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Iona Bain on Owning our Finances and Millennial/GenZ Investing

Kriti: [00:00:00] Hey guys, welcome to WhyFI Matters!

I'm super excited for today's episode on the importance of investing for younger generations, but also how financial education as a system can improve. Today's guest is the UK's leading millennial money expert, Iona Bain. Iona is an award-winning speaker, author, and broadcaster, and she's the founder of the Young Money blog, which is Britain's first blog established in 2011, to help people get a grips with their personal finances. Her newest book "Own it! - How our generation can invest our way to a better future" guides, her readers on the taboo and often anxiety provoking world of investments and finance. And today, hopefully she might guide us through this as well. So I hope you enjoyed the interview.

Hi, Iona. Thank you so much for coming on the podcast today. Like I was telling you before we started recording, obviously I've been waiting for this interview for quite a long time. So I'm super excited to learn more about what you do at the Young Money blog and also more about the power of investing for young people and how it can really help us in our lives. So, yeah. Thank you so much for coming.

Iona: [00:01:33] Oh, it was great to join you Kriti and yeah, I hope that I can share some useful stuff with you.

Kriti: [00:01:39] Can you tell us a little bit about your life as a teenager and what eventually made you interested in money and personal finance?

Iona: [00:01:50] That's a fantastic question. Well, I grew up here in the UK. I'm from Scotland originally, and I didn't know anything about money, really when I was growing up. My parents were very frugal and thrifty. So my mum in particular, because she came from what you might call a working class background. You know, she wasn't born into money. Therefore she's always had a very conserving mindset. So when we grew up, we were, we had it instilled in us not to waste money, to look after whatever money we are to make sure that we could find bargains to make our money go further.

And I was also very fortunate in that my father before he retired a few years ago was a business and finance journalist. So it might start to make sense as to why I'm doing what I do now. But in all honesty, my dad never talked to me about money when I was growing up. In so far as he never, he never encouraged me to go down the same path as him.

We didn't really talk about business and finance in the house. I was encouraged to pursue my passion, which was music. And so I was a trained musician through most of my youth. I spent most of my teenage years getting to a very high standard as a classically trained musician. And then I went to university and studied music. And it was only really in my early twenties when I was out there in the big, bad world, just a few years after the financial crash.

And I, it was only at that point that I realized that I knew very little about money. I felt very insecure about my finances. It was proving to be a really tough environment for all young people. And I knew I had to do something about it. And as my musical career stalled, I decided I had. Very little to lose and so perhaps a good way to learn about money would be to start a blog. So that's when I started Young Money blog in 2011, and I suppose the rest is history.

Kriti: [00:03:55] You and I are very similar. So, you started like your whole business, everything you do, because you were curious and wanted to learn more for yourself. And that's the same reason why I started doing the podcast cause I realized I'm very ignorant of what I spend and things like that. So definitely it's helped me, but it's great putting it out there for the world to see. You can help other people as well. So that's cool.

Kriti: [00:04:21]And also I play an instrument. I play classical guitar. So what did you play?

Iona: [00:04:28] I cello and piano, but I was also a singer songwriter. So I moved from classical music to pop music. I love most kinds of music. I can't say I love absolutely all kinds of, but I am more or less a music lover.

Kriti: [00:04:44] I love music too.

And I have an interesting question. Do you think that a lot of musicians have poor financial knowledge? Do you think that societal like judgment on musicians prevents them from even wanting to educate themselves on finances?

Iona: [00:05:02] I think that's a brilliant question. Kriti. I've never been asked that before, I would say that there has been a stigma attached to money in the musical and creative world, like art gone by in the arts more generally. Yeah, I do definitely feel like that there was a stigma and when I was a musician, it was hardly ever discussed.

And in fact, my brother is also a musician and still is one. And when he went to music college , I think he was really surprised at how little practical advice and guidance was given to him, despite the fact that he would be going out into an incredibly competitive world where the chance of success is

Kriti: [00:05:43] so small.

Iona: [00:05:44] Exactly. And so therefore people need to be very entrepreneurial. They need to hustle. They need to potentially find lots of different income streams. And they have to learn all this pretty much on their own without any help and advice, even when they go through formal institutions, which in theory could be helping them and giving them that support.

But I think things are changing. There are some really interesting organizations out there. I just came across one the other week actually. It was it's called the "Hell yeah! group". And they're providing financial advice and information for people who consider themselves to be creatives. And they're doing it in a really fun, imaginative and artistic way.

Kriti: [00:06:25] And that's awesome.

Iona: [00:06:26] And also I'm doing some workshops even though the next month for an organization called "Creative Edinburgh". And that's all about getting self-employed people who work in the arts to understand that money is a subject that they need to understand and engage with, and it doesn't have to be scary and daunting.

Kriti: [00:06:45] I think that's amazing.

And I want to talk about financial education in this narrative. Like in even in a lot of different schools, financial education is not a part of the curriculum even though it should be, or they say it's in their curriculum, they don't really teach it well. So, how do you think that we can change this narrative? What you think are the next steps to make this something interesting for us?

Iona: [00:07:12] So about financial education and what the situation is regarding financial education, I can answer that in relation to the UK. Since 2014, here in England, financial education has technically been a compulsory part of the curriculum. And in the other three nations of the United Kingdom, it was on the curriculum a little bit longer than that. However, that doesn't mean that all young people are being taught about money. And even when they are being taught about money, the approach might not be very effective. And there are lots of different factors can explain that weird contradiction there. One of the factors is that we've got different types of schools here in the UK. For instance, we have academy schools which don't follow the national curriculum. So it's down to the teachers to decide how they approach the subjects. If they choose to approach it at all. Another reason why financial education tends to be pushed off the end of the priority list is because it's part of a very big subject called citizenship. And that encompasses a huge number of other subjects. And therefore it, especially if you don't have any exams on a subject here in the UK, we're a very exam driven culture. If in the education system you have a subject that doesn't require any exams, then teachers in schools tend to neglect it and it ends up being an afterthought. So that's the reason why whilst financial education is in theory being taught in schools, it's not always being done very effectively. And also teachers aren't getting training. They're not getting resources to help them to do this effectively from the funded, by the government. They're funded by charities and financial institutions. And you have a situation even where someti

mes banks are going into the schools. And they're providing the financial education. And also often that ends up with them talking to young people about bank accounts that they can open. And so it ends up just being a sales opportunity.

Kriti: [00:09:14] Sales pitch!

Iona: [00:09:14] That's it no financial education. So clearly we've got a lot of real flaws and shortcomings, even with our approach where financial education is on the curriculum.

How do we make it more engaging and effective? And more, more interesting for younger people. Because I think that it's getting better, but money still has a big image problem.

And this image problem is down to various perceptions. Firstly, that money is boring. Secondly, that it's very grubby and that it's only the concern of people who are quite greedy. And thirdly, that it's complicated. So I think to be fair, there's only one of those three aspects. Only one of those three beliefs that I think has any truth in it, which is that money is complicated. There is no getting around it. That doesn't mean it's not fascinating. And it doesn't mean that it's not really worth us trying to understand it. And I think that it's about reframing your attitude to money. And it's about understanding that you are potentially forming your beliefs around money at a very early age.

Some of the science out there suggests that you could be forming your attitudes to money by the age of eight.

Kriti: [00:10:26] Exactly. Yeah.

Iona: [00:10:27] And if that's the case, then yeah, you are, well, firstly, if you're not being taught about this, a school that has been left up to your parents and your parents, you know, they may be brilliant and they may be kind of teaching you a lot of really great things in lots of different areas, but money might not be one of their strengths.

Kriti: [00:10:45] Yeah.

Iona: [00:10:45] They may have financial problems of their own. They may be in debt. They may be spending a lot. You're learning from them. You are taking your cues from them at a very early age. And then you are carrying on a lot of attitudes about money into your adult life. And they are really underpinning your whole financial behavior in ways that you haven't ever really fully understood or explored or admitted to.

So I think this is about a mindset, right? This is not just about maths and numbers. And I think my work is all around in all of all the about encouraging people who might be put off the whole subject of personal finance, because a lot of it seems to be about understanding numbers and being good with maths.

But actually that's just the secondary. That's a nice to have. And to be honest, it's, as long as you have access to a calculator then you'll probably be all right. You know we're not talking like PhD level. This is math everyone. Basically can't get their heads right.

For the really important stuff. And the stuff that, that thankfully is also really fascinating, that everybody can take an interest in. The really helps us think about what we want out of life. You know, really demands us to ask the big questions. I should say.

That stuff is to do with our mindset, how we think and feel about money and how it reflects our values and our attitudes. And so that's how we nail financial education. When we talk far more about the psychology of money and far less about the numbers.

Kriti: [00:12:14] I feel like even from, from a student's perspective, like myself, whenever my teachers talk about something like personal or something emotional, I can connect with them more.

Like, even if we're having like a discussion on a history thing. And then my history teacher suddenly talks about her own life and how this could relate to her. Like that's when I sort of get it, you know? And that's how we should be handling money, but obviously it's a very personal thing. So yeah.

Iona: [00:12:44] Yeah. I mean, your teacher is really brave because I think a lot of people just don't want to be that open and honest, which I completely understand. Yeah. As you say, it's a very personal issue and people can have some very deep problems. And when we think about money, it opens up a lot of potentially quite painful areas of our life that we maybe don't want to think about it.

Um, so. Yeah, you've got to, you've got to be sensitive. You can't make people run before they can walk. You've got to work with, to that timetable and, and make sure they feel comfortable. And that they're not being rushed to ask questions of themselves that they're maybe not comfortable with.

And also, I did talk in my first book "Spare Change" about how maybe you can discuss how you formed your attitudes to money with the people who brought you up. But that's not possible for a lot of people either because they're straight from their parents or their parents have sadly passed on or they never had parents.

They were brought up by other family members. There's so many different scenarios that can determine how, and why somebody is brought up with some dysfunctional financial attitudes. And therefore it's not essential really to go and find out what the source and what the cause of those issues are, or the matters is that you're aware of them and that you're committed to working on them as you grow up.

Kriti: [00:14:01] . And so you wrote your second book called "Own It", how our generation can invest our way into a better future". And this is the focal point of this episode. I really want to talk about investing and the power of investing.

So why does investing even matter? Can you give us like a few benefits and advantages of investing and why starting young is really impactful when doing this?

Iona: [00:14:31] Sure. Well, investing matters because it's you putting your money into the stock market and the stock markets is where companies list i.e., Go out there to find money in order to grow and hopefully solve problems, employ people, and generally give back to society and move the world forward.

And that, that system, which is broadly speaking capitalism, ain't perfect. We know it has lots of floors and problems. And we always have to be alive to those gremlins in the system. However, we have something that can really help make capitalism more accountable and transparent, and that's shareholder culture.

We all have the ability to be shareholders because when companies list on the stock market and put themselves out there, when they go public, then we can put our money in those companies. And when we do that, we have a say, and we can determine how that company behaves in future. For instance, if we think it's not, if we think it's being irresponsible, whether that's with regards to the environment or their own workforce or their supply chain, then we can speak out.

Now, there has been a lot of debate about how much power shareholders really have, especially individual shareholders, because we've seen a lot of companies come to market and list and go public in recent times, which have limited the ability of shareholders to get involved. That have given maybe more shareholder rights to CEOs, things like that, which is a, which is concerning because I definitely believe that investing works best when everybody has the opportunity and the potential to, to invest in those companies.

So that's why investing matters. And it's totally different from putting your money in the bank and you gain that money back at a later point when you want it, or at the end of a certain term. And that's guaranteed. That's great for certain purposes. If you need to save for emergencies, you have to access that cash really quickly.

And likewise, if you've got any kind of short term goals, where you don't want to be putting that money in the stock market and waiting and seeing whether you'll get that money back at the time you need it. Then obviously you should be putting that in the bank and that's your safe bet. But we all need to be engaging with investments. And we need to do that as soon as possible, because it's a long-term game. The longer you can put your money in the stock market, the greater the chance of you growing your money over the long term, because you need time. You need to give companies your time as well as your capital, because they can't work miracles overnight.

They need that time to grow. Therefore if you start as soon as, as you can, as soon as you have the money. And I would say that nobody should start investing until they have paid off expensive debts or built up and built up a little savings pot, there a worth a few months worth of their wages.

But once you've got that sorted, then you should be thinking about investing because it's the most powerful way for you to grow your money in the long term. So you can achieve your goals and your dreams. And I say in the book, the investing is an active, practical hope. We do it because we think that the future can be better, that we think our future can be better. And therefore, by putting money towards it, we can create more options and choices for ourselves.

Kriti: [00:18:09] I like that quote a lot. And so can you talk a little bit about disparities in investing, like the investing gap.

Iona: [00:18:19] Yes. There's definitely been traditionally a gap in investing in terms of ages. Older people, far more likely to have the money, first of all, to invest in. Secondly , to just be much more in touch with the world of investing and engage with investing. For instance, if I think about my dad, he started investing around the two thousands. Lots of people of his generation, I think you could broadly describe it as the baby boomer generation, or they grew up at a time when , shareholder capitalism here in the UK, went through this glorious phase, if you like in the 1980s.

So, Margaret Thatcher who was quite a controversial prime minister, she basically decided that that lots of our state owned companies would be privatized and then ordinary people could invest in them. And so when that happened, they priced the shares of these companies were very low. So lots of people could buy those shares, make money very quickly and feel like they were getting the power of capitalism right there in their pockets. So it was a very popular policy that she introduced there. And that really, I think, shaped a whole generation's view of investing and they really believe that investing was a way to, to grow your money farm far more than if you just put it in the bank.

And so my dad started investing in the 2000s when also investing became a lot more accessible here in the UK. So I I'm sure it was the case right across the road, but certainly here, we saw lots more platforms come onto the market, thanks to the internet. And therefore you could open an investing account online and start doing it for yourself. So that was an amazing step forward. And then I think we had the 2008 financial crash and that really set back the cause of investing for so many young people.

Kriti: [00:20:12] Because like for the baby boomers, when Margaret Thatcher created that policy, that was what sparked them. And then for the millennial generation, the financial crisis is the spark, but it did not increase investing.

Iona: [00:20:26] It had a negative impact on it kind of engendered this real mistrust of the financial industry. We, um, felt very left behind. In the U S and in the UK, without this policy of quantitative easing, which has basically meant that the price of assets have gone up hugely over the past 10 years beyond most young people's financial capabilities. And so it's created this real to track economy among the haves and the have-nots. And so, yeah, this is, I think this is partly what's maybe led to that generational divide.

But that's really started to change in the last year or two COVID has really has really turned that all on its head because there was a really long period of stock market gains. Like I say, fueled by quantitative easing, which pushed up the price of assets. And therefore people just could not get a foothold in investing. It wasn't very cheap, frankly, especially in the U S then COVID came along. There was a huge stock market crash here in the UK. The footsie fell by a third and suddenly stocks really cheap again. And a lot of them looked like they would actually bounce back really quickly, particularly technology companies and young people were sat at home bored with nothing to do saving money because they weren't going anywhere and spending any money.

So they thought, well, why don't I just put some money in the summer? What's the worst that could happen if I lose it, I lose it. But if I don't then maybe I'll make some money and yeah. Hey, that would, that would be so bad. So that's what a lot of young people did. So we saw a boom and young investors here in the UK, as you guys did in the us as well.

And the average age of investors on trading platforms here actually fell by quite a few years. So that, that generational divide is closing I think.

There is certainly a gap between the numbers of men investing in the numbers of women investing, which is really unfortunate. And that the reasons for that are extremely complex.

And I won't get into all of them now. But I think it's basically because women have never been encouraged to see investing as their domain. They may be told that their arena is how so finances making sure that you're keeping a tight grip on the purse strings that you're not spending too much money on the food shop and so on. But they have been excluded from the conversation about big money as I would call.

Again, That's starting to change. I'm hoping to change that in my own little way, because it's vital that women engage with investing. And we also need to maybe bust some myths around women and investing this idea that they are naturally more cautious than men. Well, maybe there's a reason why they're more cautious as investors because they've got more to lose.

They can't afford to go and take huge risks out there in the stock market. But nonetheless, we can't be too cautious. There is such a thing as reckless conservatism where you're not taking enough risk and you're actually letting the value over time. Thanks to inflation. So, so yeah, so that's what I'm eager to get that message out there about how you need to take some risks.

You just need to make sure they're smart, calculated risks.

Kriti: [00:23:45] Speaking of risks, I want to talk a bit about like investing habits and especially with like young people. Obviously with the democratization of investing, there has been a lot of like risky behavior when it comes to investing. Can you talk a little bit about the risks of online investing? What is the mindset of a successful investor? Like where is that happy medium?

Iona: [00:24:12] Two great questions. Firstly. Investing technology has, I think overall been a fantastic development for investors. I think that over the past 10 years, we've seen the evolution of financial technology that has made it made the stock markets so much more accessible and egalitarian that it than it used to be.

So I think overall that's a very positive development and we're also starting to see lots of trading platforms out there that are reducing the costs of investing. The US obviously gave birth to Vanguard, which has this giant fun group that's all about. Low-cost investing. Their whole emphasis is on passive investing i.e., just having a kind of basket of stocks and passively tracking them as opposed to paying active managers who a lot at the time do not justify their high fees and those high fees really eat into your returns over time. So, those developments have broadly speaking, been very positive for investors. But it's a double-edged sword.

Investing online brings huge risks. Firstly, there's the risk. That you can by making, investing easy, you make it too easy. So investing is not the same as gambling. Gambling is where you just put it no money on the roulette table. And you're putting your faith in lady luck and you're hoping, without any knowledge or any understanding really that you're gonna, you're gonna strike lucky. It's like a fun pastime. I'm not personally into gambling, but I don't judge anybody who is. However, I do have a problem with people who confuse investing, gambling, investing should be about making informed, smart choices about where you will put your money based on an educated, I guess, about what will happen in the future, in the stock market, in the company that you've chosen to invest in, you know, in the wider industry.

that's not to say anyone can predict what will happen for certain. Because things can change. And the norm and the paradigms of one time can be totally flipped in the next day era. But we can make educated guesses and we can do responsible things like diversifying our portfolio.

So if we put all our eggs in one basket, then we're absolutely setting ourselves up for failure there even. Very very few times in history. Have we ever seen an investment that doesn't come, even if it's performed incredibly well, that doesn't completely go caput at some point. It's just especially because what tends to happen.

And what we have definitely seen over the past year is certain investments suddenly gained a lot of momentum. Lots of people see that they're doing well and they pile in. That's speculating. And again, speculating is not the same as investing. Speculating really is another form of gambling. You're gambling on the fact that everybody else will keep maintaining that momentum. And then you think that you're going to be the smart one and you'll sell out at some points further down the line when before everybody else. But there's a phrase that's commonly used by investors, which is that the market doesn't ring a bell when it hits the top. You don't get that.

Kriti: [00:27:29] Yeah. They shouldn't get any notification!

Iona: [00:27:33] Any notification. Yeah. So once an asset starts falling and you haven't sold out. Then it's like, I think it was Warren buffet who talks about, you know, when, when the tide goes out, you see who's wearing this swim shorts, you know? This is what we have to bear in mind. Investing and speculating and trading have been around for a very, very long time. And we can look back in history and see so many times when people put their money into investments, thinking that it was a one way return that they couldn't go wrong. That the only way was up. when in actual fact, they were storing up problems and that at some point, the party's going gonna end.

And you want to make sure, that even if you have some money in those types of investments, that is not the end of the world for you, because you've got your money elsewhere in other assets that may perform in a different way. So when those really trendy hot investments fall flat on their face, you've got other, maybe less trendy, less fashionable investments tucked away in your portfolio that will actually come into their own and will actually have their moment to shine at that very point. So that's what diversifying is. And then also just remembering that the investing is long-term and that when we talk about investing for at least five years, this is not just a random time frame that's plucked out of the air.

This is based on data which shows the minimum time needed to write out the highs and lows of the stock market. So if you're invested for at least five years, you're giving yourself a fighting chance of earning a decent return. But if you're constantly tinkering with your portfolio, making trading decisions on a whim, because you saw someone on YouTube saying, it's a good idea, or your mate down the bar said it was a brilliant, it was a brilliant investment and you can't lose money. If you do that, then you are not giving your portfolio a chance. Yeah. The highs and lows, and you've got to patient investor, you've got to give your investments time to grow in the long term. So I think that's why we've gone wrong over the past year. And that we've lost sight of the risks of investing. I'm worried that lots of younger people are going to end up being a bit scarred by this period because they're going to be taking on too many risks I really hope that doesn't happen. So I think it's better to learn about these things the easy way, rather than the hard way.

Kriti: [00:29:48] Yeah. Like I think for me, like the last couple points you made really resonated because like I invest, but obviously it's through an app meant for like teens .

And I'm always like, oh, it's the same amount my stock portfolio is last year. Like a little different still, and I'm always complaining. And I don't think about the bigger picture. Like I've, haven't been doing it for that long in the grand scheme of things.

Iona: [00:30:14] This is it. This is the problem, Kriti. In years gone by, you would not have that kind of idea out there about how much money you could be earning from your portfolio. This is about expectation management. If you go into this process, understanding that it's gonna take a while, then you're going to look at your portfolio and I'm not to feel too bad about that. And you go, okay, it hasn't grown that much, but Hey, I've only been doing it a couple of years, give it time. Whereas if you're seeing people out there who appear to be making, you know, 200% in a month, you're going to get FOMO and you're going to feel really inadequate.

So that's the problem. It's when we compare ourselves for the people. And they're not always sung the truth. I mean, just because they're saying these things online doesn't mean that they're necessarily true, but even if they are true, that person may be in a completely different situation than others. They may have a totally different risk appetite.

Kriti: [00:31:03] And I this leads another question I had. What role does social media have in investing and what do us teens need to be careful about and how social media might be promoting certain, like types of investments? .

Iona: [00:31:17] Well, social media is a fact of life and it's something that we all have to deal with. And, it's going to be there in the mix when we start our investing journey, because that's just the way it is today. I don't want to write off social media entirely. I'm on that. I like to think I'm sharing helpful, responsible advice on social media. And there are lots of influencers who are doing the same. So you can't tell them all with the same brush. There are many people out there who are saying and doing good things on social media. But there are many other people out there who are not using that their platforms for good. A big thing to remember is that, money can come very easily, corrupt and money can corrupt influencers quite quickly when they're being offered big paychecks to promote certain products and services. And that can really distill their judgment. And I understand why it happens because I've been offered a lot of money to promote that in products. And, I'd be lying if I said the thought didn't cross my mind. Not, you know, maybe it has, maybe I should accept this. Yeah. This might, this will pay my bills for a month. Why not? And then I have to remember, hang on. This will, this will trash, all the good work that I've done and people will see through it and they won't trust me.

And for me, it's gotta be about the trust. If people don't feel like you're independent and impartial, then there's no point you may as well just go and work as a sales person for financial company. But unfortunately not everybody takes that attitude. Maybe other people do feel more financially pressured or maybe as a separate board.

They're just, they have been a little bit corrupted by them, the amount of money that they get offered to promote things, but it is happening. People are not always transparent about it here in the UK, you have to very clearly show that you are advertising something with a hashtag ad at the end. And if you don't, you get reported to the advertising standards authority.

And I mean , you're not going to get sentenced to prison or anything, but you get a slap on the wrist and that's about it. It's not very, it's not enforced very strictly. But nonetheless, there are rules that you have to follow. But that doesn't mean everyone follows them and it doesn't mean that's the case in all jurisdictions. So I would say if somebody is promoting a product or scheme, just ask why, why are they doing this? Could they be doing this because they're being paid to. Could they be doing this because they've been sent a free credit card in the post or, or they went to, or they went to the party hosted by that financial company last week and they feel quite well disposed towards them. These things happen.

And so if you think about that, then you'll go, well, maybe they're not promoting it because they think it's the best investment option in the world. And then putting that aside, even if they do think that even if they genuinely are putting this idea forward, I would say that you should be very skeptical if not suspicious of people who have decided that this is the way to go.

That's and are telling you things about the stock market that are very black and white, right.

Kriti: [00:34:31] It's always, it has to be gray.

Iona: [00:34:33] Yeah, exactly. Kind of giving you those caveats around investing, that aren't giving you that basic sensible advice that I talked about before, you know, diversifying investing for the long-term, making sure you're not constantly trading. If people are not giving you that advice, I'd say they're not looking out for your best interests and telling you what you want to hear as opposed to what you need to hear.

Kriti: [00:34:56] That's important for us as we like go out into the world and I'll keep that in the back of my head. What are your thoughts on cryptocurrency?

Iona: [00:35:07] Well, I'm not totally anti crypto. I think in particular, you've got to distinguish between cryptocurrency and blockchain.

I don't want to try and get into the whole area of blockchain. It's very big and complicated, but I do think it's potentially quite transformative, in terms of how it could change the way we organize, not just our financial systems, but lots of different systems. So putting that on one side, I think cryptocurrency, um, is a very new asset class. And it is primarily an asset class, i.e., type of investment as opposed to a currency. Because I mean, you know, I don't know about you Kriti, but I cannot go down, pay for my groceries. Using grip crypto, it's just not, it's not happening. And so one of the reasons why I feel a little bit skeptical about crypto is that I think in order for say Bitcoin to be stable, it has to become a very widely adopted currency.

We do not have that framework. I don't think that that's ever going to be achievable. And then I would say the thing about Bitcoin is that lots of people out there have lots of different reasons to get behind it. Some of the reasons are political, lots of people out there believe that the governments interfere too much in our lives. That having currency that can be vulnerable to inflation will end up kind of eroding our wealth over time. Now that is actually quite a fair point to make about Fiat money.

Fiat money is that is, is basically money that is determined by all of us. The value of the money that we use every day is based on trust. Right. It's based on, you know, I understand that $1 is worth $1. You understand it's worth $1 and so on. Um, but actually then that can become a little bit manipulative over time. If you end up pushing more money into the system to solve problems, uh, like we did after 2008, and as we've done during the COVID crisis. So that's a valid critique. If you like a Fiat currency and, and it is a valid reason why you would want to get behind Bitcoin. But, by all means, if you have that belief system, , then you know, that's, that's fair enough.

However, if you're thinking of it in purely financial terms and loads of people like that are just getting into Bitcoin because they think they can make lots of money. They don't really give a monkey's about the political stuff. Then you need to be, you need to be really careful because it's incredibly volatile. The price at the moment is largely being driven by a demand. And it's not clear what the connection is to the supply. And that's always really problematic. If you cannot grasp the fundamentals of an asset class, if you can't kind of point to really tangible driving the price, apart from loads of people who have invested in it stay, and then loads of people have sold out. You know, after that. Yeah. Then that's then that's, that's really, really tricky. And then I would say that the conversation around, uh, cryptocurrency is just not always very honest and balanced online. Loads of people aren't really talking about the risks involved with crypto. How tricky is to open a digital wallet, to store your Bitcoin safely. I know loads of people who've had their Bitcoins stolen. Even people who really love Bitcoin,have had thousands and thousands of dollars worth of their Bitcoin just stolen.

Kriti: [00:38:48] Or even like forgetting their passwords. Yeah, exactly.

Iona: [00:38:52] Things like that. Really simple things like that. Or just hacks on, on them on platforms, you know, a lot of these crypto exchanges on a very regular basis.

So if that happens, then you're stuffed because you can't, because it's not regulated here in the UK. If your money is stolen from the bank, you can go to, you can get compensation. Yeah. You're

Kriti: [00:39:14] out in the U S you're like FDIC insured

Iona: [00:39:16] Right. But you don't have that with crypto because all point of it is that it's decentralized from the government is, is outside the government's control.

So that's got, it's got positives, but it's got a huge negatives as well. There's a lot to be said for having companies and investments that are accountable to the authorities, which is the, if something goes wrong, they've got your back. So yeah, that's, that's what I feel about crypto.

And, and in the book, you know, I talk about the fact that actually, as things stand research suggests that actually the less financially literate you are, the more likely you are to get into crypto. Which I think really bust that myth that people who are in crypto are automatically smarter and more elevated than you. And I find that really, really infuriating. Like by all means, if you like crypto wants to invest your money in it, maybe put a few thousand, a few hundred dollars, maximum few thousand, if you can afford it. And you've got investments in lots of other places, then who am I to say that you shouldn't do that?

But what I really dislike is people out there saying, well, good luck staying poor and things like that. Yeah. It's not

Kriti: [00:40:23] very flashy!

Iona: [00:40:25] Very flashy and it's very off putting, and I think most people out there. You know, they don't want to become a multi stealing. Yeah, exactly. Like, you know,Elon Musk!, they just want money to achieve their goals. They don't, they, and they want to be able to sleep at night. So don't feel bad if you don't understand crypto, because quite frankly, I don't fully understand that either. I've read a lot about it. I've tried my best, but in the, I think it's not because I'm stupid. I think it's because there are things that are inherently quite weird and in a lot of illogical contradictory about crypto.

So, so that's what I feel.

Kriti: [00:41:02] This is amazing discussion and I learned so much from hearing you talk. And cryptocurrency is something I've never actually talked about before on the podcast. I'll probably try to like, learn more about it. Just to educate myself on it.

Iona: [00:41:18] No, I think you're right Kriti and I think you've got to keep an open mind. And that's the most important thing. If there's one thing that everybody should take away from today's chat, I guess it would be just stay committed to learning. Investing is a lifelong journey. It's not a destination. Things will change over time and you've just got to respond with an open mind. if you follow some basic precautions , then you will hopefully find it a really fascinating and rewarding journey.

Kriti: [00:41:48] Finally, do you have any advice for your 16 year old self ?

Iona: [00:41:52] Wow. Yeah. Well the two pieces of advice would be firstly, stop caring about what people think because, you know, you're always going to have haters. You're always going to be jealous of you. It's always going to happen. When I, when I was 16, I cared thoughts much about what other people thought. So I should have just given less, less, I should have just kept it. It's easier said than done. I think there's only one more thing I would say, which is that I used to wait for other people to give me permission to do things. And I used to think, I can't, I can't do that because, I'm not really allowed to, or nobody's told me that I can do that. And I've never really seen anybody around me do that. So I think I'm just

Kriti: [00:42:32] going to do that. I definitely do that

Iona: [00:42:34] so easy. I so easy to get

Kriti: [00:42:37] the power to someone else.

Iona: [00:42:38] Yeah. Yeah. So when I was, um, yeah, when I got into my twenties, I just had to tell myself, well, guess what I can do, whatever I want. If I decide I want to do something, I'm just going to go do it. And if it doesn't work out, it doesn't, it doesn't really matter. But I don't need to wait for someone else to give me permission. I'm still learning that today, frankly. And, and I still need to remind myself that there's is my life and I'm the one calling the shots and I'm the one who's allowed to take the decisions.

So, yeah. That's why I would say, give yourself permission to do what you want.

Kriti: [00:43:10] Well, thank you so much Iona for coming on WhyFI Matters today! I really love talking to you. And what you're doing the Young Money blog is amazing. So obviously you just keep it up and you're definitely having a huge impact in Britain. And maybe now some other people across the world, , some teenagers specifically will like start looking at your stuff. So, yeah. Thank you so much for coming.

Iona: [00:43:34] It's been so fun. I've really enjoyed it. Thank you for having me!

Kriti: [00:43:38] So that's the end of the interview and I loved chatting with Iona and I love her views on the future of financial education and what we really need to do to make it more interesting so that people actually learn.

And also, I love her views on like the impact that investing can have on us. And I think she gave us some very helpful and insightful tips on investing that I am definitely going to utilize. For more information on her. I have her website linked in the episode description. It's really fun. So definitely go check it out and also make sure to check out our website at so you can sign up for our newsletter and keep up to date with our latest content. Thank you so much for listening and I can't wait to talk to you next time.

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