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Ross Lacey, a financial advisor specializing in mortgage advice, shares his passion for his profession. He always wanted to be a financial advisor and enjoys the combination of numbers and helping people. He believes that finance is not just about crunching numbers, but also about making a positive impact on people's lives. He emphasizes that even hedge fund managers can have a positive impact if their actions benefit investors. Ross's typical day involves meetings with clients, both new and existing, to review financial plans and discuss mortgage options. He enjoys the client-facing aspect of his work the most and believes that seeing the difference he can make in people's lives is the most rewarding part of his job. Hi Scott, how are you? Yes, I'm very well thank you mate, very well. We're back with another episode, finally. Finally, it's been a bit of a break over Christmas and New Year and I've already asked you how old that is, so I can't be arsed to hear it again. Yeah, it's not for everyone with our activities over Christmas, but it was, yeah, we're happy to be back, aren't we? Yeah, well you're not, you don't look happy to be anywhere. No, I'll just say I'm super tired, but it's fine, we'll get, we'll push through. And this is our first episode on a kind of, what's it called, Riverside, it's a kind of like Teams, like Zoom, online chat rather than in person, because we've got a guest on today. And it's weird, it's a weird experience, because I'm normally looking at you in person, now I'm looking at you on a screen and also looking at myself and also looking at our guest Ross and I don't know how I feel about it all. Yeah, just don't focus on yourself too much, Dave, because I think that's it. I'm a narcissist. Yeah, exactly, exactly. But no, we've got Ross Lacey here today. Ross is an IFA, he specialises in mortgage advice. Ross is a very cool guy, he owns his own business called Fairview Financial Management, give a little shout out there. But yeah, welcome, Ross. Thank you for coming. Yeah, thanks for having me guys. Good to meet you both. Yeah, great to meet you too, Ross. So let's kick off with the first question. I am always really interested how people get into the various professions that they do. So how did you decide that you want to give financial advice for a living? So this is a really good question. It's one I get asked quite often. So lots of people that do what I do are very honest and say they fell into it. I didn't, I was the sad kid at school when everyone said, what do you want to be when you're older and people went footballer, astronaut, that kind of thing. I genuinely said financial advisor. I've always wanted to do this. So I'm literally doing my dream job. Obviously, I didn't perhaps understand the full extent of what it entails to be a financial advisor, but I knew broadly that it was the kind of thing I wanted to do when I'm older. So everything I've done since being a kid and going for exams and going to uni and so on and so forth has led me to the point of doing what I'm doing today. And I think if you ask anybody that's known me from quite a long time back, they'll all kind of echo the same thing that he was the one person that used to say he will do this at some point in the future. So yeah, here I am today. Okay, that's actually interesting because I didn't know a lot of, I take the piss out of the finance industry a bit, mainly tongue in cheek and mainly to annoy Scott. But there aren't that many people who would say, yeah, I wanted to do it from a really young age. So I think a bit like being a teacher. So it's an interesting one. What made you go into the specific realm of finance that you work in, Ross? So I think for me, it's the perfect combination of numbers. So there is absolutely an element of numbers involved in what we do. There's no two ways about it. But actually, most of what we do is people focused. So I get to spend my time speaking to different people from different backgrounds, with different requirements. Obviously, there's definitely some commonality amongst the people we work with. But I get to hear all the individual stories and for me being able to do stuff that actually helps people live life differently is massively rewarding. There's lots of things we can do in life to earn good money. And I'll be honest with you, as I am with everybody, I wouldn't be doing this if I didn't get paid to do it. I go to work and I run a business to earn money for myself and my family as everybody does, despite what they might say. But there's lots of things we can do that would do that. And for me, this is something where you can build your own wealth and you can really make a difference for other people as well. So it's a great combination to have. And it's also something you can do not as an employee. So when I was younger, I used to think about what can I do where I can actually use my entrepreneurial spirit to actually run something of my own and build something for myself. Lots of jobs. Generally, you can do that, but you're working in someone else's business. This is something that you can do on a small scale and you can build it up from there if you want to. Yeah. Okay. It's one of the boxes for me in that sense. Yeah. Nice. I think a couple of things off that. One isn't really a question, more of a I think I've just been surprised since doing this podcast and talking to Scott, who obviously I've known for a while, but Jay and people within the finance industry. I think somebody who's very much on the outside of it was quite cynical about people in finance. And it was kind of like a city boy concept in my head, you know, potentially a selfish industry, if you don't mind me saying that. It's kind of the perception I might have had coming in. And I think a lot of people do. What I'm starting to learn is that there is a genuine want to help people and an interest in people. I kind of always saw it as sitting behind a computer and crunching numbers. And I always went into being a physio because I loved working with people and understanding their stories and stuff. And I just never, as I said, not necessarily a question, but I never associated it with finance. So it's really interesting to hear you say that. Just to jump on that, Dave, I think that there are definitely areas of finance that are more like the selfish kind of big bonus type that you're referring to. Like the first thing comes to my head like. Just to jump on that, Dave, I definitely agree. I reckon there's definitely a scale where you've got people like Ross who are genuinely trying to help people and that is their main job. And then you've got, I guess, other people who, you know, the big cat sitting in their tall offices, managing very large hedge funds, making a lot of money who perhaps don't necessarily have the end investor in their mind. It might more just be about lining their own pockets. But I mean, who am I to say that's probably a bit of a judgment. And I would like to hear your thoughts on that one, Ross. I would argue that actually a hedge fund manager, if they're, that whatever they're doing is secondary. But if what they're doing is actually having an impact on someone's life for the positive, then that's all good. So let's use a really basic example. Let's imagine that someone's got some money invested in that guy's hedge fund and because of what he's doing behind the scenes, we might sort of perceive him to be some big fat cat behind a desk, completely out of touch with the world. But through his actions, that person's savings may have grown, which has now enabled them to take retirement five years earlier and spend more time with their family and do what's important to them. I would argue they absolutely deserve what they're getting. Again, I don't want to get too much into the specifics of that argument, but as long as there is some tangible benefit to the people involved, I'm very, very comfortable with what people are doing in that sense. I get you. Okay. So, Ross, you might find that my level of questioning is not quite expert financial literacy questions. However, one thing that really interests me about your industry is I just have no concept of what a day looks like. So I asked Jay on another podcast, but what's a day, like a day in the life for you? Yes. You know, it's quite a hard question to answer because it's a bit cliche, but no two days are ever the same in that sense. But broadly, if I'm having what I define as a good day, which is doing the things that I do best and my team doing their things, it would kind of look a bit like we go in in the morning, we have a bit of a brief around what's ahead for the day, so what kind of things do we need to prioritise, what's coming up in the days ahead, any particular meetings or events we need to be aware of during the day. They will then have their tasks to be getting on with. I will generally then be speaking with clients, either new or existing, and that could be review meetings for existing clients looking at their financial plans to work out are they still on track, what do we need to change to kind of keep them going in the right direction. It could be new clients who we're speaking to about what they're looking for and whether we're going to be a good fit. It could be mortgage clients where we're actually working out the final points of what kind of deal is going to be appropriate for them. All sorts of stuff like that, but broadly, the bulk of my day should be spent speaking with and working with clients. The whole point of me building a team, as I have done, is to have the back office support to actually be doing the bits and pieces that can be done by them while I'm doing my thing. So lots of talking, lots of meetings, both face-to-face, over the phone, and more increasingly over video calls as well where that's appropriate. Not playing golf, not going to the horse race, not doing any of that fun stuff, that all stopped many years ago unfortunately. Wandering around clapping in a gilet, don't do too much of that. We've all been there, we've all been there. Fine. What part of your working life do you enjoy the most, if you could put a finger on it? It's definitely the client-facing part. I wouldn't do what I do if someone said to me, you can do all this, but you're never going to meet clients. I wouldn't do it. One of the reasons I moved from being involved in more of the investment management side was you got to do a lot of the number stuff, but you never actually got to see what difference it was going to make to people. There was no context to it. All you saw was someone's portfolio going up, but for all you knew, that would have no impact on their life whatsoever. What we do is all about translating that back into what difference is it actually going to make. A really basic question we might get from someone who comes to us might be, I want you to help me get more out of my pension. My question to them, and it would sound like a stupid question initially, is why? What difference is it going to make to you? Most people actually have to think about that. It could be something like, if I can get more out of my pension, it means I can work less, or I can retire earlier, or I can spend more, but it's about finding out what those specific things are so we can actually put some hard targets in place and make sure that if that actually does happen, they go through and they do retire earlier, they do spend more, because it's really easy just to kind of chase the money and not actually translate that back into why we're doing it in the first place. It's the same with mortgages as well. It's working out what people actually want. Do they really want to borrow as much as possible and be left in a position where they've got no disposable income and they're sitting at home at a weekend with nothing to spend on going out because they've bought the house of their dreams, or do they want to find a nice balance where they can still get a takeaway, get a few beers, that kind of thing. It's about understanding context. Do you find that, I think, on that, that people initially will tell you what they think you want to hear for their why and it actually takes a little while to get the real why out of them? Sometimes, but also I think genuinely lots of people don't really know what their why is. They know it's something they need to be aware of and on top of, but they're not really sure why exactly. The obvious one, going back to retirement again, because it's such a good example to use, it's people want to stop doing what they're doing, but do they actually want to stop working? That's the second question. For some people, they don't want to have this cliff edge where they get to 55 or 50 and then just do nothing. They just don't like what they're doing now, but they might need the money from what they do. It's about how can we put you in a position where you could perhaps do something that's more rewarding, not in a financial sense, but in terms of what you get from it, but you've still got the income and the lifestyle that you want. We help people answer those questions that they didn't actually know needed answering. They came to us with a question around getting more out of their pension and they walk away completely re-looking at what's important to them in life and do they really want what they thought they wanted? Not to get too deep on it, but it does go quite deep. No, no, it's interesting and again, coming back to what I said earlier, I think I looked at financial stuff on a very superficial level before talking to people like yourself and it's so interesting to hear actually how much of an impact and how deep into people's lives and goals and visions that your industry runs. It's interesting to hear, Nate, definitely. To be honest, David, it doesn't have to be like that. There's different ways of operating. We happen to operate in a way that really does go deep and we get involved in everything to do with our clients' financial lives. It sounds a bit corny and a bit cheesy and perhaps it is, but we almost become part of the family in that sense. We're one of the first people who will get a call if someone's been diagnosed with an illness or there's been a death in the family or some big event. They call us and say, what do we need to do? That's exactly what I wanted to happen when I set my business up. I wanted to be that person that was the first port of call because I think it's really important that we can provide as much support in those instances as we can. Not every firm operates like that and that's not me being disparaging towards the firms that don't because some people don't need or want that kind of high-touch service. They just want someone to say, this is a great investment product, here you go, and then run away in the nicest way possible. So, Ross, for some people, it's probably a scary thing walking into a financial advisor's office having never been to one. You don't really know what to expect. If I were to walk into your office tomorrow morning, what would be your general process of dealing with me, essentially, and finding out what I need and how you can help? Yes, so first opportunity is really us just having a chat on the phone, me understanding firstly why, because broadly it would have been you that got in touch with us and said, I want to have a chat and these are the kind of things that are on my mind at the moment. So, I'd want to understand a bit more about what those things are and actually why now. So, what led you to doing it now as opposed to six months ago or in six months' time? Generally, there's some kind of trigger point. It could be that one of your friends has done something similar, you could have had someone in the family that got ill, you might just be more mindful about things that are important to you that you're conscious that time is just passing by. Really getting under the bonnet of what those things are and then understanding where you think we can add value to the situation, because it's perfectly possible we'll have a meeting and discussion and it's not something that will be a good fit for what we do, but we can point you in the right direction of where you could go to get that. And it's the same with mortgages as well. It's understanding what people are looking for and if someone can do something themselves and they're on the right tracks, generally there's no point in us trying to force someone into what we do, because everything we do is about value. Everything we do has to be value of some multiple of the fee we charge people, so I'm really conscious that if we take a client on in whatever we do, I've never knowingly taken a fee from a client where we haven't delivered more value than what that fee is. And again, it might sound a bit righteous, but that's so important to me as a business owner that anyone we work with never feels begrudging towards what they're paying, because something we're doing should be giving them something more than what they're paying. And that's, again, sounds really obvious, but that's the basis of any good business relationship. I was going to say on that note, because you've obviously talked about your business and starting your business. I've started my own kind of physio business in the last year or so, but what was your... was there a single moment or what sparked the decision to go, I want to start a business for myself? So it was always something I wanted to do. I think if I had got to a certain age having not started a business, I would have been very disappointed in myself, because I literally, as I mentioned earlier, from a young age it's always been something I imagined in my head. Having the autonomy and the ability to kind of pull all those different things together as a business owner, you wear so many different hats, and in the early stages, you're the marketing team, the sales team, the person doing the actual job, the admin team, HR, everything, and it's daunting, but it allows you to really get a good understanding of what it takes to run a business, so that when you start growing, when you're putting people in those positions, you know what's required to make it work, and I always wanted to have that kind of... and look, you'll probably agree with me on this, Dave, you have these ideas around, and you probably romanticise what it's going to be like, but when you come to it, it's not all rosy, of course, but there's certainly parts of it where you sit there sometimes and say, I love the fact that I've decided what colour scheme we're using for the branding, or I love the fact that we're deciding what our marketing strategy is going to be, because it's down to you, and you either live or die by it, so I love the autonomy you get from running a business. For me, it was about getting to a point where I was approaching my late 20s, and I said to my wife at the time, or sorry, my girlfriend at the time, now my wife, but we were sort of talking about how long I would wait doing what I'm doing, because the further up you go in the corporate ladder, generally, the harder it's going to be to jump off, because you start earning more money, you get more benefits, you end up having kids, we've got two kids now, psychologically, the jump to actually become self-employed and be solely reliant on yourself for income, and take a drop in income and lifestyle, certainly for the first couple of years, that becomes much harder, and I think it's easy to get comfortable, so for me, it got to a point where I said, if I don't do it now, I may never do it, and a few things happened in life that kind of made me think, right, this is the right time for me to make this step. I joined a local firm, to me, that I actually knew from my previous role, so I joined them as a self-employed advisor, basically building a business within a business, so it gave me a really good, certainly jumping in at the deep end, but a really good grounding in what it took to kind of take clients on and build a business like that, and yeah, that kind of led me to where I am today, running my own firm. And was there a single biggest challenge you found when, you know, I know there's a lot of different things, and self-doubt, and different challenges, and worries about financial things that you've already mentioned, but is there, could you put a finger on a single challenge that you've experienced? I think, in terms of challenges, one of the biggest ones is trying to almost unlearn some of the technical stuff that you've learned over the years that you thought would be massively relevant in terms of how you interact with clients, but actually isn't, and it's a really, it might sound a bit perverse here, but it's really hard not to unload all your technical knowledge that you've built up, because you're so proud of it and you want to impress people with how much you know, but actually, in my experience and everything I've read and looked at on this, it does the opposite thing, it turns people off. So actually being able to condense that stuff down into language that everybody can understand without coming across as condescending, but speaking in everyday language, and just talking like you're talking to another human being, rather than blurting out a load of jargon. Initially that was a massive challenge, because I was previously dealing with people that would have quite happily talked jargon all day long, suddenly then you're sitting with people that are experts at what they do, but not in finances, and that's why they're working with you. So you need to be able to talk to them on a level that everybody gets. So it's working out how you start bringing in analogies and ways of describing things that we all understand that's universal, that was a really big challenge for me, but actually massively rewarding when you start working on things like that, that you explain the concept that people get, and you think, amazing, because that would have taken me five minutes to explain using all the technical jargon, by using that analogy you've got it in 15 seconds, for example. But it's not easy, it takes time, and actually every time a subject like that comes up I'll spend some time working on how I can reposition that with people in a way that, again, doesn't come across as me talking down to them, but also acknowledges the fact that they're not an expert in that subject. That's really interesting, Ross, actually. So let me throw this one back. What have you actually found easier, so less of a challenge, than you may have first thought? I would say, I always had this, and I hope it is a misconception, but a misconception that being younger would be a disadvantage, so financial advisors specifically, mortgage brokers, a bit of a different demographic, but financial advisors, the average financial advisor in the UK is late 50s, so me being a financial advisor in my early 30s, you can imagine if people were going to see five financial advisors, on average you're going to be the one that looks like the child of one of those, so you almost feel like you're on the back foot, but actually lots of clients I've taken on, and again that's probably a misconception for people that ask me about my client bank, lots of my clients are in their 50s, 60s and 70s, I don't generally deal with loads of people that are the same age as me. I have got clients of that age, but broadly it's older people, and lots of them specifically said to me, we love the fact you're younger because we're not going to need to find another financial advisor because he hasn't died or retired while we're still here. We want to die before you, in the nicest way possible. So I think it's a massive selling point to be highly qualified, highly competent and younger in this profession, because being able to sit in that Venn diagram, there's very few people at the moment that sit in there, and we aren't getting new people coming into the profession either to replace those that are leaving, so we've got a massive advantage. That's really interesting, and I think it's really similar in my industry, if you're good enough whatever age you are, you're good enough, and people, and again coming back to that jargon point of really similar in my industry, that nobody really cares, they know that you have got enough knowledge to be doing the job you're doing, well they hope you do, and they really don't care about you naming every muscle in the foot, because they need to know what info is relevant to them. On that point though, around age, how are you going to combat the counterpoint that in 20 years time, when I'm guessing you're still going to be owning your business, you're no longer younger than a lot of your clients? It's a very good point, I think we all need to take our own medicine here, so I'm really open with people in that if I'm professing that you need to live your life based on the fact that time is precious, we don't know how long we've got, we need to do things while we can, if I'm in my 60s or 70s still running a business, what am I doing? If I'm building a business so that I can get to my hopefully early to mid-50s, having built a successful business, made a real difference to people along the way, and have a viable succession plan to either pass the business down the line to my kids, or have a team of people there to take it over, so there will hopefully be continuity on that front, but I wouldn't be genuine if I wasn't kind of following in the footsteps that I asked my clients to walk. Let's get into some practical advice for our listeners now, I think based on our demographic a lot of us are going to be more in the first time buyer category, and obviously with interest rates having gone up, looking like they could potentially start going down potentially at the end of this year, but who knows what's going to happen, what options are out there for first time buyers, because it's not just a case of there's a single mortgage, you can Google it online and that's what you've got, I feel like going through a mortgage broker adds real value to different options. Absolutely, yes, so broadly you've got conventional mortgages that will allow you to put down like a 5% deposit for example, so I know that's not necessarily a small amount in monetary terms, but that can make buying somewhere a lot more affordable, and there's actually a couple of products out there now that don't require a deposit at all, so one of the big ones that you might have seen or your listeners might have seen mentioned in the press is one offered by Skips in Building Society, it's based on having a rental truck record and they look at that and make some comparisons with what the mortgage payments might be, so broadly there are people out there that could get a mortgage with no deposit whatsoever, I know that sounds bizarre to say given everything we've kind of been through in our generation, but they're out there, and then you've got various kind of buying schemes as well, ones where family members can come on as joint borrowers, or equity in family houses can be used towards deposits, gifted deposits, there's various ways to do it, but it all comes back to what the people actually need to do to get what they want to get, so people generally fall into one of two camps, they either can't get the deposit, in which case it's going to be looking at something that's a low deposit mortgage or no deposit mortgage or using family members' equity, or they've got the deposit, they just can't get the borrowing they need, and actually there's certain lenders that will offer higher multiples of income depending on the circumstances, so what you'll find is there's certain tiers of earnings where if you go over a certain amount as a joint application they might offer you five times as opposed to four and a half times, and it is as binary as saying that if a couple are earning 49 grand between them, if they were earning 50 for example, that might suddenly mean they can borrow five times 50, whereas before that they could borrow four times 49, and that £1,000 could be the case of someone doing some overtime for a few months to bring them up to that level, so there's various ways in which affordability can be worked on, again that's why as brokers we'll look at all the options and say this is what we think you need to do to make that viable. We had one of your, I think he's an ex-colleague of yours, Jay, you know Jay don't you? We had him on the pod and we got into a bit of discussion around mortgages and renting versus mortgages, do you have a general, and I know it differs for every person, but do you have an opinion on I guess younger adults, mid to late 20s about whether mortgages are kind of more financially advisable than renting? So my view on this tends to be I'd never advise a couple to buy a property before renting together because I see too many instances of people buying a house together for the first time, having never lived together, and then a year later they split up, so it doesn't sound very romantic, but actually renting for a while, getting to know each other's good and bad habits, when you do go and buy it you're going to both know what to expect rather than it being a surprise and that avoids all the costs and everything else that goes with a breakup, so renting certainly serves a purpose in those instances, and actually if we talk about flexibility, for some people they don't know exactly what they want to do or where they want to live, so renting in the area or renting the type of property they might want to buy gives them an opportunity to kind of see if they're actually going to want to do it longer term, so I think renting certainly has a place, but when we're in a position where we kind of know a bit more about what we want and what's important to us, personally I think going down the route of getting a mortgage and actually buying something and building equity makes complete sense, because there's lots of people out there paying an amount in rental payments every month that could instead be going towards a mortgage, which if they carry on doing that for 30-40 years, which I appreciate is a long time, but it will go, it will come, they'll actually have that property that's theirs as opposed to that money just being completely out the window, so to speak. I was actually reading, I think today, it was seeing that a couple of banks have literally just started to reduce their interest rate for the first time in a while. For people that have mortgages at the moment and are looking to remortgage in, say, the next year, what would be your advice around going with a shorter term, like a two-year fixed versus going a bit further out and locking that interest rate over maybe five years? What's your view on that? I know it's hard to know where the interest rate's going, but what are you tending to say to clients at the moment? It's definitely a case of looking at the specific circumstances as to which one's going to be right, so it's fair to say at the moment a five-year fixed rate will be lower than a two-year fixed rate. If people are looking for the absolute lowest cost deal possible, a five-year fix is the way to go, but they may look back in hindsight and say, actually, I should have done a two-year fix and then fixed again after that, but that's hindsight. It depends on how important it is to them to have certainty over the next five years. If you take a young family where one person, for example, may be planning to give up an employed role and go self-employed within the next couple of years, certainty for them might be something they're more than willing to pay a premium for, even if they may look back in hindsight and say, we could have done something different. That's where I'd probably recommend a longer fix rather than a shorter one, whereas if people want a bit more flexibility and they want to lock something in for a couple of years, but they fully expect that they'll be able to get something a bit better, and that could be where someone's buying, for example, or remortgaging and they're at quite a high loan-to-value. Let's imagine they're at 90% at the moment. In a couple of years' time, if we assume no guarantees, of course, but a bit of house price growth, a bit of paying the mortgage off, they might suddenly be at 80% loan-to-value. So when they remortgage, they're in a lower loan-to-value bracket and they can then get a better rate, even if rates across the market haven't really moved at all. I'm conscious of using some jargon there. Loan-to-value is basically how much you're borrowing in comparison to the value of the property. So broadly over time, you'd expect the loan-to-value to reduce from where you started. Ross, would I be right in saying that if you have recently remortgaged or your mortgage payments have gone up for whatever reason, you're struggling to afford them, there are options out there for you, such as going to interest-only rather than repayment. What are your thoughts around that? Yeah, so interest-only, absolutely a possibility. So the mortgage charter that people may have heard about basically mandates lenders to give that option to people where they ask for it. It's only for six months, but it can give people a bit of breathing space to pay a bit less. Obviously, bearing in mind that during that period, you are literally not clearing the balance at all. At the end of the six months, you will still owe what you owed on day one. Maybe safety in the obvious there, but it's really important just to factor that in. Extending the term is something we've done a lot for people recently. So where rates have been really low, people have been able to make overpayments and stuff like that. So they may have 20 years left on their mortgage, but actually, based on their circumstances, they could actually have that mortgage over 40 years. The reality is they probably wouldn't keep it for 40 years, but if we can extend the term upwards, it brings payments down in the short term so that hopefully, if and when things improve in the future, they can then make a concerted effort to bring it back down again. It's a temporary measure, but it's still a measure that people should look at nonetheless. And then you've also got people that sit on the cusp of the loan to value bracket. So it could be that at the moment, they're, let's imagine, at 75% loan to value or just over. By making a small overpayment, if they're able to do that, it brings them into the loan to value bracket below and the saving they'll make on the rate on the rest of the mortgage more than compensates for what they've put in. So it doesn't always work like that, but we've seen several examples where people put in a grand, for example, and over the course of six months, they've saved that back in interest. Really nice if you can show someone that's an opportunity to exploit. Just on the overpayments part there, Ross, would I be right in saying that there are maximum amount of overpayments you can make in a single year and it's not necessarily always beneficial to do so, right? Exactly. Yeah. Most lenders on fixed rates will have 10% a year that you can overpay. There's a few lenders that actually increase that. NatWest is a good example. You can pay 20% back a year. So you've always got the ability to do that. For most people, that's more than enough. But when it comes to remortgaging, lots of people don't realise this, but you can, because you're effectively moving onto a new deal or the day after your existing rate ends, there's that kind of window, even if it's a couple of hours, where there is no early repayment charges. So it could be that, use some simple maths here, let's imagine you owe £250,000 now and you need to make an overpayment to bring yourself down into the next category. You would do that simultaneously on the day your existing rate ends so that actually you don't have any penalty at all, but you still benefit from the lower loan to value product from your new lender. That's something that any good broker would kind of arrange as part of what they do, if it's an option for you, of course. So Ross, this is obviously an investment podcast. So I need to shoehorn a bit of investment stuff in here somehow. Obviously, the landscape for property investors has changed a lot over the last few years with interest rates going up dramatically, meaning that yields on property are no longer as attractive as they once were compared to a few years back when you were getting 1-2% on your buy-to-let mortgage. What does it look like now for property investors? Have you still seen demand there or has it completely dropped off? I'd love to hear your thoughts. So I think we're definitely seeing less prevalence of people wanting to buy new properties. So existing clients who have got portfolios haven't bought more properties because the numbers just don't make sense anymore. People that are kind of coming to the end of a fixed rate are considering whether they consolidate their portfolio and sell properties to put some of that money back into other deals, which means they can reduce the loan to value and get a better rate or actually have properties with no mortgage on whatsoever. I think what I'd say is actually, again, you'll probably get bored of me saying this, but every case is different. There's certainly still some good deals to be had out there. Certain properties, particularly up north, lots of our clients will buy properties in places like Middlesbrough, for example. You can buy a three-bed semi-detached house for 100 grand up there. You can get a really good rental yield on it. So even though interest rates have gone up, there's certainly still merits in exploring deals on their own merits to see, does this work? With the interest rates where they are, does it work? If it works now, hopefully, if and when things improve in the future, it's going to work even better. But what you find is most vital that landlords will make the most of things when rates are low and then when rates start increasing, they might look to consolidate and put money in from other sources to kind of bring down their debt level. That's something we saw before when rates were higher, and obviously we've been through a period where rates have been very low for a long time. So we all kind of forget a little bit about what normal actually looks like. We've been a little bit spoilt with ultra-low rates. Now, what I'm not saying is I think rates are going to stay where they are. Obviously, no one knows what's going to happen, but I personally don't think rates will go back to those kind of 1% levels they were a couple of years ago. Not anytime soon anyway. Now, that's really interesting, actually. And maybe getting a little bit too technical here, but purely out of self-interest, when would you say it's right to hold your properties in a limited company versus holding them in your personal name? I know that over recent years, buying property in a limited company has become a lot more popular because of potential tax benefits, etc. So, yeah, interested to hear your thoughts on that one as well. Yeah. I would say generally, when you get to maybe five properties plus, it starts to make a lot of sense considering whether, or if you're planning to have that amount of properties, it makes sense to consider whether you want to hold it within what we refer to as an SPV, special purpose vehicle, so a limited company structure. A couple of reasons why you do that, mainly because any of the interest you're paying on the mortgage is fully assessable against the profit you make from rent and income. You may know this already, you may not, but any properties held personally, the rules have changed over the past few years, so you aren't able to fully offset your expenses when it comes to mortgage interest. So actually, broadly, what that means is some people are actually paying tax on profit that isn't really profit if they hold the properties personally. So, the kind of key things to look for there is assuming there's a higher rate or an additional rate tax payer if they've got multiple properties, if they've got some other bigger strategy where they're thinking about how they get that money out of the company name into their name, which could be through using pensions or loans to other companies, for example, that's where that can start making more sense. For someone that is going to kind of dip their toe in and do one or two properties, personally held genuinely can work. Again, I tend to recommend people, if they're thinking about property investment, not to go straight in and assume they're going to build some great portfolio. They might try and absolutely hate it. The reality is, I don't know one landlord that hasn't had a period where they've had tenants smear shit over the walls and all sorts of stuff. So, it's not all roses. It's like any investment, there's ups and downs. It's not for everybody. But maybe owning a property personally, it's a lot easier to do and it's also lower cost. Mortgage rates on personal buy-to-let mortgages are lower than ones that are bought through a company. Doing that first just gives people a bit of an idea about whether it's something they want to explore going forward or not, as the case may be. Can I strip things back a little bit? Obviously, you said a lot of your clients are older, but you will have obviously worked with young people who are thinking about getting their first mortgage, as you said, where a lot of our listeners might be. What are the really simplistic early considerations and early questions that you ask them and ask them to ask themselves about deciding on potentially, A, if mortgages are right for them, B, what type of mortgage they should be looking for? Because, you know, I look at them online and all the different terminology and all the different rates of interest and all of those things. What would be the simplest way of going about that process? So, the first key question is, what do you actually want to get? So, let's start with what did you have in mind? So, what kind of properties have you looked at? Where are they? What kind of budget do you think you're going to need to buy something you actually want to get? And that gives us a starting point. So, that's kind of like the dream number. Someone might come and say, right, I'm going to need 400 grand to buy this particular property. Okay, that's our starting point. How much money have you got or are you going to have to put in as a deposit? And what are the other costs we might incur, stamp duty, legal fees, broker fees? Let's fill that in so we know what our initial outlay is going to be. And that then gives us how much we're going to need to realistically borrow to make it work. And then our job is to work out, is that something they can viably do now or at some point in the future? If it's a no, what would they need to do to make it happen? It could be that, I used the example earlier of overtime. It could be that there's overtime available, but they've not been using it as much as they could do because they don't have any reason to do that. But if we can say to someone, for example, if you can do three months of overtime at this level in advance of doing your mortgage application, it would mean you can borrow this much more, which means that you can get that property. It suddenly gives people a reason for doing it in the first place. So going back to the financial planning piece, everything we do is always with an eye on what's the outcome? Why are we doing this? Is it going to get us closer to what we're looking for here? And we try and give mortgage advice in the same way we would do as financial planners. We put a financial planner's hat on when we're looking at how to structure a mortgage for someone. So it ticks the boxes around lifestyle. Is it going to leave them in a position where all their outgoings are going on the mortgage? So another key question would be, what kind of monthly figure would feel comfortable for you to pay for your mortgage? Obviously, as low as possible tends to be what most people answer, but what kind of figure would work within the context of what other things are important to you? We want to factor in if you're going to take life insurance and income protection and critical illness cover and things like that, what might that cost you? How do we put something in place so that whatever's going out for the boring stuff still leaves you with money to do the other things that are more exciting and enjoyable? Because it isn't all about doing stuff for the future. We want to make provision for the future, but still be able to live and enjoy life today. Yeah, that's great. Thank you. Yeah, yeah. That's a great answer as well. I think the question also I wanted to ask, and you've answered it a little bit as well, but do you think the general landscape of buying houses is changing? So what I mean by that is, for example, when I started my business or became self-employed, people, the older generations kind of said to me, be careful of doing that, because it might make it a lot more difficult to get a mortgage in the future and considerations like that. And you also mentioned that the mortgage provider will provide things once you can prove a certain amount of rental payment, because that's always blown my mind that I've been paying rent in London for seven years or whatever. Why do you question my ability to be able to pay back a certain amount? So yeah, do you think that landscape and the kind of thoughts around those things are changing a bit? Yeah, do you know what, David? It's a really, really interesting point. So I think there's actually quite a big misconception around how difficult it is for self-employed and limited company directors to get mortgages. So actually, one of the areas we specialise in is helping people who are self-employed get mortgages, because so many people think it's much more onerous than what it really is. The reality is, it's just about knowing what lenders are looking for. So lots of lenders will only want two years of accounts to kind of be able to lend money to you, and they're a lot more flexible than they would be with people that are employed. Some lenders will even look at one year's of accounts in the right circumstances as well. So it's not a case of having to wait years and years and years. If you've got one year's of accounts, it's still worth speaking to a broker to see what would be possible. The other thing we hear quite a lot as well is where people have got limited companies, they might not be taking all their profit out because it's not tax efficient to do that. But actually, lots of lenders, an increasing amount, are more pragmatic, and they'll look at what the profit in the business has been and what they could have taken, and they'll base their lending decision on that. So it all comes down to how we, as brokers, present the application and the applicants to a lender. It's a bit like when you sell a car, you want it to look as shiny and new as possible. When we're applying for a mortgage, we want to make that applicant look as attractive to the lender as we can. We're not going to lie, of course, but we're going to make things look in as good order as we can to give them the best chance possible of getting the lending they're looking for. But I think there's definitely more lenders that are more pragmatic around self-employed people and business owners, and also other types of scenarios like newly qualified professions, for example. So if someone's just qualified as an accountant or a teacher, generally it's not something they're doing on a whim. They've gone into it for a reason and they're probably going to stay in that profession for some time. So lenders will have their own policies around how they might be willing to lend more multiples to those people, knowing there's a bit more of a defined career path. So again, all of those situations, it makes sense. Just have a chat with a broker and understand what your options are, and it would then give you a bit more information around whether it's something you can do now, or if there are a few things you need to be doing before you get to the point of making it viable. Great. Thanks, Ross. I think that's really useful, especially for a lot of people these days that are self-employed and it's becoming a lot more, I guess, normal with the gig economy and all this kind of thing. So I think that'll be really, really useful for a lot of people listening to this podcast. I just want to pick up on something you mentioned earlier about 100% mortgages. I know that they used to be more of a thing pre-08, but obviously, because of a lot of things that happened, a lot of providers completely withdrew those types of products. Are they now coming back and a bit more prevalent in the market, or still not so much? No, honestly, it's really not prevalent. I think there's one or two products in the market. I'd like to see more. I think, in the right circumstances, they can work really well. Obviously, we need to be careful, people borrowing more than what's viable for them and interest rates going up. We're seeing that at the moment, where all the documentation people get, all the conversations you have, are always about, this is what you're paying now, but if rates were at this, this is what it would be. All of us, we look at it and we kind of go, yeah, yeah. Lots of people are now in the reality of, actually, those figures that we thought were worst-case scenario are even worse than that. You're seeing people having to sell their house or downsize or do something different because they've kind of overstretched themselves elsewhere. So, again, I think it's something that would be good to see more of, but it really needs to be positioned in the right way. Perhaps, being a financial planner, I'm a little bit more cautious with stuff like this. I'd always want to stress test and sit down with people and really make sure that that is the right thing for them to do. One more thing, guys, that you mentioned, and it was about people who were perhaps coming up for re-mortgaging and what they could do. This applies to anybody that's got a mortgage at the moment. So, if you're within six months of your fixed rate ending, my advice is to get something locked in as soon as possible. So, there's nothing stopping you doing that and then you've basically got your worst-case scenario and you can spend the next six months, or hopefully, the broker you're working with can spend the next six months reviewing the market and locking in anything else better that comes along the way because that way you're protected against rates rising, but you know what to expect as well. Part of the battle is actually knowing what it's going to look like. So, you can hopefully do a little bit of jiggery pokery around what things can we cut out of the budget, what things are we paying out for that we don't need, how can we put ourselves in a position so it doesn't come as such a big shock, but having those conversations sooner rather than later makes complete sense because if there are any opportunities to make strategic overpayments, like I mentioned earlier, or to look at other lenders or to do something different, knowing that now just sets you up well for not having that last-minute rush, which we still see people approaching us now who are kind of coming up for the end of their fixed rate in a few weeks' time, nothing locked in. Obviously, it's a mad rush to get something new, which we can do, but they're panicking. They could have been much more relaxed and calm had they have done this months ago. And is six months the magic number or can you start looking a bit earlier or maybe even slightly later? Yeah, six months is the magic number only because generally offers are only valid for six months, so you need to kind of wait until you're in that window. There are some lenders that don't let you do it within six months, but let's imagine you were with one of those lenders at the moment. There's nothing stopping you applying for a remortgage with another lender, and then when you're within the window of your own lender, you can lock something in with them if that's the right option for you. But it's never a given. Actually, lots of circumstances, the existing lender that you're with won't necessarily be the lowest cost or best option to go with. It's really important to look at what else is out there. I think that's really valuable advice, Ross, and I know a lot of people pay a lot of money to get this kind of advice, so I really appreciate it. Slightly different question for you now, and I want to know that given you've accumulated all this knowledge and experience, would you have given yourself some different advice when initially saving for your first house? I only ask that because I know people get very stuck in this mindset of as soon as I get a first job or move out, I want to save up for my first deposit and buy a house as quickly as possible, and sometimes it's at the detriment of actually having a bit of fun in life, and it may not necessarily be the right move to buy a house straight away. So, yeah, I'd like to get your thoughts on that one. Yeah, I think I always bring it back to the bigger picture here. So, too many people get caught up in chasing something that they think they need to do, because that's what everyone tells them, particularly older generations. But actually, when you're young, there's other stuff that you could be using the money for that's important to you. So, I suppose my biggest thing is not feeling guilty if, rather than saving for a house deposit, you save up and buy yourself that car you've had on your wall since you were five years old that you really want to get, just to get it out of your system. Because as we get older, all that stuff becomes much harder to do, and we all become a bit more cynical and we start prioritising things that are more sensible. So, when the appetite is there to do stuff, as long as there's a plan and actually you're not putting yourself in a position where you're going to fuck yourself over to never be able to do it, I'm a really big believer in actually working out and saying, right, well, look, I'm 16. I've just got my first job. Yeah, who cares if I'm not going to save for a bit? I'm going to just enjoy life as it is for now, because when I move into my 20s, that's when I'm going to start making a more concerted effort so that when I'm in my 30s, I can buy. But it all comes back to having a plan and knowing what you need to do to get there. And it could be something as simple as saying, if I'm 20 and I want to buy at 35, how much do I need to save every month to have a reasonable deposit to buy something? Obviously, you've got all the complexities of inflation and house prices, but that's the starting point. A plan is better than nothing at all, and that puts you in a position where if you know you're saving X amount per month, and that's getting you closer to your goal, anything you're doing outside of that, you're going to enjoy it. You're not going to be sitting there feeling guilty if you've spent money on a holiday or going out or whatever it may be, because you're making provision for your objective, as well as doing something you enjoy. Too many people go through phases where they put everything into one thing, and it loses its novelty, and they just kind of come off the bandwagon, pull all the money out and just spunk it on something. So it's about having something that's going to be sustainable. It's a bit like exercise or dieting. It's doing something that you're actually going to stick to, that means that you can live a more balanced life. So I think that would be my biggest advice to anybody. It's not all about doing that one thing. And something else, again, I wouldn't necessarily advise this. This is getting a bit technical, but I did this, and I've got a number of clients that do it. But when it comes to buying a house, if you're saving for a deposit, although I absolutely love pensions more than anything in the world, because as a financial advisor, they're such a great source. Even my kids, yeah, they're a close second to the pension, and the wife is third. And when it comes to that, I actually stopped putting money into my pension when I was saving for a house deposit, because my view at the time was I was in my 20s. I needed that money now. And although the money in the pension would have been some multiple in the future, my objective at that point was to focus in on buying the property. So actually, although it's sometimes counterintuitive, if you're putting money into a pension that you're not going to be able to touch for 30 years, putting it into your house deposit instead so you can get the house, as long as you've got the discipline to actually make provision for the future and put a bit more in if you can, I'm not against doing that. Again, that's not advice from me saying people should do that, but it's something to consider. I did it when I was looking to buy my place. It meant that I could buy somewhere sooner rather than later. I'm now putting money back into my pension in great guns to more than make up for it. And I'm very comfortable that was the right thing to do. So there's various things to think about when it comes to what's really important to you. Yeah, I love that response for us. I think we get very caught up in the normal structure of life. You know, getting a house and having kids all before you're 30. But I think you're just showing that there's more than one way to do this. And there's no right way either. Exactly that. It doesn't need to be binary. There's always times in life where we'll go completely focused on one thing, but the younger you are, the less you really need to be doing that. It's a time for trying things out. And again, it's not just people who are young. We almost have a full circle. When people retire, they've got money, they've got time, they've hopefully got health, but they don't really know what they want to do. So part of our planning when we work with people first in retirement is to say, have some budgets set aside just to try some stuff. Accept that you might do it and absolutely hate it. But if you've ever had a hankering or even in the back of your mind, some desire to try something, whatever it may be, rock climbing, sailing, whatever, try it out. See if you like it. You're going to rule out a lot of stuff that you're never going to want to do again, but you're probably going to pick up some really key hobbies that are going to make a massive difference to you that you're then going to want to build into your plan going forward. So don't be afraid of wasting money. It's not a waste of money to try things out because if you never try it, you're going to have those regrets. There's so many people, it's a cliche again, but you ask anybody that's kind of at the end of their life what they're thinking and they're saying about all the things they never got to do. And I'm a really big believer in things like that where possible, if we can do it now, why are we waiting? I love that. It's great. There's loads of stuff. I could pick up on 100 things you've just said that I fully agree with. And interestingly, the kind of comparisons with what I find myself telling people all day, every day in a different realm. But as you said, in the health and fitness realm of life, life doesn't need to be all or nothing. It doesn't have to be chicken, broccoli and brown rice all day, every day. But it also doesn't have to be you smashing 12 pints and having eight kebabs every day as well. Like find some balance and enjoy life. Yeah, I couldn't agree more with a lot of people. It's only the weekend diet, isn't it? The 12 pints. Yeah. Or the week day diet and the weekend diet on a particularly bad week. I think you've been fantastic coming on and thank you, A. But B, there are 101 other things I could talk about, building businesses and all the rest of it. But I think we've covered a lot of it and I wouldn't want to take your whole evening and for us to spend three hours talking, even though I'm sure it would be good fun. So the two things here, is there anything else, like any other top tips or anything else you think you might go away and go, I wish I had talked about that. I wish I had said that. And I'll let you have a moment to think about that. The other thing we are doing with our guests is, if they are from the kind of the wealth industry, letting them come on and ask a question regarding health or anything, not necessarily on my left knees really sore, can you diagnose it? But if there's anything you want to talk about in the health industry and then we're doing it vice versa with other guests. So yeah, anything else that you want to put across to our listeners or anything you want to ask me? Definitely something I'd like to ask you, Dave. So in terms of bang for buck, what would you say is something people can do either every day or regularly that you believe will have the biggest impact on their health and well-being going forward? That's a really good question. And again, it's really difficult to give a, you know, you see a lot of this Instagram stuff of do these three exercises and you will get shredded or it's obviously never a simple answer with health and fitness things. Personally, and I think getting somebody to do stuff in moderation is a really great idea. So something, a small achievable target every day. Personally, strength training for me is the most valuable weapon we have. And that doesn't necessarily mean somebody going into the gym and trying to lift super heavy weights to make themselves look huge. You know, it doesn't mean that you need to be a meathead and be injecting anabolic steroids and stuff. But I think the thing that I, when you look at people who are older, and I've worked in hospital wards and stuff and seen, you know, more elderly people, muscle mass massively declines once you get into older age. And the people that are living a good life when they're older, generally people that have adhered to some kind of strength training or resistance training program through their life. That's when they maintain their muscle mass. And that's when they can still, you know, stand simple things like stand from bed after a period of their feet off an operation or something. They've maintained a bit of muscle mass. They can still get out of a chair. They can still lift up their grandchildren. They can still do like important functional tasks that maintain that high quality of life. So, yeah, if I said 20-30 minutes of some type of resistance training, it can be body weight stuff. It can be, you know, again, I'm not going to go into the specifics because it depends on who you are and what you're doing, but 20-30 minutes of some resistance training would be my top tip if I could only pick one thing. And would that be daily, Dave, or not as frequent as that? I think if you were doing a very long, intense workout, you wouldn't want that to be daily because your body needs the time to recover. Essentially, in strength training, you're breaking the muscle tissue down and then creating a signal to repair the muscle a little bit stronger. Again, in real layman's terms, so if it were a longer workout and you're getting into the gym and you were lifting some serious weight, I would say every other day would be great and obviously splitting up potentially, you know, one day being a lower body session, one being an upper body session. I'm not a particularly big advocate unless you want to become a bodybuilder at all these splits of, okay, today's chest day and today's tricep day because life's too short to train like that for most people. But on the other hand, the more simple answer is I think six days a week with a day of rest if you were doing it in short 20-30 minute bouts and you were only using body weight and low resistance rather than loads of heavy weight in the gym. Would it be fair to say lift weights live longer? Is it as simple as that? Absolutely, absolutely. Yeah, it's a great quote. Yeah, it keeps you moving, good for your cardiovascular health and yeah, I think the thing for me is it maintains your function, what you can do and how you move right into later life and therefore have a good quality of life. I just want to say a really big thank you for coming on, Ross. I think you've had some quite some really valuable insights. You've kept things kind of jargon free so even an idiot like me can understand them which is great and I'm sure there's a lot of listeners around house buying and stuff that will be really happy with the content that's come out, I hope. So yeah, big thank you and I know you're not here necessarily for self-promotion. We've talked a bit about your business though. Where can people find you? How do they get in touch with you if they do want to come to you for some advice? Yeah, really good to be on here. Thank you for having me. Yeah, always happy to chat even if it's just a general conversation on the phone to give you some pointers. Fairview Financial Management, go onto the website, drop us an email, send us a message and we'd love to chat if there's anything we can help with. Once again, thank you so much, Ross, for spending the time and having a chat with us. But as always, just to finish off this podcast, I do want to say that everything that we spoke about today was for entertainment purposes only. It does not constitute as advice and if you do need some financial advice, please always seek professional help. Thank you. you you lovely