Robert “Rabbie” Burns, Scotland’s revered poet, is celebrated not only for his profound verses in Old Scots, but also for the timeless wisdom he has woven into his works.
Indeed, alongside the usual central themes in the master wordsmith’s works, which range from love and religion to equality, there are also some intriguing financial lessons.
25 January would have been the 265th birthday of the “Bard of Ayrshire”. So, with that in mind, continue reading to discover three long-term financial lessons from the wise words of Scotland’s favourite son.
1. Prepare for the unexpected
In Burns’ poignant poem, ‘To a Mouse’, the speaker laments after accidentally destroying the nest of a field mouse with his plough.
The speaker apologises profusely to the “wee, sleekit, cow’rin, tim’rous beastie” for the mishap. However, he realises that the damage has already been done, and finds the unintended consequences of his actions no less troubling.
His remorse echoes the reality that well-laid plans, whether by mouse or man, can often go awry and result in a swift reversal of fortune.
Unfortunately, the unexpected can strike at any time, though there are ways you can protect yourself and your family from uncertainty.
One way you can do this is by having a Lasting Power of Attorney (LPA) in place. This is essentially a document that enables you to appoint someone trustworthy (your “attorney”) with the ability to make decisions on your behalf if you should lose mental capacity.
There are two types of LPA available:
- Health and welfare – This allows your attorney to make decisions regarding your health, such as whether you will remain in a care facility or receive care at home.
- Property and financial affairs – Your attorney can make decisions with and manage your wealth, such as accessing your bank accounts or selling your home. Unlike a health and welfare LPA, they can do so even if you retain your mental capacity, although they need your permission to make decisions.
With an LPA in place, you can rest assured that you’ll be well looked after if you can no longer manage your finances or health, reducing any stress placed on you and your loved ones in the event of a serious illness or injury.
Additionally, it may be worth having an additional safety net in the form of financial protection.
For instance, if you fall seriously ill or are injured and can no longer work, income protection and critical illness cover could offer invaluable financial support that ensures your progress towards your long-term goals isn’t derailed.
What’s more, life cover ensures that your loved ones will be able to maintain their standard of living without your support should you pass away unexpectedly.
Financial protection, paired with an LPA, could help prepare you and your family against unexpected events in future.
Note that life insurance plans typically have no cash in value at any time and cover will cease at the end of the term. If premiums stop, then cover will lapse.
The Financial Conduct Authority does not regulate Lasting Power of Attorneys.
2. Realise when you have “enough”
Burns’ narrative poem, ‘Tam O’Shanter’, weaves a tale of a farmer riding home on his trusty steed, Meg, after a night at the pub.
On his travels, he encounters a gathering of witches and warlocks partying at a ceilidh – a traditional Scottish dance – with the devil. After watching from afar, he mistakenly calls out “Weel done, cutty-sark” (the Old Scots word for a short skirt) to one of the witches.
The coven then gives chase, and while Tam does eventually get away, one of the witches snatches his horse’s tail.
Despite the poem’s occult setting, it remains a celebration of the joys of the world. In particular, the line: “But pleasures are like poppies spread, you seize the flow’r, its bloom is shed … Nae man can tether time or tide”, emphasises that all pleasures in life are precious and fleeting.
You can also apply this philosophy to your financial planning, encouraging you to contemplate what would bring you happiness and contentment. Then, you could identify how much would be “enough” for this dream lifestyle.
After all, it’s important to remember that you’re actually accumulating your wealth for a reason: to reach your personal goals.
For example, consider your retirement. You likely have an idea of what you wish to achieve when you stop working, which could include:
- Taking a trip around the world
- Moving into a dream home or renovating your current one
- Helping loved ones meet their financial targets.
Of course, each person will have a different idea of what they want to do when they retire, which is why there isn’t a “one size fits all” sum of money you need to save.
So, if you take a goal-oriented approach to your retirement planning, you could better understand how much would be “enough” for the next phase of your life. Then, you could use this knowledge to determine how much you need to save.
Once you’ve reached this coveted “enough”, it might not make sense to take on unnecessary risk or delay your retirement to accumulate more wealth.
Instead, remember the central theme of ‘Tam O’Shanter’ mentioned above: life’s pleasures tend to be fleeting. So, once you’ve saved “enough”, this could be the ideal time to make the most of your wealth and start spending on yourself.
A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available.
3. Stay focused on the future
There’s a good chance you’ve sung Burns’ poem turned song, ‘Auld Lang Syne’, at some point on New Year’s Day.
The global favourite not only emphasises the value of friendship and brotherhood, but also underscores the importance of looking towards the future and cherishing all it may bring.
Similarly, when you’re considering your finances, it’s vital to stay focused on the long-term results, as this can be beneficial for both your financial and mental wellbeing.
Indeed, developing a clear vision of your future self, encompassing your aspirations, such as financial security or a comfortable retirement, could help ease any short-term money worries you have.
Moreover, this could help drive your savings habits, and allow you to be more confident making important financial decisions.
Long-term financial plans and visions could even offer mental resilience during times of uncertainty, helping you stay focused on your future goals.
By keeping your eyes fixed on the future, you could better navigate any financial challenges you encounter with confidence and purpose.
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This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.