Posts Tagged ‘money’
New figures from the Bank of England shows that we have all given up on the idea of saving for the future- collectively taking £23 billion out of long term savings in the last 12 months. That equates to £900 per household and analysts have calculated that this is the fastest rate of withdrawal of nest eggs for almost 40 years.
However, this isn’t necessarily bad news. Much of this money has either been shifted into instant access savings accounts or current accounts for immediate spending ability or it has actually been spent. While spending might not help individuals’ financial outlook, consumer spending does help boost the national economy, and could lead to greater prosperity through new jobs and possibly even payrises.
But you can’t blame people for dumping their notice accounts- with many paying piffling rates of interest you may as well earn nothing in an account where you can access your money more easily. Perhaps people are just getting cannier with their cash and looking at alternative investments to offer a more meaningful return.
Peer to peer lending has been on the radar for some time, with some lenders offering guaranteed returns (ie you are protected from bad debts) that beat deposit rates into a cocked hat. These have become so popular that rumour has it the Chancellor will announce a consultation on Thursday into whether such investments could be held tax-free within an ISA wrapper in future. This type of investment will come under FCA governance next year, and many already have robust financial management systems and protection in case of going bump, but remember that investments here are not covered by the FSCS £85,000 protection.
Perhaps people are just sticking cash in ISAs instead? 100% of an interest rate is better than 80% of it (after 20% tax deducted at source), even if it is teensy weensy- many ISA accounts are no-notice accounts and classed as short term savings even if the intention is to hold the cash there for some time. ISA limits are also something that may come up in the Autumn Statement- people have cottoned on to the idea that they could substitute ISA saving for pension saving without the restrictions and the Chancellor may therefore decide to impose an overall limit on contribution to spoil our fun.
Or maybe people are throwing caution to the wind and going for the riskier side of investing. While investing directly in company shares can be treacherous, it can also be lucrative, as the Royal Mail shareholders can testify (note that the subsequent Merlin Entertainments and Infinis Energy IPOs have not been as successful in the short term). But there are less drastic ways of trying to make a turn- corporate bonds are making a comeback as an attractive investment, as they often offer higher rates than banks or Government stocks. Here, you are essentially lending the company money, and at the end of the term, you should get your loan amount back, plus a sensible amount of interest. Assuming the company doesn’t go bust that is…
You can find examples of available corporate bonds through a broker, for example this 5% bond with Premier Oil plc.
As ever, whatever you decide to do with your money should be a considered decision made after determining how much risk you are prepared to take with the cash. And if the answer is “none”, you might decide to stick with miniscule bank returns. Or invest in a new telly.
Hooray. It’s December. That means everything is now officially mince-pie scented and dusted with picturesque snow that never actually arrives. Even Trading Standards (or specifically the National Trading Standards Board (NTSB)) have been hitting the sherry are getting in the Christmas spirit and have produced a “Twelve Scams of Christmas” that you just have to sing along to…
Twelve Vishers Vishing
Vishing has caught a lot of people out recently – consumers have already lost £7million to this scam, according to Financial Fraud Action UK. Scammers call victims pretending to be a bank, building society or similar official and attempt to get personal information. Consumers must remember that their bank or building society will never ask for details over the phone – they already have them
Eleven Alarming Alarmists
The National Scams Hub is warning consumers about a possible burglar alarm scam where consumers receive a cold call from a company offering to install security systems. The security system may be free or available at a nominal cost but the on-going maintenance cost is high and there is a daylight-robbery cancellation fee.
Ten Dodgy (Car) Dealers
Not very festive, but apparently yuletide is also a time to be wary of buying second hand cars, as greasy second hand car salesmen might be clocking the car to make a few extra quid.
Nine Grants Disappearing
It’s like something from your Christmas list- an email from the ‘Commonwealth Secretariat’ and ‘HM Treasury’ telling explaining that you qualify for a free £1,000 grant to be paid directly into your bank account. Unfortunately those who gleefully hand over said bank details will normally see more than the fictional grant disappear…
Eight Council Tax Bands- a- Playing
Getting your property rebanded for Council Tax purposes could save you a pretty penny, always assuming you have a genuine case and you fill in the relevant forms from the Valuation Office Agency (available free). Still, these pesky facts don’t bother claims company fraudsters who are happy to take your money and run- North-West Scambuster investigations discovered that less than 0.1% of claims submitted by companies claiming they can obtain council tax refunds are legitimate. You just pay high, up-front fees to a company that does no work on your behalf.
Seven Computers Crashing
Sometimes the old ones are still good. The National Scams Hub and trading standards are warning of a simple scam where the victim receives a bogus call from a computer company claiming that they had been alerted by the internet provider to a serious virus attack. The scammers tell the victim the only way the problem can be fixed is to buy a special computer programme. You can guess the rest.
Six Alternative Investments
Targeting the ‘more money than sense’ brigade (and we all know a few of those) these cold-callers offer attractive ways in to a range of exciting investments- diamonds, wine, carbon credits (?!)- but at hugely inflated prices, and with magical disappearing companies. Some cat is getting the cream, but it’s not the hapless investor.
Five Doorbells Ring
December is not the warmest time of year to be knocking on doors, but this time it’s not carol singers ringing your bell. Bad weather is used by rogue traders to convince some residents that they need unnecessary and often substandard home improvements at extortionate prices. Or by unscrupulous
energy companies to pressurise the elderly and vulnerable into signing expensive service contracts.
Four Calling Loans
Christmas (and January) are often times when money is tight,and that’s where loan companies sidle in offering relief. The National Scams Hub says many people have received unsolicited text messages or telephone calls from firms offering them an unsecured loan. Those who accepted were charged large, upfront fees for little or no service.
Three Free Trials
Christmas and New Year is also free trial target time. Whether it’s trying out a one-day delivery service, a film streaming service or a weight loss programme, these companies make their money on the guarantee that people will forget to cancel the trial in time, or worse, require notice of cancellation of almost the same period as the trial itself.
Worse, some scammers hide expensive contracts in amongst the fine print and after customers enter their card details to pay for the post and packaging on a freebie, the nasty people use these hidden contracts to regularly take sums of moneys from the victim’s account.
Two Bogus Charities
While no-one wants to curtail the season of goodwill, the NTSB just want to make sure you are actually giving to charity and not to some clever scammer lining his own pockets. Consumers should be wary of vague statements on packaging such as ‘donations for work creation’ or ‘donations to poor children’ and look for registered charity numbers where you can. Also check things like charity collection bags to make sure they are destined for who you think they are- before you fill them
And a dangerous toy under the tree…
The NTSB want to stress that, while a cheap toy or electrical gadget might seem a bargain, sub-standard foreign imports will not adhere to safety guidelines and have the potential to be dangerous for kill unsuspecting gift recipients. And that will not make a merry Christmas.
NTSB chairman Lord Toby Harris, wearing a red suit and white beard, chortled: “Last year, UK adults spent an average of £592 on Christmas. At a time of year when we know consumers will be parting with hard earned money, it is imperative that they be made aware of current scams. The NTSB encourages all consumers to check the legitimacy of chosen traders before buying gifts or committing to contracts.”
Consumer Minister and part-time elf Jo Swinson advised: “The first thing people should do is follow the old adage – if something sounds too good to be true than it usually is. If something is not quite right or they are being pressured into buying goods or services they don’t need, then they should report this to the Citizens Advice consumer helpline on 08454 04 05 06. They can ask trading standards to investigate claims and make sure consumers get a fair deal.”
Customers are losing thousands of pounds each year in fees and charges just for being with the wrong bank, according to new research from Which!!! What’s worse is that no-one can figure out how to compare account to get a better deal.
Which!!! compared overdraft charges, interest and the cost of using your card overseas between 21 current account providers. They found that by simply having the wrong type of account, you could be paying more than £2,000 in charges.
They say: “In our worst case scenario, going overdrawn without permission and having payments rejected could cost an extra £183 in fees and charges a month with the most expensive account, Bank of Ireland Clear Account Level 1, compared to the least expensive, the Halifax Reward Current Account. If you did this every month, it would add up to a massive £2,197 over a year.”
“Even if you only use an authorised overdraft for just a few days a month, you could be around £120 worse off a year if you bank using TSB’s, Lloyds’ or Bank of Scotland’s Classic Account, rather than Clydesdale Bank or Yorkshire Bank’s Current Account Direct. Our latest consumer insight research shows up to five million households are using their authorised overdraft facility.”
What is confusing customers is that banks are making information readily available which doesn’t help if we’re trying to compare accounts so we can find one best suited. At present, the charges are so mystifying and complex, that no-one ever really knows what they’re being charged for.
Richard Lloyd, executive director at Which!!!, said: “Our research lays bare the huge difference in fees and charges between current accounts. With many households relying on their overdrafts to cope with the rising cost of living, we’re calling on the Chancellor to force banks to release information so consumers can make sense of the way they use their account and choose the one that is best for them.”
“Unless banks make it simple for people to compare the cost of running a current account, the new switching guarantee alone will fail to transform switching rates or significantly increase competition in banking.”
Remember that loan you got out years ago that allowed you to buy Blastaways, fags and occasionally pay the rent on that condemned basement you lived in with the Bob Marley poster and the rats? Did you pay it off yet? Or did you change your name, move house and pretend it never happened?
Well plenty of people have done just that, it would seem, and the amount of outstanding student loans is set to reach £200 billion by 2042. At the moment, according to the National Audit Office, the total amount borrowed is £46bn, and the Student Loan Company is sitting on a mountain of unaccounted for loans totalling £5bn. A further 368000 had no employment record in the UK, and if they then started work, they had failed to tell Student Loans tax or information about earnings.
The Department of Business, Innovation and Skills assumed 35% of loans that would go unpaid but now that figure is closer to 40%. They also miscalculated how many students could pay back the new higher rate student loans. And as you can imagine that’s left a little hole in the budget, to the tune of £600m.
Labour MP Liam Byrne said: ‘In May, the Universities Minister was boasting of the governments ‘text book reforms.’ Now, we learn that blundering, out-of-touch ministers got their sums so badly wrong that there’s a £600m hole in the budget. We need to know how ministers got it so wrong, and how they’re going to fix it without putting Britain’s scientists, schools and colleges under threat.’
God, chill out, man. Be more like an ageing student. Make a bong out of a bottle of White Lightning and watch Betty Blue on DVD or something. It’ll get paid back. (Maybe.)
You know how it is. You’re upgrading your computer, so you chuck out your old one, giving it up to linger in a landfill forever more. BUT WAIT! Your hard drive was full of Bitcoins from 2009, which were nothing but worthless pixels back then. You had 7500 stored on there, which you’d generated yourself. And now they’re worth £613 each. Which means…YOU THREW £4,597,000 IN THE BIN YOU ****** IDIOT.
Well, that’s what happened to IT worker James Howells from Newport, South Wales, who was tidying up his drawers one day and decided to throw out his knackered machine. He’d forgotten about his crazy Bitcoin generating phase, and got rid of it last year.
Bitcoin launched in 2009, and you used to be able to make them yourself on an ordinary computer. Now it’s become increasingly harder to generate them, and they have grown in value – today they fetch $1000 each.
James explained: ‘I hadn’t kept up on Bitcoin, I’d been distracted. I’d had a couple of kids since then, I’d been doing the house up, and forgot about it until it was in the news again. There’s a pot of gold there for someone… it’s my mistake throwing the hard drive out, at the end of the day.’
Poor, foolish James. Now, digging it up would be like looking for bitcoins in a crapheap. According to landfill officials in Newport, the computer could be anywhere amongst the acres of festering rubbish, and buried approximately four feet deep.
*Puts on wellies*
Analysis from the Organisation for Economic Co-operation and Development (OECD) showed that Mexican workers get 28.5% salary replacement in retirement, while UK residents get a 32.6% of salary replaced directly by state benefits. Meanwhile, over in Italy and France, they’re laughing their way into old age as they have the best pensions from the state.
Places like Slovakia and Hungary, still firmly Eastern Bloc, have more generous governments it seems, regarding old people. Over here, the maximum payout of £110.15 is the best you can do, which has seen The National Pensioners Convention all set to lobby MPs, hoping for a living State pension or £178 a week.
Of course, with people getting healthier, babies born now won’t see their pension until they are in their 70s, meaning they will get a pension for 30 years as there are likely to be a lot of humans reaching 100.
Mr Scarpetta, behind the study said: “I am very concerned that we are moving towards a more contribution-based system but in many countries especially young people have been unemployed. They are outside the labour market so they are not contributing (into a pension). We hope the economy will kick on and then many of them will indeed get into a job and so on and so forth.”
“But they will have fewer years of contribution so potentially there is also a long-term effect of the current crisis which in some countries has been particularly severe, especially for the young generation.”
Steve Webb, the Pensions Minister, said: “We are building a UK pension system that is more sustainable for the future. As the OECD recognises, by combining the state pension and income from workplace pensions people many people in Britain can expect an adequate retirement income.”
In Britain, it’s more expensive to run a car than anywhere else in the world. Yes, your little Honda Jazz costs more to run than Justin Beiber’s pimp mobile, or Bret Michaels’ souped up RV full of dirty ladies.
On average we pay £3453 a year to stay on the road, which is a grand more than the Americans and the French, and £2000 less than the Chinese, who are scooting about on the cheap and living it up.
Webuyanycar.com took motoring costs from 21 countries and found that we shell out 27p a mile on average – paying more for fuel, tax and insurance. And of course, the thing we’re spending the most on is petrol. A whopping £2256 a year goes on filling the damn thing up.
Only Denmark and Switzerland came close to our prohibitive car costs. But the cheapest place to run a car is Saudi Arabia, where it costs the princely sum of £237.32 a year to own a car. But of course, they do have all the oil. And women aren’t allowed to drive, so that cuts costs for the oppressed ladies straight away.
Do you want a depressing table of costs? Thought so. Happy motoring!
1. UK £3,453.66
2. Netherlands £3,370.42
3. Switzerland £3,321.80
4. Italy £2,966.69
5. Portugal £2,914.63
6. Germany £2,856.04
7. France £2,538.82
8. USA £2,425.36
9. Spain £2,421.87
10. New Zealand £2,387.20
11. Australia £2,128.24
12. Canada £1,828.65
13. India £1,805.94
14. Russia £1,727.82
15. Japan £1,628.38
16. China £1,315.12
17. South Africa £1,280.18
18. UAE 672.01
19. Qatar £527
20. Argentina £269.92
21. Saudi Arabia £237.22
There’s been a lot of chatter about payday loans, but very little action lately. However, something is being done as Chancellor George Osborne said that a new law would be passed which would put a cap on these short-term loans, saying that it was a ”logical step” to put a limit on the levels of interest providers can charge.
“We’ve taken steps to control things like the rollover of those loans and I think the next logical step is to cap the overall cost of credit,” he told BBC radio. ”It’s working in other countries, it helps hard-working people, and in fixing the banks we need to make sure we fix all parts of the banking and financial system and payday lending is part of it.”
The FSA has been criticised for not imposing such a cap in the past in a bid to get some control over the industry. Tasked with deciding how a cap would be set and implemented, the new financial watchdog, the Financial Conduct Authority, will be on-hand to shore this all up.
Richard Lloyd, him from Which!!! responded to the news: “We’re pleased the Government is committed to taking tougher action on payday loans by capping the sky-high fees and charges that drag people down in a spiral of debt. This will need to be part of a wider clean up of the credit market. The Government and the Financial Conduct Authority must clamp down on irresponsible lending and excessive fees across the board, whoever the lender.”
Whether this will take people directly into the waiting arms of illegal loan sharks (who Vince Cable calls ‘The Baseball Bat Brigade’), is another matter.
You know how it is – you stumble through life, thinking you’ll never get old, drinking fizzy pop and not bothering to wash your socks because your Mum isn’t there to tell you what to do, and then BOOM – suddenly you’re 48 years old and staring into the abyss of your own mortality, and you have no nest egg for the future. *Macauley Culkin in Home Alone face*
This is according to a report by NFU Mutual which has identified the hitherto unknown and entirely made up concept of ‘retirement reality.’ This yawn-inducing buzzword, which will probably feature in a David Cameron speech soon, refers to the moment we realize that we never bothered with a pension, and we’re screwed.
‘Only [at the age of 48] do they truly appreciate what savings they need for retirement and when they will realistically be able to stop work.’ lectured NFU Mutual, slowly pushing NFU Mutual pension plan literature across the metaphorical table. ‘For some, the realisation has more dramatic consequences. One in ten of those still working past the age of 55 say they now don’t ever expect to be able to retire.’
The report, which surveyed 2001 adults, said that people who only start to save at the age of 48 have ‘left it too late’ and many who have already started saving are having to push back their retirement plans by about 4 years, in order to have enough income.
If you don’t start saving in your twenties, you’ve basically had it, and you can never retire. Which is just as well, because retirement is boring and you’d be better off contributing to society until you die, rather than pruning your azaleas and staring suspiciously through net curtains at passers by.
Six months after it launched in North America, Amazon Coins have been propelled into the UK and German marketplace. Of course, we’ve already got money that works perfectly well, but Amazon clearly felt the need to create their own currency.
Of course, this is a virtual currency and you can use it to buy paid apps and the like, from the Amazon for Android Appstore. That’s if developers buy into the idea.
Obviously, Amazon think it’ll be worth our while, saying: ”For many Indie developers, Coins has accounted for the majority of their revenue since Coins launched in the US.” The company have celebrated the launch by giving away a small amount of virtual-dough to Kindle Fire owners, most of whom will be looking blankly at it, wondering what to do with it. Maybe buy a virtual bookmark?
As for the exchange rate, 400 Amazon Coins is worth £4 according to Amazon. Naturally, Amazon haven’t forgotten about real money as they are looking at moving into the London Underground. Tube users might not be able to get tickets anymore, but they will be able to buy gadgets and whatnot.
As the Underground is closing their ticket offices (so they can go 24 hours), Amazon are looking at moving in. It has been reported that Transport for London are talking to Amazon about converting ticket offices to drop-off points for goods.
Asda has already announced they’re moving into the Tube, so customers can pick up groceries when they’re not at home to take deliveries.
If the High Street is struggling, maybe it should look to moving everything underground, like some Dystopian sci-fi film?
Reports state that roughly 19% of mortgage holders are overpaying every month, according to Santander Mortgages. 6% overpay once a year, while another 9% pay more than they need to on an ad hoc basis.
It seems people are taking advantage of low interest rates as this is a rather recent trend among homeowners.
CML chief economist Bob Pannell said: “Housing activity is set to strengthen further in the short-term, and to contribute materially to overall economic growth. Combined with the Bank of England’s recent optimism about the economy, this has led some commentators to speculate that an early rate rise may be on the cards. We do not currently share this view.”
Why overpay on your mortgage?
If you overpay on your mortgage, you’ll end up paying less interest overall. It seems that, if you have some cash to spare, it is better to pay more toward your mortgage rather than paying into savings, seeing as the rates on the latter aren’t great at the moment.
Mortgage rates have been steadily falling throughout 2013 which has allowed people to get cheaper mortgage deals, be it for a new buy or a remortgage. They can opt to use some of the savings they would have made to overpay on their usual monthly payments, thereby reducing the loan. You could reduce your mortgage term and save thousands.
According to one repayment calculator, if you overpay £181 per month on a £200,000 mortgage at 3.5%, you’d end up saving £24,118 over the mortgage lifetime, reducing the mortgage term by over five years. So if you have any spare cash, this is certainly worth thinking about.
If you’re a Barclays’ customer who has been trying to do some online banking, you’ll know that their service seems to be down. Customers are unable to access their accounts and the mobile app isn’t working either.
The site has been showing a message that says: “5 – Sorry – Barclays Online Banking is currently unavailable.” If you hit ‘next’, you get an error message.
The site isitdownrightnow.com is showing that disruption is widespread too.
Of course, Barclays customers are taking to the internet to get angry about it, and as yet, there’s no word from Barclays themselves from their main account. The UK wing apologised yesterday for some app disruption, but it appears it has all gone awry again.
Looks like customers will have to wait ’til the morning for an answer or apology. Until then, Barclays customers are advised to complain direct to the company themselves, rather than complaining so everyone else can see it (that only ensures that people will think you deserve your financial predicament).
We’ll follow this up when we hear more.
We might be so cold and poor that we’re covering ourselves in knock off Deep Heat and Lidl cling film, but we always make the rent. That’s according to a survey by LSL property services, who owns several letting agencies.
Private rent arrears have fallen to the lowest in 5 years in England and Wales, despite rents being the highest in a MILLION YEARS (citation probably needed). It seems that the majority of us are behaving ourselves and paying it, rather than splurging our cash on bingo and Tennents Super.
Between September and October, rent arrears dropped by £49m. With the average rent at £758 a month, it’s no mean feat to actually pay it on time, every time. But we’re tightening our belts and getting on with it. The fact that LSL’s figures are based on rent being paid EXACTLY on time, and not a single day late, must mean that we are becoming Martin Lewis style experts at budgeting.
Yes, so we have probably sold all the furniture and we’re huddled in the corner with a tin of Tesco Basics chickpeas while David Cameron cavorts around in his new gold hat, but you’ve got to admire our ability to keep going in a financial crisis.
Heard of Coin? Some bright spark has come up with a novel solution to having too many cards in your wallet. You add all your cards onto a single Coin card with a phone app and with a little button on the Coin card itself, you choose which card you want to use.
It looks like a good thing, but of course, if it gets stolen, that’s someone running off with all your cards at the same time (and the smartphone alarm that tells you it is too far away from you going mad in your pocket while you work out which one to cancel first).
Anyway, have a look at it here.
Good idea? Bad idea? You can pre-order a Coin card here.
The big cheese over at Primark’s parent company has told rivals that they must stop using ethical policies. George Weston thinks that other companies have being using their ethics as a way to gain sympathy from customers when really, they should actually try and change the way they work.
He said: “We must get away from the days of the past where companies parade their ethics as a marketing tool.”
To back him up, this comes on the back of Primark seeing sales jump by a very impressive 22% with pre-tax profits up 44% to £514 million. Meanwhile, M&S see their profits and shares tumble.
It seems that very few customers boycotted Primark after the deaths at one of their garment factories in Bangladesh. Not that Primark haven’t been doing their bit, spending £2 million on aid and support for survivors and victim’s families. Weston said: “If there is any good that comes out of Rana Plaza, it is a huge wake-up call that the sector has been long overdue.”
And Primark will be expanding stores in London and will be continuing to work in Europe, with 19 stores on the go already, and a further 20 planned next year.
Seems like good business and loyal customers doesn’t revolve around being cuddly and ethical at all.