old lady money 300x187 AgeUK take peoples homes, but abandon them if they need long term care...There’s a name for people who take valuable assets off vulnerable old people. And it’s not the one you think- national charity Age UK, have apparently been doing it for 40 years.

Most people have heard horror stories about pensioners who have been sold down the river by a greasy salesman offering some kind of equity release product that means the poor pensioner ends up owing debts, or having to sell their home. Still, these products are now regulated financial products and can, in the right circumstances, be beneficial in some situations. However, what might surprise you is a little-known service offered by Age UK that will allow you to give them your house, and in return, they will let you live in it. Sounds a great deal…

The service is called ‘gifted housing’ and has been offered by the charity (or its predecessors) since 1974. The pensioner gives their house to the charity, who then pay the council tax, water rates and buildings insurance on the property, and allow the pensioner to live in the house until they die. Other costs, classed as repairs and maintenance will also be covered, which may (or may not) include putting in wheelchair ramps or stair lifts should the need arise. The charity will also visit four times a year and offer support in claiming benefits etc, same as they do to any other older person.

Of course, the charity will only accept your home if they think that the value of the property at the date of the agreement will exceed the value of what they are going to have to pay out in costs. So far this seems a win/win kind of arrangement- for the charity- not only do they cover their costs, but they also make a turn on the capital growth. Great idea.

But what about the pensioner living in the house. Surely Age UK are then duty bound to look after that pensioner who has, essentially, given away their largest (only?) asset in the name of charitable giving.  Um, no. If you remain an independent-living kind of pensioner until your death, and you outlive Age UK’s predictions, you might come out better on the deal. However, no matter how much we might like to think it wouldn’t happen to us, if you need care, you could find yourself in serious trouble.

The “binding legal agreement”, which is completely unregulated by anyone, seems to be quite vague on the subject of care. Age UK will make “contributions to the cost” of care and support at home, and if you need residential care, they will help you find a home and again offer an unspecified “contribution”. In the detail of their 8 page guide, however, it is clear that, if you do end up needing care, it’s almost entirely your problem  “once we have notified you of our contributions to the costs of  care, you should consider how you would pay for any unfunded care costs you may have in the future.” Because infirm pensioners who have given away their only asset are in a great position to find money to fund care home fees aren’t they…

eBay phishing scam exposed

September 19th, 2014 No Comments By Ian Wade

eBay have been having a right old time of it lately.

They’ve now been hit by online badmen who’ve been phishing and rinsing unsuspecting customers for their usernames and passwords, by placing fake item listings and redirecting users to external sites.

According to a BBC report, it was brought to attention by an eBay PowerSeller who thought something was a bit fishy about an iPhone 5 listing that took him to a weird address.

He’s also provided a video about, bless him.

The IT professional told the BBC: “It’s guaranteed – you can bet your bottom dollar that somebody’s going to click on that and be redirected to a third-party site and they’re going to enter their details and be compromised.

“You don’t know how many of the hundreds of thousands of people who use eBay will have done that.”

eBay have removed the listings, but it’s likely to be the tip of a vast iceberg, as it tries to find out how many people had been fooled by it. It’s the last thing eBay need, having had a dozen service crashes this year already.

But anyway. Keep ‘em peeled.

Directors bonuses must now be justified

September 17th, 2014 No Comments By Mof Gimmers

fat cat rich man 300x300 Directors bonuses must now be justifiedAre you one of those people on the internet who likes hitting out at ‘fat cats’? Like griping about those who make loads of money because you  can’t stop mentioning your socialist leanings down the pub, much to the mild irritation of your pals?

Well, get this – all companies (so, not just banks) will have to be able to prove that director’s bonuses are linked to their performance thanks to a new City code.

You see, there’s a review of the corporate governance code and it has been decided that companies are going to have to provide more information for shareholders. This will include all manner of performance things, as well as details on the risks being run and details about how long a business would be able to run for under their current financing arrangements.

Unbelievably exciting isn’t it?

The Financial Reporting Council (FRC) have told the City that the next review is going to tackle diversity in the boardroom and they’ve got two years to make some changes.

“Diversity can be just as much about difference of approach and experience. The FRC is considering this as part of a review of board succession planning and will consider the need to consult on these issues for the next update to the code in 2016,” it said.

More pressing changes ask for an extension of clawback arrangements which bankers are already working to. Basically, this new code says that companies should have arrangements to allow them to “recover or withhold variable pay when appropriate to do so”. It’ll also require companies to look at how long a director should wait before receiving any bonuses and that any extra pay should be link to performance.

“The changes to the code are designed to strengthen the focus of companies and investors on the longer term and the sustainability of value creation,” said Stephen Haddrill, chief executive of the FRC. ”The changes on remuneration also focus companies on aligning reward with the sustained creation of value rather than, as before, simply on retention – a focus that has tended to promote pay escalating and leap-frogging.”

So, from now on, companies will make two statements: One will be based on accounting rules and the other will require directors to assess their ability to stay in business for more than 12 months. Could play havoc with our Deathwatch articles, but there you go.

Either way, those ‘fat cats’ are going to have to justify their bonuses now, which they inevitably will be able to, much to the chagrin of those who can’t abide these upwardly mobile swine.

Parents want payday loans to do one

September 16th, 2014 1 Comment By Ian Wade

wonga ladies 300x282 Parents want payday loans to do oneThree-quarters of the parents want payday loan adverts banned before 9pm.

Research found that more than one third (34%) of children considered the adverts to be fun, tempting or exciting as they tend to peddle their wares via the medium of puppetry, such as those wankstains at Wonga.

Look at it. How can a child REFUSE TO BE DRAWN INTO A WORLD OF GERIATRIC FELT?

This group were significantly more likely to say they would consider using a payday loan, even if they’ve never heard of them.

The report by The Children’s Society calls for restrictions on advertising loans to join those already in place to protect children from adverts on gambling, alcohol, tobacco and junk food.

Matthew Reed, chief executive of The Children’s Society, said: “Through our frontline work, we see first-hand the devastating impact of debt on children’s lives.”

“We know it’s become a daily battle for families to pay the bills, meet the mortgage or rent payments, and find money for food or other basics. One setback or even a simple mistake can lead to a spiral of debt. Right now children are being exposed to a barrage of payday loan adverts, which put even more pressure on families struggling to make ends meet and to provide the very basics for their children. That’s why the law should be changed to ban these ads from TV and radio before the 9pm watershed.”

“It is crucial that children learn about borrowing and money from their school and family – not from irresponsible payday loan advertising. A significant majority of parents back a ban and it’s now time for the government to act.”

The survey questioned 1,065 adults and some 680 kids from the 13-17 age range.

coffee cup 200x300 Want to pay less for your posh coffee? You can already save £130 on Nespresso...Some people drink coffee. Comes in a jar, add hot water. Other people drink (sh)ambrosia from the gods, served in a paper cup with your name scribbled on in marker pen, and charged accordingly. However for those who like to drink coffee at home, but still pay many times the price for it, we have some good news for Nespresso owners.

Nespresso is, of course, not just a coffee machine that needs feeding with moderately expensive coffee pods. Nespresso is a lifestyle. Anyone who’s anyone knows that Nespresso drinkers run into George Clooney all the time. However, part of the reason that Nespresso pods are so (relatively) expensive compared with stuff in a jar is the difficulty (for other manufacturers) in making generic pods to fit the machine.

But all that is about to change. A recent court case in France has meant that Nespresso have accepted court directions to provide more information about their coffee machines that will allow other coffee makers to manufacture their own pods to fit the dimensions of the machine. Nespresso will also remove wording from the guarantee that suggested the guarantee might be invalidated if non-Nespresso pods were used in the machine. Good news.

But, despite the current difficulty in manufacture, there are actually a number of non-Nespresso alternative coffee pods available on the market. This could mean that you can pretend you are posh ish, while not having to pay to be so.

A Nespresso cup costs around 30p on average, but many alternatives are not vastly cheaper, coming in at 27-28p a cup. Waitrose are currently selling Cafepod pods at £2 for 10, which works out at 20p each, but this price is due to go back up to £2.75 on October 1. However, following their French compatriots, our German neighbours could be dashing to the rescue, as Lidl’s Bellarom pods are a bargain 18p each. 18p! That would save a three-cups-a-day drinker £130 a year. And  it’ll still be better than Mellow Birds.

Of course, not everyone sees it like this, with Cafepod founder Peter Grainger telling the Telegraph that he thinks punters would be put off by “very low prices”. He said: “My gut feeling? Coffee is a bit like wine. There is a perception of quality being related to price. People do want to feel like they are getting value for money. But they are also conscious of quality. Would they want to pay £1 for a box of 10? Somehow I doubt it.”

So there you have it. Even before the ruling takes effect you could save £130 on your (overpriced) coffee, and this saving could get even bigger in the months to come. Or you could continue to pay premium prices for premium pods and look posh in your house. On your own. Waiting for George to show up…

Houses back on the up

September 15th, 2014 3 Comments By Ian Wade

london houses Houses back on the upThe house market has picked up, which is mildly good news for people who can afford a house.

Seller’s asking prices jumped by 9% month-on-month in September to reach £264,875 on average across England and Wales, Rightmove said.

Asking prices have recorded a typical monthly fall of 0.5% in September over the last 10 years, as the market usually takes a little time to gear up again after the summer holidays.

Miles Shipside, director of Rightmove, said: “We usually see a price fall at this time of year as potential home movers are generally still in holiday mode.

However, it looks like there are early signs of a bounce-back in demand after the summer lull, leaving those estate agents with a shortage of stock at a potential disadvantage and therefore eager to attract new instructions.’

The area with the biggest month-on-month jump was East Anglia, with a 3.7 per cent rise pushing the average price to £249,860.

The sharpest month-on-month fall was recorded in the West Midlands, where prices decreased by 1.8 per cent to reach £194,077. Londoners saw price inch up by 0.9% over the month to £557, 792 on average, and asking prices are 13% higher than they were a year ago.

It is the first time since 2011 that prices have increased at this time of year.

Design a pound!

September 15th, 2014 2 Comments By Ian Wade

one pound coin 300x300 Design a pound!Fancy making a load of cash? Sort of?

Now you can, by entering your design for the reverse side – you don’t get to mess with the Queen side – of the £1 coin.

The competition is open to those of any age and whatever. Even if you’re half cyborg, presumably.

This follows news from the Budget earlier this year when troubled-hair George Osborne said that the Royal Mint would manufacture a new coin in the hope of reducing counterfeiting.

The hot design at the moment is one similar to the pre-decimilisation threepenny bit, and has 12 sides – like this:

“The winning design should display an image which symbolises Britain or ‘Britishness’”, the Treasury said.

Mr Osborne blubbered: “Think about your favourite landmark, or a great British achievement or a symbol from our Islands’ story. The winning design will be in millions of people’s pockets and purses. It’ll be heads you win; tails, it’s your design.”

The winner will get £10,000 in exchange for the right to use their design, and be invited to visit the Royal Mint in south Wales.

Entries will only be accepted on an official submission form, and all designs must be submitted by Thursday 30 October.

We’ve already submitted ours.

cameron pound 500x495 Design a pound!

 

If you reckon you can do better than our efforts, put your designs on our Facebook page or Tweet us (@bitterwallet) and we’ll share your obviously tasteless work (including the ones moaning about feral shopping trolleys).

30 year fixed-rate mortgages on the way?

September 12th, 2014 No Comments By Thewlis

mortgage money 300x200 30 year fixed rate mortgages on the way?Mortgages are probably the single biggest debt most people ever take out, and for many, it is by far the largest income spend on a month to month basis. Yet when you take out a mortgage, you don’t know how much it is going to cost you every month for the life of the loan- and the newer more stringent affordability checks will interrogate your income to see how your finances would deal with a large fluctuation in interest rates. However, experts predict that soon, you can get a fixed rate deal for 25 or even 30 years, meaning you will always know exactly how much you are going to pay until it’s paid off. Sound appealing?

In theory, there is nothing to stop banks offering extended fixed rate periods at the moment, but the higher cost of longer-term borrowing and the punitive early repayment charges of up to 6% levied by lenders made them an unattractive proposition in the past. The current longest fix available is ten years, but by way of example in 2007 Nationwide offered a 25-year fix that cost 6.39%. During the first 10 years of the loan, borrowers faced an early repayment charge of 3%. Similarly, Halifax released a 6.39% 25-year fix, with identical penalties. At the time, Bank Rate was 5.5% and two and three-year fixed rates were hovering around 5.75%.

But why is this all of a sudden a possibility again? Well there are two reasons. The first is that those pesky interfering Europeans came up with the European Mortgage Credit Directive. Under the directive, which will come into force in 2016, lenders will only be allowed to impose charges that reflect the true cost of a borrower paying off their loan early. No more balloon penalty charges lining lenders’ pockets, but also therefore, making longer term fixes more attractive to punters. Secondly, and crucially, the current difference between the lending rates available to banks on five and thirty year terms has fallen to a new low, making longer term lending cheaper for the banks, who can therefore offer cheaper deals to mortgagees. Win win.

Ray Boulger, of broker John Charcol, told the Telegraph that  “there is every likelihood that we will see some lenders offering 20, 25 or 30-year deals by the end of the year.”

“Over the last couple of weeks the spread between five and 30-year swaps has fallen to the lowest point I can remember. Last week it was 0.9 percentage points and while it has gone up since then it is still very low,” Mr Boulger said. “Lenders could offer competitive deals that really appeal to borrowers who are worried about interest rate rises and want long-term certainty over their repayments.”

Andrew Montlake of brokerage Coreco said price and flexibility were key to a successful long-term fix. “There are plenty of people who want the security of a long-term fixed rate,” he said. “Families with young children at local schools are a prime example. But they generally don’t want to be locked in. Rates would need to be similar to 10-year fixes, which are currently priced between 3.99pc and 4.49pc, to be attractive.”

So would you be willing to pay a bit extra (based on the current low interest rates) for 25 or 30 years of payment certainty, or is that just a bit too far into the future to tie yourself to one lender?

Britons: rubbish at pensions

September 12th, 2014 No Comments By Mof Gimmers

pensiner 300x225 Britons: rubbish at pensionsAround most half of Britons who are not yet retired aren’t very good at preparing for the winter of their lives, according to some musings by the Office for National Statistics.

These figures show that 45% of men and 49% of women did not have any private pension savings, which means in the future, there’s going to be a lot of old people complaining about freezing to death while living in a McDonald’s bag on a hard shoulder, on social media.

Barnett Waddingham’s senior consultant Malcolm McLean said: “The figures released by the ONS this morning paint a worrying picture of the state of unpreparedness for retirement of a significant proportion of the working age population.”

‘Unpreparedness’ there. We were hoping he would’ve gone for ‘unpreparedity’ or something. Anyway, the there seems to be some areas of employment where people are more clued-up about their future years in the wilderness.

In the accommodation and food service industries, 95% of men and women didn’t pay into a private pension, while those working in public administration, defence and social security, only 7% of men and 9% of women choosing not to contribute to a private pension.

McLean continued: “This illustrates how important that particular government initiative is to secure an improvement in this situation. Not surprisingly perhaps, wealth is also unequally distributed – with those households with a private pension being seven times more better off than those without.”

So there you have it. Stop buying Maoams and cans of gin and tonic and go sort yourself out a pension.

Ryanair doing a bit better than last year

September 11th, 2014 1 Comment By Ian Wade

Ryanair New Plane Logo 214x300 Ryanair doing a bit better than last yearRyanair reckon they’re flying six more customers per flight this year than in 2013. SIX WHOLE CUSTOMERS!

This small but obviously a good thing, is said to be down to the company’s improved customer service and ticket selling.

The airline expects load factors to increase 3-4 percentage points to ‘close to 86% of available seats this year.

So basically, translated into humans, an increase of 3-4 points on the Boeing 737s, with space for 189 people on them, would represent between 6-7 more passengers.

This news comes just after the Irish airline took delivery of the first part of 380 Boeing jets over the next ten years. That’s a big letter box that fits 380 planes through it.

This addition to the fleet should take the airline’s passengers from 82 million to 150 million a year.

Forward bookings also increased between September and January, when the airline started to sell tickets up to a year in advance instead of the previous nine months barrier.

To top that off, they’re looking to buy Cyprus Air and have completed all the paperwork required to start its first routes to Russia, with proposed flights from Dublin to Moscow and St. Petersburg.

Millions moving banks

September 11th, 2014 No Comments By Ian Wade

bank sign Millions moving banksMore than a million people have switched their bank accounts since a national switching service began a year ago.

Thanks to The Payments Council, a trade body which came up with the ‘switch guarantee’ as a thing to encourage competition, said that the number of switches was up 19% on the year before.

The highly lucrative current account market is dominated by four banks – HSBC, RBS, Barclays and Lloyds – and they provide three quarters of the UK’s bank accounts.

The Payments Council have not issued a breakdown, but outside of the big four, Santander have been one of the biggest beneficiaries, with Nationwide.

A lot of switchers have come from the troubled Co-operative Group, who’ve been basically handing out their customers to their competition.

While no sign of them making much of an impact, the future could be shaken up by TSB, Tesco, Virgin Money and M&S Bank.

David Mann, who is the head of money at comparison service uSwitch, said “We no longer see our bank as our lifetime companion.”

Vodafone and VISA sitting in a wallet

September 10th, 2014 No Comments By Ian Wade

vodafone 300x216 Vodafone and VISA sitting in a walletVodafone and Visa are launching a mobile ‘wallet’ type thing next month, pass it on.

The news is slightly shaded by the Apple big cock-of-the-walk doodahs.

It will initially be only on Android devices, and the maximum spend on the phone will be set at £25, for security, and obviously no-one wants more incentive to have your phone stolen.

There are also rumours that Vodafone will allow people to pay for London Underground travel using the mobile wallet, and are also possibly offering loyalty card type scenes with Nectar.

“The pieces are falling into place,” said Alix Pryde, head of innovation at Vodafone UK. “There are now the devices, the contactless payments and increasingly the consumer behaviour to make this a success.”

Vodafone customers will need to replace existing SIMs for NFC-enabled versions and have a compatible device.

creditcards Which!!! call for an end to 0% credit cardsSince the FCA took over responsibility for consumer lending from the FSA, we’ve been impressed with how proactive they have been in identifying problems and trying to address them. They’ve even taken on the payday lending giants and the big banks in their financial conduct crusade. However, our friends over at Which!!! have decided they just aren’t doing quite enough and have offered them some pointers on where to go next- focusing on credit cards and unsecured borrowing in a new report.

According to Which!!! figures, UK consumers’ total unsecured debt remains fairly hefty at £158 billion and eight in ten (79%) people used a credit product last year. A significant proportion of those (21%) run out of money by the end of every month, a rise of two percentage points since 2012.

The report points out a few things that Which!!! are not happy about, where the FCA should get its finger out and intervene. One of Which!!!’s bugbears is the proliferation of 0% credit cards- not the principle of them but the name. After all, it’s only a 0% card after you’ve paid the balance transfer fee. Other complaints include:

Unfair and irresponsible lending practices, like setting up credit accounts automatically

Failure to explain risks, e.g. logbook loans might make you lose your car

Repeated credit searches preventing people from shopping around for the best credit deals

Which!!! have therefore drawn up a big long list of recommendations (to add to the ones they helpfully provided when the FCA first took over the job), the highlights of which are:

Banning the use of the term “0%”on credit products that charge more than 0%, for example credit card deals with an upfront fee.

Requiring high cost lenders (including those providing unauthorised overdrafts, such as banks) to show the cost of credit as pounds per £100 borrowed over 30 days as APRs are not always suitable in these circumstances and can mislead consumers. You don’t say.

Allowing consumers to shop around by requiring lenders to use ‘quotation’ searches, rather than ones that will affect credit rating.

Forcing lenders to set minimum repayments on credit cards at a level which strikes a fair balance between affordability and ensuring that the debt is paid off over a reasonable time. Ensure all repayments made in branch or online before midnight are received on that day.

Preventing retailers from automatically signing up customers for a credit account they didn’t actively apply for.

Which!!! executive director, Richard Lloyd said: “The regulator has so far rightly focused on the unscrupulous practices of payday lenders, however, we have found problems across the whole of the credit market. It’s now more important than ever that all credit products are up to scratch, so that consumers can more easily manage their borrowing.”

But are all of Which!!!’s recommendations what we really want or need as consumers, or is Which!!! just trying to babysit us too much? If people don’t realise they might lose their car if they don’t keep up the repayments on a logbook loan, should they be allowed to have their own money (or drive) at all?

Credit Card Debt Collectors 300x200 Best credit cards for customer satisfaction? They arent necessarily the cheapest...Things are possibly looking up economically, so what better way to celebrate than by slapping extra purchases on plastic. It’s not like that’s got us in trouble in the past or anything… New figures show that credit card borrowing is rising by 5.3% a year, but it’s OK, because borrowers are becoming more savvy  with it.

According to the British Bankers’ Association (BBA), a massive 42% of all borrowing on credit cards is now interest-free, up from 34% two years ago. And while the availability of 0% deals hit a low after the credit crunch, the interest-free periods are now longer than ever. Transfers can now be held for almost three years interest free, and you can even purchase goods at 0% for up to 20 months now.

But are the 0% cards the best? While they may be better for your pocket, other cards offer other benefits that are valued as part of a great overall customer experience. Which!!! surveyed a load of people and worked out the top, and bottom performing credit cards for customer experience.

Balance transfer specialists are far from top of the pops, with Halifax and its noteworthy 0% for 20 months on purchases only scores 57% in the poll, putting it in 22nd place out of 36 providers. Barclaycard currently offers the longest interest-free period (33 months) on balance transfers, but it received a customer score of just 53% which is even below the average score of 58%.

So what are the nation’s favourite cards? According to the full Which!!! table, the people’s choice is, yet again, John Lewis with a customer satisfaction score of 79%, taking the title by a significant margin. In fact, it has apparently been top of the table in almost every Which! credit card customer satisfaction survey since 2010 and is one of only two providers (along with First Direct) to receive a five star rating for its customer service.

The Partnership card offers a reward scheme, which pays one point per £1 spent in John Lewis or Waitrose and one point per £2 spent elsewhere. 500 points are worth £5 in John Lewis vouchers and you also get six months’ interest free on purchases.

Second spot goes to that other housewives favourite M&S, with a customer satisfaction score of 69%.Like John Lewis, M&S Bank offers a reward points-based card which pays one point per £1 spent in M&S and one point per £2 spent elsewhere. The much more generous interest-free period on purchases (15 months instead of six months) was not enough to topple the winner, however.

Hot on the heels of M&S is the Post Office in third place. With a score of 68% for customer satisfaction, this card offers 18 months’ interest free on balance transfers and specialises in low or no fees for overseas spending.

Car sales are on the up!

September 8th, 2014 No Comments By Ian Wade

car scrap Car sales are on the up!People are still buying cars, even more so, for the 30th month running!

The number of cars sold so far to August 2014 in the UK is now over 1.5 million. Probably because people can’t afford to catch trains and if you’re going to get rinsed for cash, you may as well do it in the  comfort of your own company.

August also saw car sales jump up 9.4%, which is unusual for a traditionally quiet month, seeing 72,163 cars being registered, according to figures from the Society of Motor Manufacturers and Traders (SMMT).

Also, it’s unusual as its September, when it all gets busy as cars sell when there’s the new number plate season and buyers want to look really ahead and attractive.

2014 sales are also 10.1% above the same period last year. The UK are ahead of the rest of Europe as far as growth in car sales are concerned.

It can’t last, apparently, as the SMMT reckon it will cool off in the next few months.