I turned up at 6pm, cooked dinner and was out by 11pm – with £10,000
Phil Howard tells of the rich pickings on offer for Michelin-starred chefs
PHIL Howard, a Michelinstarred chef, prefers to invest in a pension rather than property but says his best financial decision was backing up-and-coming chefs such as The Ledbury’s Brett Graham.
Howard, 51, has been chef-inresidence at On 5 Restaurant during Royal Ascot in the past few days.
He once earned extra pocket money picking lead out of the road and selling it to scrap metal merchants. But he now commands fees of up to £10,000 a night cooking private dinners for the super rich and invested half a million pounds into The Ledbury, in London’s Notting Hill, which is now feted as one of the world’s top restaurants.
After selling his successful Mayfair restaurant, The Square, last year, he spent more than £100,000 on a classic car.
But he has not forgotten the struggle he faced with bills and large credit card debts as a young apprentice chef. If he was Chancellor of the Exchequer, he would immediately increase the lowest threshold for income tax to £20,000.
He lives in Barnes, SouthWest London, with wife Jenni, 51, daughter Millie, 22, and 18-year-old son Ali.
What did your parents teach you about money?
NOT to spend what you do not have. My father was an accountant and my mother was a stay-at-home mum. They wanted me to be responsible with money. My father treated my pocket money like it was part of a banking system – nothing would make him angrier than if I managed to borrow some off my mother in advance of receiving it.
How much pocket money did you get as a child?
PRECIOUS little. Enough just to buy a few sweets: fruit salads, black jacks and lemon bonbons. I used to flesh it out by digging lead out of the road and selling it to scrap metal merchants, so I could add to my collections of tropical fish and stamps.
Have you ever struggled to make ends meet?
YES. I have never been on the breadline, but when I was 21 and working as an apprentice chef I did not earn a lot of money.
For two to three years, I made just enough to get by but food became an absolute passion. Given I wanted to experience everything that was out there and see what they were doing at the best restaurants, I started living beyond my means, eating at restaurants I could not afford. My credit card bills mounted up. I ended up a few thousand pounds in debt.
I did not get anxious s about it. Although my father hadd tried to teach me to be disciplined ed about money, the reality is I am not that kind of person. I am not a worrier. My view is: where there is a will, , there is a way. I wanted d to be a chef and it fuelled ed the fire within me.
Have you ever been paid silly money for a job?
SOMETIMES a wealthy person will want a certain kind of professional chef – a Michelin-starred chef, for example – to cook them dinner in their own home.
It will not involve a huge amount of work and can be incredibly lucrative. The most I ever earned for a job like that was when I cooked a private dinner for ten people. I turned up at 6 o’clock and was out by 11 o’clock with £10,000.
That is a lot of money, but I think a phenomenal experience like that can still be value for money for those who pay. They have everything they need in life: private jets, amazing houses, all the toys. What they desire is experiences.
Q What was the best year of your life in terms of the money you made?
A AT MY last restaurant, The Square, we had many great years but 2010 was the best. Our reputation had been growing since we got two Michelin stars in the 1990s. But you need the diners to come in and really spend on wine – and that does not happen overnight. By 2010, we had achieved a great average spend, maximised demand and were running the business efficiently. It delivered a great profit.
Q What is the most expensive thing you have ever bought yourself?
A IT HAS to be the 1966 metallic blue AC Cobra, after I sold The Square and its valuable lease in Mayfair last year. The Cobra cost more than £100,000 and because it is a classic car, it is an investment. But it was bought to enjoy.
Q What is the biggest money mistake you have ever made?
A SETTING up Jus Cafe, a chain of juice bars, in the early 2000s. They were amazing, but unfortu- nately the rest of the world did not agree. As a business, it was a disaster. I lost several hundred thousand pounds.
What is the best money decision you have made?
BACKING Brett Graham, a chef who worked at The Square, when he set up The Ledbury, now one of the top restaurants in the world. I invested just under half a million pounds in total. He has made an extraordinary success of that opportunity. I have no idea how much my investment is now worth, but it has certainly gone up in value and I get regular dividends.
Do you save into a pension or invest in the stock market?
I SAVE into a pension and pay the maximum £20,000 into an investment Isa. I opt for a mediumrisk portfolio but I do not pick stocks myself. I do not know enough about how to do that.
My current pension would not keep me going in retirement. I did not save into it through the prime years of The Square. Instead, I invested in half a dozen restaurants with chefs who are younger than I am. The plan is that the lion’s share of my income in retirement will come through those businesses, including The Ledbury. But I did save into a pension for many years when I was young and have recently started putting money i nto it again. Life is long and I think pensions are a good thing, alongside other investments.
Q Do you own any property?
A YES, my home, a semi- detached five-bedroom house in Barnes, South-West London, which I bought in 2000 for £ 600,000. I have s pent about £750,000 extending it. It is worth a few million pounds now. Five years ago, we also bought a ski chalet in Montalbert, in the Alps. I do not see my properties as i nvestments because I would not be prepared to sell them except as a last resort. Also, my experience of property has not been particularly rosy. I owned a flat with my brother for ten years and sold it in 1992 for £1,000 less than I bought it for.
If you were Chancellor, what is the first thing you would do?
I WOULD dramatically increase the threshold for income tax, so you could earn £20,000 and pay zero income tax.
If someone earns £500,000 a year, paying 40 per cent or 50 per cent tax makes little difference to their quality of life, but at the lower end of the pay scale, the amount of tax you pay makes a massive difference. A life pinching pennies is hard work. I would make the books balance by increasing VAT on alcohol and cigarettes.
Do you think it is important to give to charity?
YES, absolutely. I have run 25 marathons and given endless dinners for charities over the years. But I also donate my fair share personally. I think it is an obligation for those with good fortune to try to balance that out by giving to charity.
What is your number one financial priority?
TO ENJOY my money and share it with those I want to spend the most time with. I do huge amounts of fun things with my family and that is how I justify my spending. It is all in the interest of creating happy memories.