The MVAM newsletter is an investment newsletter – okay, that may have passed even regular readers by – but it is! However, as the company has also moved into financial advice we thought, why not do a newsletter on financial advice once in a while? Stunning logic huh! But, as you would expect from MVAM, it won’t be filled with any boring ‘save more money’ stuff – you would have to pay us for that kind of savvy insight. Instead, for fun, it will be a little off the wall. Usual disclaimer: we’re good, but not perfect.

So, first piece of advice: move to Scotland. Now, remember, this is financial advice, not cultural advice. That would be to move to Italy. So why Scotland? Well, have you ever heard of the Barnett Formula? Created in the 1970s, it allocates public money to Scotland based on population rather than need. Arguably, on some measures Scotland doesn’t need the money. It actually generates more tax and duties per head than any other UK region, except London and the Southeast – it is not exactly struggling. Yet due to the formula, Scotland receives an extra £2,000 per person each year in public funding. This means Scotland can make choices. Choices that give real financial benefits.

Let’s say you’re a family with three kids who might go to university, plus one grandparent who could need a couple of years in a care home, later in life. It is well known by any family whose kids are going to university that if you live in Scotland, you don’t pay tuition fees. From this September tuition fees will rise to £9,535 pa. Three kids each doing a three-year course. That’s £83,250. Less well known is that if you require care in Scotland, there is a care subsidy of £233.10 per week. Two years for grandma in a care home could mean she receives £24,242.

In total, the family mentioned above would need to earn about £180,000 before taxes to cover the difference!!

What about salaries? You might think that moving to Scotland means lower earnings. But pay in both the public and private sectors is higher. Teachers and nurses start on higher salaries. Median pay – that’s the middle earner, not the average – is higher in Scotland than the UK median. Throw in lower house prices, fresher air and fewer traffic jams and it’s starting to look like a solid deal. Of course, no financial plan is perfect. Higher earners in Scotland pay more in tax. Alcohol is subject to minimum unit pricing. And then there’s the football…

But in an increasingly divisive world, the instinct is often to feel hard done by – to compare your situation to others and feel wronged when disparities exist. Some call this ‘Othering.’ Resenting ‘Others’ simply for having different circumstances. But instead of seeing differences as unfairness, perhaps we should see them as opportunities – engines of innovation and change. Pushing governments, industries, and individuals to adapt, improve, and thrive. A bold and successful Scotland, whether you move there or not, is good for the UK, Europe, and even the world. The positive discrimination of the Barnett Formula was introduced for a reason, and it works. But when it comes to moving to Scotland, as with most big life decisions it is never all about the money, is it? And maybe we rename the North South divide, the North South difference, and celebrate it. Now that would probably bring a financial gain to us all.

By Craig Harper – Managing Director