10 money lessons from the World Cup

by John Fitzsimons on 13 July 2010  |  12 comments
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The World Cup hasn’t just been a feast of football – it’s provided many lessons we should take heed of with our finances.

So the World Cup is over. After a month of being in control of the television remote, the wife is once again in charge of our viewing habits, while I’m left to count the days until the Premier League resumes.

While it’s not been a classic tournament, there have been plenty of memorable moments. However, while I was laying in bed last night unable to sleep, it wasn’t the football on my mind, but some of the parallels and links between what took place on the pitch, and our money habits.

So without any further ado, here are my top 10 money lessons from the World Cup!

#1 – Overhyped, over-expensive

England’s performance was something of a disaster in South Africa. It brought home the fact that our players are overhyped, far too expensive and need taking down a peg or two.

However, there are plenty of people (particularly readers of this site) who would use the exact same terms to describe the UK’s housing market. Perhaps they will get their way too – Halifax last week confirmed house prices had fallen for their third straight month.

That price correction may finally be upon us.

#2 – Avoid penalties at all costs!

The last couple of minutes of the Uruguay-Ghana game will be my abiding memory of the World Cup, with Asamoah Gyan’s penalty in the last minute to clinch a place in the semi-finals for Ghana. He missed, and they then went out in the penalty shoot-out.

Like all Englishmen, I want to avoid penalties if I possibly can, and that applies just as much to my money as my football.

Always make sure you have set up a direct debit to cover things like your credit card bills so that you don’t get whacked with late payment charges, and the black mark on your credit record.

#3 – Unorthodox saves

In the final itself, both keepers made their best saves in slightly unorthodox fashion, by using their feet rather than their hands.

And turning your back on orthodoxy can get you the best return on your own savings, by ignoring the pitiful rates on offer from the banks and instead using a service like Zopa, where your money is instead lent on to other users. Zopa reckons over the past 12 months it’s delivered a return of 8.3%!

#4 – Ignoring the big boys

The World Cup was a bit of a disaster for some pretty big names, with France, Italy and England all crashing out early. Instead some of the smaller guys, particularly Uruguay, made a name for themselves.

When it comes to the mortgage world, it’s some of the smaller names – Yorkshire Building Society for example – that are really having a go at the bigger names, by releasing some fantastic market-leading mortgages.

So make sure you research all of the lenders, and not just the ones you’ve heard of, by using the lovemoney.com mortgage centre.

#5 – Keeping something in reserve

One of the many reasons Spain won the World Cup is that they not only have the best first eleven, but also the best squad. David Silva for example, who could not get into their starting eleven for most of the tournament has just gone to Manchester City for a whopping £30m!

And it’s having something in reserve for when things aren’t going as expected that makes a difference, particularly when it comes to money.

Having a decent savings safety net is not just a good idea, it’s near enough essential! Try following the hints and tips in our Build up your savings goal.

#6 – Seeing a return on your spending

Fabio Capello earns £6m a year. That’s more than the combined wages of all four of the coaches of the semi-finalists.

Sadly, the FA have seen very little return on that money. But if you are spending a lot of cash, you’re entitled to want something back, which is why cashback credit cards and reward credit cards are so great.

Just remember to pay that bill off in full each month.

#7 – Start young!

The trophy-lifting captain, Iker Casillas, seems to have been around forever. He’s not yet 30 and yet already has well over 100 caps.

Starting young is not just a good idea if you want to develop into a world class goalie though – it’s essential if you want to enjoy a comfortable retirement. If you start early enough, and do it properly, you can turn your pension pot into a million pounds!

#8 – Keep it, don’t give it away!

Related blog post

• Ed Bowsher writes:

  Has the World Cup hit the housing market?

  I still think house prices are due for a fall.

  Read this post

Watching Spain, it’s all about possession of the ball. They keep it as much as they can, knowing that the less they give it away, the better off they’ll be.

We should all take a similar attitude towards our savings, and make the most of ISAs. Why put money into a savings account where you’ll pay tax on the return, when you can instead make use of a tax-free ISA?

If you're being sensible and putting money aside, it makes sense to get the best return on that cash you possibly can!

#9 - If it’s not working, change

One of England’s many problems at the World Cup was that they were too rigid and set in their ways, unable to change with circumstance.

That’s an awful attitude in finance – shopping around is essential. That’s equally the case whether you want to change energy supplier to get a better deal, or if you don’t think your pension is performing as it should so you want to move your retirement funds, or if the time is coming to consider remortgaging.

Finance and football are both all about being proactive. Don’t just sit there hoping things will change for the better – do something about it!

#10 – Spanish dominance

The Spanish are the World Champions for the first time, and complete a memorable couple of years having won the European Championships in 2008.

The Spaniards have exerted a similar dominance within the UK banking sector, buying up established names like Abbey, Alliance & Leicester and Bradford & Bingley. And while their service has not always been as pretty as the tiki taki football of Xavi and Iniesta, it’s difficult to argue with the quality of some of their products, particularly the current accounts.

If you tend to be in the red, there’s the Preferred Overdraft Rate account, with its year-long interest-free overdraft, while the Santander Preferred In-Credit Rate account offers not only a year of 5% interest, but can deliver you £225 just for taking it out.

The Spanish are clearly here to stay.

More: How to avoid being scammed on eBay | Get more money from your pension

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