.
When you have access to all of your money, you
are causing yourself problems. What I do is I only give
(11:22):
myself access to a portion of my money that I
know that that's for me. I know my bills are
paid, and then I have a savings account that I've put my
savings in. Now, I can spend this money guilt free.
One of the biggest things about budgeting is we feel
our budgets restrict you. Actually, a budget sets you free
because I can spend this money however I want and
know I've paid all my bills, I've saved for my
(11:42):
goals, and now I'm free to spend this money and
using the online bank. Either on Monzo or Starling, one
of those types of banks where they're rude. They'll text
you and tell you, " Oh, you spent more on takeout
this month." Nobody asked you, but thanks anyway. You can keep
an eye on it, and it makes it so much easier for
you to be able to be in control of your money.
Iona Bain (12:01):
Well, that's good because you don't then have to take
all that responsibility on yourself. You're almost outsourcing the accountability
to your bank.
Emmanuel Asuquo (12:09):
Exactly, to your bank, and that's important. More and more banks are understanding the importance
of their role as well. That's really important.
Iona Bain (12:15):
What are your feelings on having spending limits? I mean,
would you advocate having a spending limit per day or
per week? What are the pros and cons?
Emmanuel Asuquo (12:23):
Yeah, I think spending limits are good for people who
are impulse spenders. If you are someone that knows that
if you walk into a shop and you smell certain smells
or you see a yellow sticker, you're gone. Then, you
need a limit how much you can spend because you're going to
overspend. If you are someone that's in more control, then
maybe you just have a limit for the week or
the month or whatever it may be, but also to
(12:45):
understand that life happens. As much as you might have
spending limits, there might be an opportunity. For example, if
I know I want to go on holiday and then
there's a really good deal, does it make sense to
me saving all the way up to the holiday and
paying the higher price if I can get a 0%
credit card and pay that now at a discount price
and then pay that off? We've got to be wise
in our spending, but know that if I'm spending this
(13:07):
now, what are the other sacrifices that I have to make?
If I'm not prepared to give it up, then I'm
not prepared to spend.
Iona Bain (13:13):
I have a theory that financial technology was once judged
on how easy it could make everything. I think in
the future, we will want financial technology that actually makes
everything that little bit harder and will allow us to
put these boundaries and this friction in place. Do you
see financial technology evolving in that direction?
Emmanuel Asuquo (13:33):
Yeah, I definitely do. We've seen with people having different
accounts and pots that they can't get access to. You have
a direct debit from your account into a pot, but
you can't access that pot and it won't show up
on your online banking. We're seeing it already that actually,
we have to hide money from ourselves because we naturally
want to spend it, but we benefit from it because
when you then look at it 12 months down the
(13:53):
line, you're like, " Wow, I saved that much." It is
really important. That's another hack that I always tell people,
have a standing order on payday to your savings account,
so you pay a like a bill.
Iona Bain (14:04):
Because actually, it has never been easier to save. That's the upside of all this.
Emmanuel Asuquo (14:07):
Exactly.
Iona Bain (14:07):
You can really make it work for you in terms of
how accessible this technology is, I mean, a good example
is yesterday morning, I woke up and I saw within
my banking app that there was an easy saver account
available, paying 4%. I opened it within a minute.'.
Emmanuel Asuquo (14:22):
Yeah.
Iona Bain (14:23):
Hey, Presto, I'm a saver.
Emmanuel Asuquo (14:25):
Wonderful.
Iona Bain (14:26):
I'm not saying that's the first time I've ever saved money.
Emmanuel Asuquo (14:28):
No, of course not.
Iona Bain (14:28):
Just in case anyone's wondering. It was just remarkable how
easy it was to do that.
Emmanuel Asuquo (14:33):
Yes.
Iona Bain (14:34):
How can we use these technologies to actually help us
save money?
Emmanuel Asuquo (14:38):
Yes. Like we're saying, it makes it easier to save, but also
to invest for the longer term. Now, it's never been
easier to open up a pension or stocks and shares
I saw or invest in stocks. Using the technology has
made it easier for us to invest as well longer
term. Just embracing it means that now, we are able
to do things that maybe before we'd have to go
to a bank to do or so forth, but we
(15:00):
can now do ourselves and be in more control.
Iona Bain (15:03):
A good example of that is round up savings, right?
Emmanuel Asuquo (15:04):
Yes.
Iona Bain (15:04):
If you spend 98 P and you have two P rounded
up into a savings or investment pot, two P in
and of itself is not going to add up to
a lot, but over time it might make a bit
of a difference.
Emmanuel Asuquo (15:15):
No, definitely. And it's all about the habits. I always tell people sometimes it's not
about getting rich. I think we think about, we've watched
Wolf of Wall Street and all these other films, and
we think, oh, we've got to invest this. Actually, just
building up that habit. If I know that two P, 10 P, 15
P, every time I spend is going in there, it's
a habit. Once I built that habit and I've seen, okay, wow, I've
put in 20 pounds this month, and now that 20
(15:36):
pounds is worth 25 pounds. Imagine if I had 100
pounds in there. Now you've got more confidence to say, "
Actually, I can put a more regular amount in there
because I see that this works over time." It's about
building those habits. Technology has made it easier. Before, if
you wanted to invest, there was a barrier to entry.
Iona Bain (15:51):
Yeah.
Emmanuel Asuquo (15:51):
Those barriers have been taken away. We've got to embrace
the technology and start to make it work for us.
Iona Bain (15:56):
Brilliant. Well, let's end with three tips on how you
can use the digital world of money to build your
own wealth.
Emmanuel Asuquo (16:04):
Great question. I'd say number one is to really understand
your money. As we talked about, embrace the technology, understand
where your money's coming in and out of, because people
always tell me, " What's the cheat code? How can I
make more money?" There's only two ways. You either make
more money or you cut your costs. That's all we're
ever talking about really. You've got to, number one, understand
where your money's coming from, where it's going, and then
(16:24):
utilize the tools that are available to you. Number two
is saving. Make sure you're getting the best on your
savings. The money that you are able to save, make
sure you're getting the best rates on your money and
review that regularly. That's really important. Number three, feel free
to limit yourself. I think we are in a society
that has no limits. We all want to have no limits, and
we want to live life to the maximum, but actually
(16:47):
embrace the fact that you can limit yourself and make
it a bit tough. Make some friction in your money
so that you can keep more of it.
Iona Bain (16:53):
Fantastic. The three tips are to build a better picture
of your finances, try to save what you can and get
that friction in your finances.
Emmanuel Asuquo (17:02):
Love it.
Iona Bain (17:04):
That was so helpful. Thank you, Emmanuel. Next time, financial
advisor and friend of the show, Bola Sol will be
back to help us manage finances with our partners. I'd
love it if you could follow the podcast, leave us
a review and help others get a little bit richer
too. You can keep up with the show on YouTube,
TikTok and Instagram at Legal & General. Until next time, see you soon.
This series is brought to you by LNG, helping you
build a future that's a little bit richer.
Iona Bain (00:06):
Hello and welcome to A Little Bit Richer, brought to
you by LNG with me, Iona Bain. In today's digital
world, our culture has shifted from cash to cashless and
it's affecting how we manage our spending and future finances.
Today, we want to talk about the role of cash
in society and what we can do to put some
friction back in our finances when our money is increasingly
(00:28):
digital. Here with me to discuss all this is friend
of the show, Emmanuel Asuquo. Emmanuel is a financial advisor,
TV presenter, motivational speaker, best-selling author with 15 years experience in financial consulting.
Welcome back, Emmanuel.
Emmanuel Asuquo (00:45):
Hey, Iona. How are you?
Iona Bain (00:46):
I'm good, thank you. Eman, we're seeing a lot online
now about people returning to cash.
Emmanuel Asuquo (00:52):
Yes.
Iona Bain (00:52):
Why do you think that's happening and what are the
benefits of using cash?
Emmanuel Asuquo (00:56):
Yeah, I think the reason I'm seeing people return to cash
is just the fact that contactless is such a disconnect.
One of the hardest parts about money is the fact
that every day you step out of your house, somebody's
trying to take money from you, not in a bad
way, but just, " Here's a service that you can take," or, "
Here's a product that I think you'd like." When you
(01:17):
can tap that away, you have all the access to
all your money. Money just continues to go, and I
always tell people, " Money flows. It comes in and it
goes out." If you don't find blockers or you don't
find ways to put your money in certain places, it
will just leave your hands no matter how much you
make. If I have 50 pounds and I'm only using
cash, I can only spend the 50 pounds I have.
No matter how much I want to spend 100, I
(01:39):
have access to 50. It helps you stop yourself when
that impulse comes in because you're limited. Then, if you
want to go and spend more, you have to go
to the cash machine. When it's just tap, it just
so simple, so easy, and it goes so fast. That's
why so much more people are coming back to cash
as a way to fill that connection to money because
there's a pain. There's no pain when you're tapping away.
(02:01):
I think that's why people are coming back to cash.
Iona Bain (02:04):
Do you think that that shift in mentality can also benefit
you if you're shopping a lot online? What you were
describing about leaving the house and having commercial pressures, you
don't even have to leave your house now. It's all
there in your pocket on your phone, constant inducements to
spend money through social media and internet shopping.
Emmanuel Asuquo (02:20):
100%. I do this thing with my clients where I
tell them, " Look, we've got a 48- hour rule," so even
if you see the thing you want to buy and it's
on sale and you're just like, you got to wait
48 hours. Do you know that with my clients, something
like 75% of the time, they do not end up
buying it when they're back in their right mind. There's
something about when you're online and you're spending and the
deals are there and you think about, " Oh, I'll do
(02:41):
this there and I'll do this there," and when you
walked away and come back, you realize, " I got something
similar in my wardrobe already," or, " I don't actually need
that," but in the moment while the adrenaline is pumping,
you feel like, " I need this now. I can't live
without it." Just giving yourself that gap. You could go
to every shop you want to go to without ever
leaving your house, and it becomes dangerous. There needs to
be a delay. We've got more stuff than we actually need.
Iona Bain (03:02):
Delays are good for us sometimes.
Emmanuel Asuquo (03:04):
Exactly. There needs to be a delay. There needs to
be a pause to actually say, " Do I need this
right now, or am I just buying this because I
have the ability to?" Again, sometimes we are emotional spending.
It's the, " I don't feel so good today, I'm going
to buy myself something." " I've had a great day. I'm
going to buy myself something." Whatever mood you're in.
Iona Bain (03:19):
Spending is the answer.
Emmanuel Asuquo (03:21):
Yes.
Iona Bain (03:22):
Two things that have really helped me in terms of controlling
my online spending. One is not having a digital wallet,
at least for a period of time. If I have
Apple or Google Pay, then it just makes spending too
easy. Whereas, even if it is a case of having
to get a card out of my purse, that puts
a bit more friction into my finances. Then, the second
thing is removing automatic credit card details. When you are
(03:46):
shopping online, the way it just fills all the forms.
You know what?
Emmanuel Asuquo (03:50):
Magically.
Iona Bain (03:51):
Yeah. Magically. Oh, well there we are, and there's no
reason not to spend now. Not ticking that box to
also fill my credit card details has definitely made a
bit of a difference.
Emmanuel Asuquo (03:59):
Yeah, I'm the same. I'm a big fan of using
my chauffeur service through an app that I'm not going
to mention, but also, I use that app for eating
as well. If I know I've ordered a bit too
much, then I'm going to uninstall for a period of
time, so I have to get back on the bus,
back on the train and back cooking in the kitchen.
Iona Bain (04:17):
Yeah. Do you think that also there's a correlation here between
cash, helping you keep on top of your budget and
being on a low income in the first place and
really having to watch every penny? It's interesting. When I
go to my local discount supermarket, the queue for the
manned checkout is always really long, and that's because it's
the only checkout that accepts cash.
Emmanuel Asuquo (04:36):
Cash. Yeah. I think businesses are missing a trick. I
get it. It feels great. You can go and just scan it and
pay and go, but the reality is that for a
lot of people, especially when money is tight, I can't
afford to pay the wrong amount. I need to make
sure that what I'm spending is I can actually afford.
I need to give myself a budget. I think we don't
think about it in that way, like you said, watching
(04:58):
every penny. I've seen my mum pour out her purse
and count 5 Ps and 2 Ps to make up enough
to buy what she needs to buy because that's all
the money she has. Sometimes, when you're tapping, you don't
have that and then now, with overdrafts and all that, you're just
getting yourself into more trouble and actually, coming back to
cash and limiting yourself, it can feel negative, but actually
(05:19):
can have a much more positive impact because you are
living within your means. I think we have to go
back to get into a society where actually it's okay
to say no.
Iona Bain (05:28):
It is hard using cash now. A lot of shops
won't accept it. You can't pay your bills with it.
You can't save and invest with it. What are the
difficulties of using cash?
Emmanuel Asuquo (05:36):
It is so hard to use cash. I mean, I
used to be a cashier in a bank. People would
come in, they'd have their energy bill, they'd write how
much they're going to pay, and we'd scan it through.
We'd take the cash and pay their bills. Now, everything
is direct debit. Everything is online. Again, you can't keep
that control.
Iona Bain (05:55):
There are some big drawbacks to cash and I think
you're going to feel very passionately about one of them,
which is that sometimes people will say to me, " Well,
can't I just put my money under the mattress," because
that's clearly the safest thing to do, and yet people
will be missing out on growth. Talk to me about
why cash can't be the answer to all our financial problems.
Emmanuel Asuquo (06:15):
Exactly. If you've got your life savings under a mattress,
I totally understand that, but if you do get burgled
or if there's an accident, all of a sudden, all
your money's gone. No security, no safety, there's no protection
on that. Whereas if it was in a bank account,
you have protection. You have people that you can talk
to say, " Look, this is my money and something's happened
to it." That's number one. Number two, inflation. We all know that 1,
(06:38):
000 pounds five years ago is probably around 600 pounds
today. If you would've left it under the mattress, you
might have gone back and said, " I've got 1, 000 pounds,"
but money is only valuable when you use it, and
I don't think people understand that concept. What we do
is we look at money and say, " I've got 1, 000
pounds today. Five years later, I've got another 1, 000
pounds. I still got 1, 000 pounds. I haven't lost anything,"
(06:59):
but actually if I go to spend that money and
I can buy it less, then I've lost money in
real terms. If we think about it, 50K used to be how
much to buy a house. 50K is now not even
enough for a deposit in some places. If I've gone
from a place of being able to buy and own
a house to now only having enough for a deposit,
(07:19):
I've lost money in real terms.
Iona Bain (07:21):
It's really hard for people to get their heads around
that concept though, because it's quite abstract.
Emmanuel Asuquo (07:25):
Exactly.
Iona Bain (07:25):
Once you grasp it, actually, you can never unknow it.
Emmanuel Asuquo (07:28):
Never ever know it, and you just see it all
the time. Then, like you mentioned, interest. Again, banks pay
you interest for leaving your money with them so you
get that growth.
Iona Bain (07:37):
How can we manage our money better when it would
just be otherwise so easy to tap our money on
that card reader and see it leave our account?
Emmanuel Asuquo (07:47):
I think the main thing is your money mindset. When
we talk about money being the root all evil and all that,
it's people. It's all us as human beings, how we
use money. Money is not the problem. Money is there
to be used. It's how we use it that becomes
the problem. For me, it's about understanding your money mindset
and how you look at money and dealing with your
money trauma and the things that you've been through and
(08:07):
how you express yourself when it comes to money. That
is the first place that people really need to work
on themselves on in regards to how they look at
money, how they use money, what is their attitude to
money, and that's really, really important. Then it's about budgeting
and for me, one of the best ways to budget,
I know we've got all these online banks. For me,
envelopes, I don't care what anyone says.
Iona Bain (08:29):
Really?
Emmanuel Asuquo (08:29):
Going back to the envelope is the best place to
get started. I have clients today that I made envelope.
You have X amount for this week because you've got
to teach yourself the discipline. Money is a habitual. If
I build a good financial habit, that will continue.
Iona Bain (08:45):
You mean to say, withdraw cash, put it in an
envelope that you need for that particular area of your
life that week, and that's it.
Emmanuel Asuquo (08:50):
That's it.
Iona Bain (08:50):
Right.
Emmanuel Asuquo (08:50):
That's it. If you've got 100 pounds for the week.
If on Monday you decide to spend 80 pounds, it's
going to be a tough week. Do you know what
I mean?
Iona Bain (08:58):
Yeah.
Emmanuel Asuquo (08:59):
You need that experience. That's how I learn money. People ask, "
Well, how did you get this mindset about?" No, I
learned the hard way. I come from struggle. I come
from not having a lot and having to look after
it. It's one of the things I always worry about
with my kids is that now they live a life of
privilege. How do I make sure they understand the importance
and the value of money? For me, having the envelopes,
now again, once you've done that, you can evolve. A
(09:21):
lot of these other accounts now allow you to have
pots and all of that, and that can be great, but
until you can do it in the physical, I don't want you to do it in a digital.
Iona Bain (09:29):
Right. I see. If we follow the envelope approach and
we can stick to only spending 100 pounds a week
and we've passed that test, Eman gives us a big
tick, then we can progress and graduate to digital ways
of putting friction back into our finances.
Emmanuel Asuquo (09:46):
Yes.
Iona Bain (09:47):
Have you got a few favorite strategies here?
Emmanuel Asuquo (09:49):
My favorite is splitting your accounts up. One of the
biggest mistakes I see people is that they have all their money in
one account. It is a problem. It's a nightmare because
Friday night, you look at your account, it's fit and
healthy, and you think, " I'm going out. I'm going to have a good
time." Monday morning, the direct debit's come out and you've
messed yourself up, and it repeats every month. For me, have
(10:10):
an account for your bills. Number two is that there
are banks that will pay you cash back for paying
your bills from those accounts. You can actually make money
paying your bills, and that way you can monitor. What
I do with my bills account, every six months I
go in, I love football, and I renegade. I list
them all, and the bottom three, I either get rid
of or I call them up and ask for a
(10:30):
better deal where possible.
Iona Bain (10:33):
That's a pretty ruthless approach you're taking there.
Emmanuel Asuquo (10:35):
The thing is, what I've realized is that a lot
of the time you have these subscriptions, I'm actually using it.
I'm actually getting value from it. Why do I still
have this? I might have a subscription, especially with kids.
I might have a subscription. They used it for that
period of time, but they're not using anymore. Because it's
five pounds and it comes out monthly, I don't feel
it. I don't see it. It's just coming out. Actually,
that's 60 pounds a year.
Iona Bain (10:55):
Whereas if you had to actually hand over that fiver,
would you do it?
Emmanuel Asuquo (11:00):
You wouldn't. You wouldn't, and you would've realized a long time ago. It is
really important to look at your subscriptions and have an
account for that. Then, I have a second account where
I put myself on a budget. I have an account
and I say, " Look, this is how much I have
to spend," because one of the biggest problems with money
is when you have access to all of your money.
When you have access to all of your money, you
are causing yourself problems. What I do is I only give
(11:22):
myself access to a portion of my money that I
know that that's for me. I know my bills are
paid, and then I have a savings account that I've put my
savings in. Now, I can spend this money guilt free.
One of the biggest things about budgeting is we feel
our budgets restrict you. Actually, a budget sets you free
because I can spend this money however I want and
know I've paid all my bills, I've saved for my
(11:42):
goals, and now I'm free to spend this money and
using the online bank. Either on Monzo or Starling, one
of those types of banks where they're rude. They'll text
you and tell you, " Oh, you spent more on takeout
this month." Nobody asked you, but thanks anyway. You can keep
an eye on it, and it makes it so much easier for
you to be able to be in control of your money.
Iona Bain (12:01):
Well, that's good because you don't then have to take
all that responsibility on yourself. You're almost outsourcing the accountability
to your bank.
Emmanuel Asuquo (12:09):
Exactly, to your bank, and that's important. More and more banks are understanding the importance
of their role as well. That's really important.
Iona Bain (12:15):
What are your feelings on having spending limits? I mean,
would you advocate having a spending limit per day or
per week? What are the pros and cons?
Emmanuel Asuquo (12:23):
Yeah, I think spending limits are good for people who
are impulse spenders. If you are someone that knows that
if you walk into a shop and you smell certain smells
or you see a yellow sticker, you're gone. Then, you
need a limit how much you can spend because you're going to
overspend. If you are someone that's in more control, then
maybe you just have a limit for the week or
the month or whatever it may be, but also to
(12:45):
understand that life happens. As much as you might have
spending limits, there might be an opportunity. For example, if
I know I want to go on holiday and then
there's a really good deal, does it make sense to
me saving all the way up to the holiday and
paying the higher price if I can get a 0%
credit card and pay that now at a discount price
and then pay that off? We've got to be wise
in our spending, but know that if I'm spending this
(13:07):
now, what are the other sacrifices that I have to make?
If I'm not prepared to give it up, then I'm
not prepared to spend.
Iona Bain (13:13):
I have a theory that financial technology was once judged
on how easy it could make everything. I think in
the future, we will want financial technology that actually makes
everything that little bit harder and will allow us to
put these boundaries and this friction in place. Do you
see financial technology evolving in that direction?
Emmanuel Asuquo (13:33):
Yeah, I definitely do. We've seen with people having different
accounts and pots that they can't get access to. You have
a direct debit from your account into a pot, but
you can't access that pot and it won't show up
on your online banking. We're seeing it already that actually,
we have to hide money from ourselves because we naturally
want to spend it, but we benefit from it because
when you then look at it 12 months down the
(13:53):
line, you're like, " Wow, I saved that much." It is
really important. That's another hack that I always tell people,
have a standing order on payday to your savings account,
so you pay a like a bill.
Iona Bain (14:04):
Because actually, it has never been easier to save. That's the upside of all this.
Emmanuel Asuquo (14:07):
Exactly.
Iona Bain (14:07):
You can really make it work for you in terms of
how accessible this technology is, I mean, a good example
is yesterday morning, I woke up and I saw within
my banking app that there was an easy saver account
available, paying 4%. I opened it within a minute.'.
Emmanuel Asuquo (14:22):
Yeah.
Iona Bain (14:23):
Hey, Presto, I'm a saver.
Emmanuel Asuquo (14:25):
Wonderful.
Iona Bain (14:26):
I'm not saying that's the first time I've ever saved money.
Emmanuel Asuquo (14:28):
No, of course not.
Iona Bain (14:28):
Just in case anyone's wondering. It was just remarkable how
easy it was to do that.
Emmanuel Asuquo (14:33):
Yes.
Iona Bain (14:34):
How can we use these technologies to actually help us
save money?
Emmanuel Asuquo (14:38):
Yes. Like we're saying, it makes it easier to save, but also
to invest for the longer term. Now, it's never been
easier to open up a pension or stocks and shares
I saw or invest in stocks. Using the technology has
made it easier for us to invest as well longer
term. Just embracing it means that now, we are able
to do things that maybe before we'd have to go
to a bank to do or so forth, but we
(15:00):
can now do ourselves and be in more control.
Iona Bain (15:03):
A good example of that is round up savings, right?
Emmanuel Asuquo (15:04):
Yes.
Iona Bain (15:04):
If you spend 98 P and you have two P rounded
up into a savings or investment pot, two P in
and of itself is not going to add up to
a lot, but over time it might make a bit
of a difference.
Emmanuel Asuquo (15:15):
No, definitely. And it's all about the habits. I always tell people sometimes it's not
about getting rich. I think we think about, we've watched
Wolf of Wall Street and all these other films, and
we think, oh, we've got to invest this. Actually, just
building up that habit. If I know that two P, 10 P, 15
P, every time I spend is going in there, it's
a habit. Once I built that habit and I've seen, okay, wow, I've
put in 20 pounds this month, and now that 20
(15:36):
pounds is worth 25 pounds. Imagine if I had 100
pounds in there. Now you've got more confidence to say, "
Actually, I can put a more regular amount in there
because I see that this works over time." It's about
building those habits. Technology has made it easier. Before, if
you wanted to invest, there was a barrier to entry.
Iona Bain (15:51):
Yeah.
Emmanuel Asuquo (15:51):
Those barriers have been taken away. We've got to embrace
the technology and start to make it work for us.
Iona Bain (15:56):
Brilliant. Well, let's end with three tips on how you
can use the digital world of money to build your
own wealth.
Emmanuel Asuquo (16:04):
Great question. I'd say number one is to really understand
your money. As we talked about, embrace the technology, understand
where your money's coming in and out of, because people
always tell me, " What's the cheat code? How can I
make more money?" There's only two ways. You either make
more money or you cut your costs. That's all we're
ever talking about really. You've got to, number one, understand
where your money's coming from, where it's going, and then
(16:24):
utilize the tools that are available to you. Number two
is saving. Make sure you're getting the best on your
savings. The money that you are able to save, make
sure you're getting the best rates on your money and
review that regularly. That's really important. Number three, feel free
to limit yourself. I think we are in a society
that has no limits. We all want to have no limits, and
we want to live life to the maximum, but actually
(16:47):
embrace the fact that you can limit yourself and make
it a bit tough. Make some friction in your money
so that you can keep more of it.
Iona Bain (16:53):
Fantastic. The three tips are to build a better picture
of your finances, try to save what you can and get
that friction in your finances.
Emmanuel Asuquo (17:02):
Love it.
Iona Bain (17:04):
That was so helpful. Thank you, Emmanuel. Next time, financial
advisor and friend of the show, Bola Sol will be
back to help us manage finances with our partners. I'd
love it if you could follow the podcast, leave us
a review and help others get a little bit richer
too. You can keep up with the show on YouTube,
TikTok and Instagram at Legal & General. Until next time, see you soon.
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