Getting Loans and Credit & Managing Money - Feed How to successfully manage your personal finances Thu, 18 Oct 2018 11:32:36 +0000 hourly 1 39026437 Are you in “persistent credit card debt” like 6.3 million others in the UK? Thu, 18 Oct 2018 11:32:36 +0000 Alex Hartley It’s not that difficult to get into trouble where credit cards are concerned. From unsolicited credit limit increases, to cards that don’t come with proper affordability checks, credit – and lots of it – is often very freely available. The consequences of this are becoming obvious, as increasing numbers of people in the UK find themselves in persistent credit card debt. This is the kind of debt that is almost impossible to pay off and new Financial Conduct Authority (FCA) rules (that had to be implemented by 1 September) have been designed to try to help find a way out.persistent credit card debt

What’s the current situation?

There are more than six million people in persistent credit card debt in the UK. This is essentially debt that is being serviced but not paid off. So, it could be a balance of several thousand pounds on which someone is only ever making the minimum payment. As a result, any payments made go towards the bank’s interest costs and not towards reducing the balance on the credit card. Many of these people fall into younger age brackets – for example, research by Experian found that 12% of credit card holders aged between the ages of 18 and 24 don’t pay off any credit card debt in a typical month. Almost half of these people said they simply couldn’t afford it.

What will the new rules do?

As of September this year there is now more protection for those who are in financial difficulties or who are struggling with persistent credit card debt. The rules are designed to help those who are simply servicing their debts, for example paying £2.50 in interest and charges for every £1 they borrow. The FCA has said that it hopes the new rules will translate to savings for customers of between £310 million and £1.3 billion a year in lower interest charges.

As a result of the new FCA rules, lenders are required to take a little more responsibility for borrowers who are seriously struggling with their debt. That includes a timetable defined by the FCA that escalates issues based on how long the individual has been in persistent credit card debt.

  1. 18+ months in persistent credit card debt – at this stage a lender is required to make contact with a customer and let them know that, unless they change their debt behaviour, their card is likely to be suspended.
  2. 27+ months in persistent credit card debt – after just over two years struggling with debt, customers will be sent a reminder of the above information by the lender.
  3. 36+ months in persistent credit card debt – this is the point at which the FCA requires lenders to be more proactive in terms of solving the situation. Lenders should offer borrowers a reasonable way to repay the balance on the card, which could include switching the credit card to a loan. Lenders will also be required to demonstrate ‘forbearance,’ which may mean cancelling interest, reducing fees or waiving charges, for example.

Do the new FCA rules go far enough?

Many people believe that they don’t and some experts have highlighted that the changes are really too little, too late. Given the size of some current interest rates, getting debt free can be serious challenge that these new rules do little to support until there has been persistent debt of at least 36 months. For example, a typical credit card debt of around £3,000 would take around 27 years to pay off if the customer only ever made the minimum payment. It has been suggested that the rules should have gone further to include:

  • Higher monthly minimums – paying more off each month so that the balance is being reduced, as well as interest payments made.
  • Fixed monthly minimums – as the balance goes down, minimum payments do too but a fixed monthly minimum that remained the same would mean the balance was cleared more quickly.
  • More stringent affordability checks – whether or not someone can afford the debt that they take out is a key issue and current affordability checks are viewed as inadequate by many, particularly given the issues that many people now have with the amount they have borrowed.
  • Opting out of unsolicited credit increases – some credit card firms have already agreed to voluntary measures that allow customers to opt out of automatic credit increases to help stop a bad debt situation from getting worse. Many hope that this will become more widespread.

Issues with credit card debt in the UK are nothing new. However, the FCA is making the first move towards trying to turn the situation around with these positive steps that at least send the right message.

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Category: Credit Cards, Debt]]>
Little lifestyle changes that will save you a lot of money Mon, 15 Oct 2018 11:05:18 +0000 Alex Hartley When it comes to saving money we are often more focused on finding the big ways to cut costs. However, the smaller savings really do add up. If you’re looking for opportunities to save money without making big changes then these are just a few of the lifestyle hacks you can try to help you achieve much bigger savings overall. And saving money means there will be much less of a need to consider short terms loans to cover the budget gap! change your lifestyle to save money

Push your big purchases until the end of the month

If you’re buying something that requires interaction with a sales rep then the end of the month is the best time to get it. All sales reps have quotas to fill – if you wait until close to their deadlines to make your purchases then you’ll have more leverage when it comes to bringing the price down and saving you money.

Make your coffee at home – or take your own cup

Avoiding the daily £3-4 spend on coffee can add up to huge savings, which is why it’s one of the lifestyle hacks most often suggested. If you really can’t do without that daily dose of someone else’s caffeine expertise then buy a reusable cup and take that to your local coffee shop each day. Everyone, from independent coffee shops to Starbucks and Costa, will give you a discount if you do.

Track your spending with an app

There are lots of different apps available now to show you how much you spend and where most of your money goes. Find one that will consolidate all your accounts so that you can see your bank accounts and debt in one place and have a clear overview of your finances. When you start tracking your spending you’ll find it much easier to identify where you’re wasting money and where there are opportunities to make savings.

Be your own personal chef

If you’re buying your lunch every day then you could be spending anywhere up to £50 a week on food. The most frugal savers know that batch cooking is a lifestyle hack that will quickly bring spending down. Whip up a sizeable batch of something on a Monday and then eat it for the next few days in a row – it will do your body no harm to eat something delicious on repeat and it will be cheaper and minimum hassle too.

Buy a water filter

You might be surprised to realise just how much you spend on bottled water each year if you really add up the cost. A water filter jug at home gives you a plentiful supply of fresh and ready to drink water with all the nasty bits filtered out. You’ll not only be making financial savings but also environmental ones too, as you’ll be sending less plastic to landfill.

Make sure you’re hydrated

While we’re on the subject of water did you know that many people frequently mistake thirst for hunger? If you feel yourself getting peckish, drink a glass of water before you eat. You might find that’s enough to satisfy your body if it was really thirst that you felt and you’ll save money on the food that you don’t consume as a result.

Ask for a cut price deal

From your internet provider to the energy company you use and the business that you bank with, it’s always worth asking if they can reduce the cost of your services. Most businesses have some leeway available, especially for loyal customers, but they aren’t that likely to offer it up unless you ask for it first. So, try requesting a lower monthly payment or reduced interest rate – even a small decrease in these costs can make all the difference.

Clear your browsing history when shopping online

New customers get the best deals so it’s always worth clearing your cache and history online. Get into the habit of making purchases as a guest rather than signing up for an account that brands can track to make sure you always see the best savings.

Learn to be happy with what you have

It sounds like hipster mindfulness nonsense but you can save a lot in the long run by learning to be happy with what you already have. Appreciating existing possessions instead of constantly looking to acquire new ones is the best way to bring your spending down.

Reduce the brightness on all your screens

From smart phone to laptop and desktop, you can reduce the screen glare to help save cash. All screens have a default setting of high brightness but if you alter this to a lower setting you can save up to 40% on your energy consumption. Plus, you’ll also be taking better care of your eyes.

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You could be due £000s of refunds. Have you claimed yet? Thu, 11 Oct 2018 11:39:48 +0000 Alex Hartley Life is expensive these days. So, if there is an opportunity to save money or – even better – to get some cash back from a purchase made then it makes sense to take it. There are more potential refunds available than most people realise – in fact, you could save thousands of pounds on refunds when you know where to look for them. These are just a few of the potential savings that are available to anyone who takes advantage of them.claim your refunds

Student loan refunds

Repaying student loans is not exactly something that graduates look forward to doing. When you leave university you’re meant to have a break between finishing university and starting to make repayments. For most people that break is about nine months, as the requirement to start making repayments only applies from the April after graduation. There is also a threshold limit and if you don’t earn enough to reach this level then you’re not required to start making student loan repayments. However, if you have an employer who is not particularly savvy about when student loan payments begin, or has the wrong information about your university dates, then you may have been making payments unnecessarily. All you have to do to get that money back is call the loan provider and ask them.

Energy bill refunds

The cost of energy is constantly increasing and yet many people don’t realise that they are paying too much. If your energy bills are being taken by direct debit then you may be overpaying. Energy companies tend to bill on the basis of estimates and so you can often end up paying too much if the actual energy usage is lower. As a result your account may be in credit and you can request that back as a refund. Some people who have done this have found themselves with hundreds of pounds of credit to refund. All you have to do is go online and see whether your account is in credit. If you are significantly in credit you can also ask for your direct debit estimates to be lowered.

Uniformed worker tax rebates

It requires a really good accountant to take advantage of all the different tax rates and rebates that are available depending on what you do for a living. However, some of these are easy to access yourself. For example if you wear a uniform to work – whether that’s an actual uniform or just a branded top – , as long as you wash it yourself, you may be able to get a tax rebate. The tax rebate will be between £12 to £74 a year and can be backdated up to four years so you could receive several hundred pounds back.

Refunds for legal fees

Specifically, if you have a Lasting Power of Attorney that you took out between 1 April 2013 and 31 March 2017 in England and Wales then you’re highly likely to have paid around £110 for it. This is actually more than you should have paid and so you’re entitled to a refund of up to £54 for each Power of Attorney. A Lasting Power of Attorney (LPA) gives someone you trust the power to act on your behalf if you no longer have the mental capacity to do so. This could cover the way that your money and property is handled, as well as crucial decisions such as those involving medical matters. LPA refunds are easily claimed, either via the Office of the Public Guardian’s website or by calling 0300 456 0300.

Tax rebates for partners

If you are married or you’re in a civil partnership then you could be due a tax rebate. The marriage (and civil partnerships) tax allowance applies to couples where there is one person who is paying basic rate tax and the other partner is a non-tax payer. If you or your other half is not working then you can apply to have 10% of your annual tax free allowance transferred across to the partner who is working. This would result in a rebate of several hundred pounds a year. The rebate was introduced three years ago and claims can be backdated to the date that it was launched, making an even more impressive refund total possible.

These are just some of the rebates that are available to those who fit the criteria. With even one or two of these rebates it could be possible to save several thousand pounds, creating cash that you can use elsewhere whether that’s for holidays or home improvements.

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The Very Real World of Virtual Currency Sun, 07 Oct 2018 15:26:10 +0000 Amanda Gillam The world of video games is a very real place. For those with little to no interest in computer games or online worlds, it might come as a surprise to even know that many of these games have their own currencies. And it’s not just like the old-school coins in Super Mario, this currency is a real thing that drives the games’ bespoke economies through in-game purchases, often called microtransactions. These range from small scale to off the scale.

gaming and in-game purchases

To many people playing the games, a small purchase here and there doesn’t really feel real. It feels like something that exists purely in the game. However, virtual currency and in-game purchases are very real. For kids, teenagers and adults alike.

At Solution Loans we’ve seen an increase in people seeking financial assistance to cover debts racked up through purchasing items with in-game currency.  It’s an ongoing and increasing problem for many, not just the few.

Money made by the video gaming companies

It’s certainly a very real phenomenon for the gaming companies, one which is extremely lucrative.

The below table shows what the top 10 mobile games make every single day.

Game Daily Revenue (US $) Daily Revenue (GB £)
Fortnite 1,822,162 1,403,064
Candy Crush Saga 1,325,069 1,020,303
Pokemon Go 1,047,624 806,670
Toon Blast 695,016 535,162
Clash of Clans 614,642 473,274
Roblox 507,598 390,850
Slotomania Vegas Casino Slots 312,473 240,604
Candy Crush Soda Saga 298,610 229,929
Toyblast 261,140 201,077
Homescapes 207,877 160,065

But it’s not just mobile games that continue to generate revenue through in game purchases. EA Sports for example, reportedly makes $650 million for in-game purchases for their flagship game FIFA. This is done through their Ultimate Team Feature – it’s also something the gaming giant has been heavily criticised for.

So how do they manage to eek so much revenue out of these in-game features? They target specific players, often termed “whales”.

These whales equate to just 0.15% of mobile gamers, but they rack up a whopping 50% of all in-game revenue. The gaming companies therefore set up the entire in-game economy to target this small percentage of players.

When it comes to the size of the purchases, the important transactions range between $9.99 and $19.99 with 47% of revenue coming from microtransactions within this scale. This is compared to just 6% of revenue coming from purchases ranging from £0.99 to $1.99.

Let’s have a look at this in context of the biggest game mentioned above and one that’s continually in the headlines, Fortnite.

Each whale will currently need to spend £11 per day for Fortnite to hit its daily revenue.

That doesn’t sound that much really, but annually it equates to £4,015 per person. Not good if the whales are kids or teenagers. To put it into context that’s more than a season ticket for an entire family to watch Premier League champions Manchester City for a full season.fortnite

Overspending on and addiction to microtransactions

Unfortunately overspending on microtransactions is a common problem that happens all too often. In some instances, it can even lead to addiction.

There’s been examples of individuals spending over $10,000 on FIFA in just a few years – hence the criticism. One Australian teenager accrued debts of $13,500 on microtransactions across the various Star Wars games.

We’ve also seen one Reddit user describe an addiction to Yugioh Dual Links, racking up spend of over $1,000. This latter cost may not seem in the same scale as the other figures mentioned above, but it is certainly enough to cause financial problems.

The biggest concern is also the user’s talk of and recognition of an addiction to the game.

It’s the word addiction that is most troubling.

This is clearly a very real problem which has led to some countries like Belgium banning lootboxes (a vehicle for microtransactions). However, these are still very much legal in the UK and US.

How does this compare to the average gamer?

Let’s look at Fortnite again to see what the average gamer spends on in-game purchases.

– 68.8% of all players have spent money on in-game purchases on Fortnite

– For 36.78% of those who have spent money on Fortnite, it’s the first time they’ve ever made in-game purchases

– The total average spent per player is $84.67

– 25.3% of all Fortnite players, also pay for subscriptions to Twitch – a streaming service that enable them to subscribe to watch other people play the game

spending on games microtransactions

How does the pricing structure work and how do people get lured in?

The in-game currency on Fortnite is called V Bucks. Here’s how much you can get for your pounds when you transfer.

  • 500 + 100 bonus (plus a specific outfit and backpack) – £3.99/$4.99
  • 1000 – £7.99/$9.99
  • 2500 + 300 bonus – £19.99/$24.99
  • 6000 + 1500 bonus – £49.99/$59.99
  • 10000 + 3500 bonus – £79.99/$99.99

As you would probably expect, it’s not just a case of a simple transaction. To lure gamers into spending more, you get more bang for your V-Bucks the more you spend.

Specifically, you can get around 150 for each pound spent with the £3.99 starter pack, and 168 for each pound in the £79.99 selection.

With Fortnite it’s all about the cosmetic, with purchases being for material items rather than a specific competitive advantage. Interestingly, going back to the above survey, 20% of players weren’t actually aware they didn’t gain an advantage by spending.

Video game spending and the UK Economy

Let’s look at this phenomenon in the context of the UK economy.

In the UK, the consumer spend on games was valued at a record £5.11bn in 2017 – this was up 12.4% from the previous year’s spend (£4.33bn). This includes spend on microtransactions as well as for the games themselves.

When looking specifically at microtransactions and in-game spending this was valued at £908.7million in 2014.

We can only speculate but this will almost certainly have increased by now.

The global impact

And globally the numbers are huge.

In 2015, global in-game spending was valued at $22billion, which is expected to rise to $32billion in 2020.

Looking at the value in pounds on a daily basis, that equates to £5,8850,752.79. Every single day across the world in 2018.

It’s big business and is starting to make its mark in the real world.

Specifically, the value of the currency in World of Warcraft has grown so much in comparison to real world economies that it is now worth seven times the currency of Venezuela.

We’ve also seen a criminal element creeping in too with money laundering a very real problem in games including FIFA, World of Warcraft, Star Wars, Final Fantasy and many more.

In fact, Korean police even arrested a gang transferring $38million to China, all laundered through Korean games.

With such a huge status globally and flourishing economy, individuals who can work the system stand to make vast sums from trading.

Trading platforms are where money can be made. Specifically, the owners of trading platform OPSkins were making over $12,000 a day in 2015 from their marketplace for virtual weapons.

It’s not just platform owners who are making the big bucks either, with those that buy and sell products as traders cashing in too. One user, simply referred to as Todd, has estimated to have made $42,321 from trading virtual cats on a game called Kyrptokitties.

Those with money are also splashing the cash on in-game purchases with the biggest ever a nightclub on the game Entropia Universe – this was for a value of $635,000.

The opportunities from gaming, whether trading in-game currency or being paid to game are huge. This has led to parents even hiring coaches for their children on games like Fortnite, hoping for lucrative success from their kids’ hobby.

Learn how to spot the signs

With huge potential to make money for the gaming companies and the ease of spending in crucial moments within games, the potential for addiction is a very real concern. As a parent try and do the following:

  • Monitor how much time your kids spend gaming
  • Find out from them which specific games they are playing
  • Learn as much as you can about the games your kids are playing and if they include in-game purchases
  • Limit their time playing these games & check for how they react when you try do this – a clear sign of addiction is an inability to let something go
  • Look for specific signs including if they are hiding their gaming use, specifically doing it at night
  • Check how much they talk about the game and how much their life begins to revolve around it – a sign of addiction is an obsessional attachment to the game

Gaming can be a good thing; however, it can often be fraught with potential problems and difficulties.

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Category: News]]>
ITV’s Tonight programme looks into debt in Britain Thu, 04 Oct 2018 11:02:49 +0000 Alex Hartley At the end of August, ITV’s Tonight programme broadcast an edition that was focused on consumer debt and the problems it’s currently causing. It identified the time-bomb that exists in the UK with millions of people only just managing by taking out loans and maxing out credit cards. With eight million people in the UK struggling to sleep at night because of their debts, the UK is officially in a debt crisis and the Tonight programme looked at some of the most common scenarios, what could be done to help people and what impact high levels of debt were having on mental health. ITV Tonight programme

The UK’s debt crisis

The average British household owes £58,000 and with interest rates set to rise, as the Tonight programme highlighted, debt levels in the UK are only likely to increase. There are a lot of signs of serious issues among UK consumers, for example in 2017 the average family spent £900 more than they earned. Savings levels are at record lows and the UK currently owes £19 billion in every day costs, such as utility bills and council tax. As the show highlighted, people who find themselves in a debt crisis have often ended up there as a result of a series of unfortunate events. It’s not wild spending on shoes and holidays that can plunge someone into unmanageable debt but often something as simple as a change of life – losing a partner, suddenly having health problems or being made redundant. The Tonight programme spoke to a couple who had found themselves in more than £30,000 of debt simply as a result of these small life changes that ended up having a snowball effect.

What are the options for anyone struggling with debts?

The Tonight programme looked at a number of different options for people with debt problems, including:

  • Individual Voluntary Arrangements (IVAs) – under an IVA the debtor pays off just a proportion of the debt. For example, the couple who owed £30,000+ paid off £9,000. However, they were also required to pay around £8,000 in fees and it’s these fees that may mean IVAs are not always the best idea.
  • Although going bankrupt is often viewed as a last resort, it can be a preferable option for many people. It costs just £700 per person to go bankrupt and debts are written off after a year with no fees due to advisors.
  • Write to your creditors – for those looking for respite from debt to provide a small window to get finances in order it’s possible for a borrower to write to creditors and ask if they will accept a token payment of £1 for a period such as a month. The government is currently looking at introducing a “breathing space law” that would provide a six week break on debts to try to support those who are really struggling so there is a basis for requesting this from creditors.
  • A Debt Relief Order – for those who owe less than £20,000 and who qualify (the qualification is means tested), a Debt Relief Order means that debts can be written off after a year for a £90,000 fee.
  • Claiming compensation – anyone struggling with debt who believes that a lender has not treated them fairly, can write to the lender to request compensation as a result. The Tonight programme used the example of Ian who received £300 for unfair treatment by a payday lender.
  • Equity release – for those who are asset rich but cash poor, equity release can be a great way to free up some of the cash in a home to help deal with debt issues. According to the Equity Release Council, 30% of those who take out equity release are doing it to tackle a current debt. However, equity release is not for everyone, especially those who want to leave the full value of a property behind for the next generation. Interest on equity release loans accrues steadily and doubles every 12 years plus there can be penalties if the original loan is paid off early (i.e. before death).

The impact of debt on mental health

One of the key consequences of debt that the Tonight programme highlighted was the fact that it has an impact on our mental health. The charity Christians Against Poverty, interviewed on the show, revealed that six out of ten of its clients were behind in rent or mortgage and simply covering regular living costs was a problem for many. They said that a third of their clients had attempted or thought about suicide because they were struggling with debt.

Debt is something that many of us have in the UK and it can be very useful. As the Tonight programme highlighted, if it is not affordable or becomes unmanageable then it can have a big impact. What’s important, if you are struggling, is to seek help as early as possible.

Where to find Debt Help

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The downsides to student debt Mon, 01 Oct 2018 10:50:33 +0000 Alex Hartley A large student debt is a cause for stress – that’s not news. Ever since fees were introduced (and repeatedly increased) for UK students there have been concerns about the impact of graduating owing such significant sums. Despite the fact that debt problems are widely acknowledged as a major cause of depression, when it comes to students, as a society we seem to expect graduates to simply knuckle down and get on with making the repayments. However, a recent report has highlighted that the level of student debt required for many people to graduate today is having wide ranging and damaging impact on the lives of graduates. Rather than simply restricting spending on luxuries, a new report indicates that the burden of student debt repayments can impact on job satisfaction, mental health and long-term financial future.The burden of student debt

What does the survey say?

The research has been carried out by the Centre for Global Higher Education, who are based at the UCL Institute of Education and the University of Michigan. Although the team are US based they have been tasked with reviewing a range of research, not just relating to US students and educational institutions but to those in the UK too. The study took place over several decades and is considered to be a fairly authoritative work of research in terms of graduate lives in both countries. It made a number of key findings, including:

  • Home ownership. Being able to buy your own home is a major step in the process of establishing a positive financial future. The research found that student debt was linked negatively to home ownership. Not only are those with student debt having to delay home ownership as a result of those debts but they are also much more likely to be restricted to purchasing lower value properties.
  • Career trajectory. For many people, debt restricts career choices – often graduates have to take any job after university simply so that repayments can be made. This tends to lead to overall lower job satisfaction and can restrict career progression.
  • Financial future. High levels of student debt can often result in lower levels of net worth. People have less time to save for the future and so may end up without adequate retirement savings. Some even find themselves in financial distress and unable to service the debt.
  • Restricting entrepreneurial choices. The study found that those who graduated with high levels of debt rarely went on to explore entrepreneurial ventures. Although many students would have liked to pursue their own business, the combination of a sizeable student debt and the challenges of obtaining new business finance were off-putting. The need to cover repayments on student loans made the uncertainty of an entrepreneurial venture in the early years impossible to tolerate.
  • The impact on mental health. The Centre for Global Higher Education found that the existence of student debt had a significant negative effect on both students and graduates. It wasn’t just those graduating with a debt hangover who found the situation depressing and stressful but also those currently using the cash for study.

Student debt without the negative impact?

As this study showed, the existence of debt can make life very difficult for both students and graduates. It’s not ideal to have to borrow to obtain a qualification but there are ways to make it work.

  • Keep perspective on the future. If you’re borrowing to pay for studies now remember that there will come a point when the loan needs to be repaid. Plan for your career when you graduate and be prepared to take steps to ensure that you have the necessary income in place.
  • Don’t borrow what you don’t need. Student life is more expensive than it used to be but can still be lived relatively cheaply. When you’re signing up for a student loan, borrow only what you need to complete the course and don’t get tempted to borrow to pay for extras, such as travel or socialising.
  • Find ways to make your money go further. There are many benefits to being a student, from discounted rail travel to the money that you can save with an NUS card. Be proactive about finding ways to make your money go further so that you don’t need to borrow to survive.
  • Work while you study. Most student schedules will allow for at least a part time job and even a small amount of income could help you to survive on what you have, rather than getting into debt to get through the student years.

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Wonga’s demise – an update on developments Thu, 27 Sep 2018 10:21:17 +0000 Alex Hartley We recently covered the news that Wonga was being gradually wound up after a series of declared losses. Today, the payday loans lender is still in some fairly serious trouble but may have a saviour in the most unlikely of forms. In what must be a fairly unusual move, the Church of England has considered stepping in to buy Wonga’s debt book in order to stop this from falling into the wrong hands. The idea is to prevent more borrowers being further exploited by what MP Frank Field called “another loan shark.” So, how might Wonga’s transition to the side of the angels actually work?

Wonga websiteSelling Wonga on at a “knock down rate”

Wonga’s £400m loan book is ripe for exploitation as a result of the desperate state of the company. Many – such as MP Frank Field – have suggested that this could well result in it being sold off at a knock down rate to another lender looking to squeeze cash from it. For those who currently owe Wonga money that could leave the door open to exploitation. It’s this exploitation that Frank Field is trying to avoid by appealing to the Church of England to buy the Wonga loans book and protect the 200,000 lenders that would be affected. The Church is uncertain about whether it is best placed to become involved.

Why should The Church step in?

Effectively, if the Wonga loan book is sold on at a discount to another lender it could leave current borrowers in a difficult position. A new lender could (and very likely would) raise the interest rates that are applied to existing loans, which would make these loans even more unaffordable. The Church of England has an £8.3bn investment fund (something that may come as a surprise to many…). Given the resources at its disposal, is there any way that this could be used to help “liberate” the poor, as Frank Field put it? According to a representative of the Church of England, it is meeting soon to discuss its options in terms of a response. As the Church of England was recently revealed to have shares in Amazon – which it is refusing to give up despite Archbishop Welby previously saying Amazon was “leeching off the taxpayer” – many are hoping it will bail out Wonga, if only to silence those who have been critical of where the church spends its cash.

What does the short-term borrowing market look like now?

Although Wonga has gone as a borrowing option for consumers there are still many other lenders out there who are willing to supply short-term credit. However, a huge increase in claims against payday lenders – driven by claims management companies – could change the landscape of this financial market for good. It was the volume of claims against Wonga that eventually brought the firm down and a wide range of other short-term credit lenders could share the same fate. If the majority of these lenders didn’t survive the tsunami of claims heading this way, what would the market look like?

  • A lack of available credit. Despite all the criticism of short-term lenders they do provide credit to borrowers where other lenders will not. Without that availability of credit it’s difficult to see how those with low incomes and/or poor credit ratings will be able to obtain finance.
  • The bank of mum and dad. According to the Financial Conduct Authority’s Financial Lives survey, 3.6 million people (7% of UK adults) are borrowing from friends and family, which is more than the 6% borrowing from payday loans lenders. This number could double without a short-term credit alternative to the likes of Wonga. However, the Bank of Mum and Dad does not offer endless resources and, as has recently been highlighted, could soon run dry
  • An increase in borrowing from illegal lenders? The worst case scenario may well be that, with the loss of lenders such as Wonga from the market, illegal lenders, such as loan sharks, move in to fill the gap where mainstream lenders are not willing, or able, to do so.
  • The emergence of a new type of short-term credit. The market as it stands does offer other options for those who don’t have the kind of credit history that would enable borrowing from a mainstream lender. Guarantor loans, for example, provide an opportunity to borrow where a friend or family member is willing to guarantee the repayments if necessary. We could also soon see a new type of short-term credit lender providing a different type of deal that sits somewhere between the payday lenders of old and the typical high street lender with their more stringent conditions but lower interest rates.

The Wonga story continues to unfold and many are waiting to see how this is going to affect the market as a whole – the rest of this year could be critical for Wonga borrowers.

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Do budgeting and banking apps work? Mon, 24 Sep 2018 15:17:11 +0000 Alex Hartley We are frequently being told today that the best way to improve budgeting and money management is to get an app for that. From apps that squirrel away tiny savings from your daily spend, to those that identify the cheapest place to buy your groceries from, there’s no doubt that technology should, in theory, be designed to make life easier. But do budgeting and banking apps really work or are they just one more thing to think about?

money management appsWhy would you have a budgeting or banking app?

Saving time and saving money are the two main motivations for those who download financial apps to their phones. Some of the apps on the market really do help people to achieve miraculous financial progress. Others may just end up being a costly mistake. If you want to make sure that you’re investing in the right type of app then it’s worth knowing what to avoid:

  • A lack of support – if you have an issue with your app then it may be important to have access to a customer services team.
  • A cost to buy – it’s often difficult to know whether you really need an app, and whether it’s the right app for you, until you’ve used it for some time. Which is why it’s frustrating that some apps charge up front.
  • A lack of functionality – particularly if you’re paying for your banking or budgeting app, it’s important to make sure that it has the functionality that you’re looking for from it. For example, does the app integrate with the banks where you hold your accounts, how easy is it to import transactions and can you add transactions via an iWatch or mobile while on the move?
  • Poor ease of use – there is little point to an app if you’re limited in terms of what you can do with it because you don’t really understand how it works. Any app that requires a degree in computer science to master the basic functions is going to be a bad investment. Those that are simple and clear to use are the ideal choice.

Which apps are worth investing in?

Although it will be a matter of personal preference, to a certain extent, with respect to the apps that you enjoy the most, there are some which are widely viewed as being a good investment.

Money Hub


  • Combines all your financial interests in one place, from savings to investments
  • Provides a way to analyse spending
  • Enables spending goals to be set
  • Has a “find an advisor” option to connect you to professional advice if required


  • It’s not free – the app costs £0.99 per month

Money Dashboard


  • It’s free
  • Provides analysis of incomings and outgoings so that you can see where you’re spending your cash
  • Has an inbuilt budget planner which is tied into the spending of the month before
  • You can centralise all current accounts, savings and credit cards into the app


  • The app supports 59 providers – this includes most high street banks so should be sufficient for the majority of people but it’s worth checking your chosen providers are included



  • If you’re bad at spending all your salary in one go, this app will help. It releases money into your main account in small bursts so that it’s impossible to break the bank on payday
  • Let Squirrel know when your bills are due and it will make sure there is money in your account to pay them at the right time
  • Your income is paid into your account in weekly instalments so it’s impossible to over spend (this can be overridden in emergencies)


  • It costs £3.99 a month
  • You need to have your salary paid into a separate account – it’s run by Barclays so is totally legitimate but this could be an issue for some people

Other helpful banking and budgeting apps

  • Vouchercloud – helps you to find the best deals and discounts close to you based on your current location
  • Stocard – a digital wallet for all your loyalty cards so that you don’t have to miss out on the opportunity for discounts. You’ll have a barcode for the shop assistant to scan in the store instead of the card itself
  • Quidco – earn cashback on purchases with this app – all you need to do is snap and upload your receipt when you’re shopping
  • MySupermarket – if you want to make sure you’re saving as much as possible when it comes to groceries, MySupermarket will show you where your cheapest options are to buy

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Consumer credit growth slowest for 3 years – what’s this telling us? Thu, 20 Sep 2018 10:10:22 +0000 Alex Hartley Something is happening in the UK economy right now. The number of British consumers increasing their borrowing grew by the smallest margin for three years. This, combined with a very small fall in the number of mortgage application approvals, has led to concerns about economic growth in the UK, particularly with Brexit on the horizon. So, UK consumers are not borrowing at the same rate as they might have been previously. But what does that tell us about the economy as a whole and what we can expect in the near future?consumer credit growth slowing

The official growth figures

According to the Bank of England, unsecured consumer credit grew by 8.5% in July of this year. That’s a drop of 0.3% on the figures for the month before and significantly below average for the past three years. These new statistics come in the wake of nationwide concerns about the high level of UK unsecured borrowing. Official figures provided this year indicated that, in 2017, British households spent, on average, around £900 more than they had coming in.

What could be causing the drop in growth?

  1. British consumers are starting to curb spending habits. It could be the imminent arrival of Brexit and fears over an increase in the cost of living. Or an anticipation that interest rates might rise again. Whatever the reason, unsecured consumer credit growth could simply be slowing down because people are spending less. Many consumer groups have reported a new caution with respect to spending habits and the consequence of this could be people cutting back on non-essential purchases.
  2. Lenders are not as willing to lend. With rising numbers of personal insolvencies and uncertainty about the financial future – especially interest rates – it’s not just consumers who are nervous. Lenders reducing the credit they make available to consumers in order to minimise their own risks could also be causing the drop in unsecured consumer credit growth. With a small slowdown on secured lending – e.g. mortgages – also happening during this time, it’s possible that lenders are reigning in their risk in general.

What does the slowdown say about the UK economy?

Although consumer spending and borrowing trends change fairly frequently, conclusions are already being drawn in terms of what this change could mean for UK economic stability.

  • Weaker levels of consumer spending. British consumers have been spending at high levels in recent years, as official figures have confirmed. If there is less demand for credit then this means that there is less money flowing back into the UK economy via credit spend.
  • A potentially weaker economy? Consumer spending is what drives the British economy and if this is beginning to drop away, the result could be a weaker economy overall.
  • The reality of unsustainable levels of debt. Debt has always been a part of British spending habits ever since it first became widely available to consumers. However, debt levels have been identified as worryingly high by experts in recent years. New consumer borrowing fell from £1.5bn in June to £800m in July – which is significantly below average for the past three years according to the Bank of England. Could this be a sign that we are finally acknowledging that debt levels may be unsustainably high?
  • More people are starting to feel overwhelmed by debt. Roughly 3.4 million people are now struggling with serious problem debt according to the charity StepChange. The slowdown in consumer credit growth could be an indication that this is beginning to bite for more people and across a wider section of the British economy. If current debts become unaffordable then consumers are much less likely to continue borrowing.

It’s still possible to borrow – and borrow well

Although many levels of borrowing have fallen, credit is still available to those who are looking for it. And it’s still possible to borrow in a positive way.

  • Make sure your monthly repayments are affordable – after the repayment comes out do you have enough to comfortably meet all your obligations?
  • Shop around for the lowest interest rate – there are some good deals out there, especially if you have a sound credit rating
  • Limit the number of applications that you make – if you submit a lot of applications in a short space of time then you could damage your credit score
  • Borrow only what you need – debt can be a great way to get ahead in life as long as you’re not borrowing in excess of what you really need
  • Compare your loan & credit options before committing to your preferred solution.

Although the slowdown in UK consumer credit growth is certainly a sign that people are spending less, it remains to be seen what this means for the economy – and whether it will continue. Factors such as interest rates and Brexit will heavily impact in ways that are simply not forecastable yet.

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Off to Uni? Here’s how to keep your finances under control Mon, 17 Sep 2018 10:42:13 +0000 Alex Hartley Money is a big issue for students – or, more precisely, a lack of it. If you don’t have the Bank of Mum and Dad to rely on (or sometimes even if you do), years at university may well be lived on a shoestring. So, if you’re about to head off to university for the first time, getting your finances ready for the experience – and planning how to cope with the cash pressures you’ll feel – is essential.Off to university

How to get your finances ready for university

It’s estimated that most students spend more than their student loan by around £150 each term. But with some careful choices you can ensure that your own spending is well managed:

  • Find the right bank. Different banks offer a variety of deals to students and some are better than others:
    • Look for an incentive to open an account with a specific bank, such as a free rail card or instant cashback. Opt for the incentives most likely to help you reduce your spending.
    • Make sure the bank has a good reputation for customer service on student accounts – spending hours on the phone trying to fix problems could be costly.
    • Is access to ATMs free with this bank and are there cash machines on campus?
    • Does the bank require a minimum amount of cash to be paid in each term?
    • How good is the savings interest rate?
  • Investigate overdrafts. Debt is a necessary part of life for most students but you don’t have to pay over the odds for it. Student overdrafts are typically interest-free but the size of the interest-free part of the overdraft can vary depending on the bank. Find the bank that offers the largest interest free overdraft with increases in years two and three. Just remember that, at the end of your university years, the interest-free element will go and everything will have to be repaid.
  • Get used to budgeting. Living life constantly at the edge of your finances is no fun at all at any stage in life. So, get used to budgeting the money that you have from the first day of the new term. Calculate your income and outgoings and see where adjustments will need to be made to keep you on track.
  • Get ready to feel rich (for about a day). Most student finance is paid on a three monthly basis so you’ll get a huge one off payment which might be more than you’ve had before. The most basic advice here is: don’t spend it. Instead, transfer the money into a separate account and work out your budget. Then transfer money across as and when you’ve calculated that you need it.
  • Avoid credit cards. Introductory deals on credit cards might seem to offer 0% on purchases – but there is always a time limit on this. If that time limit expires before you start working then your monthly repayments will significantly increase, eating further into your student finances.

There’s an app for that

Personal finance apps are plentiful and they can help you to better manage your budget, no matter how small.

Yolt. This app is free and will enable you to centralise your account information in one place. It provides smart spending insights and also helps to set and manage budgets.

Chip. Another free piece of tech, Chip is a smart app that will work out what you can afford to save and transfer it into your savings account automatically. So, you’ll be accumulating savings without even trying.

mySupermarket. Food and household products can be a big expense as a student – this app shows you where to find the best prices on the items you want to buy.

VoucherCode. From cinema tickets to nights out you can find deals to save cash on luxuries and experiences with this app.

Quick tips for student money saving tips

  • Use your NUS discount – most shops on the high street and online will give you a decent discount with it (e.g. 50% off Spotify, 10% off ASOS)
  • Stop smoking (or don’t start) – just five cigarettes a day will set you back £730 a year
  • Negotiate your rent – you don’t have to accept the monthly rental you’re offered and if you’re not staying the full 12 months then request a discount from the end of term time
  • Shop around to reduce energy costs – not all providers charge the same and you might be able to pay less by switching
  • Use sites such as Quidco to get cashback on everything you buy
  • Insure your phone – it will probably end up in the toilet after a night out or get stolen on campus and the cost of replacing phones is high
  • Don’t join a gym – use the free facilities at university or just take up running instead

Make sure you reclaim your tax – if you’ve been working and you’ve been taxed you should be able to reclaim this as long as you haven’t earned more than your personal allowance (£11,850).

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What can you do now that Wonga has gone bust? Thu, 13 Sep 2018 11:12:55 +0000 Alex Hartley Payday loans lender Wonga has gone bust in quite spectacular style. Despite attempts to restructure the business it has now been scheduled for “an orderly wind down” instead. Wonga became the poster business for the payday loans sector, achieving huge success and then being hit hard by regulatory sanctions. Its loans were described by experts as “unneeded, unwanted, unhelpful, destructive and addictive.” So, not many tears are being shed as the lender bids farewell. But what are the implications for anyone who has a loan with Wonga – and where do you go now if you’re looking for short-term credit?Wonga website

Wonga – what happened?

Wonga was launched in 2006 and was a pioneer of short-term high cost credit. The company grew quickly, backed by investors, and in 2011 tripled profits to £45.8m on revenues of £185m, making 2.5m loans. But with interest rates up to 5,000%, complaints were already being made against Wonga and in 2013, the Financial Conduct Authority (FCA) announced a cap on the total cost of payday loans. In 2014, the FCA forced Wonga to write off £220m in debts and interest for 330,000 customers. Then, in 2015, Wonga reported losses of £80 million, followed by another loss making year of £66 million in 2016. By summer of this year the vultures were circling.

The final blow

One of the most significant reasons for Wonga’s collapse this year is a general increase in the number of claims being brought against payday loans lenders. Claims management companies are increasingly targeting payday loans lenders on behalf of consumers. In 2015, Financial Ombudsman figures showed complaints against Wonga at just 269. By the end of 2017 this figure was 2,347 in the second half of the year alone. The Ombudsman is also reputedly giving consumers more time to make complaints against Wonga and it’s these claims that have scuppered the lender as it was trying to make a comeback. Of course, Wonga isn’t the only company likely to be affected by compensation claims. These claims are on the basis of loans made before 2014 when the new rules kicked in and could make survival difficult for any payday loans lender that has strayed into misselling or overcharging.

What happens if you currently have a Wonga loan?

Your debt still exists. Wonga has more than 200,000 customers still owing more than £400 million in short-term loans – if that’s you then the company’s own financial woes don’t release you from your debt. In the short-term the repayments will be overseen by administrators but the failure of the business does not wipe out the loan. Wonga has said that all of its customers should still continue to make payments as per their loan agreements, which are still valid. Anyone struggling with their payments can contact Citizens Advice or StepChange for free advice.

What are the cash loan alternatives to Wonga?

  • Other payday lenders – Wonga is just one of many lenders offering payday loans. If this is the type of finance you’re looking for you still have plenty of choice. It’s important to ensure that you can afford the repayments on a payday loan as the interest can be high – shop around to find the best interest rates for your loan.
  • Instalment loans – there are plenty of other credit options if you’re looking for small unsecured loans – you can borrow as little as £100 or as much as £25,000 with personal loans with repayment terms that are flexible.

Will the payday loans industry survive?

There has been a marked shift in the targeting of payday loans lenders over the past 12 – 24 months. In April 2017 claims management companies were responsible for around 10% of the claims being made against payday lenders. However, by the end of the year that proportion had increased to more than 60%. So, claims companies are now aggressively targeting payday lenders – which could leave many in the same position as Wonga. Whether that would mean a loss to the personal finance market as a whole depends on your perspective. According to James Daley, managing director of campaign group Fairer Finance,

“It’s not surprising that Wonga are in this position because they exploited a market that was loosely regulated. They were in the vanguard of giving people quick access to credit with high prices and high fees and they didn’t treat their customers well.”


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Is the buoyant UK Car Finance market sustainable, or is it a bubble about to burst? Mon, 10 Sep 2018 10:56:06 +0000 Alex Hartley There is no doubt that the car finance market in the UK is active – but is it healthy? New figures have revealed that, not only are UK consumers spending more than ever before on car finance, but that many are struggling to understand their lease agreements. With around 90% of all car purchases in Britain currently made using finance (according to the Finance & Leasing Association), are we seeing the emergence of a thriving industry or sitting on a consumer debt bubble that could do untold damage if it bursts?car finance at bursting point?

A thriving market

The car finance industry in the UK was worth around £44billion in 2017. Figures from February 2018 showed an increase of 13% in value on those from the year before, which is a healthy percentage for any sector. However, while these figures are great for the businesses involved in the UK car finance industry, they are a little more sobering when considered in the context of consumers. The increase in value within the car finance industry is being driven by a rise in spending by consumers. In fact, a new report found that UK households are borrowing more than £100million a day on finance to buy cars. On average, drivers are putting an average of £15,000 on credit to get behind the wheel – 209,547 cars were bought in this way during the month of May alone.

Is there anything to worry about?

According to the Finance & Leasing Association these figures are simply a reflection of rising demand for new car purchases and certainly nothing to worry about. However, what is concerning many commentators is the debt bubble that this represents to a nation already heavily indebted, whether that’s via credit cards, personal loans or mortgages. There have also been accusations of heavy handed tactics from car dealers desperate to close a sale pushing people into car finance purchases. And the Financial Conduct Authority has warned about some companies that are pushing unaffordable repayment plans with high interest rates to customers because staff have been incentivised with high sales commissions.

Why is car finance so popular?

After a house or flat, a car is probably the most expensive purchase that many of us will make in our lifetimes. Using credit such as car finance may be the only way to do this affordably. Personal Contract Plans (PCPs) are by far the most popular way to enter into car finance, often accessible with a deposit of around 10% and then requiring the consumer to make a number of payments over a period of two or three years. When the contract comes to an end, the consumer can either simply return the car to the dealer or buy it by making a balloon payment. However, some experts have highlighted that these deals are not as cheap as they might seem. Interest rates can be between 4% and 7% – often more expensive than a straightforward personal loan – and motorists often find themselves with a huge number of additional charges to deal with at the end of the contract.

The individual monthly cost

A survey carried out on behalf of Kwik Fit found that there are currently around 4.7 million drivers in the UK paying off their vehicles with car finance – that’s around £1bn per month! For each driver the monthly amount payable equates to an average of £226. However, this can vary considerably depending on where you are in the country. Motorists in London, for example, pay on average £269.01 while Scottish drivers benefit from the lowest monthly finance amounts with an average monthly car loan fee of £188.36. Even this can be a significant proportion of monthly income that could be unaffordably increased by even a small change to economic conditions, such as an interest rate rise.

Issues with car finance agreements

It’s not just cost variation and hidden charges that experts have warned might cause issues in the car finance sector but also the paperwork used. Research by the finance company Admiral found that a large number of consumers are confused by car finance deals. Many still sign up despite not fully understanding what the contract entails. When the goal is to get the car that a consumer wants, many will take whatever deal is on the table but, as Scott Cargill, UK CEO of Admiral Loans says, it’s crucial that consumers…

“…are clear on the different finance options available…Most importantly they need to choose a deal that’s affordable and right for them in the long term.”

The concern is that consumers who don’t really understand their car finance deals, or who don’t really understand the implications of taking out a loan, could end up getting into trouble in the not too distant future.

The car finance sector in the UK is currently thriving with companies generating cash and consumers getting the vehicles they want to drive. However, whether the current finance infrastructure is sustainable, especially if economic conditions change and interest rates rise, is something that no one can yet predict.

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Why UK estate agents are struggling, and can you benefit from this? Thu, 06 Sep 2018 11:12:23 +0000 Alex Hartley As we move more and more of our business and personal interactions online, it seems that the property sector is the latest to feel the digital pinch. A report by accountancy firm Moore Stephens revealed in July of this year that around 27% of estate agents are currently struggling to survive. Although the estate agent has not traditionally been a sympathetic figure, what would a failure in these high street businesses mean for the sector and what is the future of UK estate agency as a whole?UK estate are struggling

The situation on the high street today

The Moore Stephens report highlighted that insolvencies of high street estate agents are on the rise. Countrywide – which is the largest chain of estate agents in the UK – has issued two profit warnings over the past year. It has also seen its share price plunge by more than 60%. Foxtons is another well known chain that has shown signs of issues recently. Well known for its branded cars and fancy high street offices, the chain has been failing to attract business with a 15% decline in revenues in the first quarter of 2018. It too has seen its perceived value take a dip as a result with 25% shaved off its share price since May this year.

Online portals are suffering too

Specifically, those portals that are dependent on the traditional bricks-and-mortar structure of high street estate agents could run into some serious problems. Online property portal Rightmove, for example, was reported in July this year to be the biggest faller on the FTSE 100. Although its revenues grew 10% for the six months ended June 30 and operating profit was also pretty healthy, many industry experts have predicted problems for portals like Rightmove because of the dependence on high street firms. Rightmove charges on a per office basis and so with multiple high street firms shutting down offices as a result of a drop in revenues, Rightmove’s own income could soon start to suffer. As a result, there is a perception that Rightmove will struggle to grow under the current circumstances unless it starts to diversify its services.

Where are the causes of these issues?

  1. A drop in property sales. Clearly, the decline in the number of property sales in the UK in recent years is a big factor in the problems high street firms are currently dealing with. Sales across the UK fell by 1% over the past year. Between 2014 and 2017, London experienced a 20% drop in sales. 2018 seems to be a key year for an accumulation of issues to hit estate agents with a sharp rise in the number of firms reportedly getting into difficulties. Just under 5,000 firms reported being in trouble last year but this year that figure has significantly increased to 7,000. Consumers are switching from moving property to improving their property driven in part by recent changes to stamp duty bands and % rates.
  2. The rise of the online or hybrid estate agent. Perhaps the biggest factor in the decline of high street estate agents is the rise of the online competitor. Online estate agents and hybrids (i.e. those that operate online but also have ‘real life’ representatives) are becoming increasingly popular, not least because of the value that they represent to consumers. Online estate agent Purplebricks, for example, charges a flat fee to sellers looking to find a buyer for their property, as opposed to the commission charged by a traditional high street agent. Online agents have fewer overheads and are gradually establishing a perception of being more consumer friendly. High street firms are often considered over priced, frequently found to be charging hidden costs and have real trust issues with consumers to overcome.
  3. Banning letting fees to tenants. Although the plan to ban letting agent fees to tenants has yet to take effect in the UK (it is due to be put in place next year), this is also making many high street firms nervous. Letting agent fees generate significant revenues for property firms and if they cannot be collected that could leave a serious revenue gap.

Times are tough for high street estate agents but the current conditions present a significant opportunity for many well established brands to evolve. This is an industry that many believe has ridden roughshod over consumer interests, overcharged everyone and generally been unaccountable for shoddy practices for far too long. Surviving may simply be a case of reevaluating where resources are allocated and finding ways to offer genuine value to consumers instead of charging a high commission in return for a ride in a branded car. If the end result is that consumers benefit from better deals then it’s difficult to see how the impact of the current need to change could be negative.

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The rise of rented property licencing – How it works and who it affects Mon, 03 Sep 2018 12:14:19 +0000 Alex Hartley The lack of regulation in the private rented sector has been a hot topic for several years now. Over-inflated pricing and low standards often leave tenants feeling hard done by and living in poor conditions. One step that has been taken to try and combat this is rented property licencing schemes. These are now appearing all over the country and are designed to help highlight bad landlords and raise standards for tenants. However, the schemes are also attracting criticism as a cynical money making exercise and there are claims that the worst of the UK’s bad landlords will still continue to operate as before under the radar.

rented property licencingWhat is rented property licencing?

Councils can make it compulsory for every private landlord operating within a specific area to have a licence to rent out their properties. Rented property licencing is selective and so can be applied to some areas and not others. This is different to the type of licence that would be required for a landlord of a house in multiple occupation, which previously was the only type of licence required in the rental sector.

What does the requirement for a property licence entail?

It gives councils the opportunity to police the rented property sector. Any landlord will need to have a licence to operate if they are within one of the defined areas. In order to get that licence – and to maintain it – they will need to allow the council to check whether they are a “fit and proper person” to be a landlord. There may also be other requirements to meet, such as health and safety standards – for example, the council may want to see copies of certain safety certificates and also be informed of the location of smoke detectors, as well as being shown details of tenancy agreements. Licences usually last for around five years and then must be reapplied for.

Who will these licencing schemes affect?

Any landlord within an area where a scheme is being run by the local council. According to the Residential Landlords Association, at least 55 councils currently have a licencing scheme in place or would like to set one up. For example, a new scheme in Bexley, London, now covers Thamesmead North, Abbey Wood, Lower Belvedere and parts of Erith. There are schemes across many London areas, as well as in other parts of the country, such as Gateshead, Liverpool and Nottingham.

How much does a licence cost?

The cost of the licence is set by the local council and so can vary depending on location. For example, obtaining a licence in Gateshead would cost £550 to £1,000 while in Nottingham it would be £780, or £480 for a locally accredited landlord.

It’s also worth noting that it will be expensive for landlords who breach their licences – this could result in criminal prosecution or a civil penalty of £30,000.

Are there any exemptions?

Not for most private rentals. Even though local councils have acknowledged that there are already landlords who are doing an excellent job of fairly managing their properties, no exemptions are allowed from the licencing schemes. However, there are some properties that don’t fall into this category and so will be exempt, including holiday lets, student lets if the university is the landlord, business premises and properties where the tenant is a family member.

What’s the problem?

The main issue is that many landlords feel that this is rather a cynical money making exercise on behalf of local councils. Councils have responded to say that the fees that are charged are purposely kept low and are designed to only be enough to cover the council’s costs in administering the scheme. Another issue identified by landlords is that the schemes rely on landlords making themselves known to local councils. The issue here arises because criminal landlords are highly unlikely to make themselves known to councils and so the scheme could completely pass over those who were actually its intended target.

What does this change for tenants?

It should mean that standards rise across the rentals sector around the country. It will also make it possible to check whether a property is licensed – by law, councils must keep a register of all the licences that they have issued. Most councils have a searchable online database. The effectiveness of the scheme will, in part, come from the way that tenants use it. If tenants no longer rent from landlords who are not licensed then those landlords will be forced to obtain a license in order to make money from their properties. This will bring them within the remit of the local council and should help to ensure that all landlords meet certain minimum standards.

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Amigo Loans, the guarantor loan lender, floats on the Stock Market Thu, 30 Aug 2018 10:22:38 +0000 Alex Hartley Earlier this year it was announced that guarantor loans lender Amigo was to float on the stock market. When the floatation happened on 4th July it was something of a first for the UK financial sector. While Amigo is not the first sub-prime lender to float – others such as Provident Financial and Non-Standard Finance (owners of George Banco) have already done so – this time it’s different. Why? Well because Amigo falls outside the Financial Conduct Authority’s (FCA) definition of ‘high-cost credit’ – i.e. 100% or more APR. So the Amigo float is quite a landmark moment but what does it mean for consumers and for the industry as a whole?
Amigo Loans advert still

Where did Amigo come from?

Financial Processing Limited changed its name to Amigo Loans in 2012, operating as a subsidiary of the Richmond Group. The Richmond Group was a loan brokerage company set up by James Benamor in 1999. Benamor is now worth an incredible £1.1 billion as a result of Amigo Loans’ stock exchange flotation. From modest beginnings, Amigo has built up quite a history and has lent 185,000 customers over £700 million. It has an average APR of 49.9% and claims to be one of the cheapest alternative loans providers in the market. It is also one of the biggest – Amigo says that it is currently the largest guarantor loans company in the UK.

What does Amigo offer?

The rise to success experienced by Amigo has been built on the basis of offering credit to those who can’t get it by other means. The guarantor loans provided by the company are designed to be an alternative option for those who can’t access credit via banks and other sources. Amigo offers medium term loans of up to £7,000 with a maximum repayment schedule of five years.

What are guarantor loans?

Effectively, guarantor loans enable anyone to borrow even without a perfect credit score, with a troubled financial history or where there is no asset – such as a property – to secure the loan against. With a guarantor loan, a trusted friend or family member provides an assurance to the lender that the loan will be repaid by the borrower. If that does not happen then the lender can pursue the guarantor for repayment of the loan instead. Guarantor loans are a way of accessing credit no matter what an individual financial history contains and careful repayment can help to rebuild damaged credit scores.

The stock market listing

The outlook for Amigo’s stock market listing was very positive with a valuation of £1.3bn on the company. Although it is a business that is built on higher cost credit, the APR charged by Amigo means that it falls outside of the FCA’s definition of high cost credit, which requires an APR of 100%. With the FCA encouraging many borrowers to move away from the 100+% APR of true high cost credit, Amigo has benefitted significantly in offering a much lower rate of interest. This idea of Amigo being “better value” is particularly understandable when you compare this to rates that are offered by some payday loans lenders, which can reach up to 5000% APR. While there are much lower rates available on lending via regular banks, accessing those rates often requires a very positive credit history, which many people don’t have. Amgio has created its own market by offering an in between – you don’t need to have a perfect credit history to access a lower rate.

Who will benefit from the flotation?

According to the business’ founder James Benamor, directors and employees will make £326.8m from the company now that it has floated. On the day of flotation the company exceeded expectations with shares jumping to 310p, against an offer price of 275p in early trading on the London Stock Exchange. As Amigo currently has roughly an 88% share of its niche market, positivity has been high surrounding the stock market flotation.

What about the future for Amigo loans?

In July of this year – two weeks after flotation – Amigo lost 10% of its stock market value in just a single day when a Times investigation that revealed it was allowing customers to manipulate affordability checks. This loss amounted to around £140 million. There have also been concerns expressed about the way that Amigo does business – for example, it was revealed that Amigo often took aggressive court action over a missed payment after just three months. Despite this, the company remains fairly buoyant but will need to proceed with caution. Given the changes the FCA has made to regulation concerning the way consumers are treated by lenders in other markets, such as payday loans – the costs of which inevitably fall to the lenders to bear – any hint of trouble could bring the newly publicly trading company to a painful place.

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What you need to know about Debt Collectors & Bailiffs Tue, 28 Aug 2018 11:12:56 +0000 Alex Hartley Being in a position where you have to deal with debt collectors and bailiffs can be difficult. However, even if you owe money and are in debt, there are still rules about how you can be treated. It’s important to know your rights if you’re threatened with bailiffs because there are only very specific circumstances in which someone can enter your home and remove your belongings. Unfortunately, many companies and over-zealous councils have taken this too far and individuals who don’t know their rights have been unable to stop them as a result.debt collectors & bailiffs

What are debt collectors and bailiffs?

The two terms are often used interchangeably but in reality they are very different:

Debt collectors

This is someone who will come to your home to collect a debt on behalf of a debt collection agency. That agency may be working on behalf of a lender or someone else who you owe money to. Debt collectors are rarely used these days as they have no power to remove anything from your home. Debt collectors can:

  • Come to your home
  • Ask you to make a repayment on the debt
  • Try to set up a payment arrangement

Debt collectors cannot come into your home without your permission, come to your workplace, take anything, intimidate or threaten or pretend to be a bailiff.


It is the bailiffs (or enforcement agents) who have the legal powers to remove items from your home – but only if they have a court order. Bailiffs are used by the courts in various circumstances, such as where there has been non-payment of council tax, parking fines or County Court Judgments.  Bailiffs can:

  • Take items from inside your home if you let them in
  • Remove items from outside of your home if you do not let them in (for example, your car)
  • Receive payment in cash for a debt owed (make sure you get a receipt)

What to do if a debt collector comes to your door

  1. Ask to see ID – note down their name, as well as the debt that they’re here to collect and the creditor they’re collecting on behalf of
  2. If you don’t want to open the door to a debt collector then don’t – you’re not under any obligation to do so
  3. On the whole it’s better to pay your creditor directly than to hand over any cash to a debt collector on your doorstep (an exception to this, of course, is if you have a credit agreement with a doorstep lender like Provident)

What to do if a bailiff comes to your door

  1. Bailiffs must have a court order – find out which court sent them and ask for details of the court order. If there is no court order then the bailiffs have no legal right to take anything. The only exception is if they are collecting on behalf of HMRC.
  2. Bailiffs must give you at least seven days notice before a first visit. They cannot enter your home by force, they cannot come in other than by the door, between the hours of 9pm and 6am or if only under 16s are present. If you know the bailiffs are coming then keep the doors locked and make sure everyone in the household knows not to let in anyone that you don’t know.
  3. You should always ask to see a bailiff’s ID. This could be a badge, ID card or enforcement agent certificate. You’re entitled to ask for exact amounts owed, as well as which company they are from and what the contact details are for that company. Don’t be afraid to take the time to check up on the bailiffs – for example, if they say they are a county court bailiff check with the court they say sent them. If they say they are a certificated enforcement agent you can check this on the register of certified bailiffs.
  4. What bailiffs can take –  luxury items such as TVs or games consoles.
  5. What bailiffs cannot take – anything that you need to live. For example, they cannot take your clothes or your fridge. They also cannot take items that don’t belong to you (you would have to be able to prove this).
  6. A controlled goods agreement. Bailiffs won’t normally remove items from your home the first time that they visit. They will usually make an inventory of what is there and you may be asked to sign a controlled goods agreement and make a debt repayment plan. This effectively means that if you don’t stick to the debt repayment plan then the items listed under the controlled goods agreement can be taken.

If you have been contacted by bailiffs it’s important that you don’t ignore the situation. Bailiffs charge fees for their visits and these can escalate quickly, especially if there are repeated visits when they can’t get in. You will need to take steps to deal with the debt in a way that you can manage. If you feel that you’ve been treated unfairly by bailiffs, or that they haven’t followed the rules then you can make a complaint. MPs recently criticised councils for over-zealous use of bailiffs and there is increasingly a view that the debt collection industry needs to be better controlled and managed so things could change in the future. However, for now, the basic rules are as outlined above.

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How to make money from clutter – cash from the stuff you no longer need Thu, 23 Aug 2018 11:24:17 +0000 Alex Hartley Recent years have seen a boom in interest in self-storage, as we acquire more and more “stuff” with less space to put it in. If you look around your home today, can you honestly say that you need – and use – everything in it? Have you been paying for a storage unit for years, conveniently ignoring the rising cost, as you have nowhere else to store your stuff? Increasing pressure to economise, as well as the wide range of opportunities to sell old possessions now mean that those items cluttering up your home or storage unit could be put to good use. In fact, as well as clearing out your home and reducing your storage needs, you could generate some cash from all that clutter.

clutter and stuffThe best places in your home for collecting clutter

Every surface, cupboard or shelf could be a place to find clutter that you could convert into cash. In particular, these locations tend to be a goldmine for items that have been put away, never to be used again:

  • Under the stairs
  • In the spare room
  • In the attic
  • Under the bed
  • On top of the wardrobes
  • In the garden shed

The forum you choose to sell in will make a big difference

Some options are better than others when it comes to selling old items on. Clothes, for example, are often best sold on eBay while unopened kitchenware or bedding can be easily sold via apps like Shpock. If you have items such as glassware, silverware, crockery and ornaments, you might want to consider taking them to a car boot sale, as you can often achieve a higher price by selling these in a way that allows the buyer to handle the item first.

  • If you’re selling on old tech, such as smart phones, then you’ll often get the best price from a dedicated refurbishment and reconditioning outfit like Gazelle.
  • CDs, DVDs and old games don’t sell that well as single items – you’ll get more for these if you sell them in bulk. If doesn’t matter how old these items are, as long as they still play, sites like Music Magpie will take your old collections off your hands.
  • “Big ticket” items are best sold where you’re going to be able to reach the widest possible audience. So, if you have designer bags or shoes that you know are worth a substantial amount, use Amazon or eBay to get the best possible price from the broadest audience.
  • Bear in mind that you’ll be responsible for ensuring that your buyer receives the item too and that can affect where you decide to sell it. For example, if you’re selling something heavy it’s better to use Facebook or Schpock so that you can find someone local. With eBay you could end up with a buyer thousands of miles away, making postage an issue.

Top tips for selling

  1. Don’t forget to highlight the imperfections. If your items are damaged or slightly marked or broken, make a point of highlighting this in photos and in any description you provide. If you’re selling via a site like eBay and you don’t mention issues like this then you could be forced into a refund.
  2. Some items are much more difficult to sell and it can be better simply to give them away. Used children’s toys, for example, may be better donated to a local playgroup and printers rarely sell online.
  3. Providing free postage is an easy way to convince a hesitant buyer. A low purchase price with high postage is off-putting so try to factor your postage cost into the purchase price so that you can offer postage for free.
  4. Bear in mind the impact of the seasons when you’re selling. If you’re trying to make some money from a pair of used skis, for example, then you’re less likely to have success during the summer months when people are thinking about beaches and not the Alps.
  5. Don’t underestimate the value of what you have to someone else. It’s true that your trash may be someone else’s treasure. You may have exactly the books, shoes or clothes that someone else is looking for even if those items no longer have any value to you.


Successfully selling clutter to make some cash requires a little organisation in terms of how you approach the selling process. If you find the right forum then you could be very pleased with the results.

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How pressure is being kept up on Loan Sharks Mon, 20 Aug 2018 10:43:36 +0000 Alex Hartley Illegal moneylenders are increasingly being recognised as a serious problem in the UK. So much so that steps are being taken, both locally and nationally, to increase awareness and reduce the opportunities that loan sharks have to recruit new customers. Around 300,000 people in the UK are currently in debt to illegal moneylenders. It’s often not until documents have been signed and the money spent that borrowers begin to realise just how exploitative the arrangement really is. That’s why the government is stepping up its efforts to ensure that loan sharks find it increasingly difficult to survive.

loan shark illegal money lenderThe issue with loan sharks

Debt can be useful in life – it can be used for essentials, such as housing or health, and it is something that millions of Britons manage every day. However, the issue with illegal moneylenders is that the terms being offered for the debt are very onerous. Interest is high – and can be increased at any time – and there is nothing to stop these unregulated lenders from adding on fees and charges at random. If individuals struggle with repayments then the consequences can be severe. Tony Quigley, head of the England Illegal Money Lending Team, said,

“These criminals use callous methods to enforce repayment and victims are often subjected to threats, intimidation and violence.”

Governmental pressure

Around £100,000 has already been seized from loan sharks and this will be put towards supporting their victims. The Treasury has also earmarked £5.5m – which is an increase on the funding for last year – to help fund the cost of investigations into loan sharks and to pay for more support for those who have fallen victim to this type of lender. This money will be used in a number of different ways, including:

  • Supporting Illegal Money Lending Teams, which will have powers to investigate potential loan sharks and to carry out prosecutions where appropriate.
  • Providing more support to those who are at risk of being targeted by loan sharks, including encouraging potential victims to join a credit union and investigate other available finance options instead.
  • Funding regional awareness projects in areas where there is illegal money lending activity. For example, a new education project will be set up in Northern Ireland to support vulnerable communities there.

Police pressure

It’s not just government projects that are being used to help keep up the pressure on loan sharks, as the police are also getting involved. West Mercia Police, for example, are working with the England Illegal Money Lending Team on a “bite back” campaign that is designed to expand awareness of the issues people may face in borrowing from a loan shark – and to make it more difficult for illegal moneylenders to operate. The campaign includes staff training, a targeted leaflet drop, as well as school visits so that educating people on the issue of loan sharks begins as early as possible. It is hoped that the campaign will raise awareness of the problems of illegal lending but also help to identify some of the worst local offenders and make it more difficult for them to operate.

What are the regulated alternatives if you need credit?

Illegal lenders often position themselves as friendly, informal lenders who won’t demand the same credit checks or financial history as another lender might. However, the checks and balances that banks are required to carry out tend to be there for a reason. A lender willing to advance money without doing those checks is unlikely to care whether the amount being borrowed is actually affordable. Which is often where the trouble begins. There are many other legal alternative credit products available that don’t carry the same risks. Use a fully regulated credit broker to explore the following options:

  • Payday loans. Payday loans have gone through a period of evolution and the industry is much more controlled now, with limits on how much lenders can charge in fees and how often repayments can be rolled over. Payday loans are an easy solution if you need short-term borrowing – and with proof of income, a poor credit score doesn’t need to be an obstacle.
  • Guarantor loans. If you have bad credit there is another alternative to illegal lenders. Guarantor loans enable you to borrow even with a poor credit history, as long as you have someone who is willing to guarantee the repayment for you. A guarantor should be over 18 and a homeowner.
  • Homeowner loans. If you own a property then a bad credit score doesn’t have to prevent you from borrowing legally – with homeowner loans whatever you borrow is secured against the property so lenders tend to be a bit more flexible.
  • Doorstep loans. If it’s the local, informal approach of illegal lenders that appeals, doorstep loans offer this setup legally – a representative of your lender will come to your home, both to set up the loan and to collect repayments.

The clock is ticking for illegal lenders in the UK with renewed focus on stamping out these kind of exploitative arrangements. And with the broad range of financial products available to borrowers, even those with bad credit, there’s just no need to borrow from loan sharks anymore.

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Join our SEO Partnership Programme – SEO Professionals Fri, 17 Aug 2018 07:10:00 +0000 Amanda Gillam Launched today is our brand new programme that aims to give SEO specialists a bigger share of the pie – something that rewards SEO effort more equitably. Like many roles the typical SEO consultant or business is paid in relation to the time they spend on the task. This caps the rewards even if the website “goes exponential”. How would you feel about an arrangement where your SEO effort gives you the opportunity to grow your income in line with website growth? Well, that’s what we have in mind.
SEO partnership programme

A Revenue Share Agreement

Our SEO Partnership programme is open to any SEO professional (individual or company) who can demonstrate their superior SEO skills. If you have what it takes to nurture a brand new website in the UK personal finance market through a strong growth phase to a sustained strong performance then we’d like to hear from you today.

Rather than a traditional remuneration method we want share the revenue growth achieved through the search engine optimisation of brand new websites – sites that will only be marketed and developed through SEO.

Our parent company, Affiniti Digital Media Ltd, is planning to launch a number of new UK personal finance websites each of which requires a strong SEO partner. If this sounds exciting, if you could commit a substantial effort for an extended period of time and are prepared to invest your time now for a much larger return in the medium term then this programme could be for you.

Discover more about our SEO partner programme and if it floats your boat, and if you can see the bigger picture then we’d like to receive your application.

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How will consumers benefit from the cap on rent-to-own lenders? Thu, 16 Aug 2018 10:52:17 +0000 Alex Hartley The UK rent-to-own sector is currently undergoing quite a transformation. Back in autumn of 2017 it was revealed that the Financial Conduct Authority (FCA) had found some serious irregularities in the way that rent-to-own was being managed. Rent-to-own businesses were found to have failed to properly assess customer ability to repay in a number of cases. Where this was established, the FCA ordered businesses like BrightHouse to make compensation payments. Under a £14.8m compensation scheme agreed with the FCA, a quarter of a million people were to receive compensation from BrightHouse. In addition to ordering compensation payments, the FCA also discussed a cap for rent-to-own lenders and it’s now been revealed that this could save consumers even more.

BrightHouse rent to ownHow does the cap apply?

Rent-to-own is designed to offer options for consumers who are unable to pay for items, such as a sofa or a fridge, at full price up front. In exchange for a weekly or monthly payment to rent-to-own companies, these items can be leased and there is usually an option to purchase at a future date. Issues arose when it was revealed that consumers were paying vastly more for items via rent-to-own than they would simply buying the item outright. For example, The Guardian found that a £600 computer at Curry’s was costing consumers more than £2,000 at BrightHouse. However, the FCA has now taken steps to change this, suggesting a 100% cap that will save customers money. Effectively, it means that no one signed up for rent-to-own will ever pay more than twice what they originally borrowed.

Where are the benefits for consumers?

Citizens Advice found that the cap, which is due to come in from April 2019, could save customers, on average, up to 30%. The charity carried out an analysis of a range of the products currently available with rent-to-own lenders to establish how much consumers could potentially save on each one. The results showed savings of £174 on a 6kg washing machine – before the cap, rent-to-own customers could have paid an average of £584 but after the cap this would be limited to a maximum of £409. A saving of £123 could be made for customers looking to rent-to-own a 50cm electric cooker, £302 on a 60cm fridge freezer and £640 on a two-seater leather sofa.

Currently, rent-to-own firms can charge whatever they like for items – and tend to do so as long as there are customers who are willing to pay. As well as the charges for the items themselves, lenders often add on additional fees for delivery and installation. When the payments are broken down into a much smaller monthly or weekly amount it’s often easy for consumers to lose sight of the overall total cost. What the new cap will do is ensure that these payments don’t escalate beyond a certain level.

When will consumers benefit from the cap?

Currently, the 100% cap is a proposed change that is part of new rules being drawn up for the rent-to-own industry and due to come into force in April of next year. It is similar to a cap that was introduced into the payday loans sector in 2015 and which has had a very positive impact – the volume of unmanageable debt has been cut by half. In both situations it was the excessively high interest being applied to the debts that was causing people to end up paying five or six times more than they borrowed. Citizens Advice estimates that the cap on rent-to-own could result in total savings of £62million.

Why was the cap necessary? 

Complaints about rent-to-own lenders have soared in recent times. These are often based on high interest rates or an excess of added-on fees. The Citizens Advice research found that nearly 60% of those who signed up for rent-to-own ended up paying late payment fees, for example. On average these added on an extra £72 to the total cost of the loan. The new FCA rules propose to cap these charges at £15 per agreement, per year. There has also been a lot of misunderstanding between consumers and lenders over the terms of these loans, which are often fairly opaque and unclear about the total cost to a borrower. The same research also established, for example, that 25% who purchased a rent-to-own product weren’t aware of the total amount they would end up paying. 

The rent-to-own sector makes owning items more affordable for many people – with the new proposed rules in place it will also offer a much fairer deal.

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Top 14 tips for discussing money with your partner Mon, 13 Aug 2018 10:58:59 +0000 Alex Hartley Money is one of the main reasons that couples run into trouble and have disagreements. Different attitudes towards cash, not being entirely honest about money troubles and sudden financial problems can cause some serious issues. Communication is the only way to ensure that money doesn’t cause problems between you and your partner. It may not be easy to discuss financial topics, especially if it involves admitting to mistakes, but it’s essential if you want to survive as a couple. These tips are designed to help make it easier for anyone to start an honest and open dialogue where money is concerned.

how to discuss moneyStarting the money conversation

  1. Make it a priority to be honest and open about your finances from an early stage in the relationship. Find out whether you have different views on borrowing, for example, and whether your credit histories are similar. The more you know about your partner’s finances now, the less potential there will be for unpleasant surprises further down the line.
  2. It’s not just about what you have or what you’ve done. Attitudes to money will also have a big influence over how compatible you are financially and so whether you’re more or less likely to have money issues. Try to find out early on whether your attitudes to cash are similar – do you both like to save or is one of you a saver and the other a spender?
  3. Discomfort now is better than resentment later on. It’s never comfortable to talk about topics like money but better to feel that discomfort now than to be resentful later on as a result of a lack of miscommunication.
  4. Keep up the discussion. The longer you’re together, the more likely it is that there will be changes in your joint and individual finances. Make it a feature of your relationship that you regularly sit down and make time for financial chat.

How to discuss money with your partner

  1. Treat it like a business discussion. It’s tough to talk about money to a loved one who will be affected by your financial decisions. However, if you take a more objective view and discuss financial issues like you might with a business partner you will find it easier to be more practical and less emotional.
  2. Start the conversation when the time is right. 11pm at night is not the right time to start a discussion about money. Pick a moment when you’ve both got the time to dedicate to a conversation and neither of you is overly stressed.
  3. If you’ve got to raise a difficult topic do it gently and give your partner the context. Instead of just blurting out the problem and saying you don’t know what to do, explain how the situation arose, why you’re worried and why you need their help with it.
  4. Keep the conversation balanced. Take turns to speak, listen to each other and take the time to think about what has been said before you react to it.
  5. Make your plans together. If your finances are shared then you’re both going to be affected by any outcome so plans are better made jointly. Ensure you both agree on any plan of action that you choose and that you’re both on board with the steps that are required to get you to a specific place.
  6. Avoid confusion. If you don’t both understand the situation then that confusion could cause some serious issues further down the line.
  7. Ask questions. If you feel like your partner’s attitude to money is confusing or upsetting then ask them questions about why they feel like they do and why they’ve taken certain steps. Finding out more about an issue or attitude is more productive than getting angry about it.
  8. Focus on shared goals. Having shared goals can help with financial attitude alignment. Set your goals together and then identify all the small steps that are going to take you from here to there as a couple.
  9. Be honest. It’s always worse in the long run to fudge the issue now. Dishonesty about money can cause a lack of trust that may filter into many other areas of the relationship too.
  10. Take a step back if you need to. It’s very easy for financial discussions to become heated. If you feel like the conversation is getting too much then take a step back and a little time apart and then come back to it later on.


According to relationship support charity Relate it’s important for couples to sit down and dedicate regular time to talking about financial realties, practicalities and attitudes. Making the effort could even save your relationship in the long run

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UK Household debt is worse than it’s ever been! Thu, 09 Aug 2018 10:57:42 +0000 Alex Hartley Household debt and consumer spending have frequently made the headlines over the past year. In 2017, the government was warned by ratings agency Standard & Poor’s that the UK consumer credit bubble of £200 billion was simply not sustainable. Now, the Office for National Statistics has revealed that British households are in deficit for the first time since the credit boom of the 1980s. With a combination of unbalanced household spending and over-reliance on credit, the financial future for many UK consumers does not currently look that bright.household debt

A significant deficit

According to figures from the Office for National Statistics, in 2017 UK households spent on average £900 more than the income that they received. It’s this overspend that has put British households in deficit for the first time since the 1980s. Those households that spent more than they earned were either forced to borrow to cover the £900 deficit or had to use savings to bail themselves out. This is a worrying sign for economists who have already predicted that UK consumer finances are fairly finely balanced. Thanks to the impact of Brexit, as well as low wage growth, there is already tremendous pressure on household spending with many more people turning to credit cards and personal loans to pay the bills.

UK household debt worse than at any time on record

The Office for National Statistics has highlighted that the total shortfall in household spending amounted to nearly £25 billion in 2017. This is worse than at any time on record and means that the UK currently has a deficit that is equivalent to 1.2% of GDP. But where is the debt coming from? According to official figures:

  • In 2017 British households took out £80bn in loans!
  • Last year, unsecured credit – for example, personal loans, credit cards and payday loans – climbed to a record high of more than £205bn
  • Only £37 billion was deposited with UK banks

There is a widespread perception that these excessive levels of debt – and low levels of saving – are a sign that UK households are living beyond their means. However, many charities have warned that this is not the case. StepChange, for example, said

The reality is that too many households, here in Britain, in 2018, simply cannot make ends meet, however hard they try.”

Personal insolvencies hit a 6 year high

Debt statistics are not the only rather depressing figures to emerge this summer, as personal insolvencies have also hit new levels. According to The Insolvency Service, which is a government agency, the number of people declared insolvent hit a six year high in the three months running up to June 2018. The figures represent a 27.3% increase on those from last year with a total of 28,951 individual insolvencies in the second quarter of the year. This is the highest figure there has been for IVAs since they were first introduced in 1987.

The significant increase has been driven up by the record numbers of Britons who have been forced to take out individual voluntary arrangements (IVAs). An IVA gives someone who is not able to manage their debt on existing terms the opportunity to restructure the agreements that are in place with creditors. IVAs made up nearly two thirds of the total number of personal insolvencies in the second quarter of 2018 with Debt Relief Orders responsible for 24% and bankruptcies 14%.

Data from The Insolvency Service has also identified that some locations in the UK are far worse for personal insolvencies than others. In 2017, it was Stoke-on-Trent that had the highest rate of personal insolvencies in the country, followed by Plymouth, Hull and Scarborough. However, across the UK all the signs are that there are now many more people struggling with debt and personal finances than was previously the case. What is particularly worrying many experts is the fact that the Bank of England could continue to gradually raise interest rates. Should that happen, even servicing existing debt could become impossible for many people and the number of personal insolvencies could rise further still.

What to do if you’re struggling with debts:

  • Make a list of everything you owe so that you can see the full extent of it
  • Speak to your creditors about changing the way you repay your debts – for example making smaller monthly repayments over a longer period of time
  • Find ways to economise – cut back on luxuries, be thrifty with what you spend and prioritise meeting your debt repayments
  • Look for other ways to earn a little extra – could you rent out your spare room, work additional hours or take on a few additional earning gigs?

Ask for help before it’s too late – the earlier you ask for help, the more options you’re likely to have. StepChange and the National Debtline are just two of the options available.

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Key consumer rights legislation that protects you Mon, 06 Aug 2018 10:29:21 +0000 Alex Hartley In the UK there is a fairly comprehensive consumer rights framework designed to protect individuals when dealing with businesses. From protection when buying products and services online, to getting a refund from your bank if you’ve been the victim of card fraud, consumer rights legislation in the UK has many different situations covered.Consumer rights legislation

Consumer Rights Act 2015

When this legislation came into force it replaced the Sale of Goods Act, Unfair Terms in Consumer Contracts Regulations, and the Supply of Goods and Services Act. It provides various protections, including with respect to:

  • The products you buy – these must be of satisfactory quality, fit for purpose and as described. This includes digital products, so anything purchased online must match the description you were given, for example.
  • Your right to reject – the act gives you 30 days to reject items that are of unsatisfactory quality, unfit for purpose or not as described.
  • Delivery – until the goods are in your physical possession, the retailer remains responsible for them.
  • Unfair contract terms – unless terms in the contract are prominent and transparent, they can be assessed for fairness. Contract terms found to be unfair can be ignored and you may also be able to cancel the contract without a fee.

Consumer Rights Act travel amendments

From October 2016, the Consumer Rights Act was extended to enable consumers to make a compensation claim for poor service on almost all transport services, including train and coach journeys.

Consumer Contracts Regulations

These regulations give you the right to receive certain information, including a description of the goods and the total cost of goods. They also give you cancellation rights if you have entered into a contract, other than in a store, for example at a distance over the phone, online, from a catalogue or face-to-face with someone who has visited your home.

Consumer Credit Act (1974)

UK consumers are protected by this piece of legislation with respect to entering into loan or hire agreements. The Act entitles you to a cooling off period once you’ve entered into a loan or hire agreement and sets out key information that must be provided by a creditor, such as the rate of interest and any conditions attached to the interest rate. It also provides extra protection for purchases made on your credit card.

Consumer Protection Act 1987

If a product you have purchased has caused damage, death or injury as a result of being defective then this legislation gives you the right to make a claim against the producer. Products covered will be anything that can be packaged up and sold.

Consumer Protection from Unfair Trading Regulations 2008

These regulations are designed to protect consumers from unfair trading practices and misleading and aggressive tactics. This includes a list of practices that will always be considered to be unfair and which have been banned, including “limited” offers – where it is falsely stated that the product will be available for a short period of time – and “bait and switch” where one product is offered with the intention of selling something different.

Payment Services Regulations 2017 (PSD2)

If you’re the victim of a card fraud then it’s these regulations that require your bank to refund you for any fraudulent transactions that have resulted in you losing money. There are a few conditions, including that you report the loss or theft of a card, or the fraudulent transactions, straight away.

Package Travel Regulations

If you book a package holiday that isn’t as described in the brochure when you were sold it then you may be able to make a claim against the operator using these regulations.

Misrepresentation Act 1967

This Act is designed to prevent consumers from being convinced to buy something or enter into a contract on the basis of a false or fraudulent claim. If that’s the situation you find yourself in then the Act may enable you to claim compensation.

General Data Protection Regulation (GDPR)

The GDPR gives consumers much more control over the way businesses handle their data. It enables you to find out what data is held about you, ask that it is all deleted and means you can claim for misused data, among many other things.

Denied Boarding EU Regulation (Regulation 261/2004 EC)

If you are departing from an airport within the EU (regardless of airline) and your flight is delayed or cancelled then this regulation entitles you to compensation. The exception is if the airline can prove that the cancellation is caused by extraordinary circumstances that they couldn’t have avoided.


You can find out more about your consumer rights at Which?

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A layman’s guide to the Consumer Credit Act 1974 (amended 2006) Thu, 02 Aug 2018 11:07:30 +0000 Alex Hartley The Consumer Credit Act 1974 is designed to give consumers protection with respect to loan agreements, credit card purchases and a range of ancillary issues, such as accessing credit information. Together with the Financial Services and Markets Act 2000, and a number of European consumer credit regulations, it provides a comprehensive set of protections for consumers using credit in the UK.Consumer Credit Act

What does the Consumer Credit Act cover?

In most situations, the protections available under the Consumer Credit Act will only cover credit of between £100 and £30,000. Those debts that are covered by the legislation are called “regulated” debts and these include credit cards, store cards, payday loans, personal loans and hire purchase agreements. Some types of debt are not covered by the act, including mortgages, charge cards, debts that are owed to another individual, debts to an unlicensed lender (e.g. a loan shark) and debts owed to a utilities company.

Entering into credit agreements

The Consumer Credit Act 1974 (CCA) establishes key foundations for the way in which financial bodies can enter into credit agreements with UK consumers. This includes:

  • Information that must be provided to a consumer before a credit agreement is signed. For example, the nature of the agreement, name and address of the creditor, duration of the agreement, type of credit and credit limit, details of the interest rate and any charges, as well as the total amount payable.
  • The way that credit agreements should be set out, in terms of content and form.
  • How Annual Percentage Rates (APR) should be calculated.
  • Key procedures to deal with changes to the credit agreement, such as early settlement, default or termination of the agreement.
  • The requirement to credit check consumers using information provided by the consumer and also by a credit reference agency.

Cancelling credit agreements

You can cancel a credit agreement that you signed in your own home according to the rights that the CCA gives you. Together with various European regulations, the CCA gives consumers the right to cancel credit agreements in a number of situations, including when you entered into a credit agreement over the phone or at a location not on trade premises (for example at a temporary marketing display). In most cases you will have a cooling off period in which to change your mind – this may be between 5 and 14 days, depending on how you entered into the credit agreement. You should always be given information about the cooling off period before signing anything – if you haven’t been provided with this then ask. It’s worth noting that if you’re entering into an agreement for more than £60,260, or an agreement secured on land, then you may not have a right to cancel.

Your rights if you have debt problems

The CCA provides a number of key protections for anyone who is getting into trouble with their debts, including:

  • A creditor must issue a default notice if you fall into arrears with a debt, so that you have time to get your account back up to date.
  • A default notice has to take a particular form, including informing you what is owed and what action will be taken if the amounts are not paid. A default notice should give you seven days to get your account up to date.
  • If you’re in default with your debts then your creditor must provide regular statements and correspondence to keep you informed about the debt, interest and any charges.
  • If you’re not happy with the way your debts have been handled you can make a complaint to the Financial Ombudsman Service.

Hire purchase agreements

Where you have paid a third of the total price under a hire purchase agreement then the CCA prevents the creditor from taking the goods back without first getting a court order. Consumers are entitled to ask the court to suspend the order and accept instalment repayments of what is owed instead.

Additional protection for credit card purchases

Where you have made a credit card purchase for between £100 and £30,000 and you have a claim for breach of contract or misrepresentation against a retailer of goods or services, you may also have a claim against the credit card provider. This could be useful, for example, where you used your credit card to buy services from a company that has become insolvent. As the insolvent company won’t now deliver the services, and is unlikely to be able to repay your money, being able to make a claim against the credit card provider provides another way to get your money back.

These are just some of the protections in the CCA – you can find the full legislation here.

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All about Annual Percentage Rate / APR% Mon, 30 Jul 2018 10:39:36 +0000 Alex Hartley At first glance, interest rates seem like they should be quite simple. Interest is the rate that you’re charged to borrow money, such as a personal loan or a credit card. However, especially when it comes to the Annual Percentage Rate (APR) and compound interest, it can be a lot more complicated.Annual Percentage Rate

Interest rate vs. APR

The main difference between an interest rate and an APR is that, if there are any fees involved in the borrowing (for example, an annual credit card fee) then this will be factored into the APR and not into the interest rate. That’s why the interest rate quoted is often lower than the APR. If there is no arrangement fee to pay for the card or loan then there may be no difference between the interest rate and the APR.

The basics of interest

Interest is pretty straightforward to start with – if you’re paying 10% interest on a £1,000 loan then that will cost you £100 over the course of a year or £33 if you borrowed the money for just four months. Compound interest, however, can make things a little more complicated.

Savings: The way that compound interest works is – to use savings as an example – you earn interest on the money that you save for the first year. Then after the first year you’ll be earning interest on those original savings – and you’ll be earning interest on the first year’s interest. So, you can earn a lot more interest on savings that way.

Debts: Unfortunately, this also applies to debts. So you’ll pay interest on the original borrowing and you’ll then also pay interest on the debt interest applied to that original borrowing, which increases each year. The longer the period over which you have the debt, the more interest you pay. It’s easy to underestimate how much this can add to your debts – for example, if you borrowed £1,000 at 15% over 20 years without making any repayments, with compound interest applied, you’d owe £16,400. If there was no compound interest on that debt the interest would be just £4,000.

You can explore how interest rates and repayment period affects the total amount you repay by using our loan calculator – it’s capable of looking at loan values from just £500 to £25,000+ over periods as long as 10+ years. You’ll soon realise the impact of the APR% and the effect of compound interest.

The different types of APR

All lenders are required to tell you what the APR is for a loan or credit card before you borrow so it’s a useful comparison tool when you’re trying to decide which is the best credit option for you. However, there are two different types of APR and you won’t necessarily get the first one that you see when you’re looking at a loan or credit card.

  1. The representative APR. This is the rate that is generally advertised with a financial product, such as a loan or a credit card. However, only 51% of people whose applications are accepted will actually get the representative APR or better. Most APRs are calculated using an assumed credit limit and will factor in the annual interest you’re likely to pay on every day purchases, as well as any fees or charges that apply. However, these are all estimates. So, for example the representative APR on a credit card is calculated assuming a credit limit of £1,200 – but that doesn’t mean that is the credit limit you’ll be offered. Another point to note with the representative APR is that – for credit cards, for example – this advertised rate is always the purchase rate. So, it is the rate that you’d pay if you were offered the representative APR for any purchases you make. There might be a totally different rate for balance transfers.
  2. The personal APR. This is the rate that you will be offered for the loan or credit card you’re looking for once you’ve actually made the application. Lenders tend to reserve the representative APRs for the customers they think are the most attractive so, unless you have a great credit score, then your personal APR could be quite different. Your personal APR will be compiled from a number of key factors, including how old you are, how much you earn, how much you spend and what your credit score is. The better your credit score, the more likely you are to get a good personal APR.

APRs and 0% borrowing

0% credit cards are a very attractive opportunity. It basically means that you won’t have to pay the APR on any debt you have on the credit card until the offer period runs out. Some cards offer 0% on balance transfers and others on spending – there are also some cards that will give you 0% on both. When you’re signing up for a card like this make sure you still check the APR and that you’re happy with it. Once the 0% period expires then the APR will kick in and you’ll have to be prepared to pay it if you have outstanding debt.

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What does the recent failure of VISA’s card payment system tell us? Thu, 26 Jul 2018 10:51:58 +0000 Alex Hartley On 2nd June 2018, millions of people across Europe were unable to make any payments with their Visa cards as a result of a huge system failure. This network crash was, unfortunately, not the only situation in which we have seen technology-reliant systems grind to a halt recently, inconveniencing thousands of customers. There have been hacks and attacks on customer data at big name banks, as well as IT switch overs that have had chaotic consequences. But what does the latest problem with cashless paying really tell us?visa payments system

Cashless payments have their problems too

The drive towards cashless payments and using technology, as opposed to notes & coins, to pay for things has been quite relentless. From Apple Pay through to wireless payments, we are increasingly being encouraged to leave the cash at home and make payments for everything electronically. However, the Visa catastrophe shows that cashless infrastructure can have some serious problems. If the system you’re relying on to make payments crashes then you simply can’t make those payments. So how vulnerable are we really making ourselves by becoming reliant on this technology?

A diversified market would be a better option

Currently, Visa and MasterCard dominate electronic card payments. There are consequences for consumers in terms of competitive pricing and a lack of choice. However, this also means that if one of these players experiences serious problems then a very big chunk of customers will be affected. If the UK had a more diversified market, with a wider range of options, then one payment provider being affected wouldn’t have such a wide ranging impact.

What happens if you fall outside the system?

Another consequence of having a market dominated by big players is that they can exclude large numbers of people from taking part. What happens if you fall below the criteria to be eligible for a Visa card for example? If we move towards a completely cashless society then anyone who doesn’t meet the criteria for these two big card providers could find themselves completely excluded from economic participation.

How reliable is the technology?

Specifically, how reliable is the technology being used by your individual bank and the point at which this integrates with Visa or Mastercard systems? Although banks are highly likely to promote themselves as innovative and ahead of the curve on the technology front, many of the infrastructures that underpin UK banks are decades old. Often, the work has simply not been done on reconciling old systems with new and it may be here that the problems arise. Pinar Ozcan, professor of strategy at Warwick Business School told the Independent newspaper that

“most of us trust an established bank with our money, not realising that these banks’ IT systems date back to the 1970s and they have not updated these systems significantly since then, precisely due to the fear of the system breaking down in the process.”

What about your data?

Law firm Osborne Clarke surveyed 2,000 people and found that more than three quarters of those people were concerned about the amount of data they would be sharing if electronic payments completely replaced cash. The perspective that big financial institutions will have on the lives of customers by being able to see every single payment – and the judgements that could inform at the bank – is very unnerving for some.

Is there any good news?

We are increasingly moving towards a cashless society and, despite the recent network crashes and the confusion that caused, there is light at the end of the tunnel.

  • Soon, if systems crash you could just use a a card from a different provider. More payment options are becoming available as alternative banks are appearing, which means that the market is being diversified. So, in the future, if you do find yourself the customer of a provider like Visa with a system that has crashed then you should just be able to use another card from an unaffected provider.
  • Improving technology will become a dealbreaker. The likelihood is that banks that don’t update systems and invest in the latest technology to ensure systems are not outdated will simply lose their customers. Losing customers is one of the biggest motivators for financial organisations when it comes to investing in services and infrastructure so it’s highly likely that the current situation will be improved.
  • Electronic payments encourage transparency. Although electronic payments provide more data about our own transactions, they also mean that there is less opportunity for a black market than exists with cash. Cash is not traceable and so can be moved around the world to pay for anything, from drugs to terrorism. More electronic payments could, in theory, reduce this kind of impact.
  • Those who handle data are being held to higher standards. Already the GDPR has ushered in a new era of data protection and emphasis on institutions handling data to be more proactive about protecting and collecting it. It’s likely that these obligations will increase and financial institutions will have to be more responsive, not least due to the lost of customer trust that results from a data breach.

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The rise of the SIM-only phone contract Mon, 23 Jul 2018 10:16:49 +0000 Alex Hartley The SIM card is effectively the brain for your mobile phone, carrying the unique phone number, storing personal data and enabling phone operation. It’s the most important component in a phone and, as telecoms operators are beginning to discover, increasingly the only part of the phone that consumers want to contract for. SIM-only contracts are gaining popularity predominantly because they offer much cheaper deals than those contracts that also factor in the cost of a phone. But what does this mean for the mobile phone market in the UK and, if you’re looking for a SIM-only contract, where can you get the best deals?sim-only phone contracts

SIM-only contracts – the market

At the start of 2017, SIM-only deals represented around 27% of the market for mobile phone contracts in the UK. By the end of 2018 that figure is predicted to reach 34%. And by 2021, the experts have said that around 54% of consumers are likely to be on SIM-only contracts. This is a trend that is taking shape right across Europe – in fact, Spanish consumers are now almost exclusively using SIM-only contracts.

Why are SIM-only contracts so popular?

The obvious appeal is that SIM-only contracts are cheaper. You pay less for a deal that only covers the SIM because the cost of the phone is excluded from the price. Traditional mobile phone contracts bundle everything in to the estimated monthly cost, including the price of the SIM and the price of the handset. This can considerably increase what you pay for your contract. If you buy an iPhone today, for example,  – straight from the Apple Store – you’ll pay £549 for 4.7 inch iPhone 7 and £699 for a 5.5 inch phone. The new iPhone X starts at £999. Given these costs it’s not difficult to see why a traditional mobile phone contract costs more than a SIM-only deal. And yet, at the same time, mobile phone operators are still making a pretty tidy profit on traditional deals with consumers. It’s this awareness of being profited from, as well as the desire to cut monthly costs, that is driving more and more people towards opting for a SIM-only deal.

How does a SIM-only deal work?

  • The contract. Although you’re not getting the phone you still have to sign up for a contract to get the best prices for a SIM-only deal. You’ll usually be offered either a 12 month contract or a 30 day rolling contract.
  • The phone. In order to use your current phone with a SIM-only contract it will need to be unlocked. If you got your phone via a contract with another provider then it will be locked to the network that sold it to you. It’s simple to get your phone unlocked – if you’re out of contract on the phone then your old provider has to do this for free. If your contract is still running on your phone – or you bought it as a pay-as-you-go – then you might be charged to get it unlocked (up to £15).
  • The switch. Make sure you give enough notice on your old phone contract – most require 30 days. Remember that if you’ve signed a contract for two years then you won’t be able to leave until after those two years are up. If you want to keep your old number you’ll need to get a PAC (Porting Authorisation Code) from your old provider.

SIM-only deals to look out for

The best deal for you will be one that gives you the usage you need. You can see how much data, text and voice minutes you used last month via your existing provider and base your search for a new deal on that. Some of the best deals around at the moment include:

  • Virgin Mobile. A 12 month contract with unlimited texts, 1500 minutes and 2GB of data costs £7 a month.
  • A 1 month contract with 5000 texts, 2000 minutes and 2.5GB of data is £7.50.
  • Vodafone. A 12 month contract with unlimited texts and calls and 3GB of data is £8 a month.
  • A 1 month contract with 5000 texts, 500 minutes and 5GB of data is £10 a month

The future of the UK mobile phone market

If the predictions are right then it’s likely that the majority of consumers in the UK will move to a SIM-only deal in the next three or four years. This means that the big mobile phone operators will need to offer better SIM-only deals to be more competitive – or improve the appeal of their traditional contracts. For the handset manufacturers there are implications too – Apple and Samsung, for example, are already looking at putting more resources into “direct to consumer” sales to take advantage of the increase in the number of consumers looking to buy a handset to go with their SIM-only deal. These days it could make more sense to take out a loan to pay for the phone outright and buy the sim separately.

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All you need to know about acting as a rental property guarantor Thu, 19 Jul 2018 10:21:19 +0000 Alex Hartley The cost of renting in the UK is increasing – rents across the UK rose 2% in March 2018 and renters now pay an average of £919 a month. For those based in London, the average rent is £1,560. As rents rise far in excess of wage growth, it becomes increasingly difficult for tenants to cover their monthly housing costs. The risk that this creates for landlords is something that many have been attempting to provide for by asking for rental guarantors. If you’re asked to be a guarantor for someone else’s rent then what exactly is involved and how should you handle it?acting as a rental property guarantor

Why is a guarantor necessary?

Landlords tend to ask for a guarantee where there is any risk that the tenant may not be able to make the rental payments on a property. So, for example, landlords renting to students often ask for guarantees because students don’t have an income. Anyone who doesn’t pass a credit check may also be asked to provide a guarantor, as well as those who are under 21 and tenants who have worked for their current employer for less than six months. Anyone on a low income who can’t show any savings to cover future rental payments may not be able to rent without a rental guarantor. The use of guarantors is now widespread for things like loans, and utility payments, but this is fundamentally nothing new.

What does a guarantor do?

Effectively, the guarantor will step in and make the rent payments if the tenant is not able to do it themselves. If the guarantor doesn’t make the payments then the landlord will be able to take legal action against the guarantor. The guarantor will be liable for any rent that goes unpaid but may also find that the landlord asks them to cover other costs, such as the expense of repairing any damage that the tenant has done to the property.

Who can be a guarantor?

Guarantors must be over the age of 18 and landlords tend to insist that the guarantor lives in the UK. This is because it’s much more difficult to take legal action against a guarantor if they are based overseas. Most landlords also insist that the guarantor is a UK homeowner and some may require a guarantor to be able to show that they have enough income to cover any potential payments that must be made under the guarantee.

What’s the process of becoming a guarantor?

  1. Guarantors will be asked for references and also credit checked, just like a tenant
  2. Guarantors may be asked to provide proof of home ownership and/or sufficient funds to cover the liabilities under the tenancy agreement
  3. A guarantee document will be produced – legally, this must be in writing and set out the rights and obligations that the guarantor has
  4. Guarantors must see and review the tenancy that they are guaranteeing – if the guarantor is not given enough opportunity to read and question the tenancy agreement, and raise any points that they don’t understand, before signing the guarantee then the guarantee may not be valid.

What do you need to think about if you’re planning to be a guarantor?

  • How well do you know the person you’re being a guarantor for? If you don’t know them that well, or you’re not 100% sure that they will do their best to make the rent payments themselves, then you might want to think twice about taking on this legal obligation.
  • Can you afford to pay the rent? Many people agree to become a guarantor without really thinking about the potential consequences. If the guarantee is activated then you will have to cover, not only your own outgoings but also –potentially – all the payment requirements under the guarantee. For example, if you’re guaranteeing a tenant in London paying an average rent and you have to cover eight months worth of payments that is a minimum of £12,480.
  • What does the tenancy agreement require of you? You might find that you’re actually required to do more than cover the cost of the rent – make sure you read the tenancy agreement to see what extra expense there could be.
  • When does the guarantee come to an end? This should be stated in the guarantee document but there is no standard length of time. Some guarantees are for a fixed period – e.g. a year – but others are open ended. If you have an open ended guarantee then you would remain liable as long as the tenancy exists.
  • Are you guaranteeing a joint tenant? Especially in student houses it’s common for guarantees for joint tenants to cover the entire rent. So, you might think you’re only guaranteeing the rent of the person who has asked you to be their guarantor but, due to the joint tenancy, you will be liable for all the rent for the entire property. In that situation, if there is a default then the landlord would reach out to all the guarantors – but if (in a worse case scenario) none pay up then the responsibility could be yours.

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Family days out in London for under £5 Mon, 16 Jul 2018 10:29:56 +0000 Alex Hartley London is one of the world’s great cities – a vibrant and colourful melting pot of culture, activity, art, politics, people and learning. There is a lot that our Capital has to offer to growing and impressionable minds. Summer is the ideal time to take your family to explore everything that London can inspire – and you don’t have to bust your budget to do it either.days out in london

Take the bus

You could sign up for an expensive London bus tour – or you could just get on a regular London bus. Perching on the top deck of a bus is an excitement that never wanes for children (sometimes for adults too) and many of London’s iconic and exciting landmarks sit alongside some of the most regular old transport routes. The Number 8, for example, will take you past St Paul’s Cathedral, Bank and into the vibrant buzz of Shoreditch. Or you can ride the Number 11 to see Westminster Abbey, the Houses of Parliament and Nelson’s Column. Kids go free on most London buses and adult fares are just £1.50.

Attend a masterclass

London is filled with cultural institutions, many of which tend to run free courses to give something back to the communities that support them. The Theatre Royal Haymarket, for example, runs masterclasses that are the ideal opportunity for budding thespians to get inspired. Well known actors share their top tips and there is also the opportunity for attendees to ask questions. The masterclasses at the Royal Haymarket are free.

Have fun down on the farm

You don’t have to leave London to enjoy a day down on the farm thanks to the wonderful Hackney City Farm project. The farm is free for everyone and has donkeys, pigs, goats, sheep, geese and calves, to name a few of the animals that call Hackney their home. There are regular arts projects that anyone can get involved in, as well as an organic farm shop where you can buy farm produce, including eggs laid fresh that day. Whether you want to teach kids where their food comes from, or just to widen their experience of animals, a summer day down on the farm is great fun – and free.

Go cycling along the canal

When you think of London you don’t often think of water but actually the city is defined by its waterways, both those hidden and out in the open. The Regents Canal, for example, runs for 14km and has a total of 13 locks. If your children are confident on bikes then it’s a wonderful, often very relaxing, ride alongside the water with plenty of spots to stop for a drink or an ice cream. The canal travels from Paddington to Limehouse via Camden, Islington and Hackney – if you leave the path at Victoria Park then you’ll have time for an end of day picnic in the evening sunshine.

See the changing of the guard

Since the recent wedding between Meghan Markle and Prince Harry there’s been a significant surge in interest where the royals are concerned. If your family has been caught up in royal fever this summer then take them to the epicentre of it all in London – Buckingham Palace. The palace itself is quite an inspiring sight to behold but if you get there just before 11.00 in the morning then you’ll also be able to see the changing of the guard. Nearby Green Park is the ideal place to have a picnic lunch once you’ve watched this legendary military ceremony.

Hang out by the water

London has plenty of spots where you can take the family to cool down on a hot summer day – and many of them are free or charge very little. Hampstead Heath ponds is probably one of the most iconic places for an urban bathe in the natural ponds in the north of the city. Adult entry for a day pass to the ponds is just £2 and for children it’s £1 so it’s possible to enjoy a day by the water for around (or under) £5 depending on the size of your brood.

A day out at the park

London has an abundance of parks with a wealth of facilities to keep children entertained through the summer months. Brockwell Park is one of the best in South London, for example, and has a sandpit, paddling pool and a range of activities, from climbing frames through to a zip wire.

Get a dose of culture

If it’s artistic inspiration you’re looking for on a day out with your children then London offers plenty of options, all of them free. The Tate Modern, Tate Britain, The Royal Academy and The National Gallery are just a few of the locations where you can see art from throughout the ages without paying for it.

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Real Life – How to balance your household budgets when living on benefits Thu, 12 Jul 2018 10:51:29 +0000 Alex Hartley Many of the money decisions we make today are based on what to do with the disposable income that we have. That’s the amount that’s left after covering basic costs, such as food, rent and utilities. A large proportion of people have experienced a drop in disposable income, particularly since the financial crash in 2008. But there is perhaps no section of British society that has been quite as hard hit as those on on benefits

What is life like on benefits?

Many of the government’s austerity measures have been aimed at reducing the strain that benefits place on the public purse and this has resulted in a lot of cuts. Those of working age who claim benefits have had their incomes frozen since 2015 as part of general austerity measures. According to the Institute for Fiscal Studies, by 2020 on average these households will have lost £450 a year.

Who claims benefits?

There could be any number of reasons for someone finding themselves in a position where they have to claim benefits. Medical conditions that prevent people from working mean that life is restricted to what the state can provide. Redundancy and being unable to find another job could be the reason for signing on for benefits for some and, for others, it’s responsibilities such as being a full time carer for someone with medical issues. Stories in certain parts of the UK media have been rife about those living the Life of Riley on benefits but the reality of where this leaves personal finances, in disposable income terms, can come as quite a shock.

How much do you get on benefits?

Radio 4’s consumer affairs programme You & Yours recently spoke to two single women and a couple who were living on benefits. Each of these households had the following to live off:

A single person with medical issues

  • Universal credit £480 a month
  • Personal Independence Payment (PIP) for long term health condition or disability £55 a week, paid per month

A single job seeker

  • Job seekers Allowance £115 a fortnight (reduced by £15 a fortnight to repay job centre loans)

A couple, one the carer for the other

  • £150 a week income support + PIP

The reality is for many people on benefits that, after the cost of gas, electricity, council tax, food and other routine bills have been covered they have just a couple of pounds left.

What kind of sacrifices have to be made?

On this kind of income, the idea of going out at the weekends or going shopping for new clothes is simply a pipe dream. Job seekers may find it hard to get to appointments they can’t walk to because they can’t afford the bus fare. This opens up the risk of benefits being stopped because appointments haven’t been attended. The luxuries that many people take for granted, such as holidays, being able to get onto the property ladder and even just travelling to see relatives, are all out of reach.

Tips from those who balance budgets on benefits

When it comes to coping with the cost of every day living expenses there are a number of ways in which people on benefits cope, including:

  • Prioritising paying bills by transferring money into a separate account to ensure that these essential costs are met first
  • Establishing another separate account so that money can be put aside for basic living
  • Always creating a list before going shopping – no spontaneous purchases
  • Checking the cupboards and fridge before going shopping to ensure that nothing is being purchased twice
  • Choosing shopping times carefully – product markdowns often happen in the late afternoon, which can be a great time to get more for less

The basics of budgeting

  1. Work out all your income – total monthly benefits, any wages and any other income.
  2. Add up your outgoings per month – look at your household bills and add up exactly how much you pay every month. Be as exact as you can about your supermarket spend per week, don’t forget the cost of insurance and loan repayments, as well as any regular travel costs that you have. If you have additional expense for pets or childcare include those here too.
  3. If the budget doesn’t balance – i.e. if you have more going out than coming in then you’re going to have to make adjustments. For example, could you switch to a different energy provider and pay less for your gas and electricity?

Once you know what your affordable monthly budget is then stick to it. The more faithfully you commit to what your income allows you to spend, the more likely you are to be able to balance your household budget, even on benefits.

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How to entertain the kids this summer on a limited budget Mon, 09 Jul 2018 10:28:06 +0000 Alex Hartley The summer holidays are imminent and while the kids maybe looking forward to it, for the adults the pressure is on. Obviously everyone loves spending time with their children – and there’s plenty of quality time to enjoy during the summer – but it can be a challenge to work out how to entertain everyone. That’s especially so if you’re on a serious budget. In fact, a recent study found that for low income families the summer holidays often entail poor childcare support, limited access to activities and food worries. Some children may end up feeling isolated if parents are out at work and many kids in low income families end up frustrated and bored. But is it possible to entertain kids over the summer on a limited budget? entertain the kids this summer

Hit the park

Sometimes the simplest ideas are the best and the park offers all sorts of benefits on a summer’s day – for no spend at all. From socialising with other kids to joining in games of football and ensuring everyone is thoroughly exhausted by the time they get home, the park has plenty of advantages. If you’re not keen on your local park then jump on a bus or walk a little further to find one that offers something new.

Free art galleries and museums

The summer holidays are the perfect time for a little cultural enrichment and exposing growing minds to ideas and art that they might not yet have seen. Museums and galleries all over the UK offer free entry during the summer holiday so your only cost will be lunch and transport. In London, for example, you’ll be able to visit the Tate Britain, Tate Modern, Science Museum, the Museum of London and the British Library, to name just a few.

Put your kids to work

There’s no reason why the summer holidays should be all about lie ins and lazy days. It’s also a great time for kids to learn a little work ethic – and earn some summer spending money. Depending on where you live (and how old your children are) there could be many opportunities for earning a little extra cash, from a paper round, to fruit picking, working in a shop or walking the neighbour’s dogs.

Have a creative day

If you have children who are easily bored then it might be essential to ensure that minds are kept occupied. A creative day means getting all the creative tools – from pens and crayons through to cameras and music making software – and setting your children a creative challenge. That might be to write a story, alone or together with you, to design invitations to a summer BBQ or to create a theme song for the summer. If you don’t have the money to pay for courses and learning days, there is still a lot that you can do with what you have at home.

Play tennis

If Wimbledon fever grips your family this year then get your children out onto the tennis courts hitting a few balls to burn off some extra energy. You’ll find tennis events and days out all over the country and free tennis taster courses in August, as well as open days and competitions. Tennis rackets can easily be purchased second hand or you can rent one for the day instead of buying new.

Team up with another family

Often the best entertainment for children is… other children. Play dates, shared picnics, joint bike rides and movie and pizza days with another family offer cheap solutions to ensuring that children have others to interact with during the summer holidays. Sharing time with another family can also help to solve issues of childcare with parents splitting the responsibility of looking after both sets of children and reducing the amount of time off work required.

Go camping

Children love to camp. There’s something about tents and setting up a little temporary sleeping spot that generates lots of enthusiasm with kids. Camping is a great, way to enjoy a summer holiday with your children that won’t come with a huge price tag – all you need are the tents and the cost of the pitch fee. If you don’t have the time or money to travel to a campsite then camping out in the garden can be equally fun. And if you don’t have a garden, indoor camping is just as good – set up the tent, roast some smores in the microwave and sit around telling ghost stories in the dark.

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How to cut the cost of your large motoring fuel bill Thu, 05 Jul 2018 09:59:28 +0000 Alex Hartley According to RAC Fuel Watch, petrol prices in the UK have hit a three year high. We’re now paying more to fill up our cars than at any time since 2014, with the cost of unleaded up to £1.21 and the cost of diesel rising to £1.23 a litre. This increase in fuel prices is being driven by a rise in the cost of oil, which has now also peaked at the highest level since May 2015. So, are we stuck paying higher prices for motoring fuel now that the costs are rising – or is there a way to cut the cost?

cut the cost or your petrol & diesel

Five ways to cut the cost of your motoring fuel

Choose your petrol station carefully

Where you buy your fuel could actually have a big impact on how much you pay for it, as individual petrol stations have discretion over how much they charge.

  • Find a busy petrol station – the more petrol they are selling, the more deliveries they are getting and the more likely they are to be able to sell fuel at a cheaper price.
  • Choose a petrol station surrounded by plenty of others – if your petrol station is the only one for miles around then they are likely to charge a lot more than a petrol point that is just down the road from the competition.
  • Opt for a big petrol station – like any other product, petrol is a wholesale purchase and it tends to be the bigger players who are able to negotiate the best deals.
  • Avoid petrol stations in pricing hot spots – very rural areas, expensive cities (such as London), airports and motorways are where you’ll find the highest petrol prices. Opt for somewhere more middle of the road – the suburbs or a provincial town – and you’re likely to get a much better deal.

Make your car more fuel efficient

You may not be in a position to switch your car for an electric or hybrid model but there is still a lot you can do to ensure that it consumes less fuel including:

  • Check the pressure of your tyres – if it’s too low then this will increase the drag on the car, which will mean it consumes more fuel.
  • Ditch the roof rack – your car has to work hard to power forward with a roof rack attached as a result of the wind resistance. Taking the roof rack off can improve fuel efficiency by 10%.
  • Don’t use the aircon unless you really need it – air conditioning is a gas guzzler so, if you want your car to consume less fuel, then keep it off unless it’s really necessary.
  • Change the way you drive – amazingly, you can save around 30% on fuel costs if you change your driving habits. Avoid too much stopping and starting when you drive, try to slow naturally, as opposed to using the brakes, and accelerate smoothly without over revving.

And if your monthly budget will allow investigate whether changing your car to help you save fuel costs in the long run makes overall financial sense.


According to you could save more than £220 a year by using its petrol price comparison website. It’s free to sign up and provides a breakdown of average fuel prices by location and by brand. You can sign up for price alert emails, use the website or download the app to find the cheapest petrol station along your route. The app is a particularly useful tool, as it means that you can avoid buying petrol at motorway fill up stations when on the road, which are often some of the most expensive.

Get your fuel from the supermarket

Supermarkets can be a great place to fill up, as their prices are often some of the most competitive. This is especially so as you’ll often find a supermarket petrol station in an area where there are lots of other petrol stations – so there are some great discounts available if you buy fuel where you shop. It’s also worth looking into whether your regular supermarket loyalty scheme offers you any discounts on fuel. For example, some provide discount vouchers for petrol – the best way to use these is to pick them up when you’re buying what you’d normally purchase from the supermarket. Avoid a situation where you’re buying more just to get the fuel vouchers, as it could end up being cheaper just to buy the full price fuel.

Buy your fuel with a cashback credit card

With the cashback that you earn you can reduce what you pay for the fuel that you buy. However, to ensure you get the gain from this you’ll need to clear the balance on the card every month to avoid paying any interest on the balance (as this would most likely outstrip the cashback saving).

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Life inside China’s “Social Credit System” – is Big Brother really watching you? Mon, 02 Jul 2018 10:19:52 +0000 Alex Hartley Living in a country like the UK – or the US or anywhere in Europe – sometimes it’s easy to forget how different the rest of the world really is. Shows such as Black Mirror have explored the idea that a system of “social credit,” where your value is defined by the ratings you receive from the people you interact with, but the concept is still (mostly) fiction. Not so in China though, where the government has now proposed an initiative for developing a “national reputation system” called the Social Credit System that is designed to be in place by 2020.

What is China’s Social Credit System?

The Chinese government has pitched the Social Credit System as an attempt to promote trustworthiness in its economy and society. It is effectively a huge ranking system that will monitor Chinese residents and rank everyone based on their “social credit.” It’s not been made clear exactly what would cause your social credit score to take a plummet under the new system but some of the potential score damaging behaviours include smoking in non-smoking zones, bad driving or posting fake news online. The system is currently being trialled at various locations around China and the government hopes to have the basic infrastructure established by 2020.

China's Social Credit System

Is there a blacklist?

Yes. In a scenario that could have been written by Charlie Brooker of Black Mirror fame, there is indeed a blacklist for “bad citizens.” Some of the consequences of a low social credit score, or of being blacklisted as a citizen, include:

  • Travel restrictions – according to Channel News Asia, so far nine million people in China have been banned from buying domestic flights because they have low social credit scores.
  • Education bans – Beijing News reported that 17 million people who had refused to carry out military service in China faced educational consequences, including being prevented from applying for high school or enrolling in higher education.
  • A lack of luxury – those who refused military service were also reportedly banned from some holidays and the best hotels.
  • Job insecurity – although there are no reported examples yet, job opportunities could also be determined by social credit score, So, if your social credit is low then the coveted management jobs with big state owned companies and banks would be considered out of your reach.

What about being an exemplary citizen?

If you make it onto the list of “good citizens” then there are many advantages, from discounts on energy bills through to lower interest rates or being able to rent without having a deposit. Your social life could also benefit, as it’s reported that China’s biggest dating website is boosting the profiles of those who have a high social credit score.

Will it work?

There are a lot of problems with introducing this kind of system into any country and it’s likely to feel more than a little unnerving for anyone who has read George Orwell’s 1984. It effectively means setting up a mass surveillance tool to track Chinese citizens, as well as big data analysis technology to process information and generate usable conclusions on their trustworthiness. The conclusions are based on a set of criteria defined by a government that is notoriously intolerant of rebellion or free thinking. What is it that really makes a “good citizen”? Some characteristics are obvious, such as saving a child from a runaway car or paying your taxes on time. But then you also get into much more shadowy areas – for example, would a Chinese citizen who hijacked a truck of stolen dogs headed for the notoriously horrendous Yulin dog meat festival (to save them from being skinned and boiled alive) be a hero or a villain in the eyes of the social credit system?

Why is China introducing a social credit system?

Chinese society suffers from a lack of trust – according to sociologist Zhang Lifan. Years of life under the Communist Party has left citizens with the expectation that they could be cheated at any time, or get into trouble, without having done anything to deserve it. A system of social credit could give people more control over their own destinies. However, it’s also worth noting that the Communist Party in China has long been looking for a way to more effectively monitor its citizens, their loyalties and ideological outlooks. Former President Jiang Zemin in 1995 called for “the informatization, automation, and intelligentization of economic and social management.” Then in the 2000s the country attempted to introduce an automated system of social surveillance through policing projects. So, while there may be a desire to improve society and regulate the economy it’s clear that the Social Credit System will also be a tool for steering and controlling the behaviours, hearts and minds of citizens. If you live in China big brother really will be watching you.

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What to do if Credit Reference Agencies hold incorrect data about you Fri, 29 Jun 2018 10:51:37 +0000 Alex Hartley As we all know, the contents of your credit file can have a big impact on your life. A poor credit score as a result of a bad credit history will make borrowing more expensive and may make it impossible to do something like buy your own property. Despite this, many consumers in the UK have had issues with the information that credit references agencies add to their credit reports, often as a result of what is provided by lenders. But is there anything you can do if you feel that your credit score is being influenced unfairly?Inaccuracies at credit reference agencies

Complaints against credit reference agencies

Between April and September last year, 700 complaints were made against credit reference agencies in the UK. These were predominantly based around agencies holding inaccurate information on their files or not updating information quickly enough, for example when there has been a correction. Inaccurate information on a credit file can have serious consequences for an individual. Around 10 million British adults have now uncovered errors on their credit files so the numbers of complaints being made is only a small percentage of the total volume of people affected.

What are the consequences of a mistake on a credit file?

A recent example provided by a BBC report told of an individual locked in a dispute with telecoms company O2 who claimed she owed them £62. While they eventually admitted that the “debt” was a mistake, they had already passed on information to a credit reference agency that she had defaulted by not paying it. When she asked O2 to remove the default she was told it would take 90 days. The result? The woman’s credit score took a nosedive down to “poor” and her attempts to remortgage resulted in monthly payments several hundred pounds higher than they would have been without the default on her credit file. Mistakes on a credit file can also result in being refused credit that might be essential for every day life, such as a mobile phone contract or a utilities deal.

What do the credit agencies say?

Callcredit, Equifax and Experian make it clear that it’s up to consumers to check whether the information that is held about them on a credit file is correct. They also say that consumers are entitled to challenge anything in their credit files that they consider to be a mistake or incorrect – but how effective can that really be? The main issue is that consumers can provide evidence to attempt to show that they believe there is a mistake – for example, that they don’t owe money to a lender that the lender claims they do. However, the credit agency will always check that evidence with the lender. And if the lender says that there is a debt or default then it stays on the credit file.

What can you do if you’ve found a mistake on your credit file?

  • Start by speaking to the source of the error. That could be a lender who has noted a missed payment that didn’t exist, for example, or a company that claims you owe them money. If you can straighten out the situation with the source then they can apply to have the information removed from your credit file.
  • Apply for a notice of correction. This is a paragraph that is added to the credit file that explains why you think that the information is wrong. This won’t stop something like a default affecting your credit score but will at least explain that you believe it shouldn’t be there. It will also mean that any applications you make won’t be subject to automatic scoring and the lender will have to have a human being look at the file before making a decision.
  • Make a complaint to an ombudsman. If they rule in your favour then they can order a lender to take down any incorrect information.
  • Use the GDPR. New data regulations that have come in to force in May this year will apply added pressure to any organisation dealing with consumer data to ensure that it is correct. However, if you want to enforce your rights to have poor information fixed under the GDPR then you will have to take this through the courts yourself.

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Are there any other solutions?

The main issue for consumers is the amount of power that a lender or company has to dictate what appears on a credit file. If a lender tells a credit agency there has been a default then the credit agency adds it to the file and the consumer is not consulted first. One suggested solution is that any disputed information be taken off a credit file until the dispute is resolved, as opposed to leaving it there and adding an explanation via a notice of correction. Resolving these disputes can take years so this would at least mean that consumers aren’t unfairly disadvantaged until it is proved that the “black mark” on their credit report is deserved.

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How to get full value for money from your Council Tax Wed, 27 Jun 2018 10:30:48 +0000 Alex Hartley The system of councils in England is something that most of us have grown up with. We look to the council if there’s an issue with the roads, or with our rubbish collection, and every three or four years we might review who we want to represent us on the local governing body. But how much do you really know about the councils who work for your interests and are you getting the most out of the services that they offer? The average council tax in England is now £1,700 a year which is a sizeable chunk of the household budget – and a large enough sum for some people to need to borrow to pay for some of it. If you don’t feel you are getting value for money what can you do about it?council services

Council Structure in England

There are two different types of councils across most of England: county councils on one level and district, borough or city councils on another.

  • County councils take responsibility for county-wide services, including education, fire and public safety, social care, transport and planning.
  • Local councils are responsible for a much smaller geographic area and will cover services such as housing, local planning applications, rubbish collection and council tax.

The purpose of having a system of councils is to be able to organise and structure our communities. They also provide transparency to official decision making and offer a way for anyone to have a say in how their local town or county is run, either by electing a councillor or becoming one. In theory, councils are the perfect way to ensure that there is an infrastructure in place to deliver services and support the local community.

What can you use your County council for?

County councils provide a wide range of services to people who live within defined county lines. For example, your county council will deal with:

  • Trading standards issues, such as scams, doorstep crime or setting up No Cold Calling Zones
  • Registering a birth or a death, or booking a ceremony for a wedding or civil partnership
  • Financial assessments for social care
  • Applications for a disabled driver Blue Badge, as well as bus passes or travel vouchers
  • Administering grants and funding for people and projects in the local community
  • School applications, as well as school transport and the provision of free school meals

What can you use your Local council for?

Local councils carry out a wide range of functions available to anyone who lives within the catchment area for the council. So, you could contact your local council if you want to:

  • Find out when your rubbish is collected
  • Report a missed rubbish collection
  • Apply for a licence – for example, a street collection licence, pet shop licence or a licence that enables you to have a skip on, or near, your property
  • Property related queries, such as applying for planning permission or to rent a council-owned garage
  • Handle your council tax payments – for example you might be looking to apply for a council tax exemption or for information on council tax reductions for disabilities
  • Report problems in your local area, such as potholes in the road
  • Pay for a parking season ticket or for any outstanding parking tickets you have

What if you feel like they don’t do enough?

Issues with councils, local or county, often arise when people feel that they are not receiving adequate services in return for annual council tax payments. The problem is that many councils today are chronically underfunded but, nevertheless, cuts to services, such as social care and libraries, are tough to take at the same time as council tax demands have increased. In fact, council tax is set to rise across 95% of councils this year according to the 2018 State of Local Government Finance research. Despite this, around 80% of councils now fear for their financial stability. A study by the Local Government Information Unit (LGiU) think tank and The Municipal Journal found that children’s services and social care put the most pressure on council budgets. But is there anything you can do if you feel like your council doesn’t do enough?

How to hold your council accountable

There are a number of ways to have your say when it comes to what your local council does.

  • Make a complaint to the specific department that covers any issues you’ve had
  • Speak to your councilor about the problems that you’ve had
  • Complain to your local MP
  • Raise a complaint with an impartial body – for example if your issue is with council housing, you can complain to the Housing Ombudsman
  • Contact the Local Government and Social Care Ombudsman, the final stage for complaints about councils
  • Become a local councillor – sometimes the only way to really effect change is to stand for election yourself

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How to avoid being ripped off by ticket resale websites Mon, 25 Jun 2018 10:53:38 +0000 Alex Hartley Buying tickets for concerts and sports events via resale sites has become a common practice for many people. Sites like Stubhub, Viagogo, Getmein and Seatwave claim to be able to offer usable resold tickets to anyone who wants to go to a sold out event. However, recently these businesses have come under a lot more scrutiny for their exorbitant pricing and rather lax approach to consumer law. A recent Advertising Standards Authority ruling now means that resale sites are going to have to make some changes in the way that they sell concert tickets

What’s the problem with ticket resale sites?

A number of different issues have brought resale sites to the attention of the advertising watchdog. Among these are problems for ticket purchasers that include:

  • Tickets that are being resold at hugely inflated prices
  • The overuse of these sites by ticket touts looking for profit, as opposed to individuals looking to resell tickets they can’t use
  • Enormous booking and delivery fees
  • The practice of many of these sites to hide additional costs information from ticket buyers until it’s too late
  • Tickets purchased via resale sites are often unusable because many of them must be redeemed with the ID that was registered with the original ticket purchase
  • A lack of refunds for those who feel they paid much more than intended and want their money back

However, it’s not just those looking to buy tickets via resale sites who have experienced issues but sellers too. In some cases the resale site has simply cancelled a ticket transaction without explanation, leaving a seller with no way of reestablishing contact with the person who potentially wanted to buy. With all these risks associated with buying tickets you really need to take care, and think twice before borrowing money to pay for them!

What has the ASA ruled?

The ASA now requires that information about costs, such as booking and delivery fees, is presented up front to consumers. So, this cannot simply be added on at the last minute when a customer is inputting bank details. The ASA has also outlined that resale sites must no longer describe themselves as “official partners” to specific events, which some have been doing without any basis for it. This was the case with one resale site that claimed to be an official partner for Ed Sheeran tickets – until Ed Sheeran announced that no resale site tickets would be accepted at his latest round of tour concerts. Finally, resale sites will not be able to offer any guarantees, such as ‘guaranteed entry’ with their tickets. This is mainly because so many consumers with resale tickets have found themselves refused entry. For example, one group of rugby fans who purchased tickets for a Twickenham game were refused entry to the game itself when the stewards asked for ID to go with the tickets. Because the fans’ ID did not match that of the ticket purchaser they did not get in – and could not get a refund.

What’s the response from ticket resale websites?

So far, some have stated public willingness to conform to the ASA ruling. However, it’s worth looking at the controversial history that resale sites have to see just how unscrupulous they can be about profiting from resold tickets. For example, resale sites have in the past been criticised for profiteering from charity events and holding on to refunds that should have been given to fans who had been overcharged. Many people believe the sites have repeatedly breached consumer rights laws and at least one has refused to attend a select committee hearing on the topic.

So, how can you buy or sell tickets safely?

  • Look first at whether there are any tickets left for the event. Sometimes fans have paid double for resold tickets when there were still standard price tickets left.
  • Research the original price of the ticket. It’s important to have a starting point when it comes to deciding how much you’re going to pay.
  • Make sure you know whether the event or concert will accept a ticket without the ID of the person who originally purchased it.
  • If you’re going to use a resale site then make sure resale tickets haven’t been banned for the event you want to go to.
  • If you’re selling then look at social media or classified sites like Gumtree. If you’re going to make the sale this way then use an escrow service where you can see the money has been paid in and will be released once the tickets have been handed over. It’s often better to send tickets than to hand them over in person as you’ll have a way of proving receipt.

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Brexit Update – June 2018 – Any #Bregret ? Fri, 22 Jun 2018 11:06:26 +0000 Alex Hartley The government’s EU Withdrawal Bill went through the House of Commons this month, signalling the first real move towards a comprehensive Brexit strategy. Its progress through the House of Lords involved a wide raft of changes being suggested and so much of the government’s focus in the bill was removing the Lords’ amendments. Although there was a lot of uncertainty about how the bill would fare in the House of Commons, in fact in the end it passed. “Concessions” enabled the bill to pass by 324 votes to 298. Brexit

Brexit – the key issue for parliament

The potential defeat for the government over the Brexit Bill turned on the issue of whether MPs would have a say on the eventual Brexit deal that is agreed. Those who voted against the bill wanted to ensure that MPs would get a decisive say on what happens over Brexit if the terms of the deal that the government negotiates aren’t attractive enough. In the end, MPs were promised only that they would have “input” under those circumstances – and that seemed to be convincing enough for rebel MPs, many of whom were then happy to let the bill then pass. However, despite this small success for the government, the role that Parliament will have in shaping the outcome of negotiations is still not clear.

The Northern Irish border

One of the most contentious issues in the Brexit debate has been the Northern Irish border, which will also effectively become a European border when the UK leaves the EU. The latest news on the debate about the control that should be applied to this border is that the government has conceded that there will be no physical “checks and controls” after Brexit. Many believed that setting up checkpoints and cameras could result in a return to the old days of violence so this will be reassurance for some.

‘Frictionless trade’ with the European Union

Trade relations with the EU after the UK leaves have also been a topic of much discussion. It’s UK businesses who are most likely to foot the bill for any taxes and tariffs that are introduced as a result of the departure and so this has been a huge cause for concern. However, Michael Barnier who is Brussels’ chief negotiator, has now said that the idea of ‘frictionless trade’ with the EU could be possible for the UK. He is effectively suggesting the “Norway model” for the UK, which would consist of membership of the European Economic Area (EEA) with a customs union. This is considered by many to be a possible model for a future relationship and potentially the only realistic way to avoid trade penalties for UK businesses.

The prospect of a Brexit ‘no deal’

The government has frequently mentioned a doomsday scenario for Brexit in which the worst happens and there is no deal by the time the deadline rolls around next February. But what would this really mean for people in the UK? We have been told that the most noticeable impact of this would be severe food shortages, specifically in relation to imported goods. The Wine and Spirits Trade Association has now also chipped in to highlight the fact that a no deal for Brexit could disrupt gin supplies. Those aforementioned food shortages would result in a lack of juniper, which would make it much tougher to produce Britain’s favourite drink.

Damage to the UK economy

The dip in the value of the pound against other currencies was the first obvious sign of financial issues as a result of the Brexit vote. Now, a new report has identified that Brexit is having a wider impact on the UK economy and the financial sector – and that this is already taking effect ahead of the actual leave date. The EY Attractiveness Report tracks the flow of investment cash around Europe. It found that there was a significant increase in outbound investment from the UK in 2017. The total number of outbound investments was 464 in 2017, up 35% on the previous year’s total of 343. According to EY, these kinds of figures are consistent with the move of jobs and operations from the UK to mainland Europe in order to deal with the impact of regulatory change as a result of Brexit.

#Bregret (Brexit Regret)

According to a YouGov poll there are limited signs of #Bregret amongst British people – 45% of respondents said they believed Britain was wrong to leave and 42% felt it was the right decision. Of course these results could change considerably once – if the predictions are right – the nation runs out of gin!

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Switch away from the “Big 6” energy companies to save money Wed, 20 Jun 2018 11:18:24 +0000 Alex Hartley Energy price rises are not exactly news. However, for many consumers, the rate at which the big energy companies continue to put up their prices means increasing, uncomfortable, pressure on personal finances. In May SSE became the last of the ‘Big Six’ energy companies to announce ongoing price rises. So, is it time to move away from the big companies and switch to a smaller energy provider instead to start saving cash?
switch energy suppliers

Recent price rises by the “Big 6” energy suppliers

All the major energy suppliers in the UK have now announced an increase in the prices that they charge for gas and electricity. That includes British Gas, EDF Energy, E.ON, Npower, Scottish Power, and SSE. The increases are different, depending on the energy company that you’re currently with. For example, SSE customers will see a 5.7% increase in the cost of gas and a 7.7% rise in electricity prices as of 11th July. For  2.36 million customers that’s going to result in an average increase of £76 a year. Around 4.1 million British Gas customers will see an increase of 5.5%, which will add an average of £60 to annual bills. Around a million people who buy their energy from Scottish Power will be paying £63 more on average (an increase of 5.5%). The same number of customers at NPower will be paying 5.3% more, which translates into a £64 increase, which will be payable from mid June. And finally, E.On has changed its billing processes with the result that the average standard variable rate will increase.

What can you do to save money on your energy bills?

Many of these price rises have been criticised by the government as “unjustified” but, given the fact that these are not nationally owned power companies but private entities, there is little that can be done to stop power companies increasing bills. So, the only solution for individual customers may be to shop around and find a cheaper energy supplier – which is increasingly where smaller energy companies are more appealing.

What does the process of switching suppliers involve?

It’s pretty simple, especially if you use one of the big and well established switching websites.

  • Create a comparison of the prices available to you – you’ll need to enter information, such as your post code and how you use energy, to get this.
  • You’ll be shown the options for comparison and the price of each one so you can see the available services and costs.
  • Make the switch – if you use one of the big comparison sites the switch can often be made on the site. Your new supplier will contact the old supplier for a meter reading and the switch automatically takes place.

Make sure you use a website that is Ofgem accredited and look for one that states you will have a 14 day cooling off period to change your mind if you decide the new supplier is not for you. Remember that price comparison websites take commissions from energy companies in return for a successful switch so there should be no cost to you.

What to bear in mind when you’re switching energy suppliers

  • Start by looking at your existing bills. This will be a useful way of working out how you already use your energy and could also help you to save cash. For example, if you’re using most of your energy during the day then you could opt for an off peak tariff that should be cheaper. Read your meter so that you know exactly how much energy you’re consuming per month and year and then look at the deal you were previously on to see if something similar would work with a new energy supplier.
  • Fixed and variable tariffs. When you’re choosing a new energy supplier your tariff options will be fixed or variable. A fixed tariff will remain the same for the length of your contract whereas a variable tariff may go up or down. So, if prices go down then you benefit more from a variable tariff but a fixed option may make it easier to budget.
  • What about a dual fuel deal? It’s always worth looking at whether it is cheaper to buy both gas and electricity from the same supplier – you may get a discount for doing this.
  • Look at the opportunities to save. For example, the supplier may offer a discount if you pay by direct debit and you could get a further discount if you opt to manage bills online, as opposed to receiving paper bills.

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How to cut the cost of your bank overdraft Mon, 18 Jun 2018 11:13:11 +0000 Alex Hartley How much does your bank overdraft cost you every year? Collectively, in the UK we paid out a total of £1.2bn on overdraft charges in 2017. Somehow, overdraft charges seem to have been overlooked by industry reform designed to make borrowing cheaper for consumers and charges can still be high. While some banks have anticipated incoming overdraft price caps by reducing their fees, many still remain fairly exorbitant.overdraft costs and fees

How much do overdrafts cost?

Government figures show that around a quarter of the UK has been overdrawn at some point in the past year. Charges vary from bank to bank but if you’re persistently entering into an unauthorised overdraft, for example, you could find yourself with incredibly burdensome costs. The Labour party has conceived plans to cap overdraft charges at £24 per month for every £100 borrowed. However, until that happens, banks are still free to apply fees and charges as they wish. So, how can you reduce your overall overdraft costs before the price caps are implemented?

8 ways to cut the cost of your bank overdraft

  1. Don’t go overdrawn. It sounds obvious but if you think about the times when you have dropped over your limit and incurred charges as a result it was probably when you weren’t concentrating particularly hard on your finances. If you are racking up high charges and you want to bring this to a halt then start by shifting your perspective so that your starting point is to begin managing your money so that you don’t go overdrawn in the first place.
  2. Start budgeting properly. Whether you use an app or pen and paper, if you are able to get on top of your incoming cash and outgoing expenses then you are much less likely to find yourself in a position of accidental (and expensive) overdraft.
  3. Switch your bank. The charges that are applied to overdrafts vary a lot from one bank to the next. You can significantly reduce what you’re paying for your overdraft by getting it from another provider. For example, if you borrowed £500 via an unauthorised overdraft for a week you’d be charged £7.75 (£6 monthly fee and £1.75 interest) by Natwest and £5.25 (75p a day up to £1,000) at Barclay’s. If you were a First Direct customer you’d pay just 71p in interest, as there are no fees or charges applied at that bank.
  4. You can still move banks even if you’re already overdrawn. Many banks look at someone who is already using their overdraft and see them as a much more lucrative option than someone who is not. So, you don’t have to wait until you’ve cleared the overdraft to move to a different bank. Shop around for the best rate and then make an application that involves paying off the existing overdraft with the new one.
  5. Speak to your current bank. Use the fact that you’re looking at other options as leverage to get a better detail on your overdraft use. If you keep going into an unauthorised overdraft, for example, you might be able to agree an authorised overdraft with the bank that attracts lower charges and makes it cheaper for you to use. If you’re already in overdraft then apply for an extension – yes, you will attract more interest and a fee but this is likely to be cheaper than continuously going over your overdraft limit and paying the penalty charges as a result.
  6. Get text alerts from your bank. Most banks now offer a text alert service that will tell you when you’re getting close to your account limit – or about to go over it. This might seem very simple but is also very effective. Financial Conduct Authority research found that using text alerts and a banking app tended to reduce monthly overdraft charges by an average of 24%.
  7. Pay off your overdraft with cheaper debt. 0% credit cards and personal loans with lower rates can be a much better option than remaining in an overdraft where the charges are much higher.
  8. Stop using cheques. If you’re trying to manage your money better then cheques can be a real hazard. The time that a cheque takes to come out of your account will depend on when the recipient of the account banks the cheque and how long your bank takes to process it. So, the moment that a cheque is going to hit your account will be completely unpredictable and cheques could very easily be the items that push you over your limit.


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How much does a wedding cost and how can you pay for it? Fri, 15 Jun 2018 11:09:22 +0000 Alex Hartley In 2017, the average cost of a wedding was £27,161 – an increase of almost 10% on the cost of a wedding the year before! Given that the average salary in the UK is £27,271, paying for a wedding is a significant challenge for many people. So, what are the costs involved in your wedding budget and how are you going to pay for them?the cost of weddings

Your wedding budget – the main costs

It’s crucial to start with a budget when you’re planning a wedding because it’s very easy for wedding expenses to escalate. Cake makers, venues and photographers instantly increase their prices when the word “wedding” is involved. But that doesn’t mean that you can’t still have the perfect big day, as long as you’re prepared to pay for it.

A wedding venue

The average wedding venue will set you back around £2,790. This may not seem that expensive until you realise that this is only the location where the ceremony takes place and not where your guests will drink, dine and party.

A reception location

Receptions can be held almost anywhere, from a classic country house or golf course through to your parent’s top field. The average amount that couples pay for their reception location is £3,919, which will usually include standard event furniture but not decorations. It’s also worth noting that you’ll be paying separately for the catering and this figure will only cover the cost of the venue hire.

Food and drink

The cost of food and drink will can also vary enormously and if you’re able to arrange some of the catering via friends or family then discounts can help you to save significantly here. Average catering costs come in at around £3,959 but you may need to revise this figure depending on factors such as the kind of catering you want to have, as well as the number of guests and the number of times you’re planning to feed them.

A photographer/videographer

You could, in theory, get your guests to snap away on smart phones and then send you all the images collected to save costs on your wedding photography. However, most people want to have at least a couple of shots that are professionally taken to keep and frame. A wedding photographer will set you back an average of £1,046, depending on how long you need them for and how much shooting they need to do.


Your wedding location and reception venue will most likely both need some decoration, whether that’s flowers, balloons or gorgeous place settings. Costs will vary but an average expense for wedding flowers, for example, is £638.


The average cost of a honeymoon is £4,413 – under any other circumstances that would be a pretty pricey holiday for two. Of course you can keep your costs down by opting for a less exotic location but it’s still a key expense to consider.

Other Bits & Bobs

These are some of the major costs involved in any wedding but you’ll also need to bear in mind the smaller expenses, as these can really add up:

  • Entertainment: £773
  • Cake: £300
  • Groom’s outfit: £439
  • Bride’s outfit: £1,677
  • Wedding rings: £809
  • Stationery: £271

How can you cover the cost of your wedding?

Couples all over the world have come up with a wealth of creative solutions for finding new ways to pay for a wedding, including:

  • Find a sponsor – agree a reduction in wedding prices in return for advertising on the day
  • Pay as you go – most wedding services companies will take a large, up front deposit and then enable you to pay as you go for the rest
  • Use your gift list – many gift lists today offer the opportunity for guests to contribute financially instead of buying a gift, whether that’s to the cost of the honeymoon or the dress. So, you’ll have a pot of cash after the event to clear anything you owe
  • Use equity release – for weddings later in life, equity release from an owned property can be a great resource

Any for the rest of us…

Borrowing has become a regular part of wedding financing today and can help ensure that you have everything in place for the perfect occasion. Wedding finance options include:

  • Personal loans – longer-term unsecured lending that can be repaid over a period of years
  • Secured loans – if you’re looking for wedding financing and own your home then a homeowner loan allows you to borrow against your property (with possibly a more flexible approach to your credit rating)
  • Credit cards – find a low cost or 0% credit card so that you don’t pay interest on covering some of the cost of your wedding

note: data source –

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How to live your life off the grid – running away from your bad credit rating! Wed, 13 Jun 2018 10:42:24 +0000 Alex Hartley Living off the grid sounds like something Jason Bourne would do. However, escaping a world driven by consumerism and cash – especially if you don’t have an ideal credit rating – is certainly worth considering. So, how do you do it?living life off the grid

Why would you choose to go “off grid”?

Assuming that you’re not being chased by a government agency, the main motivation for living off grid is often to escape the influence of over-consumerism. Many people with poor credit ratings also find themselves trapped in a world where products and services are expensive and it’s difficult to improve a credit rating to get access to better deals. Going off grid means you can escape the shadow cast by your credit rating and make life choices that aren’t dominated by consumerism.

7 stage plan to live your life off grid

  • Minimise what you own and what you need. It’s very easy to become a hoarder in the shopping-driven world that we live in today. You might feel like you really “need” to have a power shower and 15 pairs of red shoes but the reality is that you don’t. If you want to go off grid and make it work then it’s best to adopt a traveller-style attitude so that you only have with you what you really need. Minimise your possessions and identify what it is that is essential to your survival and what is really just luxury or extra.
  • Own your own home. It’s quite difficult to live life off grid if you have a landlord or a mortgage, as every time you move or remortgage you’ll be subject to credit and personal checks. If you own your own property then you have no ties to outside financial institutions or other companies or people. This doesn’t have to be a bricks and mortar property – it could be a canal boat, a yurt, even a tent on land you own.
  • Investigate alternative power sources. Some people who go off grid are happy to forgo basics such as water and electricity. If that’s not you then you’re going to need to find other sources of heat and light than just getting them from big power companies. Alternative energy provides some great options here, from solar panels on the roof through to wind turbines in the garden. You could also resort to more traditional sources of heat and light, from wood burning stoves to oil lamps and candles – or just get used to getting up and going to sleep as the sun rises and sets.
  • Look at the future cost of everything you buy. When we’re evaluating the cost of an item we often only look at how much we’re going to pay to acquire it. This kind of short-term thinking means you’ll most likely be back on the grid in no time at all. So, when you’re investing the money that you have in something, try to get an idea of the future cost too. What will it cost to run, how much would you pay to replace it and what will the maintenance expenses be?
  • Take a step back from tech. Technology requires a lot of energy to power it and, if you’re going off grid, that could be difficult to obtain. So, it’s often useful to take a step back from tech or go back to simpler times – replace your radio app on your smart phone, for example, with a wind up radio that doesn’t require electricity to power it.
  • Make frugal living your goal. If you’re living off grid then life isn’t going to be one expensive whirl of luxuries. Although, of course, that depends on what your definition of a luxury is – if it’s freedom from commuting, spending time in nature and not having to worry about energy price rises then off grid could feel like a very luxurious lifestyle. Either way, get used to looking for the cheapest options and finding ways to make savings. That could be something as simple as growing your own food, making your own furniture or getting a sewing machine and learning how to create or customise your own clothes.
  • Don’t leave debts behind you when you go. Going off grid with a poor credit rating is one thing but taking the step when you have a poor credit rating and a lot of debt is quite another. If you clear your debts and stop spending as a result of going off grid then the end result could be that your credit rating actually beings to improve. However, if you leave debts behind you – on which you don’t plan to make any further payments – this will send your credit rating through the floor and could result in court action.

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Why you should consider consolidating your unsecured debt Mon, 11 Jun 2018 11:15:39 +0000 Alex Hartley When you’re juggling multiple debts it can be difficult to ensure that you meet the payment deadlines and don’t get into trouble with managing your other finances. Many people, for whatever reason, find themselves with more than one debt to manage and sometimes that can be challenging. If you’re looking for a way to simplify your finances, as well as reduce the amount of interest that you pay, then consolidating your unsecured debt could be the answer.consolidate unsecured debt

Debt consolidation loans – what are they?

The idea behind a debt consolidation loan is to take all your unsecured debts and consolidate them into one single debt. In practice, this means taking out a new loan that will cover the cost of all the other debts, using that to pay off those existing debts and then settling down to repay that new loan over time. In terms of simplifying your debts and giving you opportunities to make them more manageable, debt consolidation loans can be advantageous.

The benefits of consolidating your unsecured debt

  • Combine everything you owe into one single debt that you can monitor and manage much more easily. No more missed monthly payments or inconsistent interest rates – everything will be under one single agreement.
  • Cut the interest rates that you’re paying. If you have a range of different debts to combine then these may have a differing interest rates too, some higher than others. One of the major advantages of consolidating debt is that you may be able to cut costs with a debt consolidation loan that has a lower overall interest rate. The less you pay for your debt, the easier it will be to clear it more quickly.
  • Reduce your monthly payments. If you’re struggling to meet current debt repayments, a consolidation loan could provide the opportunity to restructure in a way that suits you better when it comes to repayment. Choose a slightly longer term for your consolidation loan and you’ll have lower monthly payments to deal with. This may mean that you’re repaying debt over a longer period of time – and so you may also pay more interest overall. However, it will put less pressure on monthly finances and may make it easier to ensure you stay on top of them.

Consolidating your unsecured debt – what to be aware of

Debt consolidation loans can help you to better manage existing debts, from personal loans and credit cards to overdrafts and store cards. However, it’s worth looking carefully at the terms you’re being offering to make sure they are really going to be beneficial. In particular look out for:

  • An interest rate that is higher than the one you’re already paying
  • Monthly repayments that are higher than required by your current debts (unless you’re looking to pay the debt off more quickly)
  • The opportunity to spend the consolidation loan without repaying the debt. If you don’t use the debt consolidation loan to repay those other debts then you will end up with double the debt as a result
  • Fees and charges that are applied by any of the lenders you’ll be repaying – what additional costs will there be to make early repayment?

How to arrange debt consolidation loans

  • Work out exactly how much you need. Don’t borrow more than you need but make sure you’ll have enough to clear all the older debts and close down the accounts so you’re not tempted to spend them again.
  • Decide what kind of terms you’re looking for. Are you seeking a lower interest rate than on current debts and do you want to pay less each month, for example.
  • Shop around for an attractive lender. Debt consolidation loans are widely available and, depending on your credit score and existing debts, you should have some appealing choices. Online loans brokers, high street banks and digital lenders are all good options.
  • Choose one or two lenders to apply to. It’s a good idea to avoid making too many applications in a short space of time, as this will affect your credit score. Choose one lender instead and wait to hear about the outcome of the application before you move on to another.
  • When you receive your loan repay all the other debts immediately. Don’t spend a penny of the new loan on anything other than repaying old debts.
  • Carry out some account maintenance. You’ll need to cancel old direct debits and set up new payments so that you can meet the terms of the new debt consolidation loan.

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How to find a new job if you lose one when in your 50s Fri, 08 Jun 2018 11:31:11 +0000 Alex Hartley It’s all too common that people in their 50s find themselves out of work as younger and cheaper people “steal their jobs”. However, youth is wasted on the young, as they say – and employers are increasingly recognising that older employees have a lot to offer the workplace. As a result, job hunting in your 50s isn’t the intimidating task that it once was. If you’re looking for a career change, or you’ve been forced into making a move, there is every chance that you’ll be able to find a satisfying and lucrative role that suits your needs. It just may take a while so you also need to manage your finances accordingly.job hunting in your 50s

Job hunting in your 50s is more common than it used to be

People are living longer, the retirement age is rising and many more people find it necessary to work into later life. Plus, thanks to the advantages of modern technology, the range of different roles available is much broader and much more interesting. If you’re job hunting in your 50s then you have a lot more of a market to choose from and you’ll find that you’re not alone – according to the London School of Business and Finance, 43% of employees between the ages of 45 and 54 are looking for new opportunities.

Getting started with job hunting in your 50s

What do you want from your next role? It’s important to start from a position of assuming that you’ll be able to get some, or all, of the things that you want from a new job. You don’t have to take the first one that comes your way. Are you looking for flexible working, the opportunity to learn practical skills or to work abroad, for example?

What can you bring to a new job? We all have different skills and strengths and focusing on yours can help you identify which job you’d be well suited to, as well as helping you to convince an employer that you’re the right person for the job. Perhaps you’re a great negotiator, you have a lot of management experience or niche knowledge in a particular sector of the market.

Are you online? You may or may not be a bit tech-shy in your 50s but, if you’re job hunting, then you need to recognise the advantages of the online world when it comes to finding a new job. Being on LinkedIn, for example, will be essential – it will act as an online CV that will give potential employers an idea of what your skill set is.

Is your CV out of date? If your CV is out of date, or just in a bit of a mess, then now is the ideal time to rewrite and rework it into a really useful document. Start with your most recent experience first and tailor every the CV you send to the role in terms of relevance. Keep your CV concisely written and short in length – even if there is a lot of experience to include – and make sure you check twice for spelling or grammar errors.

How to find a great role in your 50s

  • Networks are everything. If you’re looking for an exciting new opportunity then remember the power of your established networks when it comes to finding it. Make contact with old colleagues and bosses, clients or customers if it looks like they could give you a helping hand when it comes to tracking down the right role and making introductions.
  • Social networks can be useful too. Haven’t yet ventured on to Twitter or Instagram? Now could be the perfect time to do it. You can make useful contacts via social networks and attract attention for the content that you post, whether that’s cleverly shot images or smartly written tweets or blogs.
  • Age is just a number. Often, the success of job hunting in your 50s is defined by the confidence you have in your ability to achieve results. Don’t worry about being older than other potential candidates and instead focus on the benefits this has, from more on the job experience, to better people management skills.
  • Be flexible. It may be the case that you don’t find the perfect role for you and you might have to accept a compromise for now. Flexibility will get a foot in the door and show your ability to compromise in a positive light.
  • Broaden your approach. Today, there are many more options when it comes to jobs and you can work in many different ways. It may be worth looking at totally new career options or roles that you may not have considered before. You could also investigate the possibilities of being self-employed and working in the gig economy.

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Money management if you’ve lost your job Thu, 07 Jun 2018 11:24:37 +0000 Alex Hartley There are currently around 1.42 million unemployed people in the UK – according to the Office for National Statistics – and 96,000 people lost their jobs between October to December 2017. While the redundancy figure is 11,000 lower than the number for the year before, for many people there still exists a significant threat of ending up out of work. So, what do you do if you’re suddenly without the monthly income that has kept you afloat?money management plan

How to to manage your money now you’re unemployed

You could have become unemployed either because your job became redundant or because your employer felt your performance in the jobs was not good enough. The difference here is that if your job was made redundant you will probably have been paid a redundancy sum. This can give you some financial protection – at least for a while.

Becoming unemployed could happen to an employee at any time – many simply don’t see it coming. Coping financially with a period of unemployment before you secure another job, can involve some careful planning and money management. Many, many people in the UK do not have any savings to protect them when they become unemployed. If you are currently in work then you really need to build up an emergency fund now!

Here’s are our suggestions as to how to deal with money while out of work:

  • Revise your budget. A post-redundancy budget is going to be significantly different to the budget you may have enjoyed while in work. Now is the time to reevaluate your spending and identify where you can make savings. Start by working out what your income is going to be per month until you find another job – this is mostly likely to be a combination of redundancy pay, benefits and savings. Then go through all your spending and cut back wherever you can.
  • Claim benefits if you’re entitled to them. Depending on your circumstances, you may be entitled to a range of benefits, including jobseeker’s allowance. It’s worth visiting your local job centre to find out what financial support you might be able to get while you’re in-between jobs.
  • Manage your redundancy pay. It’s important to establish that you’ve paid the right amount of tax on redundancy payments (anything under £30,000 should be tax free). A redundancy pay out can seem like a huge sum of money when first received but will quickly dwindle. Make sure you put the money aside if you can, preferably somewhere that it can earn some interest, and don’t be tempted to go on a spending spree with it.
  • Are you eligible for a tax rebate? Every opportunity is worth investigating when your income comes to a sudden halt like this. If you were made redundant half way through a tax year, for example, then you could be entitled to some tax back. HMRC will be able to tell you whether that’s the case.
  • Don’t avoid your debts. If you’ve been made redundant then you might be feeling incredibly stressed about the future and unsure how you’re going to cover payments in the long term. The ‘head in the sand’ approach does not work in this situation – you need to face up to your debts and make sure they are properly managed. Prioritise those debts that are the most important – for example, the mortgage that will keep a roof over your head – and then allocate funds to pay the others where you can. If you’re struggling, speak to a lender or creditor before you get into a position where you’re in default.
  • Avoid borrowing any more. If you don’t have a job then your borrowing options will be more limited but you can still borrow via homeowner loans etc. However, it’s important to consider whether this is really necessary, as it will create another obligation that could be stressful to fulfil. If possible, avoid taking on anymore borrowing until you at least have a job offer on the horizon.
  • Proactively look for work. Being made redundant can be depressing – it’s the same for everyone. However, now is not the time to sit back and wallow in it. The jobs market is not as dire as it used to be in the UK (in fact the unemployment rate is at a 42 year low!) and proactively looking for work will help to keep spirits up, as well as increasing your chances of success. And to be able to claim Universal credit you will need to show you are looking for work.
  • When you start work again… make it a priority to repay any additional debts you’ve taken out while you were redundant and focus on clearing credit cards with high interest rates first. Give your new employer your P45 so that you can go straight onto the right tax code and try to put aside a proportion of your remaining redundancy money to provide a safety net for the future.

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FCA clamps down on high street “Rent to Own” shops Mon, 04 Jun 2018 16:07:23 +0000 Alex Hartley High interest borrowing has been the subject of a Financial Conduct Authority (FCA) investigation that has taken nearly two years to complete. One of the major targets of this has been the rent to own sector, which includes stores such as BrightHouse that offer payment plans on items, such as ovens or furniture, available on very high cost credit terms [in 2016 we showed how you could end up paying 2-3x the cash price!] . 

The FCA has now concluded its investigation and the result is a potential crackdown on rent to buy – but not much impact on other forms of high cost credit, such as overdraft fees or doorstep to own washing machine

What is “rent to own” or “rent to buy”?

Rent to buy acted as a trigger for the FCA investigation, which was designed to look further into the high cost credit market. More than three million people in the UK use high cost credit and around 400,000 people currently have an outstanding debt to a business like BrightHouse. This type of credit makes it possible for anyone who is unable to pay the up front cost of an item, such as a washing machine, to make the purchase using credit instead. Rather than paying for the entire item up front, regular payments are made until the debt is cleared, at which point the item is owned. In principle, this sounds like a good idea for cash poor individuals who need a little more time to cover the cost of essentials. However, the FCA investigation has found that customers ended up paying a lot more for an item than would have been the case with a single up front purchase thanks to the high cost of the credit. For example, BrightHouse customers were paying £1,500 for ovens that sell in other high street shops for under £300.

How is the FCA taking action?

A new cap is likely to be introduced that is designed to prevent the cost credit in the rent to own sector from spiralling so disproportionately. The FCA is about to undergo a period of consultation with the industry before potentially introducing the price cap into the market in April 2019.

What about other forms of high cost credit?

Campaigners against high cost credit (including actor Michael Sheen) were looking for more from the FCA review. In particular, many were hoping that the FCA would impose a cap on bank overdraft charges too. According to Gareth Shaw of Which? the charges that banks apply to those going over their overdraft limits can be seven times more expensive than the cost of a payday loan! In 2015 the FCA intervened in the payday loans market to cap the cost of credit. The intervention has been deemed a great success and so many debt charities and campaigners were hoping that step would provide a blueprint for every type of high cost credit, including overdraft fees.

Why has the FCA not tackled high overdraft fees?

Andrew Bailey, the Chief Executive of the FCA has not ruled out a cap on high overdraft fees, saying,

“Our immediate proposed changes will make overdraft costs more transparent and prevent people unintentionally dipping in to an overdraft in the first place…However, we believe more fundamental change is needed in the way banks charge customers for overdrafts.”


So, it’s entirely possible that – at some point in the near future – the FCA will introduce a cap on overdraft charges. However, the FCA hesitation is anchored in a fear of getting a price cap wrong when it comes to overdrafts, particularly as the British banking industry is a formidable opponent with no qualms about challenging change in the courts. In particular, the FCA is wary of a 2009 case that ended up in a supreme court challenge that went in favour of the banks on the issue of price caps.

So, what is the FCA doing with overdrafts right now?

Instead of introducing a price cap, the FCA has made a number of recommendations to the industry that are designed to save consumers money. These include requiring banks to send mobile alerts with respect to imminent overdraft charges, no longer including an overdraft in the definition of “available funds” and making credit and borrowing costs clearer.

Is the FCA doing enough?

The cap on high interest credit, such as rent to own, is a great first step and is likely to benefit around 400,000 people who currently owe money to companies like BrightHouse. However, the £2.3bn in overdraft fees that are generated by customers who go over their limits and into the red remains untouched by the FCA recommendations. Banks will still be able to collect these, no matter how disproportionate they are. For campaigners, the hope is that the FCA won’t take too long to work out how to engineer a price cap for these fees too.

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How to avoid being duped into laundering criminals’ cash Fri, 01 Jun 2018 10:59:27 +0000 Alex Hartley Money laundering is something that we tend to associate with large companies and big banks. However, new figures from the UK’s fraud prevention service, Cifas, have indicated that money laundering is becoming a much more personal problem. According to Cifas, we are entering an era of vulnerable individuals being used as “money mules” to launder the cash of criminal enterprises through their own bank accounts.

money laundering

What is a “money mule”?

The definition of a money mule is effectively someone who is being used by criminals to move money from one account to another. The money goes in to the individual’s account as “dirty” money, often the proceeds of people trafficking or drugs, for example. Then, when it is transferred on from the individual’s account, it has been cleaned or laundered. Using money mules enables criminals to avoid the authorities and to keep the proceeds of illegal enterprises under the radar.

How does someone become a “money mule”?

Criminal gangs are increasingly targeting those with money issues, such as students or young people, and offering them the opportunity to be a money mule, often under the guise of a job offer. Social media provides a platform for fraudsters looking to reach out to people who might potentially be open to allowing their bank accounts to be used in this way. According to Sandra Peaston, Assistant Director at Cifas, Whatsapp is the communication tool of choice for fraudsters seeking victims who are often lured in by fake money making schemes or even fake job offers.

How does money laundering work?

It involves an individual making their bank details available so that money can be transferred into and out of the account. Usually, when the money is transferred out of the account, the victim is entitled to retain a small percentage. Around 32,000 bank accounts were highlighted in 2017 as potentially belonging to money mules so it’s an issue that involves fairly large sums of cash.

It’s free money isn’t it?

According to the experts, the money that these accounts are being used to launder has usually come from drug smuggling, people trafficking and terrorism. So, while there may be some small benefit for money mules, the end result is that they are supporting some of the worst elements in society. It’s also worth bearing in mind that handing over bank details to anyone, let alone a fraudster, leaves an individual open to serious financial harm. Once a criminal has bank details that belong to a money mule they could be used for anything, from scamming that individual to creating a false identity in their name.

What about the law?

Money laundering is illegal in the UK. A conviction for money laundering could lead to 14 years in prison. So, there could potentially be some very real consequences for money mules who are involved. Individuals who have their bank accounts shut down for something like money laundering could find it difficult to get back up and running in financial terms. After a money laundering issue it can be difficult to get student loans, mobile phone contracts and other financial products.

How do you avoid becoming a money mule?

According to Cifas, between January and September 2017, there were 8,652 cases involving 18-24-year-olds being used as money mules. It’s a growing problem targeting younger individuals – so, how do you avoid getting inadvertently being made a money mule?

  • Be cautious about handing over your bank details to anyone. If it’s not someone you know and trust then it’s rarely a good idea to give them this very personal and valuable information.
  • If something seems too good to be true then it probably is. There is no such thing as free money. Even if you’re tempted by the cash and not that bothered by where the money has come from, the risks to you in giving a criminal your bank details – or getting caught – are significant.
  • Be wary of any unsolicited offers of financial help. Why have they targeted you and how realistic is what they’re offering?
  • If you’re offered a job out of the blue then spend some time researching the company to establish that it’s a genuine business and not a money laundering front.
  • Be especially careful with any job offers that relate to a “job” that is purely online.

If you get a job offer that is written in poor English or full of grammar or spelling mistakes then this could be a warning sign. Make sure you look further into the company and what it actually does before you agree to anything. If you need money then it makes more sense to look at other ways of earning it or borrowing it – don’t take unnecessary risks.

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The current state of the UK’s cashback credit cards market Wed, 30 May 2018 10:29:09 +0000 Alex Hartley Cashback credit cards are designed to help you generate cash every time you shop. With cashback received for every pound that you spend, you are essentially getting paid for going shopping. There are some great benefits to having cashback credit cards, as long as you know how to use them. So, what are the pros and cons of cashback credit cards and where can you currently find the best deals?cashback credit cards

The pros and cons of cashback credit cards

Like any financial product, there are pros and cons when it comes to signing up for cashback credit cards – these are useful to know before committing to one card over another:

The pros of cashback credit cards

  • Earning cash every time you spend. If you’re using the card in the normal way – i.e. not adjusting your spending habits or spending more – then getting cashback for what you’d be doing anyway is a big bonus.
  • The better the credit you have, the higher the percentage of cashback. If you have a great credit score then you’ll usually benefit from a much better deal on cashback credit cards. Cashback is usually paid as a percentage total of your overall spend and that percentage will be higher if you have a great credit score.
  • The savings can really add up. Although the percentages of cashback may seem fairly small initially, those savings can be quite substantial over the course of a year.
  • If you pay off the balance every month then you get all of the benefits of cashback credit cards with none of the pitfalls. As long as you don’t go forward with an outstanding balance then you are generating a positive return every time you spend.
  • If your interests align with the savings the card offers then you can save a fortune. For example, some cards give cashback against specific categories, such as fuel and supermarket spending – if these suit you then you can save a lot.

The cons of cashback credit cards

  • Some of the cards that offer the most lucrative rewards programmes tend to come with a fee. Make sure you’re not paying out more in an annual fee than you’re likely to earn in cashback.
  • If you don’t have a great credit score then you won’t get the best rates. Like every other type of credit card, cashback credit cards provide the best deals to those who have the most attractive credit history. So, if your credit score is low then you may not find that the cashback deals are worth it.
  • Interest rates can be higher for cashback credit cards. Pay close attention to the interest rate that you’re offered with a cashback credit card deal. This will, to a certain extent, be dependent on your credit score but is also dictated by the type of card. If you’re looking for really low interest rates on a credit card then a cashback card may not be the right choice.
  • Cashback cards can create some bad spending habits. For example, you may be tempted to spend more on the card to generate the cashback and then be unable to clear the balance. Remember that if you do that you will usually pay more in interest on the outstanding balance than you will earn in cashback so it could be costly to change your spending routines.

Cashback credit card deals available right now

  • Amex Platinum Cashback Everyday. The card is fee free and has a 5% introductory rate. Spend £2,000 within three months to get an intro offer of £100 cashback and you’ll then go onto a tiered cashback system – £0 to £5,000 = 0.5% cashback and anything above that generates 1% cashback.
  • Tandem. The Tandem credit card is also fee free with 0.5% cashback on all purchases over £1 worldwide and you can track your spending via the Tandem app. APR is 18.9% for both purchases and cash withdrawals. No fees for overseas purchases.
  • The Asda Money card. For Asda shoppers this is a great deal, as you’ll get 1% cashback on every Asda shop in the form of Asda vouchers. Other purchases generate 0.2% cashback. There’s no annual fee and the APR is 19.9%. John Lewis and Amazon also offer cards with similar deals that generate cashback when used to shop with that particular brand.
  • Aqua Reward. If you don’t have a perfect credit score you could still enjoy cashback credit card benefits with Aqua Reward. The card provides 0.5% cashback on all purchases up to a credit limit of £1,200. The interest rate is higher – APR 34.9%.

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How to get the best exchange rates when travelling abroad Mon, 28 May 2018 11:51:49 +0000 Alex Hartley Since the EU referendum, exchange rates have been something of a sore point for anyone looking to travel outside of the UK. Brits have become used to enjoying some fairly favourable exchange rates against currencies like the Euro and the Dollar. However, all of that changed when Britain decided to leave the EU and the value of the pound fell substantially. Today, we are still in a position where the pound is worth a lot less than it used to be in exchange terms – which is why it’s so important to make sure that you get the best possible exchange rates when travelling exchange rates

Using credit cards overseas

Credit cards can be the cheapest way to spend when you’re overseas. Many believe that they consistently offer the best rates and the most low cost option for withdrawing cash abroad. However, this depends on ensuring that you have the right credit card. The ideal credit card for overseas spending is one with no non-sterling transaction fees on foreign spend and no charges or interest on ATM withdrawals. Whenever you’re overseas and spending with a credit card, look out for Dynamic Currency Conversion. This is where you’re given the option of paying in sterling abroad. It may seem like a good deal but the reality is that you’ll be charged about 5% more than the correct rate if you opt for it.

Exchange rates when you’re taking cash

There are a few locations where you’ll get a better deal on your cash currency if you buy this on arrival but, on the whole, it’s usually a much better idea to get your currency before you leave the UK. There are a number of different ways to get hold of cash for a trip abroad at a sound rate of exchange. For example, you could buy online with one of the big airport currency specialists, such as ICE, Moneycorp and Travelex. If you buy your money in advance and then collect it at the airport you’ll get a far better rate than if you purchase on your way through to departures. High street options can also be a great idea if you shop around. The Post Office is consistently rated as one of the cheapest ways to buy overseas currency and tends to have fairly strong rates, and you can also look at local travel agents to see what they offer. If you’re going to make comparisons then work from the same baseline question each time i.e. “how much sterling will EUR100 cost me?”

The option of travellers cheques

Although travellers cheques used to be the number one way to take money abroad, they are not that widely used now. In terms of convenience, the risk of loss and the average exchange rates they tend to be less appealing.

The benefits of prepaid cards

A prepaid card enables you to take your cash with you in a more secure way – loaded onto a prepaid card that can be blocked if lost or stolen. The rate of exchange you’ll get with prepaid cards varies but you can generally avoid paying any fees to withdraw cash using most of these cards. A lot of credit cards charge 2-3% fees on overseas transactions (although some don’t) and you can avoid these with a prepaid card too. It’s worth remembering that prepaid cards can’t be used as a surety when you arrive at a hotel or to rent a car, for example. You’ll need a regular credit card for that. There’s an element of reliability with prepaid cards that many find appealing – you’ll get the currency rate on the day that you convert your cash to the card. This can make it much easier to set, and stick to, a budget and also means that if things do change and the pound takes another dive then you won’t be affected while overseas.

The option of using a debit card abroad

Although it’s probably the card you’re most used to spending with, your debit card is generally viewed as a last resort because most banks tend to charge high fees to use debit cards overseas. This is not the case across the board so it’s worth checking whether your bank will charge you for using your debit card when you’re outside the UK. In particular, look at the potential costs for withdrawing cash from a local ATM. Some banks will charge an ATM fee every time you use a debit card overseas and another fee on top of that every time you spend.

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How to protect yourself from rogue traders when doing home improvements Fri, 25 May 2018 11:18:33 +0000 Alex Hartley It’s the scenario that anyone making home improvements dreads: assuming that you’re working with a reputable plumber or builder and then finding out that they are actually a rogue trader. Normally, this only becomes evident when it’s almost too late to do something about it. So, how do you protect yourself from being misled by someone without the of best intentions?avoid rogue tradesmen

Be aware of the common scenarios

Rogue traders are everywhere in the home improvements industry. Construction work and refurbishment, for example, are big investments for most people but also something many of us don’t have a lot of experience in. There are large sums of money involved and often a lack of knowledge of what is a “usual” process means that rogue traders can get away with misleading people. A common scenario involves a deposit payment up front for something like a conservatory or an extension. The deposit is usually several thousand pounds but could be up to five figures. Often, that’s the last that the homeowner will see of their money as the trader simply disappears.

Doesn’t the law protect homeowners?

In theory yes. However, it can be quite a process. Currently, the law allows a rogue trader who has ripped someone off to simply declare their company insolvent and then start up a new company the next day and carry on. Anyone who has contracted with the old company will have only limited opportunity to get their money back, as directors can often walk away from an insolvent business without any liability for debts. Eventually, if there are enough complaints about a business, then Companies House may strike that person off as a director, which means they can’t create any more businesses.

How significant is the problem?

It’s a fairly substantial issue, especially as it often involves life changing sums of money. Citizens Advice receives 3,000 calls a month about building work that is substandard. Over the course of a year it received 7,000 complaints about work where money had changed hands but projects had not been finished. With 43,877 complaints annually, substandard builders represents the second biggest issue that Citizens Advice receives complaints about.

How can you avoid a rogue trader?

  • Use a credit card to make payments. If you opt for a credit card, as opposed to a bank transfer, then the payment is protected under the Consumer Credit Act. Bank transfers are not protected by this legislation.
  • Take out insurance to safeguard any deposit monies that you pay. There are plenty of schemes that offer a Home Improvements Guarantee to provide protection in the event that a rogue trader makes off with your money. Look for a scheme regulated by the Financial Conduct Authority (FCA) and offering a guarantee of at least 10 years.
  • Find a builder with an accreditation. The Federation of Master Builders, for example, has a strict set of membership criteria for those who receive its accreditation. It also has a Code of Practice and requires members to pass an independent inspection. If something does go wrong with an accredited builder then you have access to a government approved disputes service to try and find a solution to the problem. Other trading bodies include the National Federation of Builders and the Guild of Builders and Contractors.
  • Do your research. When people have a bad experience with a builder or tradesman today they are often quick to go online and tell others about it. So, by searching the name of the business, its directors and the individuals involved you might be able to find information that indicates you could have a problem before any money changes hands.
  • Use a reviews website. There are a number of different websites springing up today that rate services, such as builders and tradespeople. Rated People, for example, is endorsed by Location, Location Location’s Phil Spencer and enables those who have used a local builder or tradesman to leave a rating to give others some idea of what is was like to work with them.
  • Ask around. Often, the best recommendation for contractors will come from family or friends who have already used an individual or a company. If you’re planning an extension or a conservatory, for example, and you know someone else who has already had this done then get in touch and ask some questions about who they used, and why. You’ll get an honest review of the work completed and the way the job was handled, as well as how much everything cost.

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Cybersecurity for the home – what is best practice for staying safe? Wed, 23 May 2018 12:14:35 +0000 Alex Hartley Our digital home lives are becoming increasingly more complicated. There are now 8.4 billion devices in the UK that connect to a home network and which together make up the Internet of Things (IoT). These devices could be something as obvious as a mobile phone or a laptop or a voice activated speaker. They could also be games consoles or smart fridges and smart energy meters. There is even technology now that has been used to create a smart hair brush that sends data about the way you’re brushing your hair to your phone so that you can learn how to do it better. According to the experts it’s the IoT – and our lack of understanding of it – that is causing problems when it comes to security.home cybersecurity

Where do the issues arise?

Firstly, many people will purchase a “smart” device, such as a smart meter or a smart plant watering system, and not realise the extent to which this makes them vulnerable. Cyber criminals can use gadgets such as this to hack into a home network. From there it’s possible to go on to harvest other data, such as bank details and passport numbers, that can be used in identity theft. The second issue is a lack of understanding of the technology itself and the fact that it may well have a “use by” date.

What do the government security experts say?

The experts at the National Cyber Security centre have highlighted how important it is becoming for people to understand the risks from the IoT. They have introduced a Code of Practice that is designed to give people information on, in particular, how long it’s safe to keep using a device or gadget before it becomes a security risk (i.e. past its “use by” date). The obvious comparison is a mobile phone, which is frequently updated with new fixes and patches when vulnerabilities are discovered and then discarded for a new model when the technology becomes redundant. The idea of a use by date effectively suggests the same approach for other devices, from smart meters to smart fridges. Once they get beyond the point of no longer being supported by the manufacturer they are vulnerable to being hacked and consumers should move on.

Is the risk real?

Yes. According to the National Cyber Security centre it’s possible that cyber criminals have already been able to use hacked smart TVs with cameras to spy on people’s homes. The risk is very real and the cyber criminals are coming.

Best practice for digital home security

  • Make sure you know which devices in your home are connected. What does the IoT look like in your property?
  • Keep an inventory of purchase and “expiry” dates. Take the time to understand the shelf life of all the devices in your home and to make a note of when it might be time to consider an upgrade or simply replacing the device with something not connected.
  • Prioritise your router. Many people buy a home router, install it and then forget about it. An out of date router – or one where there is no security – is one of the easiest ways for cyber criminals to access your data. So, make sure you have noted the date for upgrading or renewing your router and that you know how to handle its security features.
  • Change the name of your Wi-Fi network. The default name settings give away a lot of information about you and the type of network you have.
  • Turn off your Wi-Fi network when it’s home alone. If you do this then you’re minimising the opportunity for hackers to get into it without anyone spotting what’s happening.
  • Consider where you place your wireless router. If it’s right in the centre of the property then it will not only ensure you get better signal in all the rooms but will also prevent anyone standing just outside from being able to get the signal.
  • Use Wi-Fi encryption. Encryption effectively scrambles the data that is being sent over the Wi-Fi connection so that it’s impossible to decipher to anyone who shouldn’t be looking at it. All Wi-Fi kit will support some sort of encryption, whether it’s WPA or WPA2.

Don’t disable your router’s security. Most routers today have a firewall built in and it’s important to make sure you don’t disable this if you want to have basic protection for your home network. You could also consider installing an additional level of security in the form of security software on each device connected to the router.

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Financial tips for Millennials who want to get on the housing ladder Mon, 21 May 2018 10:10:15 +0000 Alex Hartley Millennials (those born 1981-2000) face some fairly tough financial challenges today. House prices that are beyond unaffordable – especially in London – combined with poor interest rates on savings and wage growth that rarely rises with inflation can create some serious barriers to positive financial health. Although this is the age group that has been tagged “Generation Rent,” there are still many Millennials who have ambitions to get a foot onto the bottom rung of the housing ladder, regardless. In the current financial climate, accruing wealth and property from a starting point of zero is tough but with the right financial advice Millennials could change the future that has been forecasted for them.advice for millennials

Be prepared to buy with someone else

According to the Institute of Fiscal Studies, house prices in the UK have shot up by 152% over the past two decades. Wage growth has not. Most mortgage lenders will limit the amount available to borrow to four times that of annual salary. According to the Annual Survey of Hours and Earnings, the average UK salary is around £27,000. The average price of a property in the UK? £225,047, according to the Land Registry. So, take the average salary to a mortgage lender and you won’t even get to half the amount you’ll need to borrow to buy the average property. However, if you buy with another person you’ll have much more chance of success. Whether that’s a sibling, a partner or a friend this way you’ll both get a foot onto the property ladder in an affordable way – and sooner too.

Use Help to Buy

It used to be the case that lenders offered solutions to those who had not quite been able to get a deposit together and weren’t going to be gifted one by parents. These were often in the form of a 125% mortgage (i.e. including the deposit) or an interest only mortgage. Today, few – if any – mortgage lenders offer these products and for good reason, as they can place a heavy financial burden on those who are trying to pay them off. However, that does leave rather a gap for anyone without five figures in savings but who is still keen to buy. Help to Buy is the government scheme that has stepped in to fill this gap. You only need a 5% deposit to make an application for a mortgage with Help to Buy – a government equity loan for 20% of the property purchase price will cover the rest. Help to Buy is available for new build properties only, with a purchase price of less than £600,000.

Open a Lifetime ISA

For those under the age of 40 (i.e. all Millennials), a Lifetime ISA offers a tax free savings vehicle that also has the benefit of a government top up. This type of ISA is especially useful for freelancers or anyone who doesn’t benefit from being part of an occupational pension scheme. You can pay up to £4,000 into a Lifetime ISA each year and the government will top up whatever you pay by 25%. The Lifetime ISA is designed to be used either as the deposit for a first home or to pay for retirement – if you opt to use it for anything else then you’ll lose 25% of whatever is in it as a penalty.

Learn how to budget

Key financial advice for any demographic and any generation is learning how to budget. Without this key skill it’s almost impossible for anyone to achieve financial success. Budgeting is simply the balancing of incoming and outgoings to ensure that one doesn’t overwhelm the other. However, there are many different ways to achieve this. One of the most successful is the 50-30-20 rule:

  • 50% of your income is allocated to necessities (e.g. bills and rent)
  • 30% of cash is put towards financial goals (e.g. saving for a deposit)
  • 20% of what you earn goes to the things you want (e.g. festival tickets, new shoes)

Map out a pension and savings now

Getting into the habit of putting money aside for the future is better done sooner rather than later. Old age may seem decades away but that time can quickly pass and there are some pretty expensive events that could take place in between. Sign up to an occupational pension scheme as early as possible – minimal contributions now will build up over time – and get used to putting aside the 20% of what you earn so that you can reach your financial goals. If you’re not great at financial planning and saving then get a little help from technology. The Cleo app, for example, is an AI assistant designed to help you get better with your cash.

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Tax Scandals Decoded – Protect Yourself from Fines and Worse! Fri, 18 May 2018 15:15:20 +0000 Amanda Gillam Everyone has heard about tax avoidance and tax evasion but very few of us understand the differences and the potentially extreme consequences of getting involved in one of these schemes.

At Solution Loans, we’ve put this article together to let you know what tax avoidance is, what tax evasion is, what to do if you think you may be involved in a scheme and the potential legal consequences. We’ve included a list of hallmarks of schemes to look for as well as details of three of the most common tax avoidance schemes.

The UK Government has put a lot of resources into clamping down on both tax evasion and tax avoidance. HMRC, which oversees the collection of taxes, has referred increasing numbers of cases of both evasion and avoidance to the Crown Prosecution Service, making 1,135 referrals in 2015/16.

What’s the difference between tax avoidance and tax evasion?

One of the key areas of confusion is the difference between tax avoidance and tax evasion.

Simply put tax evasion is completely illegal and is the name given to the practice of not paying taxes by not reporting income or by reporting expenses not legally allowed. This kind of activity is basically a form of fraud that could land you in prison and with very hefty fines. Between 2017 and 2018, the average prison sentence for tax evasion increased from just over three years to four years as the government continued their clampdown.

Tax avoidance is bending the rules, exploiting loopholes and using complex company structures to minimise tax liabilities. A hallmark of many of these schemes is that they involve money leaving businesses and going through a series of transactions either through other businesses or intermediaries that are unnecessary and then coming back again.

So, is tax avoidance legal?

The short answer is, it depends. These schemes often work within the letter of the law but not its spirit. The Government, specifically HMRC, are working hard to ensure these schemes don’t work and either involve a lot of work that comes to nothing or is actively penalised when HMRC take those involved to court and recover the money for the treasury.

Why would I get taken to court for involvement in a tax avoidance scheme?

HMRC set up something called the Disclosure of Tax Avoidance Schemes (DOTAS). This makes anyone involved in or promoting a Tax Avoidance Scheme disclose it to HMRC. Each known tax avoidance scheme has a number that must appear at the top of your tax return. HMRC take a dim view of anyone failing to disclose a scheme. If you’re just the business using such a scheme, penalties start from £5,000. If you’ve devised the scheme and fail to report it the penalties can be up to £1 million.

What can I do if I’m involved in tax evasion?

If you’re involved in tax evasion then you should stop immediately and consult a lawyer and reputable accountant about what to do next.

How do I know I’m involved in a tax avoidance scheme?

HMRC publishes a list of known schemes here. As mentioned above, if a scheme is complex and involves multiple businesses for no reason other than to avoid tax then this is likely a Tax avoidance scheme. Other things to look for are:

  1. It sounds too good to be true (i.e. for no real effort or reason you avoid paying tax)
  2. There is no real economic activity or risk involved (such as an investment)
  3. The scheme consists of money going around in a circle through other businesses or intermediaries
  4. A third party or the scheme’s promoter provides funds to make the scheme work
  5. Known tax havens are involved
  6. Offshore companies are involved (or offshore trusts)
  7. There are confidentiality requirements

What are some specific examples of tax avoidance schemes?

Tax avoidance schemes come in a huge variety of different shapes and sizes. Here are three examples:

Job board tax avoidance scheme

This is one of the more common tax avoidance schemes. It is used by contractors to avoid paying tax and national insurance contributions.

Job Board Tax Avoidance Scheme

Land Tax & Stamp Duty tax avoidance scheme

This scheme was used to avoid Land Tax and Stamp Duty by abusing rules on gifting and unlimited companies.

Land Tax & Stamp Duty Tax Avoidance Scheme

The Gift Aid tax avoidance scheme

This scheme was a high-profile one-off involving a charitable trust set up to help avoid tax via gift aid. The charity involved was shut down by the Charity Commission. The scheme famously involved cycling pro Bradley Wiggins.

Gift Aid Tax Avoidance Scheme

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Unsecured lending is down but so too are secured loan default rates Thu, 17 May 2018 14:59:36 +0000 Alex Hartley The UK economy is going through a challenging period. With destabilising factors, such as Brexit and a rise in interest rates for the first time in a decade, the lending market in particular is an interesting place to be right now. The ongoing change and the fluid nature of influences such as the EU referendum and global political events have created a number of trends in both unsecured and secured loan lending.

secured and unsecured loans

The amount of unsecured consumer lending has dropped

According to figures from the Bank of England, the amount of unsecured lending to consumers fell in the first three months of 2018. The drop was significant too, with a fall of almost 40% recorded in the Bank of England statistics. This reduction has been attributed to a significant slow down in the volume of approvals of unsecured credit (e.g, personal loans) by lenders. Successful credit card applications, for example, were down by 26.2%. Other forms of unsecured lending dropped by 13.2%. The reasons behind the trend are thought to be a lack of appetite for risk on behalf of unsecured lenders. In reality this translates to lenders who are less willing to approve applications where there is any doubt at all over whether a borrower might potentially be able to repay.

Unsecured lenders are becoming more cautious

Whether as a result of a slower economy or a weaker consumer environment, lenders are not as willing as they once were to agree to credit for consumers where there might be some risk. It’s also thought that unsecured lenders – in particular, credit card lenders – are more cautious in the wake of the Financial Conduct Authority’s voiced concerns about credit card debt.

Unsecured consumer lending is the lowest since the recession

In terms of whether this trend is likely to continue it’s worth noting that the availability of unsecured loans to consumers has dropped by the highest rate since the Bank of England’s records began in 2007. Unsecured lending rates have fallen more quickly than at any point since the recession, and this is part of a trend that was also evidenced, and accelerating, back in 2017.

Rates of secured lending are much more stable

According to the Bank of England quarterly credit conditions survey the drop in unsecured lending rates is not being reflected in the secured loans lending sector. In the first quarter of 2018, those lenders that participated in the Bank of England’s survey reported unchanged secured loan availability. Secured credit is lending, such as mortgages, where an asset – such as a property – is provided as security for a loan. Lenders have less risk to bear where there is an asset, which could explain why the secured lending sector has not seen the same change as in unsecured lending.

Default rates for secured lending are lower too

This is a trend that is expected to continue with a reduced number of defaults on lending right across the secured loans sector.

Can you still borrow under these conditions?

Yes. Whether you’re looking for secured or unsecured borrowing, there are still applications being approved by UK lenders. If you’re planning on making an application for either of these types of finance then there are a number of ways in which you can prepare to give yourself the best possible chance of success.

  • Check your credit report. Amend any mistakes, ensure you’re on the electoral roll and make sure your personal information (such as addresses) is up to date. If your credit report is connected to that of another person you once shared a credit account with, but now no longer see, then ask for a notice of disassociation so that their credit behaviour won’t affect your credit score.
  • Pay off other debts first. One of the key factors that lenders will bear in mind is whether a potential borrower already has an unmanageable level of debt. Reducing, or paying off, any existing debt will help to improve your credit score and make you a more attractive lending prospect.
  • Make sure any borrowing you’re applying for is affordable. Affordability is a key criteria in the lending sector today, whether secured or unsecured. When you make an application for a loan or mortgage, calculate how you’re going to handle the repayments and whether you’ll still be able to ensure that your other expenses are covered.
  • Apply for the right loan and to the right lender. Different lenders have different requirements when it comes to approving an application or not. Choosing the right loan product with the lender best suited to you as a borrower can make all the difference.

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How to claim Marriage Tax Allowance to get another £230 per year Tue, 15 May 2018 15:20:16 +0000 Alex Hartley The Marriage Tax Allowance was introduced in April 2015 and is designed to benefit couples who are either married or in a civil partnership. It’s essentially free money and is available even where one partner has passed away – and yet around 1.5 million people in the UK have yet to claim it. Whether it’s a simple reluctance to make a claim for the allowance or a lack of awareness that it’s actually available, if you are married or in a civil partnership and you’re not claiming then you could be losing out on £230 a year. marriage tax allowance

What is the Marriage Tax Allowance?

It essentially allows couples to share a small percentage of their individual personal allowance between them. The tax free allowance is the amount that everyone in the UK is entitled to earn free of tax every year. For the 2017/2018 tax year it is £11,850. Those couples who are entitled to the Marriage Tax Allowance can transfer 10% of the allowance from one partner to the other (£1,190).

Who is entitled to the Marriage Tax Allowance?

It’s available to anyone who was born on or after 6 April 1935 and who is married or in a civil partnership. The allowance is not available to couples who are simple cohabiting. There are two key conditions to note for the Marriage Tax Allowance:

  1. One of the partners in the relationship must be a non-taxpayer. So, their income for the year must be less than the personal allowance.
  2. The other partner in the relationship must be a basic rate taxpayer. The allowance is not available to anyone who is a higher or additional rate taxpayer.

It doesn’t matter if you’re living abroad as long as both partners get a personal allowance. Having a personal pension also won’t affect entitlement to the allowance.

What if one of the partners has died?

As of 29 November 2017, it’s still possible to make a claim for the Marriage Tax Allowance even if one partner in the relationship has died. As long as the above conditions are met it’s highly likely that the claim will be successful.

How do the numbers work?

In total, anyone applying for the Marriage Tax Allowance now could be entitled to up to £900. This is broken down into the allowances over the past four years, as it’s possible to backdate a claim for the Marriage Tax Allowance over this time. In 2015, the allowance was worth £212, in 2016 £220 and in 2017 £230. When added to the £238 for the 2018 tax year the total is £900. Much larger than the average cash loan. And you don’t have to repay it!

How can you apply for Marriage Tax Allowance?

The applications process is fairly simple and you can do this via HMRC. The person who is the non-taxpayer will need to provide a form of ID from the list and both partners will need to be able to access National Insurance numbers. It’s important to note that it’s the non-taxpayer who must make the application, as they are effectively asking HMRC to transfer 10% of their personal allowance to their partner. If the application is made by the taxpayer then this will be the wrong way around and may need to be done again.

The Marriage Tax Allowance – other points to note

  • The allowance will only apply for the years that you’re eligible. So, for example, if one partner’s income goes above the basic rate tax threshold in a tax year then the couple will not be eligible for the allowance in that year.
  • Non-taxpayers come in all shapes and sizes. For example, you could be at home looking after children, working part time, retired, caring for relatives or not currently in work because of your health. As long as your income stays below the correct level of personal allowance you’ll be able to claim.
  • The correct level of personal allowance for non-taxpayers will be 10% below the limit – so, you must have at least a £1,190 difference between your total earnings for the year and the top limit of the personal allowance. If you go over the personal allowance by a little you can still claim but not for the full amount.
  • A successful claim results in HMRC sending out a cheque for the amount. This is processed automatically after the application is made.

Currently, 2.7 million people in the UK benefit from the Marriage Tax Allowance but there are still 1.5 million who are eligible but who haven’t claimed. It’s worth checking to make sure that you’re not missing out on quite a substantial pay out.

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All you need to know about accessing one of the UK’s food banks Fri, 11 May 2018 11:31:55 +0000 Alex Hartley Many columnists and commentators believe that food banks shouldn’t even exist. But, as Guardian columnist Owen Jones wrote recently, “benefit cuts and an unjust social order have left hundreds of thousands hungry in one of the richest countries in the world.” In the UK, the use of food banks has jumped by 52% – we are using them four times as much as we used to. Regardless of where your politics lie in terms of what has caused this situation, it’s clear that more Britons have become more reliant on food handouts. In fact, in 2017, around 1.3 million food parcels were handed out by the Trussell Trust alone. But what are food banks, who benefits from them and how do they actually work?UK food banks

What is a food bank?

Food banks are usually staffed by volunteers and are set up to provide those in need with food essentials. The food that is distributed via food banks comes mostly from donations, often from members of the public. These are collected at donation points around the country, at churches, supermarkets and schools for example. The donations are sorted by volunteers at the food bank and then parcelled up and distributed to those who need them the most.

How do you get access to a food bank?

You need to have a food bank voucher. These are issued by people such as social workers and health visitors as well as staff at schools. They are given to those who are identified as being in a state of crisis and unable to buy these provisions on their own. The food bank voucher entitles anyone with one to three days worth of supplies. Where a voucher hasn’t been automatically given, it’s also possible for those who feel they need access to a specific food bank to start the process.

  • Contact your local food bank. Every food bank will be able to provide a list of referral agencies through which you can obtain a voucher.
  • Contact one of the referral agencies. You will have the opportunity to show why you need help from the food bank and then you will be issued with a food bank voucher.
  • Take the voucher to the local food bank. You will get three days worth of nutritious food, as well as the opportunity to sit down with volunteers and potentially get some advice about your situation.

What does a food bank parcel contain?

This varies but the Trussell Trust, for example, will provide three days’ worth of nutritionally balanced, non-perishable tinned and dried foods. This could include a very wide range of different produce, including cereal, rice, biscuits, UHT milk and fruit juice. Many food banks also provide other items with food parcels, such as essential toiletries and hygiene products. Those who are eligible to receive a food bank parcel will sit down with a volunteer and go through the options in terms of dietary requirements to ensure that none of the food that is handed out goes to waste.

Are food banks purely about the food?

No, many food banks have evolved to provide a helpful infrastructure to those who use them. That could simply be company or someone to listen, as well as directing people in need to the various charities and organisations that might be able to help them.

Who uses food banks the most?

This tends to change annually. However, some statistics from the Trussell Trust from 2016/2017 provide some insight into those who were the most frequent visitors to the food bank during that year. During those 12 months, 39% of visitors to the food banks were single men, 13% were single mums with children, 12% were single women and 9% were couples with dependent children. In that year 87% of those who used the Trussell Trust’s food banks were born in the UK and only 3.7% were asylum seekers.

Why do people need food banks?

Although living on a chronically low income can be a factor in driving people towards using a food bank this is not the only influence. Researchers have found that it’s often some kind of “shock” that ends up pushing an individual or family into a place where a food bank is the only choice. This could be a rent increase, for example, or the removal of a benefit payment. We are using food banks today much more than we ever have before, even in the wake of the lean years of the 2008 financial crisis. In 2010-11, the Trussell Trust gave out 61,500 food parcels but in 2017 this had risen to 1.3 million.

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Could my partner’s credit rating affect my ability to get credit? Wed, 09 May 2018 17:01:04 +0000 Alex Hartley According to the credit ratings agency Experian, one in six people have had their loan prospects harmed as a result of someone else’s credit report. The research revealed that a partner – or ex partner – who has a bad credit history could have a serious impact when it comes to applying for credit. From former spouses through to university housemates, there are many people who come into – and out of – your life who have the potential to make getting credit more difficult.your partner affect your credit rating

Who could adversely affect your ability to get credit?

Anyone with whom you have shared a credit account in the past. For many people that’s an ex partner or spouse but it could also be a housemate or a sibling.

How does someone else’s credit score affect your own?

If you have formerly shared the responsibility for some credit with someone then you will continue to share a link when it comes to credit information too. Joint financial activity will mean that your credit file becomes associated with that of another person. As a result, when you make an application for a loan/credit, the lender will have the option to look at your credit history and also at the credit report of the person you have become associated with.

Does your credit file contain their credit information?

No. When a lender makes a search of the credit file they will see only the information that relates to that particular person. However, there will also be a note that indicates there is another credit file connected to this one. So, a lender can also go and retrieve the financial information of the associated file. If it’s information that flags up a potential risk to the lender (for example, missed debt repayments) then there could be some hesitation when it comes to lending to the original applicant.

What can you do to protect yourself?

Experian research also found that one in three people now rate being good with money above good looks when it comes to finding a potential partner. This focus on financial dexterity is a sensible place to start when it comes to avoiding a situation where your credit history is being adversely affected by a partner or an ex partner. But there’s also a lot more that you can do, including:

  • Have a frank conversation about cash. The earlier you do this, the better for the relationship and for your own financial future. Establishing financial compatibility can not only help to avoid a negative credit situation in future but could be the key to working towards a relationship that helps you reach your own money goals.
  • Make sure you know exactly how and when your credit report could become linked to that of another person. Everything, from applying for a mortgage with a partner through to setting up a joint account with a sibling you’re sharing a home with could create financial association. If you’re not sure whether that’s going to be the case then ask before you sign anything.
  • Swap your credit scores. It may seem like pretty personal information but honesty is the basis to any good relationship and secrets tend to cause issues, especially when it comes to money. So, swap your credit scores early on so you can see whether this person is a good match for you financially or whether there is something in their credit history that means there could be a potential problem in future.
  • Act quickly when a relationship breaks down. Although it can be an emotional time it’s important to protect yourself financially. For example, you will need to start monitoring transactions closely in any shared accounts to ensure that payments aren’t being made or cash withdrawn without your knowledge. It is also a good idea to settle any outstanding joint debts that you have as quickly as you can, where possible so that there are no remaining ties.
  • Break your financial connections ASAP. You can apply to each credit agency for an official notice of disassociation that will cut the financial tie between you and whoever else you may have once shared a credit account with. This will ensure that, in the eyes of any lender you make an application to, your credit report is not linked to anyone else’s.

Having a different credit rating to your partner doesn’t have to mean the end of the world for your relationship. It’s important to be honest and open about where you are financially to lay the foundations for making things work. And, if things come to an end, to ensure that you can both go your separate ways unencumbered.

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The top 10 pieces of money advice every young person should know Mon, 07 May 2018 09:59:09 +0000 Alex Hartley Financial management tends not to be a life goal for anyone under the age of 25. However, it’s often before this point in life that you can have considerable influence over what your financial circumstances aged 30+ are most likely to be. With that in mind, these are the top 10 pieces of money management advice that every young person should hear as early in life as 10 money management tips

The Top 10 Tips


  1. Saving is boring – but essential. Saving is the key to the door of financial success and the earlier you get used to putting 10% (or so) of your income into savings each month, the more you can build up. Savings will enable all the fun things in life, such as holidays and shopping, as well as the serious stuff like a mortgage and starting your own business.
  2. Learn how to budget now. Budgeting is just the balancing of incomings and outgoings and ensuring you’re not spending more than you have. It will become a crucial skill as soon as you leave home. If you haven’t acquired it by the time you graduate then you could easily get into trouble with debt and meeting further life goals could be difficult.
  3. It’s never too early to save for retirement. The amount of cash required for a comfortable retirement these days is up in the six to seven figures. So, it’s a huge mistake to leave saving for retirement up until the years when you can actually see it on the horizon. Start saving early and save small so that you gradually build up a retirement fund that gives you security and freedom.
  4. Set some financial goals. More realistic than “I’d like to retire at 30” but more ambitious than “I just don’t want to get into debt,” good financial goals can help to motivate and inspire you onto better things. Financial goals could be anything, from being able to take two years off work to travel, to embarking on a freelance career, getting married, having children or buying your own home. Clear financial goals will help you to create a money roadmap.
  5. Pay off your credit cards at the end of each month. Or, if you can’t do this, at least limit the number of cards that you have and try to keep the balances as low as possible. Credit cards can be a really useful option for paying for large purchases and many offer attractive benefits, such as accumulating air miles. However, they need to be carefully managed so that you don’t end up paying too much interest.
  6. Be aware of your credit report. As early as possible, take a look at your credit report and begin analysing what factors affect the view a future lender might potentially take. For example, you might need to pay off debt to improve a credit score and if you’re not on the electoral roll then your score will drop right down.
  7. Learn how to live within your means. Budgeting is the first step towards living within your means but there is more to it than that. As early as you can, start acquiring the skills that enable you to live lean when times are tight, from shopping second hand to learning how to managing food shopping and preparation so that you’re nutritiously fed without spending a fortune.
  8. Have a rainy day fund. This is money that you set aside to cover life’s little emergencies, from a broken boiler through to paying the excess on your car insurance. Life is a lot easier if you have a financial safety net so it’s worth working to create this as early as possible in life.
  9. Work out what you’re good at. If you do what you love then you’ll never work a day in your life – or at least that will be how it feels if you genuinely enjoy what you do. Plenty of people take jobs for the salary that comes with them and are perfectly happy. However, ultimately, you might find that you’re more financially successful if you’re doing something you’re genuinely good at and really enjoy.
  10. Investing doesn’t have to be risky. You can put your money into all sorts of places to help it grow, from tax free ISAs through to investing in stocks and shares. Investing in stocks and shares tends to generate the highest returns but also comes with the most risk – you could lose it all. However, if you start with small investments and learn as you go, there is a lot of potential to make more money.


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Act now! The era of the very low mortgage rate is coming to an end Fri, 04 May 2018 10:24:32 +0000 Alex Hartley Mortgage opportunities have changed significantly since the start of the financial crisis in 2008. It’s now much more difficult to pass affordability criteria and mortgage lenders are much less likely to offer the most attractive deals to all but the most appealing buyers. So, for the majority of those trying to get onto – or move up – the property ladder, mortgage deals are not what they once were. This is particularly evident when it comes to the most popular mortgage deals.low cost mortgages

An increase in the cost of the best deals

As lenders look ahead to a potential interest rate increase, many have already increased the cost of a mortgage. As a result, the most popular mortgage deals are now the most expensive they have been for two years. The Bank of England last increased the base rate in November 2017. While it was a small increase of just 0.25% it was the first time that the rate had been put up for a decade. And the Bank of England warned that the rate increases were not likely to stop there with two further rate rises over the next three years according to the Bank of England governor Mark Carney. It’s because of this 2017 increase – and the potential for a further rate rise – that the cost of a mortgage continues upwards. In fact, between March 2018 and April 2018, the average mortgage rate has gone up by 0.25 percentage points.

What is the average increase in the cost of a mortgage now?

For a typical mortgage of £175,000 it now costs £44 more a month than it did to borrow last autumn around the time when the Bank of England raised the base rate. In May, many financial commentators are expecting that the next of the two rate rises will be announced by the Bank of England, taking the base rate from 0.5% to 0.75%. And it’s because of this that mortgage costs have started to spike upwards once again. However, research from uSwitch found that lenders have actually been increasing the cost of their mortgages for some time and not just in the run up to anticipation of the latest Bank of England announcement. Barclays, for example, has changed the rate on around 60 products already.

How can you protect against the increasing cost of a mortgage?

The short answer is that you can’t. At least not forever. In the short term, locking in a fixed rate mortgage for a period of years will provide some certainty to homeowners who don’t want to find that their rates suddenly shoot up. This is what happened around the time of the first Bank of England rate rise back in November 2017 when there was a significant flurry of people who opted for fixed rate mortgages to try and ensure that they secured a lower rate for a specific period of time.

What are the benefits of a fixed rate mortgage?

Currently, many people are being urged to opt for a fixed rate mortgage as a result of the speculation that interest rates are heading upwards. The major benefit of a fixed rate mortgage is that, whatever happens to the interest rate, the mortgage payments will remain the same for a homeowner with a fixed rate mortgage. This makes the payments due much more predictable and makes it easier to manage the debt. Fixed rate mortgages for five years used to be an incredibly popular option – however, it’s the two year fixed rate that is starting to gain increasing popularity. Two year fixed rates tend to offer a better deal than a longer period and are also more flexible. In particular, for new homeowners, after two years, having paid down a proportion of the capital in the property better deals are likely to be available.

Mortgages for first time buyers

If you don’t yet have a foot on the property ladder then the prospect of mortgages getting more expensive can be intimidating but there is always something you can do to ensure that they remain accessible to you.

  • Look into Help to Buy. The government provides a 20% equity loan that will enable you borrow just 75% from a mortgage lender with a 5% deposit so you’re a more attractive lending prospect.
  • Accumulate a sizeable deposit. The more deposit you have, the smaller the mortgage you will need and so the more attractive the rate available to you is likely to be.
  • Keep an eye on your credit report. Positive factors in your credit report will contribute to your chances of getting a mortgage, and at a more attractive rate.

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7 Things about Debt you ought to know! Wed, 02 May 2018 15:07:06 +0000 Alex Hartley Debt is part of life in the UK. From managing student loans through to getting a mortgage, almost all of us will take on a debt at some point in our lives. However, despite the fact that debt is so commonly used in the UK we are never taught how to deal with it. There are no lessons in handling debt at school and many parents don’t pass on this kind of information to their children. As a result, there are many things that you simply may not know about debt, even if you should. burden of debt

  1. The debt burden in the UK is huge

As of autumn 2017, the average UK debt stood at £8,000 per person. This figure was worked out on the basis of unsecured debt, such as credit cards and personal loans and does not include mortgages. Research from established that 62% of Britons were worried about the level of personal debt that they had accrued and 6 million Britons didn’t believe that they would ever get to a position in life where they were debt free. So, the use of debt is widespread in the UK and not everyone is comfortable with it.

  1. Student debt is slightly different

Student loan terms are probably the most attractive you will ever be offered for debt. Low-ish interest rates and long repayment terms are made available to students and this isn’t often the case out in the wider world. For example, you don’t need to start repaying student debt until you’re earning at least £25,000 and after 30 years any remaining debt is written off. Whether it makes sense to pay your student loan off early is debatable and depends on your personal situation.

  1. Those with mental health issues are much more likely to struggle with debt

The Money and Mental Health Policy institute, set up by Money Saving Expert Martin Lewis, found that people who have mental health issues are three times more likely to be in trouble with debt and struggling financially. This could be anything, from depression through to anxiety. Worryingly, debt and mental health issues tend to feed each other and can create a vicious circle from which it’s difficult to escape.

  1. There’s no such thing as free money

Credit cards and overdrafts can seem like free money, especially if they’re offered at a time when their rates are low and there are no fees attached e.g. when you’re a student. However, these attractive student rates are often quickly converted as soon as graduation takes place and the costs kick in. If you haven’t cleared balances before that point then the costs can soon mount up.

  1. Creditors prefer communication when people are struggling

When you get into debt then you owe money to a creditor, such as a credit card provider or personal loans lender. If it looks like you’re not going to be able to meet the regular payments agreed then most lenders are much more appreciative of borrowers who give them a heads up first. So, if you’re about to miss this month’s credit card payment it’s always worth contacting the lender first. Most lenders will want to work out a way to help you out of trouble so that what you owe them eventually gets paid off. UK Finance, the organisation that represents banks and lenders, suggests for example a 30 day breathing space to borrowers who are in trouble.

  1. More and more people are getting into trouble with debt

Charities like StepChange are getting increasing numbers of requests for help from those who are not coping with their debts, especially from younger people. In 2017, the 340,000 people who contacted the charity looking for advice had a grand total of around £4.5 billion in unsecured debt between them. As interest rates go up, wage rises remain sluggish and the cost of living rises, experts have predicted that getting in to trouble with debt is highly likely to become more and more common.

  1. Debt problems can have a broad influence

For example, although debt is often offered cheaply to students, if it is not paid back before graduation this can often have an impact on your credit score. Credit cards and personal loans where there have been defaults or missing payments could make it difficult to get new credit – such as a mortgage – in the future. Debt problems that spiral tend to bring default fees and more interest payments, which can make budgeting even more challenging. And problems with debt could affect your mental health to the point at which it’s difficult to concentrate or work. So, debt problems aren’t just about not being able to make a repayment, they can affect your life in a much broader way.

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All you need to know about the Lifetime ISA (LISA) Mon, 30 Apr 2018 10:20:09 +0000 Alex Hartley The Lifetime ISA was launched in 2017 and offers savers the opportunity to put away up to £4,000 a year between the ages of 18 and 50. It’s a rather different type of savings vehicle, as the money saved must be for one of two purposes: either for retirement or the purchase of a first home. Although the Lifetime ISA has stayed under the radar as a savings option it still has a lot to offer in terms of benefits.Lifetime ISA

What is the Lifetime ISA?

It’s a savings vehicle that was designed to provide an opportunity for anyone to save in a tax efficient way. The big draw of the Lifetime ISA is the fact that the government will top up whatever is saved in it by 25% – up to a maximum of £1,000 a year.

How to save with a Lifetime ISA

You can put up to £4,000 a year into a Lifetime ISA, either paying this is as a lump sum, or as and when you can. The 25% bonus added by the government is paid into the ISA once a year. So, if you save £4,000 a year then you will have £5,000 a year after the government’s 25% has been added. Once the 25% bonus is in your Lifetime ISA account then you will be able to earn interest on what you’ve saved and also on the bonus – at the rate that the account offers. Your LISA can contain both cash and stocks/shares and the proportion you choose of each will depend on your attitude to risk.

Lifetime ISA restrictions

There are two key restrictions to note when it comes to the Lifetime ISA. The first is the age limit. You must be at least 18 to open a Lifetime ISA and you must be under the age of 40. So, this is not a savings product that is open to everyone. The reason for the upper age limit is that you can only put cash into your Lifetime ISA up until the age of 50.

The second important restriction to note with a lifetime ISA is how the money you save can be used. You must use the savings in the ISA to buy your first home or to help pay for retirement. If you plan to use the money for other purposes then there is a 25% charge applied to the savings when you withdraw them from the ISA. Effectively, this means that you will lose the 25% bonus that the government has added to your saved cash. However, the way that the numbers work out mean that you will also lose some of your own savings if you use what you have in a Lifetime ISA for other purposes. For example, if you have saved £4,000 in one year and receive the £1,000 bonus from the government, 25% of £5,000 is £1,250. So, if you were to then withdraw the cash for other purposes you would lose the £1,000 from the government plus £250 of what you had saved. You can only avoid this charge if you withdraw the money from your Lifetime ISA:

  • Once you are over the age of 60
  • In order to buy your first home
  • If you are terminally ill and have less than 12 months to live

When are Lifetime ISAs a good idea?

  • For young property savers. If you’re young and keen to start saving for your first home then a Lifetime ISA could be an important first step towards a deposit. Any property must cost £450,000 or less and you can’t buy within 12 months of opening a Lifetime ISA if you want to use the money you’ve saved in it.
  • For couples looking to buy. If you both have a Lifetime ISA you can both use the 25% bonus to help you save enough to buy your first home.
  • For freelancers. If you work for yourself and don’t have a company pension scheme to rely on, the Lifetime ISA is an efficient way to put cash aside – with that 25% bonus on top.
  • For anyone without retirement savings. Although you can only put money into a Lifetime ISA until the age of 50, if you don’t yet have retirement savings, this is an easy way to top up by 25% a year. However, it’s not recommended to rely solely on a Lifetime ISA, as a personal pension will probably create a larger return and more sizeable pension pot.
  • For those looking for low risk savings. Lifetime ISAs don’t offer large returns but neither are they high risk – this is a slow, steady and reliable way to build up cash.

Who offers a Lifetime ISA?

Currently, there are not that many Lifetime ISAs available and the only provider offering a cash Lifetime ISA is The Skipton Building Society. The interest rate offered is fairly low but it’s the 25% government bonus that will be the real appeal for most people.

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Update on the FCA’s review of motor car finance deals Fri, 27 Apr 2018 10:39:08 +0000 Alex Hartley The review of car finance being carried out by the Financial Conduct Authority (FCA) began in July 2017. The motivation behind it was to ensure that the market for motor finance – which has experienced an enormous boom – was/is a safe one for consumers. The use of car finance agreements has almost doubled in the past decade. In 2008, the number in use was 1.2 million and by 2017 this had risen to 2.3 million, making car finance a very sizeable part of the finance market. Given this vast escalation in use, as well as some consumer horror stories that emerged at the time, the FCA began looking into whether the industry presented a risk of harm to consumers.motor car finance review

The FCA’s findings

The latest review from the FCA on the car finance industry was presented in March of this year. Despite the fact that many were expecting the FCA to find a broken market in danger of capsizing, so far that doesn’t seem to have been the case.

Where has the growth in the take up of car finance come from?

The FCA found that the strongest rates of growth were among consumers who had better credit ratings, as opposed to those who were struggling to get other types of finance. So, it’s generally people with higher credit scores who are driving the increase in the volume of car finance. The review so far has also found that the market is a relatively stable one and that the level of arrears and defaults has remained fairly low. However, there is also evidence that defaults and arrears for consumers with the lowest credit scores are somewhat higher.

What about the risks we’ve seen from the severe drop in the prices of used cars?

Surprisingly, the FCA review found that lenders were managing this fairly well. When presented with the issue of lower prices of used cars and the impact this could potentially have on the fact that car finance firms are dealing with large numbers of used cars being returned to them at the end of a car finance plan, the FCA research found these firms were coping well. Prudent measures were in place to manage how much the car would be worth in the future and most firms had robust asset valuations and risk management processes.

Are issues with car finance related to problems with any other type of finance?

Not according to the FCA review. In fact, there is no significant relationship between those who get into financial trouble with a car finance agreement and falling foul of other types of consumer credit products. So, there is no domino effect disaster waiting to happen.

Do car finance providers deal transparently with consumers?

According to the FCA review, on the whole, the answer is a resounding “yes.” The contracts that are used for car finance were found by the FCA to be transparent and simple to understand. Similarly, the language used on websites – and in communications with consumers was the same, as well as being consistent and straightforward right across the information provided.

So, what did the FCA decide overall?

It seems that the FCA believes that the car finance market is generally working well in the interests of consumers. It was found to be well structured and to involve balanced risks that those within the market are aware of. However, the FCA review is not yet complete and there are some issues that the regulator felt were worthy of closer examination. These include whether there is a potential conflict of interest in some car finance commission agreements where incentives are given to brokers if they arrange the finance at a higher rate for the consumer.

What’s likely to happen next?

The FCA has outlined a number of specific steps it plans to take, including:

  • Staging a mystery shopping exercise. The point of this will be to clarify whether enough information is given to consumers and to ensure that it is clear about the options and risks involved.
  • Affordability checks. This will be mostly aimed at those with lower credit scores and what kind of information a lender might be able to use to check whether someone in that category can genuinely afford the repayments.
  • Commissions and incentives. The FCA will be looking further into the incentives that some brokers receive for arranging higher rates, as well as what the difference is between highest and lowest rates and whether this is potentially harmful to consumers.

The review by the FCA is scheduled to be completed in September 2018.

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Looming changes to privacy legislation – how so-called GDPR will affect you Wed, 25 Apr 2018 10:53:56 +0000 Alex Hartley On 25th May this year the General Data Protection Regulation (GDPR) will come into force in the UK. This marks a seismic shift in the landscape of individual data protection and has been designed to give consumers more control over their information. It will mean that individuals have a lot more rights when it comes to how their information is collected and used – and it also requires any business that is using individual data to ensure that its processes are compliant. But what does this actually mean for customers who disclose personal data – and for the businesses that want to work with it?

GDPR General Data Protection Regulation

What does GDPR mean for business?

Rather worryingly, the Federation of Small businesses conducted a survey of its members and identified that only around 8% of them feel ready for changes. In addition, only a third had begun to put measures into place to ensure GDPR compliance. Many said that they simply didn’t understand what was required of them and that the scope of the GDPR is so broad that it could cost up to £10,000 to make the required changes. However, the new rules introduced by the GDPR don’t just set a new standard of data protection they also usher in a new era of enforcement too. Any business, no matter how small, that isn’t GDPR compliant could face fines of up to €20 million or 4% of turnover. So, what are the key areas of the GDPR that businesses need to note?

  • The need for better consent. The GDPR requires that businesses have user consent in order to store details and data about them. This consent must be clear, well informed and unambiguous, as well as given by affirmative action. That means that it’s no longer acceptable to scrape data from websites or to pre-tick consent boxes.
  • Consumers can revoke consent at any time. Where a user revokes the consent they have given to a business to use and store their data this needs to be actioned in a timely way, which could present a significant issue for businesses that just don’t have the systems in place to do this.
  • Buying marketing lists is no longer an option. Compliance with the GDPR presents big challenges for businesses looking to market to a new audience because cold calls and buying marketing lists will mostly be unacceptable. Instead, it will be necessary to establish that the consumer really wants to hear from the business and what it is that they want to hear about.
  • Data security now needs to be inbuilt. There are many new provisions that apply to the security of data that is in the hands of a business. Perhaps one of the most potentially problematic is the requirement to notify if there has been a security breach. Now, businesses have just 72 hours to do this. The very public nature of notification could create some real issues for small businesses reliant on customer trust to grow.

What does GDPR mean for consumers?

Particularly in the light of the recent Facebook and Cambridge Analytica scandal, there is a lot of focus right now on what happens to consumer data after we hand it over. But what is the GDPR really likely to change for consumers?

  1. The right to be forgotten. Consumers who don’t want a particular business to continue to have information about them can ask for all of it to be deleted.
  2. More privacy transparency. For example, businesses can no longer use complex and hidden privacy notices to bamboozle customers about what really happens to their data, as the GDPR requires that it’s all set out clearly and simply in black and white.
  3. The right to access data. Consumers can request that a company reveal all the information that they hold on that individual. This used to be something that businesses charged for but with the GDPR it’s an action that will have to be completed for free.
  4. The right to object. Consumers will have more right to object to their data being used for direct marketing – and this is something that the businesses using the data have to highlight to their customers.
  5. The necessity of opting-in to communications. Because there are new and much stricter requirements for businesses to obtain proactive consent from consumers to communications, this should reduce the amount of unwanted communication received. Once the GDPR is in place businesses won’t be able to add customers to a mailing list just because they make a purchase, for example, unless there has been explicit and specific consent.

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7 low cost collectibles that could make a future fortune! Mon, 23 Apr 2018 10:40:26 +0000 Alex Hartley It is the dream for any hoarder – all of those erasers or comics that you’ve been collecting for years are actually worth a fortune. For most of us our low value collectibles turn out to be just that: not worth very much. However, there are some items that, even if you haven’t started collecting them already, could be a wise investment now – because they’ll make you a fortune in the future.collectibles

Low cost collectibles that could be high value items

Collectibles can be very subjective – it all depends on whether you can find the right buyer who wants to pay the right price for what you’ve collected. However, there are some categories of collectibles that have a better chance than most of making you a fortune in the long run.

  1. Pop memorabilia. Music memorabilia has always had a great deal of value and now is the time to begin drawing together, and adding to, anything you have from the 1980s onwards – the era when pop music began to explode. It’s amazing what people will pay for unique items of pop memorabilia so don’t be put off if at first you think what you have is of no value. For example, a single set list from a Nirvana gig sold for $8,750 at auction because it had been scribbled on by Kurt Cobain.
  2. First edition books. This doesn’t have to be vintage books (although they do tend to be very valuable) but could be modern classics too – first editions of the Harry Potter books, for example, can go for five figures. The general rule though is that the longer you hold on to them the more likely they are to increase in value.
  3. Childhood toys. There is a big market for childhood toys now, mainly driven by the nostalgia factor and people looking back at what they used to play with. If you’ve been collecting Micro Machines since the 1980s, for example, you could find yourself with high value spoils on your hands. To the right collector, the right Micro Machines model could go for anywhere up to £200.
  4. Star Wars stuff. The older collectibles and figurines tend to fetch the highest prices right now but Star Wars collectibles from recent films, especially the limited edition pieces, are unlikely to lose their value. The rarer the figurines, the more they tend to fetch. So, if you have Star Wars figures and you’re not sure whether they’re worth anything it’s important to check first so that you don’t end up accepting less for them.
  5. Comic books. Comics are some of the most collectible items around and those that can often generate the most impressive financial return. If you’re looking to invest in comics that really might make you a fortune then it’s those that date back beyond 30-40 years that have the really high price tags.
  6. Old coins. Maybe you inherited a stack of old coins from a relative or perhaps you’ve been a serious collector for some time. Coins can be worth a lot more than their face value if they are unusual or out of commission. The rarest coins fetch the most cash but you might also see the value of your collection swell with rare, commemorative or limited editions.
  7. It’s often difficult to put a value on a collection of stamps – even some of the oldest ones may not be worth that much other than to a nostalgic collector. However, it is always a good idea to get a valuer to look at the stamps you have in case the collection contains some rare ones. A Penny Black, for example (the world’s first adhesive stamp) could fetch many thousands of pounds if it still has the original gum and the right margins.

Some sage advice on collecting collectibles

  • Choose something that you love, not just items that you think are likely to make you money. That way if it turns out that you have nothing but boxes full of old comics, as opposed to a priceless find, then you’ll still get some pleasure from them.
  • If you’re doing this purely to make money then choose wisely. You need to make sure that whatever you’re going to spend money collecting will guarantee you a return. Do your research online, check out auction sales and look at what other collectors have received for similar items.
  • Start with what you already have. If you have a box of old Bratz dolls or a bunch of first edition board games then build on what you’ve already got rather than starting completely fresh.

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The psychology of money in our pursuit of happiness Fri, 20 Apr 2018 11:45:16 +0000 Alex Hartley Does money make us happy? The obvious answer to this is “no.” There are plenty of examples of people who have had lots of it and yet been miserable. However, the flip side of the argument is that a lack of it – or difficulties with it – can make life very difficult. So, where does money fit in terms of our overall state of happiness in life and how can you achieve financial well-being?financial well-being

The psychology of money

Looking deeply into the psychology of money tends to reveal that we’re all very different when it comes to how we cope with our cash. However, there are some general themes and personality types that can provide some helpful insight into the ways that we think about money. For example, many of us find delaying gratification very difficult but it can mean better results in the long run. A famous 1960s test – the Stanford marshmallow experiment – gave children the choice of eating a marshmallow straight away or waiting and getting two as a reward for delaying gratification. The children who were able to wait had better life outcomes in follow up studies. However, it’s difficult to wait, especially as we live in an era when everything is instantly available. Spending hits all the pleasure zones in the brain – saving does not – and, as many of us have trouble visualising our future selves, saving feels like giving money to a stranger!

The financial personality types

Sometimes, getting to grips with the psychology of money can be assisted by working out whether you fall into a specific financial personality type. For example:

  • The Hoarder – a cash saver who is to fearful of letting go of money saved to invest. Would benefit from releasing some cash to invest it and generate more.
  • The Social Value Spender – spending money generates warm and fuzzy feelings for this person, as well as gratitude from others. It’s important to stop impulse spending and keep an eye on debts if this is you.
  • The Cash Splasher – using money to make people think more highly of them, Cash Splashers will benefit from finding other ways to achieve contentment and cement relationships.
  • The Ostrich – avoiding bills, refusing to talk about debts and just wishing it would all go away. This personality type benefits from facing up to things and getting organised but taking small steps to get there.

The objectives of financial well-being

Whatever financial personality type you might fall into there are many different ways to define financial well-being. Some, for example, would focus on low debt and high net worth as being the ideal combination of factors to achieve it. The US Consumer Financial Protection Bureau defines it as “a state of being wherein a person can fully meet current and ongoing financial obligations, can feel secure in their financial future and is able to make choices that allow enjoyment of life.” It might mean something subtly different to everyone but, overall, it’s generally being able to use the money you have to enjoy your life and not having to worry too much about a lack of it. Whatever it means to you, most people’s financial well-being objectives will include:

  • Being able to absorb a life event that causes a financial shock
  • Being in control of budgets and finances, daily, weekly and monthly
  • Having a degree of financial freedom so you can make choices
  • Being able to set financial goals and move towards them

Taking steps towards financial well-being

  • Start saving. In 2017, Brits struggled to save even 4.6% of their income and yet this is one of the fastest routes to a sense of financial wellbeing and well worth doing.
  • Change your mindset. Start viewing saving as a gift to your future self and/or future family, as opposed to giving money to a stranger.
  • Review what goes out of your account already. One in eight people are currently paying for subscriptions they don’t use, for example.
  • Use savings tools. There are lots of different tools out there to help you track your saving and spending, and visualise your progress.
  • Get organised with your important payments. Make sure these leave your account as soon as you’ve been paid. That way you’ll know how much of your cash is left to spend.
  • Be firm about saving. Set up a standing order that leaves your account for a separate savings account at the same time as all other important payments.
  • Shop around for the best deals. Find the lowest costs and highest savings rates to make the most of the cash that you have.

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How to stay safe and spend wisely if considering cosmetic surgery Wed, 18 Apr 2018 11:12:26 +0000 Alex Hartley According to data from the British Association of Aesthetic Plastic Surgeons (BAAPS), the number of cosmetic surgery procedures fell 40% in 2016. The reason? Many more “relatable” celebrities who are seemingly at home with their flaws. However, for many people cosmetic surgery remains a very attractive option, whether you’re considering a full procedure or a tweak like botox. If you’re keen to have cosmetic surgery, it’s important to make sure that you have all the facts – to ensure you don’t pay more than you need to, and to stay safe. cosmetic surgery

Cosmetic surgery – the options

If you’re looking at cosmetic surgery then there are two broad categories: surgical and non-surgical procedures. Non-surgical procedures are generally less invasive and are unlikely to require anaesthetic or a hospital stay. Surgical procedures are much more of a commitment. These are some common examples of the two:

Surgical procedures: breast enlargement/reduction, breast augmentation, tummy tuck, ear correction surgery, liposuction, hair transplant, eyelid surgery, facelift, labiaplasty, a nose job or surgical fat transfer.

Non-surgical procedures: botox, dermal fillers, microdermabraison, chemical peels, laser hair removal, skin lightening, tattoo removal or permanent make up.

The cost of cosmetic surgery

Some cosmetic surgery is available on the NHS, which means that there will be no cost to you. However, this is becoming increasingly unusual and generally requires a broader motivation than simply wanting to have fewer wrinkles or a smaller nose. Costs for cosmetic surgery can vary significantly, depending on where you are in the UK and the type of clinic that you choose. Research carried out by Private Health UK identified these average costs for some common surgical cosmetic surgery procedures in the UK:

  • Facelift – £6,156
  • Breast enlargement – £4,610
  • Eyelid reduction – £3,113
  • Liposuction – £3,507
  • A tummy tuck – £5,685
  • Nose reshaping – £4,235

All of these procedures are costly and we are aware of a constant flow of people wanting to borrow to pay for cosmetic surgery.

Non-surgical procedures tend to be much cheaper and are much more accessible. Often, this is because they are administered by beauty therapists and not by doctors, nurses or trained clinicians. If you’re looking at non-surgical cosmetic surgery then these are some of the most common procedures, as well as the potential costs involved, according to the NHS:

  • Dermal fillers – £150 to £300 per session
  • Botox – £150-£350 per session, depending on the amount of product used
  • Chemical peels – £60 – £500, depending on the depth of the peel
  • Microdermabrasion – £60 – £80 per session
  • Laser hair removal – £40 – £400
  • Tattoo removal – £150 – £800, depending on the size of the tattoo

Where to get cosmetic surgery, the UK or abroad?

For anyone looking at either surgical or non-surgical procedures the choice of where to get the cosmetic surgery is often based on cost. Many people become cosmetic surgery tourists, travelling to other locations in order to access cheaper plastic surgery. And this is often worth it, as it’s possible to save around 60% on the cost of cosmetic surgery by choosing to go to somewhere outside the UK. The idea also appeals to many people because of the privacy element involved – the surgery can be scheduled into a holiday and no one needs to know. If you’re considering cosmetic surgery abroad then the NHS has these tips:

  • Find out how doctors and clinics are regulated in the country you’re thinking of, as well as how standards are enforced.
  • If you can’t establish that a surgeon is fully trained then it may be better to go elsewhere.
  • Make sure the surgeon speaks English so everything can be explained to you.
  • Look for feedback on the clinic and the service – social media can be a useful tool here.
  • What happens if things go wrong? Find out what insurance the clinic has and what local hospitals are like if there is a problem.
  • Look into aftercare – how will this be administered?

Cosmetic surgery – how to stay safe

There are always risks to any kind of surgery or operation and accepting these is part of the process of determining whether you’re ready for cosmetic surgery. There are also some key steps to take if you want to stay safe.

  • Check the surgeon’s registration status – you can do this online with the General Medical Council.
  • Consult the Joint Council for Cosmetic Practitioners register – this is a new register aimed at those carrying out non-surgical procedures, such as botox and fillers. Currently, no qualifications are required to administer non-surgical procedures but anyone on this register must have had approved training.
  • If you’re having a surgical procedure then make sure the person who advises you about it is the person who will actually do the surgery.
  • Find out whether the clinic has insurance coverage in the event that anything should go wrong.
  • Check that the clinic is registered with the Care Quality Commission (the independent regulator of health services in England).
  • Visit the clinic and ask questions – for example, what kind of aftercare is there, what are the total costs involved and what happens if something goes wrong?
  • Search for feedback and reviews – many people who have had a bad experience with a surgeon or beauty therapist go online to share it. Search social media, Google and chat rooms and forums to see what you can find.

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What happens if you get into loan repayment arrears? Mon, 16 Apr 2018 10:20:15 +0000 Alex Hartley A 2017 survey carried out by the Bank of England found the highest numbers of customers defaulting on loan repayments since the beginning of the financial crisis. This is a worrying statistic for both credit providers and consumers. It also means that, for many borrowers, being aware of how a potential arrears situation could arise – what the implications are and how to deal with it – could be essential knowledge.repayment arrears

How do loan arrears arise?

If you miss a repayment on a personal loan then you will find yourself in arrears. There could be any number of reasons for this, for example you may lose your job or experience a change in lifestyle that means you have less disposable income. You could even just have a single month of poor budgeting. However it happens the results will be the same – you will be considered behind with your personal loan payments.

What’s the difference between arrears and default?

These are two separate stages in the process of failing to make payments on a personal loan. The arrears letter is usually the first stage in the process. This will act as a way of notifying you that you have missed a repayment, or repayments, on your personal loan. The letter will usually set out the date of the missed payment, as well as the amount and what you need to do to rectify the situation. A default means that the lender has reached the stage of assuming that the lending agreement you both signed up to is now breached. Defaulting on a payment is more serious than simply being arrears, which can be rectified simply by paying off what you owe, which may be just one or two payments. When a default occurs the credit provider can take more significant action, including requiring the entire loan to be repaid or taking legal steps. The presence of arrears of defaults on your credit file will lead to you having a so-called “bad credit history” with all that that implies in terms of obtaining further loans & credit.

How to deal with loan repayment arrears

If you get an arrears letter in the post from a lender you’ve borrowed from then the most important thing is to take action as soon as you can. Although loan arrears will likely show up on your credit report, if you can remedy the situation quickly then you’ll be able to prevent serious damage. Contact the lender and let them know why you have missed the payments that were due. In most cases, lenders are keen to ensure that borrowers keep making repayments. So, if there is another way to enable you to do this, such as lengthening the term of the loan, they may be willing to help you out.

What happens in a default situation

Default situations tend not to occur straight away. If you’ve missed three to six payments then you could end up on the receiving end of a default letter but not usually before this point. Defaults can only be issued for debts that are covered by the Consumer Credit Act (this will include most personal loans) and it’s important to note that you’re required to be notified of the default in writing. You can still stop a default situation from escalating, even after you have received a default notice. The first thing to do is contact the lender and explain your situation – you may want to try making suggestions about how it could best be resolved to see if the lender agrees to help you. However, once you get into a default situation it’s not possible to escape the fact that this will leave a mark on your credit report. In fact, a default stays in your credit history for six years after it happens. During that time your credit score will be lower and you may find it tougher to take out any new credit.

What to do if you think you’re heading into arrears or default

  • Assess the situation. Work out exactly how much you owe and why this has happened. Look for opportunities to make up the arrears or default – prioritise this over other spending if you have to.
  • Speak to the lender involved. Most lenders appreciate being contacted before they have to go to the trouble of sending out an arrears or default letter and may be more willing to help you restructure your lending so that it becomes more affordable.
  • Look for specialist debt advice. If you’re really struggling with your debts and can’t see a way to pay what you owe it’s always worth speaking to the experts. A debt specialist will be able to assess your situation with an experienced eye and make suggestions for solutions, as well as providing reassurance that there is always something you can do.

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How to find your next job in a rapidly interconnecting world Fri, 13 Apr 2018 10:47:47 +0000 Alex Hartley As of December 2017, UK employment figures had dropped by 56,000. This caused many economists to start warning that the UK jobs market had peaked. However, with unemployment remaining at record low levels and the jobs market itself diversifying thanks to the influence of tech and globalisation there is still a lot to be positive about. So, if you’re currently looking for a new role then it’s still possible to find your dream job. You may just have to make some adjustments in the way that you go looking for it.finding your next job

Networking has changed

Networking is a tried and tested way to help find new job opportunities. From being the first to know about a role not yet advertised, to being headhunted by someone you’ve met during a networking event, there are lots of ways in which it is possible to positively influence a job search by time invested in networking. However, networking today needs to be a balance of online and offline activity. Social networking via platforms such as LinkedIn and Twitter can be just as valuable in terms of extending your connections and creating opportunities as going to events.

How to use the internet to find your next job

As well as engaging with social networking, there are many other online tools that will make it easier to get ahead.

  • Create your own website or portfolio. Depending on what you do, having your own web pages to display your work could help to bring you to the attention of your next employer or client.
  • Synchronise your online profiles. From Facebook, to LinkedIn make sure anywhere that you’re represented online highlights your career goals and demonstrates what you’ve achieved.
  • Clean up personal profiles. New employers will look at your personal social media profiles as part of the standard process of reviewing you as a candidate. So, untag yourself in the drunken photos, delete the late night statuses and choose a professional profile photo.
  • Post your CV online even if you’re not actively looking. This will mean that you can be found by someone who could identify you as an ideal fit for an available role. It’s always easier to get headhunted than not.
  • Sign up for updates and newsletters from businesses you want to work for. That way you’ll be the first to know about any opportunities they have and you’ll be well equipped to talk about the business itself if you get to the stage of an interview.
  • Decide what it is you actually want from a job. You’ll be a much more impressive candidate if you’ve clearly thought this through and are committed to the outcome.
  • Don’t sit on your hands if you’re between jobs. There’s a lot you can do to contribute to your job search, from honing your CV through to doing voluntary work that will help to illustrate a specific skill set that could be useful for your next applications.

Key changes in job searching in the last couple of decades

  • Social media matters. Most employers now check a candidate’s social media profiles even if they don’t rely on them to make decisions.
  • It’s not just for employers though… Social media is a great way to find out about job opportunities, to learn about a company culture and what the values and vision are for the business, as well as the latest news.
  • Telephone and Skype interviews have become standard. Often the first step in a recruitment process after the application has been made is a brief “initial interview” by phone or Skype.
  • CV standards have risen. We all have laptops now, as well as spell check and access to tech tools. So, employers expect CVs to be well laid out, engaging and error free.
  • Online recruiters have a huge reach. Online recruiters and job search sites are often a first port of call for employers looking to engage the widest pool of candidates. This makes them a rich source of potential for anyone looking for a new job.
  • Candidates have more power. Employers expect candidates to ask for what they want and also to challenge employers on what the business could do for the candidate and not just the other way around.
  • But some things haven’t changed at all. For example, asking good questions at interview, personal hygiene, being on time and ensuring that your interview answers tally up with the content of the CV all remain important.

Senior roles can be trickier. For those in senior or management positions it’s often a lot more about who you know and who could put you forward. That’s why networking is such a crucial tool for anyone at any level.

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How lenders judge loan repayment affordability and why this is important to you Wed, 11 Apr 2018 10:04:40 +0000 Alex Hartley There are many factors involved in being approved for credit. However, perhaps one of the most important today is affordability. Changes in the personal finance market over the past decade have put affordability at the top of the list of criteria that lenders must establish before they decide to approve a loan application. But what kind of tests do lenders use to measure affordability and what does it mean for you if you don’t pass them?judge loan affordability

How credit providers judge affordability

The basis of affordability is whether you can borrow the personal loan – or use the credit card that you’re applying for – and be able to make the required repayments. And once you have made the repayments, will you still have enough disposable income to make other essential payments, such as mortgage or rent, the cost of food and transport.

So credit providers will need to know your monthly income (net of taxes) versus your monthly outgoings. They will probably try to distinguish between your discretionary costs (i.e. those things you can choose not to spend money on e.g. your socialising) versus non-discretionary (i.e. those costs you can’t avoid, such as food, energy, rent/mortgage payments & travel, etc).

  • How much you earn – the more you earn, the more income you have to cover repayments.
  • Your outgoings – the higher your monthly outgoings, the more unaffordable new credit is likely to be.

But don’t get affordability mixed up with creditworthiness. Your creditworthiness needs to be strong too. If you can afford the loan repayments but your repayment behaviour has been poor (as recorded in your credit file at the credit reference agencies) they may still refuse to lend to you. You need to be able to demonstrate that you can afford the loan repayments and that you actually do make the repayments on time and in full.

So credit providers will also use your credit report to help them make a judgement about whether to lend to you. They don’t use the credit scores generated by credit reference agencies but, instead, will use the information in your credit report to generate their own. The following factors will have an influence over how credit providers assess your credit worthiness:

  • The amount of debt you already have – if you are already making payments on multiple debts then lenders might not feel it would be affordable for you to add to that.
  • The ratio of earnings to debt – high earnings and low debt is the optimum to demonstrate you can afford credit. However, middle income earnings and low debt may work too, as well as other combinations. If you have low earnings and high existing levels of debt then you may struggle to get further credit.
  • Public records – your credit report will demonstrate to a lender whether you’ve struggled with borrowing in the past, for example if you’ve had a court judgement against you. Although this doesn’t go to the heart of affordability it will demonstrate how easy you find it to manage debt.
  • Your financial associations – your credit report will also show a lender who you are connected to financially. If a current or ex partner has a very negative credit report, for example, it could mean a lender assumes you might end up being responsible for their financial situation and unable to afford your own obligations.

Why does affordability matter?

There is now an increased focus on responsible lending, particularly in the short-term credit sector. The UK Financial Conduct Authority has issued official guidance that makes it clear that a credit provider should not be advancing credit to a customer before assessing their creditworthiness (including affordability). This is a requirement in addition to the assessment the credit provider will do to determine the risk to itself in providing the credit to the customer. As a result, every lender will now carry out an affordability assessment so, for those looking to borrow, it is an important factor to consider.

What can you do if you’re not approved?

If you find yourself in a position where a credit provider has refused your application on the basis of affordability then there are a number of steps you can take.

  • Check your credit file. Look for mistakes that could have given the impression you couldn’t afford to make the repayments – or a connection to someone else who doesn’t have a good credit score.
  • Pay off existing debt or consolidate debt. It may be that your application was refused because you already have too much debt – if that’s the case then reducing that debt is a good place to start. Or restructure your debt to make monthly repayments smaller.
  • Start budgeting. If you’re not in control of your finances then you could fail an affordability test on the basis of an imbalance of income and outgoings. Learning to budget can help you to bring these figures back into line.
  • Look for other types of credit. Affordability criteria vary from lender to lender. You may also find that a different type of credit is a better option. For example, a homeowner loan – which uses your property as security – could result in an approval where an unsecured loan application did not.

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Brits attitudes towards spending now on big ticket items Mon, 09 Apr 2018 10:59:32 +0000 Alex Hartley According to the Chancellor Phillip Hammond, the UK economy has reached the point of still being within the tunnel – but able to see light at the end of it. However, for UK consumers these remain testing times and many are still struggling to catch even the slightest glimpse of the promised end-of-tunnel brightness. Consumer confidence is one of the easiest ways to measure how the UK economy is being experienced by those who live within it every day – and those metrics currently tell rather a different story.

Consumer confidence metrics

The GfK consumer confidence index looks at the individual experience of UK consumers. It uses anecdotal evidence to analyse how people feel about the state of their own finances, the wider economy, as well as whether they feel that this is a good time to start spending or saving. The most recent results from GfK indicate that UK consumers are perhaps more cautious than the Chancellor would like to believe. We are certainly more careful with cash than we used to be – still making purchases but thinking twice about them before we do, especially when it comes to larger and more expensive items. The GfK survey creates a picture of the consumer side of the UK economic landscape right now that looks a little like this:

  • A significant drop in the number of items being sold
  • A tendency towards holding back on spending, buying something better quality and buying less
  • An unwillingness to take on the kind of credit that might usually be required to enable a bigger purchase
  • Avoiding spending unless something actually needs to be replaced or where an emergency purchase is necessary
  • Taking a long-term, as opposed to a short-term, view of spending and keeping an eye on the future so as to tailor spending as things change

Consumer confidence tends to shift month on month. In January of this year it was reported that consumer confidence had risen somewhat. However, in February it had taken another dip, as people began to worry more, both about their own personal finances and the state of the wider economy. So, nothing is set in stone.

So what are we spending our cash on?

Each year the Office for National Statistics (ONS) updates its “basket of goods,” which is designed to reflect the evolution of UK consumer shopping habits. It’s also used to measure inflation. Crucially, this basket of goods can provide some guidance on what UK consumers are actually spending their money on. The ONS’s current basket contains a total of 714 items. It highlights food preferences, such as an increase in the popularity of quiche and a drop in the popularity of pork pies. It can also be used to identify wider trends – for example, the inclusion of non-dairy milk, cycling helmets and active wear leggings indicates a burgeoning trend towards healthier lifestyle choices. Items that drop out of the basket are also a useful measure of consumer choices. This year, peaches, nectarines, leg waxes and edam cheese all fell out of the basket.

The credit provider perspective

The ONS’ basket of goods indicates that consumers are generally more drawn towards affordable purchases and lower cost treats that don’t require credit to buy them. However, we are still in the middle of a surge in consumer credit cards that includes 1.3 billion credit card payments worth £46.8 billion made in one month alone at the end of 2017. With annual payments on credit cards increasing by around 13% is it likely that this cautiousness with credit will continue?

Most credit card providers remain optimistic about the interest that consumers have in using credit to pay for items, whether they are large or small. Figures from last summer indicated that spending on credit, debit and charge cards was growing at the fastest rate since 2008. And most lenders tend to expect a slow down during the months of the year after Christmas as consumers adjust to credit that may have been used up to pay for annual festivities. Plus, as the consumer confidence index shows, all of this can change extremely quickly and from month to month. All the signs are that any reservations consumers have now about taking on credit to buy large items could be temporary. And, if the Chancellor’s prediction about light at the end of the tunnel should turn out to be true then we could see a revival on the high street sooner rather than later.

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How to close the gender pay gap if you discover discrimination Fri, 06 Apr 2018 11:13:54 +0000 Alex Hartley The gender pay gap is currently a very hot topic. With businesses with more than 250 employees now forced to reveal how much less women are paid than men we are beginning to see just how little the female side of the workforce is valued by a number of very big brands. Ryanair, for example, recently revealed a gender pay gap of 72% – the worst in airline history – and even in the public sector this figure comes in at 14%. The deadline for private firms to report on the gender pay gap was 4th April – if you’ve discovered that the business you work for has a significant gender pay gap, what can you do about this kind of potential discrimination?close the gender pay gap

Understand the data

Looking at the gender pay gap data that is being released can be somewhat confusing. However, this isn’t about equal pay for equal work – even if there is a large gender pay gap that doesn’t mean that there is discriminatory practice. Equally, if there isn’t much of a gender pay gap to speak of at your firm it doesn’t mean that pay discrimination isn’t an issue. Look instead at data such as how many women are in the lower paid roles, what the bonus gap is and whether there is a decent proportion of women in the higher earning brackets. All of this will give you a good idea of how committed your company is to giving women equal opportunities.

If you can, think about joining a union

According to the statistics, the gender pay gap in unionised workplaces is smaller. Even if your employer doesn’t recognise a union it’s still worth joining, as they can provide plenty of support. Where a union isn’t an option it’s a good idea to get together with others who have the same concerns, to sit down and identify what the issues are and how you would like them to be dealt with.

Speak out

Now is the time to take action if you find that you’re stuck in a gender pay gap. The data that is being revealed is very public and there is widespread shock about how much of a gender pay gap there really is. This is putting pressure on businesses to do something about it, which means that now is the ideal time to put your case to the senior people who have the power to make a difference. You might want to ask about flexible working and when the business last did a job evaluation scheme (if at all). Enquire about bonus structures, whether there has been an equal pay audit and whether bonuses are structured so that men and women have equal access to them.

An equal pay audit

Equal pay audits identify whether men and women are being paid differently for the same job. They will also highlight whether those who join the business come in on a different rate of pay as a result of gender. If the results show that the business is actually breaking the law with its gender pay policies then an employment tribunal can compel the business to make changes.

Don’t accept the same tired old excuses

Many businesses reporting gender pay gaps simply say “we just have more men at senior levels.” Statements like this have been used as an excuse for not making change for decades. Now is the time to challenge companies to provide an explanation for why this might be the case. Is it institutionalised discrimination? Is it because the more senior roles are structured so as to be impossible for those with caring responsibilities (most of whom are women)? Is it because there is a culture that men and women belong in certain positions? None of this needs to be an excuse anymore and now is exactly the right time for change.

Ask for what you want

A promotion. Men are overwhelmingly paid better than women, both in terms of basic salary and also bonuses. They tend to take the head office positions and senior management roles – and that may also be the case in the company you work for. If you know that you’re ready to move up then ask for a promotion and encourage other women to do so to. There should be a willingness to address the gender pay gap and seniority inequality with all the statistics that have been released, particularly if your employer has fallen short of fairness.

A pay rise. Avoid demanding a pay rise simply because your employer has a significant gender pay gap. It’s far better to try and gather information that relates to your specific role within the business. See if you can get information on what others in a similar position are paid, ask for collaboration from your colleagues and then steel yourself and request the pay rise, no matter how awkward it may feel.

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What type of cars should we buy, now and over the next decade? Wed, 04 Apr 2018 11:16:42 +0000 Alex Hartley The automobile industry has undergone a dramatic shift in the past couple of years. Public concern over air pollution has forced a complete rethink of the traditional gasoline powered engine. As a result, we now have many more options when it comes to what type of car to buy – and which part of the industry to support. But what are the best options when it comes to the type of car we should buy now, and over the next decade?the cars of the future

Why not stick with what you know?

Petrol – and, in particular diesel – cars have brought some serious environmental and health issues to the UK. The air in our towns is now significantly polluted with nitrogen dioxide, which is incredibly toxic. It may seem like an issue only for those with environmental concerns but air pollution has serious consequences and is responsible for 23,500 premature deaths in the UK every year. Although the EU responded to this worldwide crisis by setting strict rules on nitrogen dioxide in 2000 this did very little to reduce the crisis thanks to the actions of the auto industry. Diesel vehicles produced by carmakers were designed to show acceptable levels of emissions in the test centres to comply with the EU rules but then emitted much higher pollutants outside once in normal use. So, change is well overdue.

What type of car to get now?

The cost of financing an electric vehicle has fallen in the past year or so, which has made it a more feasible option for drivers who want eco-power. It’s an option that makes particular sense for drivers in London who can avoid the £11.50 a day congestion charge with an electric vehicle. However, outside of the capital – and other urban hubs – it’s still a challenge for a number of reasons:

  • Range anxiety – electric car batteries go further than they have ever done but still not far enough for some. The Renault Zoe, for example, now has a top range of 180 miles on just one charge.
  • Charging points – the UK’s charging infrastructure has grown to some 5,000 public locations. However, more street and lamp post chargers are likely to be required to ensure full ease of use.
  • Cost – buying an electric vehicle outright still generates a considerable cost but leasing options are starting to make ownership more viable. The concern for many is the speed at which EV values drop – a single development in battery technology, for example, could mean that the value of old cars drops through the floor.

What type of car to get now: a hybrid. For many people who are keen to reduce their environmental impact a hybrid car is a good first step.

What type of car to get in five years?

There are already 130,000 electric vehicles on the UK’s roads and a choice of 60 different models for consumers. However, issues remain and the relatively small size of the market has kept costs high. This is all set to change with carmakers hatching ambitious plans to flood the market with battery and electric vehicles that will be competitively priced.

  • According to researcher LMC Automotive, electric car sales will account for around 10% of global auto sales by 2025.
  • Battery costs are declining rapidly, causing all carmakers, not just environmentally driven brands like Tesla, to start producing their own models.
  • General Motors Co. has planned to release 20 models by 2023 and Toyota Motor Corp 10.
  • Over the next five years, 127 battery-electric models will be released onto the market.
  • Since 2013, electric vehicle charging infrastructure across Europe has grown by 30 – 60% every year. By 2019, all new houses in the EU countries must have an EV charging port, according to new regulations – that will be 10% of all buildings and parking space by 2023.

What type of car to get in five years: many consumers will still hesitate over an electric vehicle in five years time but costs will likely be lower, choice increased and infrastructure growing to support it.

What type of car to get in 10 years?

It’s in 10 years time that many predict the electric vehicle market will reach its tipping point. That’s the moment at which the mass market of car buyers turns its collective gaze towards electric as a realistic option.

  • According to Bloomberg New Energy Finance, EVs will reach price parity with gasoline-powered cars by 2029 or earlier, which will be the moment at which many consumers seriously consider an electric vehicle as a competitive choice.
  • Carmakers don’t want to be left behind – in a decade, the gasoline powered car could be as out of date as a horse and cart.
  • Charging is set to become faster. BMW, Daimler, Ford and Volkswagen are already collaborating on an ultra fast charging network that will be rolled out across Europe over the next 5-10 years.
  • The charging infrastructure should be sizeable by 2028 – electric charging points are set to outstrip the number of petrol stations in the next few years and soon every supermarket, railway station and hotel will have them.
  • The figures will soon make sense. There are already multiple incentives for businesses to support electric vehicle charging infrastructure (e.g. a £600 subsidy where companies install double charging points) and reducing the cost of public charging is a key target for government over the next decade.

What type of car to get in 10 years: an electric car. By 2028 you won’t have to choose an electric vehicle on principle, as the numbers will make sense too. By 2040 he UK intends to ban the sale of all petrol and diesel vehicles, but other countries intend to move more quickly (e.g. Norway by 2025 and Netherlands by 2030).

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How exercising can make you money – the apps that turn pounds into pounds! Mon, 02 Apr 2018 10:48:25 +0000 Alex Hartley Exercise is (usually) a good idea. It can help to increase fitness levels, keep weight under control and also improve your mood. But can you make money just from getting on your bike or hitting the running track? A couple of years ago the answer would have been a definitive “No.” However, today we are in a world of mobile apps that have broadened out the way that we live our lives, including how we motivate ourselves to exercise. And, as a result, it is actually possible to make money from exercising if you have one of these apps.make money from exercising


The Fitcoin app works with any fitness tracker that will integrate with Apple Health app on your iPhone. It enables you to generate rewards from the activity that you do during the day. So, the more calories you burn and the more exercise you do, the more likely you are to have something to show for it at the end of the day. Although Fitcoin doesn’t pay out cash to those who earn their share of Fitcoins, you can convert these into vouchers that can be used to make purchases with retailers such as Amazon.


If you’re a keen walker then you could make money every time you step out with Sweatcoin. The app will reward users with one Sweatcoin for roughly every 1,000 outdoor steps that are taken. Sweatcoins can then be redeemed in the app’s own store against fitness kit and gadgets, services and experiences. The app has had great reviews from users who have found it useful, both in terms of motivation to get fitter and satisfaction of rewards. The best way to work with Sweatcoin is to generate the rewards from the steps that you would already be taking in a day.


You can use the Bounts app with your fitness tracker or device or just use the pedometer in your mobile phone. The app is designed to encourage fitness by rewarding certain activities with points. Those points can then be used to join various challenges that come in a variety of different shapes and forms, including Kudos, Chance of a Reward & Guaranteed Reward Challenges, and win prizes. You can also simply use the points that you accumulate to redeem offers and discounts that big name retailers have agreed with Bounts.


The Bitwalking app is one of the few that enables users to generate “real” money, as opposed to rewards that can be redeemed for vouchers. It is described by the app makers as “a technology that recognises our human value. A new global currency generated by each of us, for all of us.” That currency is ‘Walking Dollars’ (W$) and the theory goes that you’re using your steps to mine this cryptocurrency. Opportunities to enjoy the W$ that you earn include spending them in the app’s store, trading W$ with others and eventually you’ll also be able to withdraw the W$ that you earn as cash.

Charity Miles

If you’re keen to raise cash for a good cause and you want to use activity to do it then Charity Miles is an app worth investigating. It enables anyone to walk, run or cycle to accumulate Charity Miles that can then be donated to more than 30 very well known charities. The app uses the GPS on your smartphone to track the activity that you do and then donates on the basis of how far you get. It may sound a bit fanciful but the app has some pretty big name sponsors, including Johnson & Johnson and Humana. So, if your motivation to exercise is of the more philanthropic kind you might feel you can go further with Charity Miles.

Healthy Wage

This app is all about rewarding weight loss and giving you the opportunity to earn money by betting against yourself in the process. Healthy Wage is a free app but does require a verified weigh in before you can start to use it properly. It works on the basis of giving users the opportunity to set time sensitive goals and then to make bets based on whether you think that goal will be achieved. So you bet money to win for weight lost within a specific time period. If you’re successful in your bets then the rewards can be cash, which is paid out through PayPal, or you can choose to opt for Amazon credit instead. The app is incredibly motivational as you’re using your own money to place the bets and enjoying rewards that are both physical and financial.

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Household debt costs to surge over next five years Fri, 30 Mar 2018 09:50:28 +0000 Alex Hartley The next five years could be a tough time for those with debts, whether credit cards or mortgages. According to projections obtained by a freedom of information request to the Office for Budget Responsibility, the cost of household debt is going to soar. In fact, by 2023, debt servicing costs are likely to increase by 29%. The rise of a third in the cost of having a mortgage or servicing loans could be challenging for many UK households already stretched to breaking point. But where is the cost most likely to bite and what can you do to prepare for it?

Debt problems

Where are we right now?

Most of the UK population is currently unprepared for the reality of what a significant increase in debt cost is going to look like. Over the past five years we have seen debt costs fall 9% and decline as a percentage of household income. However, this has been largely thanks to the way interest rates have remained low. In November 2017, the Bank of England raised interest rates for the first time in a decade and has already indicated that further rate rises could be implemented as early as May 2018. According to the Governor of the Bank of England, the combination of a growing economy, including GDP growth, as well as increasing average wages means it’s time for interest rates to start going up.

How much is the increase actually likely to cost?

According to the figures, the average UK household could find itself with an extra £468 a year to pay in debt interest costs. So the average interest cost of household debt will rise from £1,983 in 2018 to £2,451 by 2023. This could be seriously problematic for many UK households that are already struggling. The figures are based predominantly on the cost of mortgages so it’s not known how high costs could go for those who also have other types of debt with variable interest rates, such as many personal loans and credit cards.

Who is likely to be the most affected?

Opinions differ on who will potentially suffer the most from the increase in debt costs. According to Andrew Hood, a research economist at the Institute for Fiscal Studies, it is most likely to be felt by richer homeowners who have more valuable properties and larger mortgages. However, independent think tank The Resolution Foundation has identified millions of low-income families reliant on cheap credit as the potential worst hit.

What can you do to protect your own finances?

  • Make affordability your top priority. Whether you’re shopping for a mortgage or a new personal loan, affordability should be the driving factor in the choices that you make. If you can afford to make the repayments and still live comfortably then you can avoid a situation where a small rise in interest rates starts to make life very uncomfortable. You could investigate the use of a debt consolidation loan to help make your non-mortgage debt more affordable on a monthly basis (but read the small print).
  • Reassess the way you use debt. We are a nation of homeowners and buying a property remains the goal for many people – we will get into great debt to do it. However, a surge in interest rates could make mortgages seriously unaffordable. For many people it might be worth looking at renting long-term as a better option than taking on a mortgage that’s only going to increase in cost over the next five to 10 years.
  • Make a solid repayment plan. If you’ve been lacking the motivation to get moving when it comes to debt repayment now is a great time to make a begin. Any debts that you have are likely to start costing more in the next five years – so, the more of these you can clear now the easier your finances will feel.
  • Start budgeting. If you aren’t committed to budgeting then it’s time to get involved. The increase in debt costs is going to require better financial management from anyone who doesn’t want to find themselves with serious problems when it comes to covering the cost of living and keeping up with debt obligations. Whether you sit down once a week with a pen and notepad or use a budgeting app, now is the time to take control of your finances.

So shop around for the best deals on debt. Deals on credit cards, mortgages and personal loans can vary widely depending on where you’re looking. If you want to ensure that you’re getting the very best deals on interest rates and other costs then it’s a good idea to shop around. Online lenders often offer the best deals but some high street banks can be competitive too. As the costs of debt begin to rise don’t be afraid to ask for the deal you want before signing on the dotted line. Use our QuickStart tool to help you narrow down your loan choices, and our free enquiry service to make your credit application.

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How to save for a deposit for your first home Wed, 28 Mar 2018 10:13:12 +0000 Alex Hartley For many of those not currently on the property ladder, the topic of deposits creates an instant sinking feeling. The average deposit in the UK is currently £32,899. If you’re looking to buy in London then that triples to £106,577. Government Help to Buy has enabled first time buyers to get on the housing ladder with just a 5% deposit. Although this has brought home ownership within reach for many it doesn’t reduce the associated cost. To get a good deal on a mortgage, most experts agree that you need to have a deposit of at least 10% of the purchase price, ideally 20%. So, how do you do it?Deposit for your first home

The argument for cutting back

The average salary in the UK is £27,000 and the current average rent is £921 a month (£1,246 in London). As Money Saving Expert Martin Lewis says,

“There are those young people who are managing their money so badly that they can’t afford property, then those who would never be able to buy without help from the bank of Mum and Dad.”

So, for many people when it comes to saving for a deposit the figures just aren’t going to add up. However, for others it may be a simple case of managing your money better. And, if you’ve already started to save, you have a little help from someone else or you’re earning above the average salary then it could make sense to look at cutting back on outgoings as a way to help you get that deposit together. These are just some of the places where savings could potentially be made:

  • Daily coffee – switch from your local artisan coffee shop to a cheaper brand or take your own coffee from home and save upwards of £600 a year.
  • Clothes – cut back on what you spend on new clothes while you’re saving for a deposit or look for bargains in charity shops. Depending on your spend you could find an additional thousand or two over the course of 12 months.
  • Taking your own lunch – buying lunch every day is an expense that could set you back £100 a month. Take leftovers from home and you’ll be £1,200 better off at the end of the year.
  • Drink less – the benefits of cutting back on alcohol affect your well-being as well as your bank account. If you’re spending around £120 a month on drinking then your annual savings total will be £1,440.
  • Those little luxuries – we all have luxuries that we somehow manage to justify spending money on, no matter how it impacts our budgets. Whether that’s a pricey haircut or fuel for a car that isn’t really a necessity, you know where your weaknesses lie. Saving for a deposit is a great time to reassess whether you really need the haircut or the use of the car. Could you temporarily do without in order to get that first step up on the property ladder?

Remove the impact of paying rent

When you’re trying to save for a deposit it’s often rent that ends up creating the most significant obstacle. So, increasing numbers of people are looking for other options, whether that’s moving back to a relative’s spare room or moving with someone else to split the rental cost. For an average renter the annual cost is more than £11,000 – for those in London it’s close to £15,000. So, just a year or two in temporary arrangements with less (or no) rent to pay could make a real difference.

Consider buying with someone else

Given the discrepancy between average salaries and the average property price, most people in the UK will find it hard to buy alone. This obviously benefits people in relationships but doesn’t necessarily exclude everyone else. You don’t have to buy with someone you’re in a relationship with – in fact, sometimes it can be less complicated if you don’t. Friends, siblings and current housemates could all be a good option with respect to sharing the cost of a property purchase. Just make sure you have the right legal documentation in place to enable a split if you later want to go your separate ways.

And if you just can’t get there on your own…

It’s is often worth asking friends or relatives whether they are able to help you out. Contributions towards a deposit could give your savings the boost they need, whether they come from a relative’s own savings pot or something like equity release, which enables a homeowner to release (as cash) some of the equity in the property that has been paid off.

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All you need to know about the NS&I (National Savings & Investments) Mon, 26 Mar 2018 12:00:29 +0000 Alex Hartley The NS&I (National Savings and Investments) is often recommended as one of the safest options for savings and investment products. But does it offer the best deals? If you’re looking to do more with your money then it pays to get to know the NS&I, where it might be the best way to save and when other options could help you earn more.NS&I logo

What is the NS&I?

The NS&I has been around for well over a century and now has more than 25 million customers. It’s essentially a state owned UK savings bank that offers a range of savings and investments products, such as Premium Bonds and Children’s Bonds. The NS&I is a government department and an Executive Agency of the Chancellor of the Exchequer and is about as safe as they come with respect to ensuring your money is secure. The NS&I offers 100% security on all deposits, which is one of the factors that sets it apart as a savings and investment option.

What does 100% security mean?

In an age of issues with online fraud and hacking, the guarantee provided by the NS&I is very attractive. It means that if anything happens to the cash in NS&I accounts the organisation guarantees to reimburse the saver for any loss. So, where any payment has gone out of the account that has not been authorised by the account owner – unless it can be proved otherwise – reimbursement for the payment is guaranteed. The NS&I is also 100% safe as a savings institution – it is backed by HM Treasury so depositing your cash here means that it’s as risk free as it’s likely to get.

What kind of products does NS&I offer?

The NS&I is a good option for a range of different bonds, ISAs and investment accounts, all of which are managed online, including:

  • Premium Bonds – there is no interest or capital gain with Premium Bonds but you can be entered into draws for cash rewards (which are tax free).
  • Investment Guaranteed Growth Bonds – a product that requires tying up cash for at least three years. You’ll need a minimum £100 investment and get a rate of 2.2% interest before tax.
  • Guaranteed Income Bonds – for those with at least £500 to invest, Guaranteed Income Bonds can be committed to for one year or three. One year attracts 1.45% gross interest and three years 1.9%.
  • Guaranteed Growth Bonds – these are fixed rate bonds ideal for those seeking peace of mind from investments. They attract a rate of 1.5% gross for a one year commitment and 1.95% for three years.
  • ISAs – the NS&I Junior Isa has an attractive rate of 2.25% up to £4,126 for the 2017/18 tax year for those aged 16 or 17. Older investors can put cash into the regular NS&I ISA which attracts interest of 1%. Both are tax free.
  • Savings account – the NS&I Direct Saver account attracts interest of 0.95% (gross) and offers easy access at any time without notice or penalty.

Is the NS&I the best way to save and invest?

It depends on what you’re looking to achieve with your money. The NS&I is ideal for those who are seeking:

  • Safe savings – with 100% security there is no risk to your savings and investments, either in terms of loss from fraud or the financial institution going under.
  • Longer term savings – the best rates on NS&I products are available to those who can commit cash for at least three years.
  • Slower income growth – NS&I savings will certainly give you income growth but over a longer period of time.
  • Tax free savings – the NS&I offers a tax free ISA.

You may want to look elsewhere for savings and investment options if you:

  • Want a higher interest rate
  • Are looking for a more sizeable return
  • Are keen to achieve a faster return
  • Need a higher interest savings product that will give you instant access to your cash
  • Have money to spare that you can take more of a risk with

Other products from other banks and financial institutions might be better suited to the above criteria. For example, NS&I doesn’t offer a stocks and shares ISA, which is a higher risk product but also one that offers a greater return – the average stocks & shares ISA fund grew by 15.8% during the 2016/17 tax year. The key attraction with NS&I products is that you know your cash is safe, whatever happens. If that’s your priority as a saver or investor then the NS&I is well worth investigating.

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Unexpectedly brilliant and cheap weekend destinations in the UK Fri, 23 Mar 2018 11:27:38 +0000 Alex Hartley The Pound is struggling against the Euro and the Dollar, inflation is rising and it costs more than ever before to pay for overseas travel. However, most of us still want to get away from it all and enjoy the odd weekend break. So what’s the solution? There’s nothing new about the idea of taking a ‘staycation’ in the UK rather than going overseas. However, you might be surprised to find just how many locations offer an awesome weekend away without a crippling price tag.


East Yorkshire town Hull (full name ‘Kingston upon Hull’) is located on the coast, a port city that sits where the River Hull meets the Humber Estuary. For a city break without the European cost it is the perfect choice, whether you’re looking for history or culture. Visit Wilberforce House, birthplace of William Wilberforce and a museum that documents the abolition of the slave trade, or take a cycle tour through Hull’s perfectly flat streets. Hull was named as the 2017 City of Culture, a title that lasts four years and means there’s a full schedule of exhibitions, art shows, performances and even a drive in cinema for visitors to enjoy. A night in a 3-star hotel will set you back £66.

Newcastle upon Tyne

Another northern citybreak option, Newcastle was named as one of the Rough Guides’ top place to visit for 2018. Famous as a party town, Newcastle also has vibrant food, drink and arts scenes that have begun to put it on the map as something of a hipster hangout. Craft beers, cool independent coffee shops, sourdough pizza and creative restaurants serving irreverent dishes such as deconstructed English breakfasts give Newcastle an edge. The cultural events scene is strong too – visit in May, for example, to experience The Late Nights, a late-night cultural crawl of the city’s art hubs. The average cost of a 3-star Newcastle hotel is £63 a night. Newcastle upon Tyne


The town of Southport may not instantly make you think of classic English style but it’s an unexpectedly interesting location for a weekend away. This Victorian town in Merseyside is smack bang in the middle of beautiful natural coast that is perfect for wildlife walks and the town has it’s own stretch of beach. Championship golf courses, botanical gardens and activities such as Southport Splash World provide plenty of entertainment. But it’s the quirky attractions many people love the most about Southport, such as the British Lawnmower Museum where you’ll discover a history of antique lawnmowers and garden machinery. The average 3-star hotel in Southport costs around £65 a night.

King’s Lynn

For countryside that gets the royal stamp of approval, book a weekend away to King’s Lynn. As well as a fascinating maritime history, King’s Lynn is a short bus journey from the Sandringham Estate, the Queen’s favourite retreat, described as “Dear old Sandringham, the place I love better than anywhere in the world” by King George V. West Norfolk is also renowned for its coastline with a large proportion of the 43 mile stretch designated an Area of Outstanding Natural Beauty. Horse riding, golf, fishing and birdwatching are just a few of the relaxing ways to pass the time. A night at a 3-star hotel in historic King’s Lynn will cost you around £80.

The Lake District

Yes, everyone knows the Lake District is an area of great natural beauty but it’s also a staycation option with landscapes that will feed your soul. Head for the quieter spots – such as Ennerdale – and there are some great deals to be had. This is an area that has inspired some of the greatest British creatives, from William Wordsworth and Beatrix Potter to John Ruskin. It is England’s largest National Park and also a World Heritage Site. Boating, cycling, walking and cave diving are all on the agenda for those seeking an action packed weekend away that won’t break the bank.  An overnight in Ennerdale will set you back around £45. The English Lake District


One of the UK’s classic Victorian seaside resorts, Eastbourne is much overlooked as a weekend destination. From the vintage architecture to the theatres, galleries and pier, the spirit of the seaside over the centuries is well preserved here. Beachy Head, as well as Birling Gap and the Seven Sisters are key local attractions – and it’s the access to the South Downs (the UK’s newest National Park) that really make Eastbourne something special. These chalk hills stretch for 260 miles, from Eastbourne to the Itchen Valley in the west, and offer up some beautiful coastal walks, wildlife, camping, stately homes and historic sites. A night at a 3-star hotel in Eastbourne averages £54.

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How to protect yourself from pensions scams Wed, 21 Mar 2018 12:18:03 +0000 Alex Hartley Change has come quick and fast to the pensions world in recent times. We now have a much broader range of options when it comes to how to save for retirement and greater freedom in terms of choosing investments for pensions. While this means that we have more control over our money it also increases vulnerability and the scope for scammers to succeed. So, how do you protect yourself from scams while navigating this new pensions landscape?how to avoid pension scams

Don’t take cold calls

The Pensions Regulator specifically highlights unsolicited phone calls, emails or texts as a prime source for pension scams. So, if you get a call or email out of the blue then be very wary. Most reputable organisations simply wouldn’t do this kind of cold marketing when it comes to their products so it’s far more likely to be a scammer.

Be cautious of unregulated investments

Pensions themselves are regulated but there are all sorts of investments for retirement that are not. For example, you might be offered the opportunity to invest in something glamorous, such as a vineyard in France or a hotel in the Caribbean. This could be pitched as an exciting investment with “guaranteed returns.” The trouble is that if you put your cash into one of these unregulated investments and something does go wrong then you don’t have any access to the Financial Ombudsman Service or Financial Services Compensation Scheme. You’ll also have no real way of knowing how competent the business is that’s handling your money.

Don’t be lazy

If a friend tells you about this fantastic investment opportunity for your pensions cash then look into it thoroughly. So many people have lost money through schemes that are recommended by a friend and that recommendation is trusted 100%. Make sure that you take on the responsibility of fully understanding what you’re getting into – read all the small print. If you unwittingly get scammed because you didn’t bother to fully understand what was being sold to you then the only person who will lose out is you.

Think carefully about an annuity

Since recent changes have enabled those over 55 to release cash from pensions and not purchase an annuity, many people now have a lot more freedom when it comes to what to do with pensions cash. However, it’s a good idea to think carefully about whether that annuity might actually be a good idea. An annuity is designed so that a lump sum is purchased up front to provide a regular retirement income for the rest of your life. If you don’t take the opportunity to buy an annuity then have you really thought about how you’re going to pay for the rest of your retirement?

If you’re nervous then choose big brand names

Margaret Snowdon, the Chair of the Pensions Liberation Industry Group, has said she is “reasonably confident that £1 billion has gone to scams.” When it comes to pensions fraud, figures are thought to be grossly under-reported. There are two reasons for this: firstly, scammers often pay out under investments for the first year or so as this provides a false sense of security and allows them to complete the scam and disappear. Secondly, many who have been caught by a pensions scammer are so ashamed that they don’t tend to report it. So, there is a lot to be wary of when it comes to pensions investments – if in doubt, opt for the big brand names where you know products will be regulated and providers will be accountable.

Nothing is guaranteed

Many pensions investments offer “guaranteed” returns. However, the reality is that nothing is guaranteed. Investments are by their nature a high risk endeavour so anyone who attempts to sell a product on the basis of a “guaranteed” returns is highly likely to be either fraudulent or inept.

Avoid anything that is time sensitive

It is a trick that scammers often use to tell potential victims that there is an element of time sensitivity to an investment or deal. This “one day only” type approach enables scammers because it means paperwork is often not read and the consequences of an investment being made are not really thought through. Take your time when it comes to deciding what investments to make and then give yourself enough opportunity to read all the paperwork and think through whether this really is the right investment for you.

Follow a couple of basic rules

Ultimately there are two key rules that will help you to keep your pension pot safe if you follow them:

  1. Only deal with businesses registered with the Financial Conduct Authority (FCA)
  2. Don’t put your pensions cash in the hands of an overseas business that the FCA can’t reach


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The Rich, the Super-Rich and the Rest of Us Mon, 19 Mar 2018 14:35:10 +0000 Amanda Gillam We all know that money can’t buy you love or happiness and yet there are those who somehow manage to acquire lots of cash even if it wasn’t the first thing on their mind. We thought we’d take a look at the wealth of the elite across a number of popular careers and industries. Just how wealthy are some of those successful people and if you compare their wealth to your own income how do things look? We’ve come up with some interesting ways to compare that highlight more starkly the wealth of the tiny minority versus the wealth of the majority.

Try This Wealth Comparison Tool

To make your jaw drop, simply input your income and then select the name of the person you’d like to compare yourself to.

Then the tool will show you all sorts of interesting statistics – for instance how long would it take your chosen “celebrity” to earn your annual income? What would be the cash equivalent for the celebrity of you dropping a pint of milk? How long would it take them to earn enough to buy average UK home?

It’s easy to convince yourself that being super-rich automatically leads to happiness, but the stories of unhappiness are legion. So, don’t let the numbers make you feel left out. After all having strong friendships is perhaps the best way to achieve happiness, and such friendships can’t be bought!

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Summer 2018 Holidays – Where to go and how to pay for it Fri, 16 Mar 2018 11:24:13 +0000 Alex Hartley Storm Eleanor, Storm Georgina, high winds and forecasts of snow – the weather of 2018 so far has been cold, wet and dark. If you’ve been dreaming of escaping the damp grey of the UK then now could be the time to start planning a summer escape. We passed the longest day on 21st December, which means that the countdown to summer has already begun. It may not feel much like it right now but actually we’re just a few (ok, five) months away from summer 2018 and all the travel possibilities that brings.

Summer holidays travel

Why now is the perfect time to plan your summer holidays

  • There are some fantastic deals around on prices
  • Buy now and you have plenty of time to pay off your holiday on credit
  • Many travel operators are currently offering extras such as “children go free”
  • Book up the best festivals, hotels and locations while they’re still available
  • January to March are traditionally the months when the most summer holidays are sold – and when the most effort goes in to discounting and promoting them
  • You can secure a fantastic summer holiday right now with a low deposit
  • Book now and you’ll have great choice of travel times and more convenient flights
  • If you’re only able to travel during the school summer holidays when prices are high and everyone wants the same trips you could save a fortune by booking early

What are the options for paying on credit?

At this time of year, personal savings can be low after all the spending of Christmas. That’s why the option of paying for a summer holiday on credit is such a popular choice. With three months to go until June, now is the time to start planning a fantastic summer trip that you can pay for in the run up to the summer months. If you want to pay for your summer holiday on credit then what are your options?

Travel agents and operators

Big names like Tui and Thomas Cook offer ‘low deposit holidays’ in addition to the multiple promotions and sales that they use to push their trips at this time of year. So, you can secure a summer trip with a deposit from as little as £50 per person in some cases. You’ll then have the option of clearing the remaining balance on a monthly basis or in one or two block payments.

A personal loan

Personal loans are a great way to pay for a summer holiday now if you’ve got cash coming in and you know that you can clear the balance in the future without putting too much pressure on your finances. Despite a slight rise in interest rates, loans rates remain some of the lowest they have been so if you’re looking to pay less to cover the costs of your trip you could find a great deal with a personal loan.

Rewards credit card

There’s a double bonus to using a rewards credit card to buy your summer holiday – the holiday itself plus all those additional rewards points. From high street vouchers, to points that you can use for future flights, choose rewards that will add something to your lifestyle.

Interest free credit card

If buying your summer holiday now and paying the lowest interest for it is the priority, an interest free credit card is a great way to do it. The key is to find a card that is interest free on purchases and which gives you enough time to clear the balance before the higher rate of interest kicks in.

Great value summer 2018 holiday locations

Given the drop in the value of the pound thanks to Brexit it’s harder than it used to be to find great value when it comes to holidays – but not impossible.

  • Argentina – this beautiful South American country is still good value for Brits. You’ll get £662.24 more for £1,000 in 2018 than you would have in 2012/3.
  • Mexico – the Pound has improved by 24% against the Peso in the past five years, which means Mexico, with its stunning beaches, Aztec culture and wonderful food is still great value.
  • Norway – you’ll get around £190 more for £1,000 this year than you would have done five years ago so Norway’s fjords and beautiful natural landscapes still represent an attractive option.
  • South Africa – for fans of wildlife and wine, South Africa still remains a good deal with a 23% improvement in the Pound to Rand rate in five years.
  • Australia – a trip of a lifetime is possible for any budget thanks to exchange rates. For every £1,000 you exchange in 2018 you’ll get £111 more than you would have done in 2012/3 so start planning your Outback experience or Sydney foodie tour now.

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Why should you save using an ISA? Wed, 14 Mar 2018 11:55:56 +0000 Alex Hartley An ISA (Individual Savings Account) is designed to be a simple and tax efficient way to save money. But with very low available rates, combined with the changes to the personal savings allowance, many have questioned whether any kind of ISA is still a good deal. So, what are your options if you’re looking to save in the most efficient way possible –  and does an ISA still feature in them?saving with an ISA

Why ISAs are a good idea

ISAs have evolved over the past couple of years and now offer a very wide range of choice for tax free savings. Today, you have the option of tax free savings or a tax free investment account that you can open via a broad selection of different building societies, banks, asset managers or insurers. The ISA seems like a great idea – a way to accumulate cash without attracting tax up to an annual limit (in the 2017-18 tax year, you can put £20,000 into a cash ISA). However, these savings vehicles do have issues. The main problem is that ISA rates are currently very low (1.1% per annum), which means that there isn’t going to be much of a return on the cash that is invested into the ISA.

The personal savings allowance

Another key reason for the current lack of interest in ISAs is a change in the law that introduced a new personal savings allowance on 6 April 2016. As a result of this allowance, a basic rate taxpayer can now earn interest of up to £1,000 on savings not in an ISA and this interest is tax free. For higher rate taxpayers this drops to £500. Many believed that the introduction of the personal savings allowance meant the end of the line for the ISA, given that the tax free savings offered by both are currently almost identical. However, there are a few differences to bear in mind:

  • ISAs can be passed on tax free on death, which doesn’t apply to other savings products
  • If you move into the higher rate tax band then your allowance for the personal savings allowance drops by half
  • ISA products continue to diversify and offer a wide range of ways to invest as well as save

ISAs today – what are your options?

There are a growing number of ISAs to choose from and some of the less traditional are offering considerably more impressive rates of interest than the standard 1% on a cash ISA.

The Innovative Finance ISA. If you’re looking to get the highest return from an ISA then the Innovative Finance ISA has the most impressive rates. This is a new type of ISA that is based on the idea of peer-to-peer lending. So, you – together with other investors – are effectively lending your money to individuals or businesses and the returns that you make on these are tax-free. Currently, there are Innovative Finance ISAs that are offering targeted returns of around 7%, some of which can be opened with just £1. It’s important to bear in mind that this is a different type of product to other ISAs because of the investment angle involved. The returns are not guaranteed and you could lose your money if there is a complication, for example the business that your money has been loaned to goes bust. These ISAs are also generally not protected by the Financial Services Compensation Scheme.

The Stocks and Shares ISA. When you put your money into this type of ISA it is invested into stocks and shares, such as government bonds or individual company shares. Any income and gains that you make as a result of the investment are tax free (these would normally be taxable). So, the Stocks and Shares ISA offers a way to increase your savings, up to the limit, without paying tax. And you’re not limited to interest rates – returns depend instead on the performance of the stocks and shares you put your money into. Bear in mind that there are a number of charges that apply to this type of ISA and your investments can go down, as well as up.

The Lifetime ISA. This type of ISA has a specific purpose: saving for a home or saving for retirement. As long as it is used for this purpose then savers get a bonus additional 25% on top of whatever goes into the account. The Lifetime ISA has an annual limit of £4,000 a year and you need to be under the age of 40 to open a Lifetime ISA. If you don’t use the cash you’ve saved for the specific purpose then you will lose that extra 25%.

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Eating out vs. home cooking – The Great Food Debate continues Mon, 12 Mar 2018 11:22:49 +0000 Alex Hartley Food and eating habits can be a confusing business. One minute we’re told that this or that ingredient is a superfood, the next day another report emerges indicating it’s bad for your health. It’s very easy to end up not really knowing what – or how – to eat given the range of confusing information out there. However, while diets and food types tend to be a very subjective matter, when it comes to the choice between home cooked food or takeaways/eating out in restaurants it’s a little easier to quantify the arguments.eating out vs home cooking

The takeaway

Historically, the takeaway has had a really bad reputation. Nevertheless, according to government statistics, a fifth of UK adults have a takeaway once a week. Typically, takeaway food is fast food – high in salt, fat and sugar and low in nutrients and fibre. The average doner kebab, for example, has 2,000 calories (80% of the daily allowance for the average adult) and a wineglass sized portion of fat (according to research by Hampshire County Council). Just one slice of takeaway pizza can be around 300 calories and almost 10g of fat. These are not the kinds of statistics that will win a healthy eating argument. The government has also found a correlation between obesity and takeaways – obese children are more likely to be from deprived areas and government research shows a close association between the density of fast food outlets and the level of deprivation in an area.

Takeaways vs. restaurants

On the whole, takeaways don’t offer a wide variety of healthy food. Even with the arrival of services such as Deliveroo – which open up takeaway options other than pizza or kebabs – the bulk of takeaways will likely remain the high fat options. But is eating out at a restaurant any better than getting a takeaway? In 2014, an American study concluded that this is not the case, generating headlines such as, “Eating In Restaurants No Better Than Fast Food For Health.” The study found that people eating in a full service restaurant were consuming just as many calories as those who ate fast food. Although it’s worth bearing in mind that the study did not identify portion sizes it’s still a surprising result.

The home cooking debate

The same study that identified that restaurants could be just as calorific as a takeaway used home cooking as a point of comparison to both. It found that, on average people consume 205 more calories per meal when eating out at a restaurant, as opposed to cooking a meal at home. People eating a takeaway or at a fast food restaurant consumed an additional 194 calories per meal than those who were eating at home.

Why do we eat more when we’re out?

There are a number of possible explanations for this, including:

  • Portion sizes may be larger
  • The food on a restaurant menu may be higher in calories
  • We often view eating out as a “treat” and indulge more
  • We pay less attention to what we’re eating if we’re out dining with others
  • We just don’t know what’s in the food on a restaurant or takeaway menu, compared to something we have cooked ourselves

What about the financial cost?

There is a lot of conflicting information out there about whether healthy food or junk food costs less. However, in terms of where you’re eating that food – at home or from a takeaway or restaurant – home cooking wins on the financial front every time. In fact, average prices for food cooked at home dropped by 0.5% in the last financial year while restaurant cooked food prices rose by 2.7%. So, it’s actually getting cheaper to eat at home than it has ever been. Given that in the UK we currently spend around half of our annual food budgets on eating out and takeaways (according to the Office for National Statistics) just imagine how much more you could get for that cash by cooking at home more often.

So, when it comes to the great food debate, in cash terms home cooking wins every time – it will always be cheaper to eat at home than to buy a takeaway or eat at a restaurant. With respect to the health statistics it’s not quite as simple. Yes, you are more likely to consume more calories simply because of the nature of the food on a takeaway or restaurant menu. However, with the wider range of raw food, vegetarian and vegan restaurants popping up, as well as concerted efforts by mainstream restaurants to offer healthier options, you don’t have to. As always, it comes down to being informed about what’s in your food and then making the right choice.

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When and how to use the Small Claims Court Fri, 09 Mar 2018 12:01:31 +0000 Alex Hartley The ‘small claims court’ is not a court at all but a system of handling claims that are worth £10,000 or less. So, if you’ve had a workman make a mess of your bathroom, or goods that you purchased were faulty, then you’re most likely to find yourself on this track. If you’re making a claim that is worth £10,000 or more then you will need to go through the regular court process, which can be more expensive, more time consuming and may require legal counsel.small claims court

Why do people use a small claims court?

You can make a claim in the small claims court for most types of breach of contract claims. The most common types of small claims are:

  • A claim for compensation for faulty service – for example, the builder, plumber or gardener who does a bad job and causes damage or the dry cleaner who ruins your clothes.
  • A claim for compensation for faulty goods – for example, the dishwasher that never worked or the electronics you bought that have a serious manufacturer fault.
  • A claim that involves a dispute between a landlord or tenant – for example claiming compensation from a landlord for repairs that were never carried out or claiming unpaid rent from a tenant.
  • A claim for money owed under a work contract – for example, unpaid wages or a payment where proper notice wasn’t given.

Why would you use a small claims court?

If you feel that you’ve had a genuinely bad experience and been wronged as a result of an individual or company not doing what they said they would then the small claims court is a good option. It’s worth remembering that whatever you’re claiming will be scrutinised so if there’s anything you’re not sure about – or where you might be embellishing the truth – it’s a good idea to think twice before starting your claim.

How do you use a small claims court?

You can make a claim against an individual or a company in the small claims court. The cheapest way to make a small claim is to do this online – if you opt for the online route then you’ll have the following fees to pay:

£25 – £410 Initial claim fee – to begin your claim

£40 Court allocation fee – this fee gets your case into the courts

£25 – £325 Hearing fee – you’ll pay this if you actually have your day in court

There are time limits on when you can make a claim – for example, a breach of contract claim must be made within six years of the breach. You also have a responsibility to try and resolve the matter without going to court. So, before you start looking at the small claims process it’s important to contact whoever you’re planning to make a claim against and give them time to resolve the situation.

If you don’t have the cash available to make the claim then take care. Only borrow money to do it if you feel you have a genuinely strong case.

What’s the process involved?

  1. Fill in and send a claim form. This is where you set out what the claim is about. You’ll need to send two copies of the claim form, which will be stamped and the court will serve it on the defendant (this will certainly get their “attention”!).
  2. If the defendant agrees that they owe you money then they won’t defend the claim and you should be paid immediately.
  3. If the defendant doesn’t agree then they will have 14 days to prepare a defence.
  4. You’ll receive an allocation to the small claims track and a hearing date. You will be asked to submit documents you’ll be using at the hearing to both the court and the defendant 14 days before the hearing.
  5. During the hearing, both sides will have the chance to make their case and at the end of it the judge will make a judgement in favour of one or the other.
  6. If there was an irregularity in the proceedings or you feel the court made a mistake in law then you will be able to appeal.

What other options are there?

Mediation – if you don’t want to pay the court fees but you’re keen to recover money you think you’re owed, an independent mediator could help both sides to reach a fair conclusion.

An Ombudsman – an Ombudsman is an organisation that has been set up to protect consumers. If you have a consumer complaint then you can contact an Ombudsman and they also have the power to order compensation and compel various actions. Just as with a court claim you’ll need to try and resolve this yourself first.

A watchdog – there are a number of industry watchdogs in the UK. Although they don’t have any powers to order compensation they have some sway in terms of influencing change if there are large numbers of complaints in a particular industry or profession.

A professional body – many industries have their own professional bodies and consumers can make complaints about businesses or individuals that are members of that body. For example, if you want to make a complaint against a letting agent you can contact Association of Residential Letting Agents and if the agent is a member they will investigate and can take action.

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How to access your credit report Wed, 07 Mar 2018 12:37:48 +0000 Alex Hartley Your credit report has a lot of impact on your financial future. It’s what lenders will use to help decide whether to approve an application for credit, such as a loan or a mortgage. It can also determine whether you’re able to access the cheapest interest rates and how much you pay to borrow. It’s an important document that many people still don’t take the time to keep track of.accessing your credit report

Why should you read your credit report?

To make sure your details are correct. If your credit report has mistakes in it then this could affect your credit score. It could also give lenders a false picture of whether you are a potential borrowing risk. For example, your credit report may not show an address for you for a period of time which a lender may find suspicious.

To identify any mistakes. For example, your report might show a missed credit card payment from years ago that you cleared straight away. You can ask that this is removed, which will improve your overall credit history.

To look for inconsistencies. If you’re repeatedly being turned down for credit, looking at your credit report could help you work out why. For example, is your report still linked to an ex-partner who has a bad financial history?

To understand what you can do with your finances. While credit scores differ from agency to agency – and lenders don’t actually use them to assess your credit worthiness – they can be a good indication of your financial potential. By looking at your credit score you’ll be able to gauge what mortgage rates might be available or whether you’ll be able to get a low interest credit card, for example.

To avoid fraud. Regularly monitoring your credit report will ensure that you spot any signs of fraud quickly, for example multiple credit cards being opened in your name.

How to access your credit report

There are three main credit agencies in the UK: Experian, Equifax and CallCredit. You have a legal right to receive a statutory credit report that will provide you with key information, including whether you’re on the electoral roll, the credit accounts that you have, any missed payments and searches against your credit report. It costs £2 to access a statutory report and all of the main agencies are legally obliged to provide you with one.

How to access your credit report for free


You can access your entire credit report for free with Equifax for the first 30 days. After that it’s £14.95 per month with the option to cancel at any time.  You’ll need addresses for the past six years and details of mobile phone contracts, credit cards etc to confirm your identity, just as you would for any of the other credit agencies.

Pros: Equifax is the UK’s second biggest credit agency so you’ll see what many of the lenders you apply to will see.

Cons: the monthly fee is quite substantial, particularly if you’re planning to access your credit report every month on an ongoing basis.


You can also access your credit report for free with Experian, although the agency places the same 30-day limit on free access as Equifax. After the 30-day free trial it costs £14.99 a month to have ongoing access to your credit report.

Pros: Experian is the largest credit agency and also puts together a selection of credit offers based on your credit info.

Cons: you can only access the 30-day free trial once and the monthly fee is high.


Noddle is part of CallCredit, the UK’s third credit reference agency. It is the only one of the big three agencies to offer access to your credit report for free. In fact, Noddle’s marketing is all based around the fact that access to your credit report and credit score is “free for life.”

Pros: it’s free – forever and gets some pretty good reviews on Trust Pilot.

Cons: CallCredit is the smallest of the agencies but that doesn’t necessarily mean that you won’t get a comprehensive picture of your credit history


Another service that provides free access to your credit score and credit report for life. ClearScore is based on your Equifax credit report although the two companies are not connected. It’s very straightforward to navigate and updates once a month with new credit information. The app is particularly easy to use.

Pros: it’s free and easy to access

Cons: there’s a lot of advertising for financial products although you’re not obliged to apply for any of them

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If you feel financially excluded what can you do about it? Mon, 05 Mar 2018 16:29:28 +0000 Alex Hartley Financial exclusion has become a big problem in the UK. Around this time last year the Select Committee on Financial Exclusion called on the UK’s banks, as well as the Financial Conduct Authority, to make tackling financial exclusion a priority. Currently, there are around 1.7 million people in the UK who don’t have a bank account. And roughly 40% of those of working age in the UK have tiny savings pots of less than £100. So, if you feel financially excluded then you are part of a large number of people who fall into the same category. But if you are financial excluded then what can you do about it?

being financially excluded

What is financial exclusion?

Essentially, it means being outside of mainstream financial services. Someone who is financially excluded will have difficulty accessing – or be completely unable to access – those financial services, whether that’s credit cards or a bank account. However, those are not the only elements involved. If you’re financially included then you not only have the ability to access a range of financial products and services that are appropriate to your life and income but you also have the financial literacy and savvy to know how to manage them. The financially excluded may struggling with basic financial concepts and may not have the financial capacity to get to grips with the range of financial products that are available today.

What is the impact of being financially excluded?

The number of people who find themselves financially excluded can cause problems, not just for individuals but also for the country and its infrastructure.

  • Employment issues. Many employers today will only pay wages into a bank account so those who don’t have one may struggle to get paid (or even to get work).
  • Retirement poverty. Those without savings will struggle to get by in old age.
  • Higher utility rates. Utility providers tend to drop their prices for those paying by direct debit, which is only an option for someone with a bank account.
  • High fees. If you don’t have a bank account you may have to use high street cheque cashing stores, which charge high fees for transactions, on top of 7-9% of the value of the cheque.
  • High interest credit. The financially included have access to attractive loans at affordable rates. Those who are financially excluded may have no option but to borrow high interest credit, which is more costly to repay.
  • Insurance protection. Insurance is another financial product that those who are financially excluded don’t have, leaving them completely unprotected in the event of fire, theft or flooding.
  • Social exclusion. There is plenty of evidence that financial exclusion reinforces social exclusion – but also that financial inclusion can reverse social exclusion if it is correctly tackled.

What can you do about financial exclusion?

The Post Office Card Account (POCA) – if you don’t have a bank account then the POCA enables you to receive pensions, benefits and tax credit and withdraw cash without expensive fees.

Basic bank accounts – as part of an initiative towards universal banking in the UK, 17 mainstream financial services providers now offer basic bank accounts. These don’t provide overdrafts or credit but basic account services without credit checks.

Financial skills for life – this is a partnership between Citizens Advice and Prudential plc, designed to improve financial literacy and understanding for anyone who feels financially excluded. It includes resources such as financial training and digital money coaches.

The Social Fund – the Social Fund provided a range of grants and interest free loans to people on low incomes. Unfortunately, it was abolished by the Coalition Government’s Welfare Reform Act in 2013. It has been replaced by funding made available to local authorities who can still provide assistance in their local areas to those in need.

Pensions auto-enrolment – around 80% of people believe that the state pension will be sufficient to cover the cost of retirement. However, this is barely the case now and certainly won’t be in the decades to come. Pensions auto-enrolment means anyone over the age of 22 earning £10,000 or more a year is automatically enrolled into a workplace pension to which an employer also contributes. If you don’t have any savings for retirement then don’t opt out of auto-enrolment.

Getting out of debt – over indebtedness is one of the main reasons that people remain financially excluded. However, there are a number of free services and organisations designed to help people get out of debt, including the National Debtline, Citizens Advice, and charities such as Step Change.

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60 years of the ONS Family Spending Survey – How Times Have Changed Sat, 03 Mar 2018 11:08:55 +0000 Alex Hartley 2018 sees the Office for National Statistics (ONS) turn 60. This non-ministerial department of government is the executive office of the UK Statistics Authority. Over the years it has provided a barometer of change when it comes to the spending habits of Brits. This year, the ONS is marking its birthday by going right back to its origins and looking at just how much times have changed since it first started monitoring how we spend our cash.Family Spending Survey


To celebrate 60 years of its Family Spending Survey, the ONS has made some comparisons between the way British families were spending when it first began and the way we’re spending now. In that time some 375,000 households have voluntarily provided information on their spending habits to the ONS, creating a picture of the way that families in this country spend their cash. Back in 1957 the world was a pretty different place to 2017/8. No one had mobile phones or the internet, we were pretty behind the curve on gender rights such as equal pay and you could still buy a house for around £10,000. Britain was also experiencing a period of full employment and rationing from World War Two had only come to an end three years before. So, the world was a very different place but how have things changed?

1957 – 2017

Overall spending. In today’s money, the average household in 1957 had a third less to spend per week than is the case now. Today the average home spends around £554 per week whereas back in 1957 this was the equivalent of just £381 in today’s money.

Homes and housing. Since 1957 we’ve gone through a property boom and house prices are the highest they have ever been – particularly when compared to average salaries. The homes we enjoy today are very different to those of 60 years ago when outside toilets were still common and many British houses didn’t have any central heating. While you could still buy a home in 1957 for £10,000 or less, today the average house price in the UK is £226,071. So, it’s not surprising that the ONS found an increase in the amount that families dedicate to housing costs from their weekly budgets – the proportion of total expenditure on housing has doubled in the past 60 years, from 9% to 18%.

Food and clothing. Back in 1957 Brits were still very much in a non-rationing mindset, as this had only ended three years previously. Fruit, sugar and meat were all fairly new to the British diet at this point and a much larger proportion of weekly spending went on enjoying them. In fact, the amount that British households spend on food has halved between 1957 and 2017. In those 60 years we’ve seen the proportion of total spending on food drop from 33% to 16%. The same is true of clothing, which used to account for 10% of weekly spend and in 2017 had dropped to 5%. You have to wonder whether if we’re spending so much less on food and clothes than we did 60 years ago, has the quality of what we’re getting dropped significantly too?

Health and wellness. If the consumption of alcohol and cigarettes are an indicator of how seriously Brits take their health then we’re doing better today than we were 60 years ago. Spending on tobacco, for example, accounted for 6% of household budgets in 1957 and in 2017 this was just 1%. Of course, all the research on the health risks of cigarettes has come in much more recent times so it’s probably not surprising that we were spending more on cigarettes then than we now spend on clothes. Surprisingly, alcohol consumption has stayed pretty much the same and we spend the same proportion of our weekly budgets on it now as we used to in 1957.

Many of the costs that eat further into our budgets today are easy to explain – for example we spend vastly more on transport today than we did in 1957. But, as more of us have cars, and as we tend to travel much more for work and leisure that’s perhaps not that surprising. We also spend a lot more on leisure and services as there simply weren’t that many options in terms of paid for leisure and entertainment 60 years ago.

From fashion, through to travel costs and food, spending habits have evolved significantly in the years since the ONS first began. And, given the revolutionary change we’ve seen during that time socially and politically, it makes you wonder what’s likely to happen in the next 60. Hopefully the ONS will be around to find out.

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Equity Release reaches record levels in 2017 Wed, 28 Feb 2018 11:39:53 +0000 Alex Hartley Equity release is a frequently discussed topic these days. According to statistics from the Equity Release Council, older homeowners released £3.06 billion of equity from their homes in 2017. In the last quarter of 2017 the equity release industry broke new records with annual lending growth in the sector reaching the highest levels since 2002. So, equity release is clearly a popular option for older UK homeowners – but is the trend likely to continue?equity release schemes

What is equity release?

It is a way for UK homeowners to access some of the value that has been built up in their property by paying off the mortgage. The equity in the property – i.e. the paid off value – can be unlocked to release cash that can be used for other purposes. The lifetime mortgage is the most popular option for equity release – 75% of the new equity release arrangements agreed at the end of last year were of this type. Lifetime mortgages release a cash sum from the property but don’t require monthly repayments as a regular mortgage does. Instead, the interest that would normally be paid under such an agreement is rolled up and added to the overall amount owed. This is repaid when the property is sold, usually on death or when the last surviving home owner is taken into care.

Why are we seeing such an increase in equity release?

A broad range of reasons have been put forward as to why we’re suddenly seeing such an increase in the popularity of equity release products, including:

  • Interest rates are the lowest they have ever been, which makes this kind of borrowing cheaper than it used to be
  • The older demographic is growing by the day, creating an increasing number of people who are eligible for equity release every year
  • Equity release has become more common – it used to be that equity release had a “bad” name but there are now more safeguards in place and equity release has a far better reputation.
  • The market offers a wider range of choice – the competition to attract customers to equity release has forced equity release providers to offer better deals on interest rates, for example.

What do people spend equity release on?

Those who opt for equity release are borrowing, on average, £80,000. This is being spent on a very wide variety of different things including:

  • Home and garden improvements
  • Payments to children and other relatives
  • Holidays, travel and enjoying retirement
  • Making a pension go further

An increasing number of people are also using equity release to pay off or consolidate existing debts, for example credit card debts or personal loans. Some are repeatedly releasing equity from their homes in order to repay new debts over and over again.

Are there other alternatives?

Although equity release has clearly been fully embraced by the current generation of older homeowners it is not for everyone. It’s easy to forget that releasing equity from a property means that a large proportion of the sale value of that property will then go the equity release lender when it is eventually sold. This could have a big impact on inheritance value for generations coming up behind, many of whom are already struggling with stagnant wages and higher housing costs and may have been relying on such a windfall. In addition, the full effect of the interest is often not taken into account. Equity release offers average rates of interest of 4-5% – which seems low when compared to average credit card interest rates of 17%. However the interest can quickly mount up, particularly if the homeowner lives a decade or more after the equity release has been agreed. So, what are the other alternatives?

  • A remortgage. Right now it’s possible to get a better rate of interest for many mortgages than with equity release as interest rates are so low. As a result, a remortgage might be a better option.
  • Using a secured loan (also known as a homeowner loan) – current rates start at just over 3.5% p.a. and can be a relatively straightforward way to borrow against the value of your home.
  • Trading down. Selling a home with a lot of equity in it and buying somewhere smaller, mortgage free, can release that equity without creating a future obligation.
  • Not spending. It’s worth considering whether the spending is actually required or whether it might be better to simply go without if it’s seriously depleting the one valuable asset most people have.

For those considering equity release it’s important to take legal advice on the decision and also to speak to debt charities such as Step Change as they have a lot of insight to offer. And – crucially – relatives need to be told about changes such as this as it will considerably impact on their own expectations for the future.

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Are you taking on debt you can’t really afford? Mon, 26 Feb 2018 10:55:27 +0000 Alex Hartley “Alarming” increases in consumer debt have been much in the media in recent times. New figures show that unsecured debt could exceed £15,000 per household in 2019, rising to £19,000 per household by 2022. This is not debt made up of mortgages but purely unsecured debt, such as personal loans and credit cards. The statistics have triggered fears that whole swathes of the UK population will end up with debt that they can’t afford to repay – the effect of which could be disastrous for the economy as a whole. However, while there’s no doubt that household debt levels are certainly rising, the demographic affected by this is not as many have predicted.unaffordable debt?

Who is taking on this new debt?

New research from the Bank of England and the Financial Conduct Authority has found that new borrowing is not necessarily being driven by desperation. The research has identified that these borrowers have good credit ratings and no mortgages. So, they are not made up of “the struggling poor.” This comes as something of a surprise to many commentators who had been labouring under the assumption that debt increases such as this are largely due to borrowing by those who are unable to manage on existing income.

Why are the “well off” borrowing more?

This is something that the Bank of England research doesn’t reveal. And it’s this information that could be the key to understanding whether the rise in borrowing is really something to be concerned about. As a nation, we now owe as much as we did before the 2008 financial crash – but how much of a risk does this represent?

“Free” money. Those who are better off could well be borrowing to take advantage of low interest rates, which effectively offer “free” money for a period of time. So, for example, some might be taking advantage of 0% credit card spending rates to invest the cash elsewhere and then repay the card at the end of the 0% period having made a profit. Others use credit cards to earn points or take out low interest loans to cover unexpected costs because they’re cheaper than insurance.

No hope of a mortgage. The data provided doesn’t tell us enough about who these new debtors are to draw any real conclusions. However, there has been speculation that it’s younger generations who have good credit ratings – but no hope of taking out a mortgage – who have been driving the increase in consumer debt.

Cheaper deals. One thing that the research did reveal was that these consumers are remaining in debt for longer. This would indicate that debt such as low cost car finance and low interest rates on loans and credit cards is providing an incentive to borrow. As long as there are cheaper deals on borrowing the trend could continue to grow.

What are the risks?

Although this new research has been viewed positively by many, economists at the Bank of England have still warned about any rise in the levels of consumer debt for the following reasons:

Stagnant wage increases. It’s been a year since inflation began to outstrip pay rises and wage growth remains stagnant. If interest rates continue to rise this could mean debt becomes unaffordable even for the well off.

A good credit rating doesn’t mean excessive wealth. You don’t need to be rich to have a good credit rating. The new research doesn’t actually show whether new borrowers are relatively wealthy or just have a good borrowing history.

Things can change. Anyone borrowing still needs to ensure their debt is affordable. Life changes quickly, from illness to a new baby, and high debt levels could quickly become unsustainable even for those who aren’t “poor.”

Good value credit is key

There’s no doubt that these statistics are being driven in part by the fact that credit is better value than it used to be. So, where do consumers find the best value credit?

  • Online lenders tend to be able to offer better rates of interest and no fees or charges, whether for personal loans or credit cards.
  • New lenders. We are seeing a whole swathe of new lenders poised to enter the market with borrowing that is less costly and provides more in return.
  • Innovations in finance are being designed to tailor credit options to individual circumstances to ensure that consumers always get the best value credit. Enter artificial intelligence such as the chat bot Cleo, which is designed to help driver smarter, bespoke personal finance decisions.
  • Peer-to-peer lending. There are increasing options for peer-to-peer lending – this type of lending can be to businesses or individuals and often provides a cheaper credit option than borrowing from high street banks.

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Car Finance – the worry of extra charges Fri, 23 Feb 2018 11:28:43 +0000 Alex Hartley Car finance is an enormously popular way to own a car in the UK. Personal Contract Plans (PCPs) are now used for four in five new cars that are purchased and there are millions of these loans now in force in this country. However, some consumers have found that when the time comes to hand back the vehicle, if this is done via a voluntary surrender then there may well be some unanticipated additional finance on new cars

The mechanics of the PCP

The PCP is essentially a hire purchase agreement that enables someone without the cash to buy a car up front to borrow the money and repay in instalments. PCPs are structured around an initial deposit and a series of monthly payments that are made over three to four years. These monthly payments are calculated to cover the fall in value of the car as it ages. When the PCP contract comes to an end the car can either be purchased or it can be handed back without any additional cash to pay. If the car is to be handed back then it must be in decent condition and not have gone over the mileage limit.

What about voluntary surrender?

As it turns out, there is a third option for consumers with PCPs and it’s this that has somewhat muddied the waters. It is the “voluntary surrender” option that is causing the problem. This arises from the 1974 Consumer Credit Act, which enables a consumer who has made a purchase using a hire purchase agreement to hand back the item in question, as long as half of the contract has been paid up. This is a legal right that applies to anything obtained on hire purchase, including cars.

Where do the extra charges appear?

The Consumer Credit Act 1974 also says that a lender can apply additional charges if the consumer has failed to take reasonable care of the goods that are being voluntarily surrendered. In the case of a car it would probably be understandable if the lender applied an additional charge for a dented bonnet or stained interiors, as these would considerably impact on any resale value. But what about additional mileage? Currently, lenders are arguing that it is perfectly fair and reasonable – and legal – for additional charges, often in the hundreds of pounds, to be added on a voluntary termination where mileage on the car has gone over estimated totals. The justification for the charges is that mileage exceeding the set limit falls within the definition of failing to take reasonable care within the Consumer Credit Act.

What about the PCP contract?

What has prevented many consumers from making complaints about this in the past is the fact that virtually every PCP contract explicitly states that charges will be applied in this way. However, the point to note here is that a large number of experts have said that these clauses don’t stand because they are contrary to the Consumer Credit Act. Just because something is written into a contract doesn’t make it fair, reasonable or legal. And if a contractual term goes against the legislation then it could be found null and void.

What’s the practical situation?

It’s a difficult one to navigate. Currently, there are a number of consumers entangled with PCP lenders who have applied these charges and are looking to enforce them. Some have even applied them as missed payments that show up on credit ratings. However, legal experts still claim that these lenders have not got a leg to stand on, that actually they are ‘bluffing’ and should a case of this kind come before a judge – which it will do soon – the charges will be found to be unenforceable against consumers.

The reality is that PCP contracts are hugely popular, with consumers and also with lenders and manufacturers. However the voluntary surrender option is only popular with consumers because it often means the other parties lose money. Up until now lenders have used their own terms and conditions to enforce additional charges, for example for extra mileage. They have also relied on a lack of consumer knowledge about how legislation and contracts interact and the fact that few consumers have access to affordable legal advice. Now, we are beginning to see a stream of challenges and some could succeed. With respect to extra mileage it might be easy to see how 100,000 extra miles might indicate a lack of reasonable care. However, the charges are being applied to vehicles with much less – 7,000 in one case. Currently, there’s no clarity on these numbers, or anything else, but if there could well be in the coming months if one of these claims succeeds.

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George Banco is acquired by Non-Standard Finance PLC Wed, 21 Feb 2018 12:07:13 +0000 Alex Hartley The market for guarantor loans has grown significantly in the UK over the past couple of years. Particularly for younger people with impaired or inadequate credit ratings, a guarantor loan often represents the only opportunity to be able to borrow. George Banco has risen to prominence as a guarantor loan lender over the past few years and towards the end of 2017 was acquired by a fellow sub-prime lender, Non-Standard Finance PLC.

Who is George Banco?

The lender was established in 2014 and offers guarantor loans. This is a type of lending that requires a third party to stand as surety for a loan. It enables someone without a great credit rating to be able to borrow, thanks to the guarantor system. Guarantors are required to be over 18 and are usually homeowners with a good credit rating. In the years since it was established, George Banco has expanded considerably and has become the second most prominent provider in the guarantor loans market. When the company was acquired it had a loan book value of around £40 million and in the year up to 31 May 2017 it generated revenue of £9.3m.

George Banco is one of a large number of guarantor loan lenders that Solution Loans works with – it’s quick and simple to apply to all our lenders in one go, and at no cost!

Who acquired George Banco?

When the acquisition of George Banco was announced, the market value of Non-Standard Finance PLC increased as a result so this is clearly a positive move for the lender. Non-Standard Finance PLC was established in 2015 and has become the UK’s third-largest provider of home credit (i.e. loans where the repayments are collected at home), as well as other unsecured types of loans. George Banco will sit alongside another acquisition that the business has made – TrustTwo, which was acquired in 2015. TrustTwo targets younger borrowers who either have no credit history, or a difficult credit history, and aren’t particularly eligible as borrowers as a result.

What does the acquisition mean for the market?

The thriving guarantor loans market looks set to continue to grow with the consolidation of these businesses. Guarantor loans have become incredibly popular in the UK for a number of reasons:

  • They are unsecured so can be borrowed even where there is no asset (such as a home or a car) to secure the loan against
  • New lenders have made guarantor loans more attractive. Lenders recognising the need for this type of lending now offer low (or no) fees, as well as instant cash availability.
  • Guarantor loans offer slower repayment. While payday loans, for example, have short repayment terms that may suit some borrowers, spreading payments out over a longer period of time with a guarantor loan makes borrowing more affordable for many.
  • Parents and relatives can provide low risk assistance. Guarantor loans are popular with the younger generations currently struggling to obtain finance. Guarantor loans offer a way for parents and relatives to support a loan application at no financial cost (as long as the borrower keeps up the repayments).
  • A debt lifeline. For some people this is the only option when it comes to obtaining finance. Guarantor loans provide lenders with the reassurance they need to extend credit to certain borrowers. Without this some borrowers might not have access to finance at all.
  • There is no limit on what the finance can be used for. From helping to get a business off the ground to paying for emergency repairs, there is no requirement for guarantor loans to be used for a specific purpose.

What does the George Banco acquisition mean for borrowers?

It’s a sign that the market is continuing to develop and that more sophisticated products and options will likely be created. Non-Standard Finance PLC has said that it intends to expand its product ranges to meet demand from customers and to offer different types of borrowing that cater to non-standard borrowers.

“George Banco represents a transformative acquisition for the group, putting NSF into the clear number two position in the fast-growth guaranteed loans segment. Complementing our existing TrustTwo brand, George Banco provides us with real scale and an opportunity to grow even faster”

said John van Kuffeler, chief executive of Non-Standard Finance.

What obligations do guarantor loans place on the guarantor?

Guarantor loans offer a great opportunity for a borrower and are also attractive to lenders – but what about the guarantor? It’s always important for a guarantor to understand what might happen if the borrower doesn’t keep up essential repayments. Any repayments not made become the responsibility of the guarantor, as well as any applicable fees, charges or interest. Guarantors are often friends or family members – it’s important for the guarantor to trust that the borrower is going to make the repayments on time.

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Spring Short Story Competition Open for Entries Mon, 19 Feb 2018 16:38:45 +0000 Amanda Gillam We’re pleased to announce that our third short story competition is open for entries. Entries to our previous competition grew significantly compared to our inaugural one. And we’re expecting a lot of interest in the new one not least because of its theme and a certain event that it coincides with!

The theme of this competition is “The Wedding Gift”. It can be interpreted any way you wish, but we do recommend you take heed of our judges’ advice following our previous competition:

As a writer, it’s worth remembering that your first idea for a story may often be someone else’s too, so it might be a good idea to dig again more deeply for a different or more unusual idea?

wedding rings atop a roseHere are the competition’s rules and terms & conditions. They should all be self-explanatory.

Not only is the competition FREE to enter (unlike many others) but you could also WIN a first prize of £250 or a runners up prize of £50!

Please be aware that your entry must be received by midnight on Thursday 31st May 2018.

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How’s 2018 looking for house price movements in your area? Wed, 31 Jan 2018 11:49:05 +0000 Alex Hartley For anyone trying to buy – or sell – a property right now, the UK housing market is a confusing place to be. Tax cuts for first time buyers would seem to be an encouraging sign but then mortgage approvals have hit a significant low. On the one hand house prices are still some of the highest in Europe – but for those looking to sell movement has been incredibly sluggish. So, where are we right now in terms of the housing market and what change is there on the horizon?house price growth

It’s not a great time to get a mortgage

According to industry trade body UK Finance, mortgage approvals fell to a 13 month low at the end of 2017. 40,488 mortgages were approved in November, for example, compared to 41,576 in September. Some experts have predicted that this marks the beginning of a downward trend in mortgage approvals, something that has been made worse by the rise in interest rates last year. There could be many other reasons for the fall too, from the higher interest rates on mortgages in 2018 to more stringent lending criteria.

However, that’s not the case if you’re remortgaging

In fact, the number of remortgages at the end of last year was 37% higher than the year before. This was largely attributed to more competitive remortgage rates as a result of the interest rate rise. As ever if you are looking to remortgage to release equity to do major home improvements or to fund some other sizeable project then it is also worth looking at secured loans as an alternative.

The housing market in general is sluggish

Words such as “flat” and “quiet” are being used to describe the UK housing market, which was previously viewed as fairly dynamic. Data from the RICS UK Residential Market Survey in November indicated that new buyer enquiries were still low but not as low as in previous months. However, other than in Wales and Northern Ireland, sales agreed numbers were either completely flat or in the negatives. A lack of new instructions to sell is highlighted as one of the major reasons that the market is so slow. The supply of homes for sale has been in decline now for some 22 months and isn’t likely to change significantly in the near future. Brexit is often named as another of the major reasons for the poor performance of the UK housing market at present. With uncertainty over the UK’s exit from the EU set to continue for another year this influencing factor isn’t going to be relieved any time soon.

House prices are static

On a national level, house prices have remained static in the last couple of months. However, regionally it’s something of a different story. London, in particular, has seen significant downward movement in house prices. Analysis by Zoopla identified that around 35% of the homes that are being marketed for sale via its site have been marked down and London is where the biggest discounts are to be found. For example, the average price reduction for homeowners selling in Richmond in London is £84,244. Across the entire country, Zoopla identified the average house price reduction at around £25,562. Again, Brexit is considered an influencing factor here – the number of properties being marked down before the EU Referendum in 2016 was slightly less at 29%.

The forecast for 2018

EY Item Club predicts house price growth of just 2-3% in 2018. There are many reasons for this, including the fact that inflation is currently running at a rate far higher than income growth. So, life has become unaffordable for many people and a large and risky purchase, such as a property, just isn’t an option. The impact of low consumer confidence is being exacerbated by the increased difficulty when it comes to getting a mortgage. For many people, given the number of potential obstacles to buying, it seems like a process fraught with issues and costs. So, are there any positives for the UK housing market this year?

  • First time buyers can purchase without paying stamp duty. Properties up to £300,000 are stamp duty free
  • This is a good time to remortgage – remortgage rates are some of the most attractive they have been for some time
  • Buyers with sizeable deposits generally won’t struggle with mortgages and could enjoy significant bargains as a result of house price drops
  • Some experts have predicted that demand for one and two bedroom flats will increase as house owners look to downsize
  • Slow house price growth should make it easier for first time buyers with mortgage options to get a foot onto the property ladder

Regionally, there have been some house price gains (for example in Wales, Northern Ireland and the North West region) and an increase in both new sales agreed and new instructions.

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Credit file vs credit score – what’s the difference? Mon, 29 Jan 2018 12:42:24 +0000 Alex Hartley “Credit file” (or “credit report”) and “credit score” are terms that are often used fairly interchangeably, as if they represent the same thing. However, while both involve the same data these are two quite different elements in the picture of your financial health and history that available data can create. So, what’s the difference?

your credit file

What is a credit file

This is essentially a potted history of your financial behaviour with respect to the credit that you’ve had. This information comes from public sources (e.g. the electoral roll) and also from private sources (e.g. data that is shared between lenders). It is collated by credit reference agencies who then put it together into a report that is made available to lenders, mobile phone operators – anyone that you apply for credit with.

What’s in a credit file?

There are three main elements to your credit file: who you are, how you’ve borrowed and what you’ve borrowed.

  1. Who you are. This is personal information about you that confirms your identity. So, for example, this could include name and address, as well as where you are registered to vote.
  2. What you’ve borrowed. This can cover a very wide range of credit, including credit cards and personal loans. Contracts for a mobile phone or internet provision are also included here. Potential lenders will be able to see what your current balances are, the total debt and a list of the credit accounts that you currently have.
  3. How you’ve borrowed. Your payment history is broken down into some detail in your credit file, showing when payments have been made on time and when they haven’t. This will be a crucial part of the decision making process for a new lender, as if you have a history of missing payments on credit cards they might be reluctant to offer you the credit you’re asking for.

Your credit score

There’s a perception that the UK has a universal system of credit scoring but in fact that’s not the case. There are three main credit reference agencies in the UK and each one has its own system of scoring. So, you will have one score with Equifax, for example, and quite a different score with Experian. Each agency has a different top limit – Experian’s is 999, Equifax’s is 700, and Callcredit’s is 710 – but all use the same data to calculate the scores that they produce. It’s your credit file that determines whether you have a bad credit rating or not and a credit score is simply a representation of this.

How is a credit score calculated?

The information in your credit file is used by each of the individual agencies to calculate the credit score that you get.  The higher the score you have, the more likely you are to get credit with a new lender. However, it’s worth bearing in mind that there are no guarantees, especially because lenders use their own scoring systems to rate each potential borrower.


Why do credit providers access a credit file? They are looking to see whether it’s a good idea to give you the credit you’re asking for i.e. how you’ve behaved as a borrowed in the past. A credit file can also be accessed as a way to check identity.

Do credit reference agencies determine your credit score? Yes and no. Credit reference agencies will give you a credit score based on the information in your credit file and their own systems of scoring. However, each one of these is different. More importantly, lenders don’t use the scores that agencies generate when it comes to making lending decisions. They will rate a potential borrower using the information in the credit file but against their own internal scoring systems. So, an ‘Excellent’ score with Equifax may not guarantee you the credit you want with a credit provider using a different scoring system.

Can you change your credit score? Yes. There are a number of ways to improve a credit score (see the video above), such as paying off debt, correcting any mistakes on the file and disconnecting your credit file from an ex-partner who has a bad credit history.

Can you change the information in your credit file? If it’s incorrect then yes. Other than that, no. We are all creating new credit history all the time with the decisions we make with every loan or credit card we have. But it’s not possible to go back and erase bad past decisions.

How much influence does your credit file have? A lot. You can still get bad credit loans and credit cards if you don’t have a great financial history but it tends to be harder and more expensive. The more positive the financial history in your credit file (and consequently the higher your credit score) the easier it will be to get credit.

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How do Credit Reference Agencies work? Fri, 26 Jan 2018 11:21:15 +0000 Alex Hartley Credit reference agencies, such as Experian, have come to play a significant role in most people’s lives. We tend to interact with them at the point of applying for credit, whether that’s a mortgage or personal loans. However, while most of us have had some interaction with credit reference agencies at some point there is still quite a lot of misunderstanding about how they actually reference agencies

Why do credit reference agencies exist?

According to the World Bank “credit reporting…allows lenders to evaluate the borrowing capacity of clients. And lets good borrowers benefit from more and cheaper lending.” Today, credit reference agencies have two main purposes: to help lenders make decisions that are fair, consistent and well informed and also to help prevent financial fraud. There are three agencies in the UK: Callcredit, Equifax and Experian.

Who uses credit reference agencies?

Banks, other lenders, building societies, mobile phone companies and retailers are some of the main organisations that use credit reference agencies. The information that is provided to these enterprises enables them to make a fairly swift decision about whether or not to offer credit to a consumer. The available data provides insight into whether the person making the application can afford the credit that they want and, crucially, whether they are likely to be able to repay it.

How are credit reference agencies regulated?

They must be authorised by the Financial Conduct Authority and credit reference information must be stored and processed in accordance with data protection legislation. Complaints about agencies are made to the Information Commissioner’s Office or the Financial Ombudsman.

Where does the data come from?

There are two main sources of data for credit reference agencies: public information and information that has come from a credit account.

Public information – this includes the Electoral Roll, as well as information on court judgments and bankruptcies from government services such as the Insolvency Service.

Credit account information – this is information from other lenders about their customers. This is effectively a combined copy of all the information that individual lenders have about someone, held in one accessible place. Only lenders who are members of a scheme called CAIS (Credit Account Information Sharing) have access to this information.

Does there have to be consent?

When it comes to credit account information, yes. When an application for credit is made to a lender there will usually be a requirement for the borrower to give that lender permission to share information with other lenders. If you read the small print of your last loan or credit agreement you will find that permission written into the terms.

With respect to the public information that credit reference agencies hold there is no requirement for consent as this is already public knowledge.

What do credit reference agencies do with the data they have?

Nothing. The data is simply gathered together in one place and then held there for lenders to access when an application is made for credit. The agencies themselves don’t actually process the data or package it up. It’s actually the provider of credit who uses the data to help them decide whether credit should be extended to the applicant.

Who can see the searches against my file?

Lenders are legally required to keep a record of all the searches that are carried out. Every time a search is made against an individual it leaves a ‘footprint’ that other lenders can see (although lenders can’t see who has made the search and will only see credit searches and not non-credit searches such as an identity check). This information forms part of the decision making process for lenders. For example, if an individual has a lot of footprints against their name in a short space of time this could be an indication of someone applying for credit that they can’t afford. In some circumstances a so-called “soft search” can be done that does not leave a footprint.

What don’t credit reference agencies do?

Credit reference agencies are quite limited in terms of what they can and can’t do with the data they receive. There are some common misconceptions about this – in particular what these agencies don’t do with our data:

  • Make lending decisions – credit reference agencies provide data with which lenders can make decisions about whether to lend. However, the agencies themselves don’t make these decisions.
  • Advise lenders – there isn’t any element of advice when it comes to the relationship between lenders and credit reference agencies. The information collated is presented without any obvious bias.
  • Create blacklists – agencies don’t compile ‘blacklists’ of people who aren’t suitable for credit.
  • Receive data on whether or not credit applications are successful. Although eventually, new loan or credit card data will be recorded with a credit reference agency, there is no process of informing agencies as to whether a lending application has been successful.
  • Determine your credit score for lenders. Each agency will give you a credit score based on the information they have about you. However, these are all different and are not used by credit providers to make lending decisions.

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What are your responsibilities as a guarantor for a loan? Wed, 24 Jan 2018 11:17:35 +0000 Alex Hartley For someone without a great credit score, finding a friend or relative willing to be a guarantor can be a simple solution to getting rejected for credit. If you’re willing to stand as a guarantor for someone you know then you’re doing them a great favour. However, it’s also important to understand what you’re signing on for and what might happen if they’re not able to pay back the loan.Being a guarantor for friend or family member

What is a guarantor?

If you decide to be a guarantor then you’re guaranteeing the obligations of the person who is taking out the loan. In practice, that means that if the borrower can’t make any repayments on the loan you’ve agreed that the lender can demand them from you instead. Guarantors are asked to sign a guarantee agreement – this is a legally binding document and once you sign it you become responsible for the loan repayments if the person you are acting as guarantor for cannot pay.

Why do lenders ask for guarantors?

It all comes down to how creditworthy the borrower is. If there is any reason to doubt that they might be able to repay the loan – for example, they have a poor credit score – the lender will look for back up in case there is a default. The guarantor is the back up that enables the lender to advance the loan without taking all the risk on to their own shoulders – hence the term “guarantor loan“.

What happens if the borrower doesn’t repay?

The lender can come directly to you, the guarantor. If the lender decides that it will be simpler and less costly to pursue you for what is owed, as opposed to the borrower, then you will be the first port of call after a payment default. You will then be obliged to make the payment that the lender is requesting, in line with the guarantee agreement signed.

What are the risks in being a guarantor?

  • You will be required to make payments due under someone else’s debt – the total amount could be more than the original loan with default fees and interest
  • You don’t have any right to the amount borrowed by the person you are guaranteeing but the guarantee agreement makes you responsible for repaying it
  • If you aren’t able to make the necessary payments the lender can pursue you for it, via the courts if necessary
  • If you get into trouble financially as a result of repaying someone else’s debt as a guarantor then this could affect your credit score
  • If you have been asked to provide security for the loan then you risk losing this if you can’t make the repayments (e.g. your car)
  • If you end up out of pocket it could affect a close relationship

What does the lender need to do?

Lenders must be responsible and take steps to ensure that you would be able to make the payments you’re agreeing to as guarantor should that situation arise. Most lenders will recommend that you take independent legal advice so that you know what’s involved. If you don’t, lenders must communicate to you key information, such as what your liability will be, the fact that it can be limited, whether you’ll be told if the borrower gets into difficulties and what clauses in the credit agreement affect you (e.g. interest).

How can you protect yourself?

As a guarantor there are a number of ways to protect yourself, from the debt and also from making a poor decision.

Before you sign anything:

  • Avoid “All Obligations” guarantees – if your guarantee uses this language then you are guaranteeing not just this loan but any others that the borrower has too
  • Get the guarantee in writing – it should state the amount of guarantee, how long it lasts for and when your obligations might kick in
  • Choose security carefully – the lender will likely ask for security for the guarantee. This should not be something that is worth more than the debt or anything you can’t afford to lose
  • Think about the borrower – is this someone who is responsible enough to manage their own debt? Do they really need this money?
  • Create a written agreement with the borrower that covers who is responsible for which part of the loan. You can also include clauses that allow you to see what is in the borrower’s accounts and to insist the borrower keeps you informed of their financial decisions
  • Think about whether your finances are in a good place – can you actually afford to repay this loan if asked to?

Once the guarantee is signed:

  • If you’re not happy then cancel the guarantee. This can be done at any time. You will still be responsible for the original loan until it is repaid but not for any further debt of the borrower’s
  • If you were forced to sign the guarantee under undue influence or you feel the credit agreement is oppressive then you may be able to challenge the lender’s right to come after you

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What types of credit may still be available if you have a bad credit history? Mon, 22 Jan 2018 11:54:54 +0000 Alex Hartley If you’re looking to borrow, bad credit can be a problem. However, even if you don’t have a perfect credit score, you still have options. Roughly 30% of people fall into the territory of having a “bad” credit score i.e. one that sits at the bottom of the levels defined by credit references agencies. However, it’s widely recognised that even someone who falls into this category may still have borrowing needs. And, as sensible borrowing can actually help to mend a broken score, credit is something that could benefit anyone, even those on the lower end of the spectrum.bad credit loans

What counts as a bad credit rating?

It depends very much on the agency doing the rating – and not all of them are that straightforward about the numbers that would give you a bad credit score. However, if your credit score sits at the lower end of the scale then you’re firmly within this category. There could be any number of reasons for ending up with poor credit. It might be something as obvious as defaulting on a previous credit agreement, missing repayments, making repayments late or being taken to court for non-payment of debts. Credit ratings can also be affected by a range of other factors. For example, you might have missing information on your credit file. Or your file may be connected to an ex-partner or housemate who has a bad credit score. There are different degrees of bad creditworthiness and each will have a different impact on the kind of credit that might be available to someone who has a bad credit rating.

Credit for people with a bad credit rating

Guarantor loans. This type of credit is specifically designed for a borrower with bad credit. The support of a guarantor – a third party willing to step in and cover the repayments if the borrower is not able to – is reassurance to a lender who may otherwise not lend. Guarantors need to have good credit, be over 18 and preferably be a homeowner (although a tenant may be fine too, especially for smaller amounts). Terms can be up to five years and guarantor loans are available for fairly substantial sums – up to £15,000. Smaller guarantor loans are available too, from £100 – £750.

Secured loans. If you don’t have great credit then it’s much easier to borrow if you own your own home. Secured loans are available to homeowners with bad credit who are looking to use the growing value of their property to support a credit application. Loans of up to 95% of the value of the property may be available, depending on circumstances. This type of loan is secured on the value of the property, which means that if it’s not repaid the property may be used to repay the lender.

Logbook loans. Another type of secured lending that is open to someone with a bad credit rating is a logbook loan. Rather than a property, with this type of loan the credit is secured by the value of the borrower’s car. Terms are usually three years and the typical borrowing amount is £1,000. As the loan is secured on the car, if it is not repaid then the car may be sold to raise the capital to repay.

Payday loans. When it comes to short term credit solutions, payday loans are ideal. And they are also well suited to someone with bad credit for two reasons. Firstly, the short term nature of the loan means that loan amounts are often lower, less risky for lenders and so the credit rating is not as crucial. Secondly, payday loans require you to have an income – as long as your income will clearly cover the repayments, lenders are more likely to lend regardless of credit rating.

Other options for borrowers with bad credit:

  • Doorstep loans – borrowing up to £2,500 is made possible even without a bank account. Lenders are open to borrowers with bad credit.
  • Bad credit credit cards – small borrowing limits mean low risk to lenders. A good opportunity to rebuild poor credit by making repayments regularly and on time.
  • Instalment loans – borrowing up to £2,000 may be available to those with bad credit, repayable in regular monthly instalments over 3 to 24 months. Interest rates can be high.
  • Car finance – if you’re a borrower looking for credit to finance the purchase of a car, a bad credit rating won’t usually exclude you from being accepted for car finance.
  • Personal loans – it may be more difficult to obtain a standard personal loan with a bad credit rating but many lenders offer bad credit personal loans, especially to homeowner borrowers.

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An unpleasant surprise is awaiting people on PCP car finance deals! Fri, 19 Jan 2018 11:47:45 +0000 Alex Hartley Personal Contract Plan (PCP) car finance deals are one of the most popular ways to buy a new car. In fact, 86% of new car buyers are currently using PCPs in order to finance the purchase of a new vehicle. However, recent changes in the values of new cars and used cars have made PCPs more expensive and meant that those who have already a PCP contract may not find it that simple to get a great deal next time around.PCP car deals

What is a PCP car deal?

It’s a very simple way to buy a car if you don’t have enough cash in the bank to make an outright cash purchase. Instead, you’ll pay a deposit for the car – often matched by a contribution from the dealer – and then take out a loan for three or four years that covers the rest of the sale price of the car. Regular monthly repayments are made over the period of the loan and these cover the gap between the new price of the car and the expected value of the car when the PCP comes to an end. When the PCP finishes then there are three options: hand the car back, pay an amount agreed in advance to own the car, or negotiate a new PCP deal. Most car buyers tend to do the last of these and that’s where the issues with car values are starting to kick in.

Why are people looking for PCPs suffering?

It’s now more expensive than it used to be to buy a new car. As a result, anyone looking for a PCP will pay more for the same car than would have been the case 12 months ago. There are a number of reasons for this, including the impact of Brexit, which had a significant effect on the value of the pound, and the increased cost of raising environmental and safety standards which manufacturers are passing on to consumers. At the same time as new car values have gone up, used car values have been dropping. The one benefit to this should, in theory, be that those on PCP contracts who choose to buy their existing car at the end of the contract will pay less. However, in reality most PCP contracts will account for this with an increase in the prior monthly repayments to compensate for the lower used car value. So, none of the savings get passed on to consumers.

What about existing PCP contracts?

If you already have a PCP in place then nothing is going to change until you come to the end of the contract. Previously, when new car values were lower and used car values higher, this would be the point at which the PCP borrower would have built up some equity in the car. That equity could be used to bring down the price of the new PCP contract or at the very least to reduce the size of the deposit. However, that’s no longer likely to be the case because prices are higher. The disparity in different car values also means that negotiating a new PCP is going to be much less favourable than previously. Now, it may simply not be possible to replace  a car with the same model when the PCP comes to an end because that same model may now be much more expensive.

What has caused the problems?

The issues with PCPs all turn on the differences in price between new and used cars because the monthly payments under a PCP are fixed on the difference between new and used car values. In many ways the success of PCPs has also played a role in undermining them. Because so many people now use PCPs there are many more used cars on the market and this has had an impact in terms of driving down the value of used cars – there’s just so many of them around. Consumers love PCPs and so do dealers, who make commission both on the car purchase itself and also on selling the finance. But the result of such widespread use is that PCPs are getting more and more expensive.

Can you still get a good deal on a PCP?

Yes, particularly as new car sales dropped off substantially at the end of 2017 meaning that many dealers now have a lot of surplus stock. The key with a PCP is to make sure you understand the terms, you know how the payments work and that – crucially – the deal is affordable for you. It’s worth bearing in mind that there are a lot of other costs generated by a new car that you’ll also have to cover so it’s not just the monthly payments that need to be affordable, you need a buffer too. However, if you shop around and find something affordable, a PCP could still be the best way to buy a new car.

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Who can be my guarantor for a loan? Wed, 17 Jan 2018 11:29:16 +0000 Alex Hartley There are many ways to borrow these days and if you don’t have the perfect credit score then that doesn’t necessarily need to be an obstacle. Loans that have a guarantor are one example of a bad credit loan i.e. borrowing even if your credit score is poor. If you apply for a guarantor loan then you are effectively giving the lender the reassurance of having someone else who will “guarantee” that the loan is repaid according to the terms of the credit agreement. But what is a guarantor and who can be one?what it means to be a guarantor for a loan

What is a guarantor?

A guarantor is a third party who agrees to meet the obligations you’re agreeing to if you’re not able to do so. The system of using a guarantor when it comes to financial obligations is an old one and actually pre-dates the credit scoring lenders use today to make decisions. It means that if you look like you might be a credit risk – for example, you have a low credit score – there is another option. Instead of being rejected completely for credit, you could be successful with the help of a guarantor.

Who can be a guarantor?

In theory, anyone over the age of 18 can stand as a guarantor for another person. However, the reality is that lenders are often looking for someone quite specific before they will accept a guarantor for a credit application. These are a few of the factors that lenders tend to look for in a potential guarantor:

A good credit history. Guarantors will often have their own credit rating checked by the lender, in addition to the checks carried out on the borrower.

Financially stable. The most appealing guarantors are those who can show that their finances are healthy so that they are in a position to cover the credit repayments should the need arise.

A homeowner. For many lenders a guarantor who is a homeowner is the ideal because this means there is a tangible asset to provide security if something goes wrong with the credit repayments – but many lenders will now accept non-homeowners.

A link with the borrower. A guarantor doesn’t have to be someone related by blood or marriage. However, lenders will be more convinced that the guarantor is committed to the responsibility if there is a clear link/relationship with the borrower.

A UK resident. If a lender has to take legal action against a guarantor then they will need to be UK resident for this to be successful.

Income and/or assets. If the guarantor is not a homeowner then there will need to be evidence of enough income and/or assets to cover the repayments that need to be made. This could be savings, an annual salary, investments and potentially a pension.

What does a guarantor do?

Initially, nothing. Checks are carried out against the guarantor and they will be legally required to sign a guarantor agreement. If you fail to make a repayment on a loan or other type of credit then the guarantor will be asked to make it for you. The responsibility for repaying the entire loan doesn’t then shift to the guarantor – repayments remain yours to make unless you’re unable to. If the guarantor refuses to make the payments then the lender can take legal action against the guarantor.

How do you choose a guarantor?

It’s important to choose a guarantor with care as it is a big responsibility. Use someone who is able to understand the impact of signing on the dotted line. Although the guarantor won’t have any right to the credit you’re borrowing they are making themselves responsible for its repayment and that can turn into a significant liability if you’re not able to meet the obligation.

  1. Make a shortlist of potential people. Often, this starts with close family members and people you trust. Parents, brothers, sisters, grandparents or close colleagues could all be a good option.
  2. Think about the financial stability of each of the people on the list. Could they afford to make the repayments for you if you weren’t able to? How would this affect their lives if that turned out to be the case?
  3. Who on the list owns their own home? This will make a guarantor much more attractive to a lender, particularly if the purchase is not recent. Tenants or people who live with their parents won’t be that appealing as a guarantor for a lender.
  4. Speak to whoever you have identified as your first choice and find out key information, such as whether they are willing to stand as your guarantor and what kind of credit score they have.
  5. Make sure both of you are happy with the situation – and both understand what’s involved.


Video: All About Guarantor Loans

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What causes someone to have a bad credit rating, and what can they do to fix it? Mon, 15 Jan 2018 11:05:11 +0000 Alex Hartley If you’ve applied for credit and been unexpectedly rejected then this may have something to do with your credit rating. A credit rating is basically an overview of the way that you have managed your money and credit in the past. It is data that is made available to lenders by credit reference agencies that will reveal information such as how much you’re borrowing, how well you’ve made repayments and how often you’re applying for credit. Lenders use their own “rules” to turn this credit rating data into a credit score, and then use the score as a means to decide whether to lend or not.Causes of a bad credit rating

A poor credit rating may not seem like the end of the world but it can have an impact in many ways. For example:

  • Rejection of credit card loans and applications
  • Only being offered high interest credit
  • Higher insurance premiums
  • Being unable to take out a mobile phone contract
  • Difficulty getting a car loan
  • Being denied business start-up finance

What causes a bad credit rating?

There is no single credit rating that every lender can see to make a judgment when it comes to your finances. However, there are a number of factors that will drag your credit score down whichever credit rating agency you refer to. These include:

Not sticking to the terms of another credit agreement. For example, you may have signed up for a personal loan but then not made repayments each month, as agreed. Even just making loan repayments late can have a negative impact on your credit rating.

Making only minimum repayments. If you’re doing nothing but paying off as little as possible on credit cards, for example, this could also negatively influence your credit rating. Many lenders see this as evidence of being unable to manage money and pay off debts. 

You’ve never had any credit. It might seem that being completely free of debt in the past would make you an ideal candidate for a lender now. However, that’s not the case. If you haven’t borrowed before then there is no evidence of good money management on your file and this can make it just as difficult to borrow now – and at a good interest rate – than having a history of bad credit decisions.

Being declared bankrupt. If you’ve struggled with credit in the past and ended up either with an Individual Voluntary Arrangement or having a County Court Judgement against you this will have a very negative impact on your credit rating.

Making too many credit applications. Although the various credit agencies rate this differently, roughly 10% of your credit rating is affected by the number of credit enquiries being made. So, if you’ve recently made multiple credit applications – especially if all have been denied – then this will negatively impact on your score.

Inaccurate, false or fraudulent information. The information in your credit file needs to be accurate in order to reflect your genuine creditworthiness. Your credit rating may be low if, for example, you are not registered on the electoral roll. You’ll see a significant drop in your credit rating if you’ve been the victim of fraud and someone else is spending credit in your name. Even incorrect address information could have an impact.

What can you do to fix a bad credit rating?

  • Make your payments on time to show a pattern of good borrower behaviour
  • Reduce some of the balances you currently have outstanding, even if only by a little
  • Check your credit report and make sure all the information is accurate. Look out for any activity you don’t recognise that could be evidence of fraud
  • If you’re struggling with the debts you already have don’t apply for more credit. Seek help in managing and paying off those debts
  • Wait at least six months before making any more applications for credit that will result in enquiries on your credit file. Wherever possible ensure any credit provider uses a “soft search” to assess an application – then there will be no footprint on your credit file.
  • If you don’t have any credit history then apply for a credit card or personal loan, even if the interest rates are not favourable. Pay this off in line with the credit agreement to start to establish positive borrower history
  • Apply only for the credit you’re likely to get – look at these bad credit loans options.
  • If you’ve shared finances with someone in the past but now gone your separate ways, make sure your credit file isn’t still linked to theirs. If they have a bad credit score it will affect yours too
  • Check your credit history is accurate – for example, if you have a bankruptcy order annulled make sure that a copy of the order of discharge or annulment is distributed to credit agencies
  • Try to stay put – lenders like long-term addresses, landline phone numbers and a solid employment history as all these provide evidence of stability.

Video: All About Bad Credit & How to Fix It

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“Open Banking” is coming your way but what does it mean? Fri, 12 Jan 2018 12:11:03 +0000 Alex Hartley Open Banking has been causing ripples, both across the fintech sector and in the news. Back in 2016, the Competition and Markets Authority (CMA) issued a ruling that requires the nine largest banks in the country to allow licensed startups direct access to their data. And with that the first step towards Open Banking was taken. The decision was a response to the dominance of established banking institutions in the UK – Barclays, HSBC, Lloyds, Santander and Royal Bank of Scotland currently hold 80% of the market. The CMA believes that opening up this data to other companies, especially those looking to innovate in personal finance, will result in better deals for consumers.Open banking is arriving in the UK

Why is Open Banking happening?

Investigation by the CMA found that there was too little competition in the UK banking market. Those same big five banks dominate, each offering fairly similar products at much the same rates with little variation through which consumers could find better deals. We have stagnated as banking customers too – only 3% of us move accounts every year. But why would we go to the trouble of moving banks when the products across the board are almost identical. Open Banking is designed to change that, to provide better choice for consumers and, as a result, to help bring down costs and drive more innovation.

How does Open Banking work?

It focuses on the idea that financial data – how much we spend on coffee, when we go over an overdraft limit etc – belongs to the customer and not to the bank. As a result, the customer can give permission for this data to be shared with others. So, customers of many of the big banks have already received letters informing them that this data can be shared with licensed startups if permission is given. If that permission is given then this opens the door to customers who want to work with fintech businesses that are disrupting banking with new ideas.

What will Open Banking look like?

Open banking comes into force on January 13th 2018. It will give new innovators the opportunity to take the financial data that we generate and do something creative with it – after all, Uber was just Google Maps and location data before someone turned it into something useful. “Useful” innovations for this data could include being able to see an overall perspective on all financial information over all accounts held. Breakdowns of spending currently offered by fintech businesses such as Monzo will become commonplace. Data could enable automatic switching to the best financial deals, as well as direct payments between retailer and customer, cutting out middlemen like card providers who charge fees. It could also enable more responsible banking, such as generating alerts where there is unusual activity on the account of someone with mental health issues.

Open Banking could potentially change the way that we bank completely. For example, currently fees for exceeding an overdraft are a big problem for many people, especially as they often kick in when cash is tight. Those designing the new Open Banking system envisage a time when these fees are no longer an issue. Instead of going over your overdraft limit, automatic systems would monitor your transactions and step in before you go over the limit. Either money would be automatically moved from another account or the exact amount of credit arranged automatically with another lender at the best possible rate of interest. The result? No going over the overdraft limit and no fees to pay.

Are there any risks?

Yes. The big risk that everyone is very focused on is the risk of opening up data to third parties in this way. Although the data is only meant to be made available to licensed third parties who will be accountable for its use this is a new opportunity for fraudsters. All it would take is a convincing fake request for permission to access data and the entire financial history of an individual could end up in the hands of someone who wants to exploit it for gain.

The other risk is to the banking sector itself. Take the fees for exceeding overdraft limits for example. The ability of Open Banking to do away with these fees for consumers has been highlighted as one of the major benefits of the system. However, income from overdraft fees currently provides a third of revenues for the more established banks. So, what happens if you take that financial income stream away?

Many fear Open Banking and many are excited by its transformative prospects. Either way, a new wave of banking is coming much sooner than many expected so being ready for it is key.

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Blue Monday, the most miserable day of the year! Wed, 10 Jan 2018 11:10:06 +0000 Alex Hartley Blue Monday falls on the third Monday of January, just inside the start of the New Year but far enough from Christmas for the glitter to have faded. This is (apparently) the most miserable day of the entire year when we all realise we are failing at our resolutions and summer is nowhere to be seen. But what is it about this particular Monday that makes it such a depressing day?Blue Monday in January

The Blue Monday formula

Blue Monday was actually conceived by a PR company so the scientific basis for its existence is sketchy. However, there is some sense behind the idea that the first day back to work after the weekend in one of the greyest, coldest months of the year could make all of us want to take a duvet day. The various factors involved in calculating the “Blue Monday formula” are:

  • The weather – often grey, windy, stormy, cold and generally not much fun to leave the house in
  • Debt – according to comparison service uSwitch 9 out of 10 people end up with a debt hangover after Christmas. It’s often in mid-January that this really kicks in and you start to realise that taking out an extra credit card for all the food and gifts and parties now gone probably wasn’t worth it. And your credit card bill will be payable towards the end of the month!
  • Time elapsed since Christmas – the glitter is faded, you’ve had your time off and there are no more excuses to eat chocolate for breakfast
  • Time elapsed since making – and failing on – New Year’s resolutions. Most people break their resolutions by mid-January leading to feelings of failure and resentment
  • Lacking motivation – January is the month when motivation levels are the lowest
  • A desire to make change – January is also the month in which many of us start to identify the parts of our lives we don’t like and want to make change. However, we may be stuck with low motivation or high Christmas debt and so unable to do anything about it

When you look at it like that it’s not difficult to see why the theory behind Blue Monday tends to hold water. But what can you do about it?Feeling depressed on Blue Monday

Antidotes to Blue Monday

Make a plan. Whether it’s a plan for debt repayment, getting fit or finding a new job you’ll feel much less hopeless if you’ve decided on a way forward.

Do some exercise. Exercise releases endorphins and will instantly make you feel better even on the gloomiest day of the year.

See some friends. A problem shared is a problem halved. There’s nothing like spending time with those you love to provide an antidote to Blue Monday feelings

Throw away your New Year’s resolutions now. Instead, replace them with a daily intention to do something constructive

Be kind to yourself. It’s much more courageous, strong and constructive to give yourself a break rather than feeling bad about broken resolutions or punishing yourself over Christmas debt.

Dance to the upbeat “Blue Monday” by New Order!

Things to look forward to in 2018

If the above antidotes don’t work then remind yourself that there’s plenty to look forward to in 2018, including:

  • The Winter Olympics – taking place in Pyeongchang in February, this is your chance to distract yourself from winter gloom and get deep into the world of skating, skiing and bobsleigh.
  • Exceptional visual entertainment – from the return of Black Mirror and Westworld, to movies like Black Panther, Mary Poppins and more instalments in the Avengers and Jurassic World series and The Handmaid’s Tale season 2, there’s a lot to celebrate on screens big and small in 2018.
  • Frozen, the musical – now you can sing along to “Let it go” in a room full of hundreds of people doing the same. Very therapeutic.
  • A royal wedding – Meghan and Harry are tying the knot in May at Windsor Castle – not long to go now.
  • The World Cup – football fans rejoice because 2018 is the FIFA World Cup in Russia.
  • A royal baby – the Duke and Duchess of Cambridge are due to welcome the regal newborn in April so spring will be a season of lots of new starts.
  • Positive anniversaries – 2018 marks 100 years since the end of World War One, for example, as well as a century since women won the right to vote.
  • Beyonce at Coachella – even if you don’t go, even if you’re not a fan the performance is likely to be an uplifting, lively one.
  • The return of longer days – yes, it happens every year but it’s definitely something to look forward to. We’ve already passed the shortest day so summer is definitely coming.
  • Intergalactic insights – 2018 is due to be the year that commercial space travel finally becomes a reality. Plus, a robotic Mars lander will finally be launched into space after a two year delay.

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What to do if you don’t feel you’re getting value for money at university Mon, 08 Jan 2018 11:47:49 +0000 Alex Hartley With the tuition fees cap about to be raised and many students already paying £9,000 a year to go to university, the stakes in higher education are much higher than they used to be. As a result of the enormous financial investment that is now involved in getting a degree, there is an increased focus on the quality of the teaching and whether courses are delivering in terms of results and value for money. Many universities are now bracing themselves for complaints, not just about the courses but the facilities – such as accommodation – too. But what can students really do if they don’t feel that their chosen degree has delivered value for money?value for money from universities

Degrees vs. goods and services

It’s worth remembering that what students pay for isn’t the degree itself. There’s no guarantee that anyone will walk out of university with the degree that they’re hoping for and no amount of cash spent will (or should) change that. What’s being paid for are the services and facilities that enable students to do their very best when it comes to getting the degree. And if these are substandard, or not as advertised, then surely there should be some way to get compensation.

The university complaints process

If there’s a problem with the teaching, accommodation or services then the first port of call will always be the university’s own complaints process. Most universities post their complaints policy online for easy access and it should be fairly simple to follow the steps to begin a complaint.

  • What is the complaint about? It’s important to be able to clearly identify what the problem is e.g. cancellation of classes or even an entire course, discrimination or harassment, poor learning resources, bad accommodation.
  • What is the desired outcome? Another key part of the process is identifying the desired outcome – is it financial compensation, a revised grade or replacing a member of staff?
  • Where is the evidence? Just as with any redress procedure such as this there needs to be evidence to support the complaint if it’s got any chance of success.
  • Completion of Procedures Letter. Once a complaint has been made the university is required to investigate it – once that’s happened a Completion of Procedures Letter is sent out that sets out what the conclusions are.

The Competition and Markets Authority is getting increasingly involved in the way that universities are complying with consumer law. Their guidance for higher education institutions provides a useful benchmark against which to judge whether a complaint has a good chance of succeeding or not.

Office of the Independent Adjudicator for Higher Education

The Office of the Independent Adjudicator for Higher Education (OIA) is an independent review body for student complaints and a second port of call if an internal complaints procedure has been unsatisfactory. The OIA upholds around a quarter of the complaints that it receives and has the power to order compensation to be paid. Interestingly, research carried out by the OIA found that most students who complain aren’t looking for a cash payment but for some kind of fair restitution. Large pay outs are not a common occurrence – the highest made was for £45,000, which involved a dispute over a PhD which had been a lengthy and damaging process for the student.

Court action

If internal procedures have been exhausted then it is possible for students to sue their universities for compensation. However, this is a complex and expensive process and requires a pretty high standard of fault and also evidence. However, students do go ahead and sue universities – and over something as simple as feeling that they have been given the wrong grade. For example, student Andrew Croskery sued Queen’s University, Belfast when he didn’t get the grade he was hoping for citing poor supervision as the reason. Mature student Mike Austin is probably the most successful student to sue in the courts, receiving £30,000 from the University of Wolverhampton in an out of court settlement for a range of problems such as lecture overcrowding and non-delivery on promises made.

So, for students who feel that they have not received value for money when it comes to a degree it is possible to take action. The first step should always be to make contact with the university to see if the situation can be rectified, followed by the filing of an official complaint. After that, it’s possible to get the OIA involved and finally to move to the courts. However, the further away this gets from being an internal matter the more costly it can be – and for those already struggling with student debt that could be a seriously off-putting factor.

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Gloomy forecasts for the UK from the Institute of Fiscal Studies Fri, 05 Jan 2018 11:24:11 +0000 Alex Hartley The most recent forecast from the Institute for Fiscal Studies (IFS) has predicted a couple of tough decades for the British public. While the last century or so has seen consistently increasing living standards, according to the IFS, this is now likely to be a thing of the past and not an ongoing trend that anyone should rely on. Instead, we can look forward to stagnant wage growth, low productivity and yet more austerity. So, it all sounds rather gloomy if the IFS is to be believed – but are they right and what are the implications?Gloomy forecast for the UK economy

IFS conclusions

After the Chancellor Philip Hammond’s 2017 autumn budget the IFS drew a number of conclusions that were based on its own analysis of the budget and a report from the independent Office for Budget Responsibility.

Earnings will be lower than expected

There has been a lot of talk about the poor – or non-existent – growth in wages. After the autumn statement, the IFS concluded that wage growth for 2021 was now forecast to be £1,400 a year lower than was predicted in 2016. In fact, when adjusted for inflation, average earnings will be lower than before the financial crisis in 2008. So, there is no recovery in wage growth to look forward to and that can have a very broad impact for everyone.

The implications: wages aren’t going to go up. That means we’re not going to have any more cash to spend and life isn’t going to become more affordable. When you combine a lack of wage growth with rising house prices and an increase in living costs, a drop in living standards is inevitable.

Productivity has gone through the floor

Productivity is generally used to measure the output of a workforce and, on a broader level, the strength of an economy and the health of its public finances. The measure of productivity is GDP and, according to the IFS analysis, GDP in the UK will be 3.5% smaller in March 2021 than was forecast back in 2016. So, the economy has failed to pick itself up and we have not achieved the kinds of productivity gains that would make the country economically prosperous once again. These gains are normally the result of an increase in skill in the workforce or of advances in technology.

The implications: The economy will be £65 billion smaller in 2021 than anyone thought it was going to be. Weak productivity means weak economic growth, which also means that more of the public finances get sucked into bailing the country out. Without an increase in productivity, wages stay stagnant, living standards fall and many people become increasingly reliant on public services.

Public services are seriously stretched

The NHS, for example, is currently facing the biggest funding squeeze since the 1980s. In the UK an ageing – and expanding – population is putting huge pressure on this vital public service. However, government spending has fallen – after the financial crisis this was at 4% after inflation, now it’s just 1%. Plus, there are nearly £12 billion in welfare cuts that have still to be processed through the system, hitting many of the worst off in the UK the hardest. And, despite the fact that demands on our public services are likely to get more intense as people struggle with dropping living standards and poor wage growth, spending on day to day public services is going to be 3.6% lower in the next 5 – 7 years.

Implications: the safety net of the NHS and public services that we’ve come to enjoy in the UK is being gradually eroded. Many have highlighted that there is potentially more cash in the Treasury for this but that it is being spent on other things that are more important to the currently Conservative government’s key supporters. They conclude that, without a change in government, spending on public services just won’t pick up.

What can you do to protect yourself?

  • Make careful buying choices. It’s going to become more important to get the best value on food and consumer goods so if you’re not already shopping around and buying in the sales now is a good time to start.
  • Take advantage of the few opportunities. For example, a holiday on Stamp Duty was announced in the autumn statement – if you are a first time buyer you could save around £5,000 as a result.
  • Learn how to budget. Money management is going to become increasingly important. There are a range of different tools to help you with this now, from budgeting apps to digital financial assistants.
  • Have a safety net in place. With no growth in wages it’s going to become increasingly important to have another option to cope with a financial crisis of your own. Savings and access to personal loans or bad credit loans could get you out of a sticky situation.
  • Future-proof your job. Despite the gloomy outlook there are some careers that are booming – for example, IT security is a part of the economy where there is a constant skills shortage and salaries are climbing. Be prepared to retrain and develop new skills.

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The future of banking, money management and personal finance Thu, 04 Jan 2018 11:21:28 +0000 Alex Hartley Technology is truly changing the world – at an increasingly blistering pace. And perhaps nowhere is this more apparent right now than in the world of money and banking. FinTech (finance + tech) is the latest buzzword and represents a huge swathe of innovation when it comes to the way that we bank and manage our money. While online banking is well established as the alternative to going in to your local branch to handle transactions or make balance enquiries this is really just the tip of the iceberg. In terms of the future of money and banking there are some pretty exciting developments on the horizon.The future of UK banking

Artificial Intelligence

Artificial Intelligence (AI) has been identified as a new frontier when it comes to helping us better understand and manage our money. Cleo, for example, is a virtual personal assistant that interacts with users of the app as if it were a real person. Ask it questions, request help and the responses are chatty and emoji-filled (the app is aimed at 20-30 year olds).

What this AI is actually doing is analysing transaction data sourced from the user’s online banking records over the past 12 months. It can use this to provide insight – such as how much is spent in a particular store over time – and to offer up budget and saving suggestions. Communication happens via Facebook and Messenger. According to the Cleo CEO, the future of banking is within software companies and traditional banks are on the way out. The team at Cleo isn’t actually a bank (it doesn’t have a banking licence) but wants to be the platform for financial management.

Given the accessible language, the mobile focus and a structure that is tailored towards the specific issues that many young people face (saving, budgeting, getting the best credit deals), it’s no wonder that it’s already starting to fly high. And it’s also no wonder that it has plenty of competitors – Xobi and Hublio to name a few.

Digital wallets

According to the World Bank there are two billion people in the world who don’t have a bank account. Mobile payments and digital wallets are seen as a much more workable solution, particularly in countries such as India where there is a sea change away from a paper money based economy. New technology such as Ezetap has enabled software that allows for mobile phone payments that don’t require bank accounts. This overcomes numerous issues, from how to manage accounts if you’re too remote to get to a branch, to doing away with the need for cards.

Digital currencies could be a logical next step down the route of digital wallets. It’s already possible to pay for some goods and/or services with a currency such as bitcoin but this has yet to be widely accepted. And with digital currencies comes blockchain – a chain of transactions or agreements that is self-verifying and so doesn’t require a middleman like a credit card provider.

Super cash machines

While digital currencies and online transactions are certainly becoming much more the norm, cash machines are going nowhere just yet. Particularly when it comes to older generations cash is still king – in 2015 17+ billion payments were made in cash in the UK. Plus, the number of cash machines surpassed 70,000 for the first time and 48 million people used them.

However, perhaps in order to keep up with the functionality of the online world, cash machines are also evolving to offer much more than just a simple way to withdraw notes. So, there are plans for the humble ATM to change to become a “bank in a box” – soon you’ll be able to do virtually everything you could once do in a branch without even walking through the door. Video links and mobile interactivity are just two of the features that will enable banks embracing technology to create super ATMs from existing cash machines.

A new approach to credit risk

Although still very much in its infancy there is a move towards reassessing the way that lenders look at the risk a borrower presents. Currently, applying for personal loans or credit cards involves incorporating the credit score of one of a limited number of agencies who use a fairly restricted pool of information. A new approach could involve a much wider spread of data involved in the risk assessment process, including social metrics and default rates. German startup Kreditech is already working under this new approach, analysing borrowers for loans using an algorithm that factors in 20,000 data points in order to provide the lender with a risk assessment.

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Why Bright House have been forced to repay £15m to its customers Fri, 29 Dec 2017 11:00:37 +0000 Alex Hartley Times are tight for many in the UK. Inflation is on the rise and there has been little or no real wage growth to speak of. The result is that, for families and individuals all over the country, there has been a real squeeze in household budgets that has left little room for bigger purchases. Step forward the rent-to-own sector, which was designed to give those on restricted incomes the opportunity to get credit on an item where a regular lender might to own washing machine

What is rent-to-own?

It is a sector that revolves around household goods, such as TVs, washing machines, furniture and computers. The idea is that if you’re not able to purchase one of these outright then you can do this via rent-to-own instead. Many of those who use the rent-to-own sector are struggling with a bad credit score and so wouldn’t be eligible for credit from a mainstream lender. Rent-to-own is meant to be an alternative way for people to pay rent on an item, such as a washing machine – and own it once that rent is paid off.

What’s the problem?

The Financial Conduct Authority (FCA), the UK’s financial regulator, has recently stepped in with respect to Bright House, one of the biggest names in the rent-to-own sector. Bright House has 283 stores around the UK and more than 230,000 customers. However, the FCA has found that Bright House has not been acting as a responsible lender, principally due to the high cost of the credit that it has been providing to its customers. There are unfortunately many examples of how Bright House has been using its position, appealing to those without many other options, to charge excessive amounts. For example, the FCA found that Bright House had charged more than £1,000 over a period of three years for its cheapest washing machine. Research by the media has found that a similar model washing machine, with breakdown cover, would cost just £250 – £350 if purchased outright. Another customer purchased a laptop from Bright House that would have cost £600 if bought out right. When the laptop was finally paid for with Bright House the total payments came to £2,287 over 26 months – almost four times the laptop’s actual value.

What does it mean to be a responsible lender?

Most of us accept that when we take out credit, whether that’s to pay for household items or as a straightforward loan, there will be interest to pay for being able to borrow. However, the excessive credit costs that Bright House has attached to its borrowing mean that it’s a world away from being a responsible lender offering credit at reasonable and affordable rates. The FCA has now ordered Bright House to make compensation payments to 250,000 customers totalling £14.8 million. This payment is broken down in a number of ways including:

  • 81,000 customers who were incorrectly assessed by Bright House in terms of their ability to repay the loan – and consequently forced to hand back the items – will be repaid (with interest).
  • 181,000 customers who cancelled their agreement with Bright House before receiving the goods will have their initial payment refunded plus interest of 8%. This applies to customers who signed up after 1 April 2010.

What are the alternatives?

Bright House’s success is driven by a lack of credit options for those who may not have access to mainstream credit. So, where do you turn for purchases if you’re in a similar position?

  1. Other rent-to-own providers. The rent-to-own market is a growing one so there are certainly other options. However, it’s always important to make sure that you don’t end up in the same position as Bright House customers. What are the credit costs and how much will you pay overall?
  2. Not-for profit credit providers. There are not many of these but organisations such as Fair For You provide funds for household goods that are much more in line with what the FCA considers to be fair lending practices.
  3. Bad credit lenders. It’s often worth looking into whether other lenders might be able to offer less expensive terms. For example, a payday loan could be a better alternative because you’ll be able to buy the item outright and then pay off the loan at the end of the month. If you’re looking for longer-term finance then guarantor loans could give you the same up front payment advantage. Although some interest rates can be higher than mainstream lenders, it’s easy to find a lender that doesn’t charge fees and the credit charges are likely to be far lower than those offered by a business like Bright House.


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Is consumer spending and debt getting out of control? Wed, 27 Dec 2017 12:29:41 +0000 Alex Hartley Debt is something that many of us have learned to live with. And, on the whole, it provides a useful way to make important life changes, from paying for study to buying a home. But, in autumn of this year, figures were released that revealed that British consumers now have unsecured debts that total more than £200 billion (i.e. exc. mortgages and other secured loans). That’s an increase in personal debt that brings it to levels not seen since the financial crisis.Consumer spending and consumer debt

Debt levels are rising

In 2014, consumer credit grew at an annual rate of 4%.  However, in 2016 this figure hit 12% as it was revealed that British consumers now had credit commitments to the tune of £204 billion. As 2017 draws to a close the figure remains lower than last but this has predominantly been put down to a drop in car loan figures, as opposed to a drop in the appetite for consumer debt overall. This increasing desire for consumer borrowing has worried many experts, particularly in the light of the recent interest rate rise.

How will interest rates affect consumer borrowing?

Most loan and credit card interest rates are tied to the Bank of England Base Rate (BEBR). On 2nd November this year the BEBR was increased to 0.50%, which marked the first time that the rate has risen since 2007. The Bank of England has forecast another two rate rises in the next two years with the base rate being capped at 1% by 2020. So, for borrowers this means that it’s going to cost more to borrow. For those who already have large debts the implication is that those debts will cost more, which will make it more difficult to clear them and get debt free.

How has this happened?

British consumers have been encouraged to spend, as opposed to save, ever since the financial crisis of 2008, partly to stimulate the economy and partly due to interest rates so low that saving has seemed almost pointless. Most experts have been unable to determine whether this current surge in consumer spending has come as a result of consumer confidence and willingness to spend. Some believe that this could be the case. However, others highlight that there are many consumers who could be turning to debt out of desperation, as opposed to confident spending. Economic conditions, such as an increase in inflation and almost completely stagnant wage growth, have left many families without any other option than to borrow to get the day-to-day cash they need.

When are we likely to feel the impact?

Currently, the rise in interest rates has been fairly minimal and, although there is concern about the impact of this in the long term, for now the government is content to simply monitor its impact. However, even before the impact of the rate rise is felt, there could be trouble on the horizon. Figures released this autumn reveal that personal insolvencies in the UK rose to a five year high in the third quarter of this year. The figures indicate that in the 12 months leading up to September 2017, one in 477 adults became personally insolvent in the UK. This represents an increase in figures to the highest rate since December 2014.

In the third quarter of the year 15,523 IVAs (a voluntary way of repaying some or all of a debt owed) were recorded in England and Wales, an increase on the 13,290 in the same time frame last year. The same period saw a 2.1% increase in debt relief orders for those on a low income.

And it’s not just individuals who are beginning to struggle with ratios of debt and income that just don’t add up. Since the EU referendum the number of companies registered insolvent has risen by 15%. The significance here is that many of these companies are small businesses run by individuals and problems at the SME end of the scale could result in more personal debt problems.

What changes can we expect?

  • The largest number of lenders since 2008 now plan to put additional restrictions on the borrowing of unsecured credit according to the Bank of England’s Credit Conditions Survey. This means that it could be tougher for individuals to obtain credit that isn’t secured by an asset such as a property.
  • Individuals are being encouraged to think carefully before taking out additional credit cards or loans, particularly in the run up to Christmas which is notoriously expensive.

Saving is still growing at the lowest rate since the financial crisis in 2008, despite the small rise in interest rates. A renewed focus on encouraging consumers to spend money is likely, particularly when it comes to saving for old age.

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How our feelings affect the way we spend Mon, 25 Dec 2017 12:16:20 +0000 Alex Hartley Are you an emotional spender? Most of us would like to answer “no” outright to that question. However, the more honest response is likely to be at least a tentative “yes.” According to a recent study there are many different types of emotions that can trigger a desire to spend money. However, the top four are boredom, sadness, stress or when you’re celebrating. So, it’s not just negative moods that can get us into trouble with our cash but upbeat moments too. How our emotions affect our spending

Which emotions leave us the most vulnerable?

According to a study conducted by MoneySuperMarket partnered with consumer behaviour experts MindLab, stress is the most expensive of our emotions. It’s the feeling that leaves us the most open to impulse buying. If you’re feeling stressed when you go shopping then the study found that you’re likely to spend 15% more than a happy shopper. We all have our own individual reasons for making impulse purchases when emotions are running high – these could include buying items that you wouldn’t normally buy because they feel like a treat or are comforting. So, unsurprisingly, food and drink are very popular stress impulse buying purchases, as are sweets, chocolate, shoes and clothes.

Other studies have identified reasons why specific emotions – other than stress – could trigger emotional spending, including:

  • Anger – angry people tend to take more risks and to be willing to do reckless things like purchasing an item they can’t afford.
  • Sadness – when we feel sad we might be more willing to give up a part of our future (i.e. money saved for something else or debt that will need to be paid off) to feel better now.
  • Guilt – feeling guilty can lead to purchases for others to feel better about ourselves.

Credit cards

On the whole we are all likely to spend more – and more often – if using credit cards as opposed to cash. A study that monitored supermarket spending over the course of a year found that those spending cash tended to spend less. There is something about paying with credit cards that makes the transaction feel less real. It’s much easier for us to respond to an emotionally driven desire to buy if we’re doing that with a credit card to hand. Cash, on the other hand, might make us think twice.

Online and ads

There’s no doubt that the online world has made it easier to impulse buy in some ways – online shops are always open and the advertising is inescapable. However, evidence suggests that we are starting to not respond to online advertising – a number of studies have found that people actually look away from ads designed to lure them into impulse purchases. And when it comes to an impulse purchase, being in a shop will always been more tempting in terms of being able to enjoy or consume a purchase as soon as you’ve paid for it. At least until instant delivery arrives in the UK…

Young people

Under 35s are the most likely to be emotional spenders and there are multiple explanations for this. Some attribute it to a lack of experience with money while others see the cause linked to the fact that young people today are more dissatisfied with their appearance than ever before. That’s one negative emotion for which the beauty and fashion industries provide a wealth of impulse buying opportunities.

Can impulse spending ever help negative emotions?

The pleasure receptors in the brain do light up in the moments before we make a purchase. So, some experts have suggested that there is definitely a feel good factor that is associated with buying. The secret is to activate that good feeling with a purchase that you can actually afford, as opposed to one that leaves you feeling guilty or wishing you hadn’t done it. However, overall there is very little evidence that buying goods ever helps us to feel better, according to the experts. If you want to buy something then purchasing an experience – as opposed to a ‘thing’ – could actually make a difference to how you feel. That’s especially the case if the experience is one that you’ll do with other people.

For most of us, the secret to controlling emotional spending is recognising the triggers that could lead us to it and that impulse buying is an issue that might need tackling. It doesn’t have to be a problem that gets completely out of control – the key, according to the experts, is to try to stay within the limits of what you can afford.

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How to max out your savings in the New Year Sales Fri, 22 Dec 2017 10:14:32 +0000 Alex Hartley There seem to be more retail sales than you can shake a stick at these days. However, while Black Friday or the summer sales can deliver some great discounts, it’s the New Year sales that often offer the most potential for savings. Many stores refresh their stock for the new year so it’s out with the old (at heavily discounted prices) and in with the new. Whether you’re looking for Christmas themed items to put away for next year, sports gear, technology, fashion or toys, the New Year sales are worth doing properly. So, how do you maximise the savings potential at this time of year?New Year Sales

Top Tips to get the most in the New Year Sales

In-store Sales

Get up early. If you’re going to do your New Year sales shopping in-store then there’s just no substitute for being the first through the door. Discounts don’t change over the course of the day but the best items will inevitably be snatched first off the shelves so if you want to get them for yourself you need to be up with the birds.

Plan your route. There are many websites that will give you a preview of sales discounts on the high street so you can work out in advance where the best savings are likely to be. Plan the most efficient route for your shopping trip to make sure you pick up all the bargains you’re looking for.

Pay with a credit card that has points. If you’re planning a sales splurge on the high street for the New Year then paying with a credit card that offers points has a double benefit. You’ll not only have the items you’ve bought in the sale but you’ll also get the points you accumulate for spending on the card. Depending on the rewards your card offers this could net you free flights, cash discounts or vouchers for 2018. Just remember to pay off the balance.

Online Sales

Be focused. Online sales can be high pressured and bewildering and you might not be able to resist huge discounts even if you have absolutely no need of the item they apply to. So, be focused – work out what you want to buy in advance, as well as how much you’re willing to spend. Don’t go over budget or spend on items you don’t really need that will end up diminishing the savings you make overall.

Sign up for memberships and newsletters. Many online stores announce their sales early to members. Whistles and Net-a-Porter, for example, tend to offer a ‘private sale’ that is available to those who have signed up for newsletters or have accounts around 24 hours before the actual sale starts. So, if you want to make sure you get the biggest savings on the best products make sure you’re the first to know.

Leave items in your basket. Have you noticed that if you’re half way through shopping and you forget to finish the transaction that you’ll often get an email with a discount incentive to do it? Many retailers will automatically send you a discount code if you seem to be abandoning your check out so you can save even more if you time it right. Normally, you don’t have to do much to trigger this, just navigate to another web page or leave the item dormant for a while.

Shop around. When you’re sales shopping online you have the unique advantage of being able to check prices on different online stores in an instant. If the item you’re looking for is available in more than one location then check to make sure that you can’t get it cheaper elsewhere. Use a price comparison site, search for the item and see what comes up or simply jump from one website to another to compare. Don’t forget to keep a record of locations and prices so you know where to go back to for the best deal.

Don’t pay for shipping. The cost of delivery can eat into sales savings significantly so make sure you’re not having to pay extra to get your purchases. If possible, combine as many as possible at one store so that you’re more likely to hit the threshold at which free delivery is available. If you’re a regular shopper at certain stores you might also want to consider an annual free delivery fee, which means that with a small up front fee all the shipping is free for 12 months.

Paying for Your Purchases

Take care not to get carried away when you start your sales spending. If you’re shopping in-store then paying by cash will make sure you can’t go over the top. If you are buying a relatively expensive item (e.g. sofa) you could look for an interest-free loan from the retailer and this would help you spread the cost and make budgeting easier. A credit card can also make sense because of a) the short interest-free period and perhaps more importantly b) the extra protection you receive for purchases over £100. Credit cards make extra sense when making online purchases – even more sense than paypal and debt cards – although take care about paying extra fees for using your card.

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Christmas through the decades – A Retrospective Wed, 20 Dec 2017 12:47:15 +0000 Alex Hartley Christmas might be an annual event but it’s become a very different experience with each decade that goes past. If you grew up in the 1960s then your festive traditions and feasts would have been very different to those for children today. So, what is it that has made a Christmas in each of these decades so very distinctive?

Christmas in the 1960s

The 1960s was the first decade when turkey really became a tradition on the British Christmas table – preceded by a classic prawn cocktail starter of course. On the drinks menu it was Babycham as the celebratory tipple of choice although you might also have had a glass or two of a Mateus Rose.

Under the tree. Space was the big theme for toys in the 1960s, from board games to Thunderbirds toys. You might also have had something James Bond themed, a brand new shift dress or a Beatles style tailored suit. The Beatles were everywhere in this decade – in fact, they dominated the Christmas Number 1 singles chart spot for almost half the decade with songs like “I Want to Hold Your Hand.”

On the TV. Three channels showed a range of shows with two of the most popular being Max Bygraves meets The Black and White Minstrels on BBC1, and The Bruce Forsyth Show on ITV.1960s christmas decorations

Christmas in the 1970s

The 1970s was one decade when “tasteful” and “understated” were two words that most people threw out of the window – especially at Christmas. Cue the mass use of tinsel and an array of wonderfully trashy festive decorations. Turkey was well established as the traditional feast – perhaps preceded by a starter of coloured gelatin Christmas trees or a (bright blue) blue cheese mousse. This was the decade of Cinzano and drinks topped with glacé cherries but it was The Snowball that was the totally festive tipple of choice – Advocaat mixed with lemonade.

Under the tree. If you were lucky then in the 1970s you might have unwrapped a Sooty glove puppet, Scrabble or an Etch-a-Sketch. Twister and Operation were the board games gifted around this time and for the really lucky there may have been a Sindy or a space hopper.

On the TV. You might have started Christmas Day in the 1970s with Basil’s Christmas Morning with Basil Brush or Ken Dodd and the Diddymen.  The Morecambe and Wise Christmas Show would have been an unmissable event for many and these were the days when everyone still tuned in for The Queen’s Speech (the actual Queen, not the Colin Firth film).

Christmas in the 1980s

Many people think Christmas in the 1980s was the best decade – certainly some of the classic Christmas songs (“Do They Know It’s Christmas”) and viewing (E.T., Gremlins, Die Hard) came from this decade. It’s unlikely you would have attended a Christmas party in the 1980s without eating cheese and pineapple on a stick but turkey was the tradition on Christmas Day. Ready-made food started to appear more widely during this decade, from Christmas puddings to pigs in blankets. Boxing Day wouldn’t have been complete without a classic sherry trifle. If you were lucky then champagne would have been your drink of choice for Christmas parties and events – thanks to yuppie culture it suddenly became much more widely consumed.

Under the tree. If you got a Millennium Falcon for Christmas in the ‘80s then you were probably going to be the most popular kid in school come New Year. Teddy Ruckspin, a My Little Pony Castle or a Rainbow Brite doll would also have been a Christmas win.

On the TV. In the 1980s there were many more options than decades gone by in terms of Christmas Day viewing, from The Man with the Golden Gun to Top of The Pops. The Morecambe and Wise Christmas Show was still a firm fixture or you could have chosen Paul Daniel’s Magical Christmas or The Two Ronnies.Christmas decorations yestayear

Christmas in the 1990s

Christmas in the 1990s probably bears more of a resemblance to what we recognise nowadays with mass produced turkeys on every table and maybe some Frubes or a Club biscuit to keep you going after breakfast. The tradition of the office Christmas party took hold in this decade with many companies having to write off any productivity the day after as a result. Christmas fizz was now obligatory – whether cava, prosecco or champagne – but for younger generations it was all about the K cider, Malibu and alcopops like Hooch.

Under the tree. The Gameboy was the must-have gift for 1990s kids – either that or a Tamagotchi or a pair of roller blades.

On the TV. For those with young children, Wizbit’s Christmas morning show might have been followed by the Songs of Praise Christmas Special. In the afternoon, perhaps a repeat or two, such as Raiders of the Lost Ark, followed by Wogan in Hollywood and Noel’s Christmas Presents with ‘90s TV favourite Noel Edmonds.

Christmas 2000s – today

During a noughties Christmas it was all about parents trying to get the kids off MSN messenger (as opposed to Snapchat today..). School Christmas discos entered the era of being a fashion-off – babydoll dresses and Buffalo shoes for noughties kids, skinny jeans, ironic tees and fedoras for young people today. Music has remained familiar too – think Beyonce, Lady Gaga and Arcade Fire or the X-Factor winners, such as Leona Lewis and Sam Bailey who have dominated the Christmas Number 1 spot from 2005 to recent years. Christmas dinner could well have been all about the nut roast in the 2000s – a decade when vegetarianism grew at a far faster pace – perhaps accompanied by glasses filled with Smirnoff Ice, WKD or Archers and lemonade. Today, clean eating trends could see more vegan Christmases than ever before. Thankfully, the thirst for alcopops has diminished and you’re more likely to be handed a glass of English sparkling wine or perhaps a nice organic red.

Under the tree. For children of the noughties Bob The Builder, Bratz Dolls or a Nintendo Wii would have been the lusted-after gifts of choice. Things haven’t changed that much today although Santa will get more requests for smart phones this year than ever before.

On the TV. A Christmas Day in the noughties might have featured The Fresh Prince of Bel Air, singer Charlotte Church or films like Independence Day. Victoria Wood with All the Trimmings provided the laughs and, like today, the listings would be awash with repeats, such as Back to The Future. This year it will be the year of the Christmas Special, from Bake Off, to Strictly Come Dancing. The big Christmas films are all glamour, from The Great Gatsby to Cinderella – with a Home Alone repeat or two for those who pine for Christmases of decades gone by.

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A plan to switch from being a two to a one person income household Mon, 18 Dec 2017 12:20:21 +0000 Alex Hartley Strange things can happen to couples over time and these aren’t always very predictable. You may start off down the road together in separate, stable jobs, working nine to five and enjoying a comfortable double income. But this could change at any time. Perhaps you get pregnant and one partner decides that actually all they’ve ever wanted is to be a stay at home mum/dad. Or you might suddenly uncover a burning desire to study again or to write a book or attempt to launch a start-up. It may seem like an enormous challenge to go from being a two income household to surviving on one – but it is possible if you “mind the income gap”.mind the income gap

Making the switch to being a one income household

Halving your monthly income might seem like a recipe for anxiety attacks. However, it’s also a good opportunity to reassess your spending and your financial situation – you could even end up in a better position as a result. So, how do you successfully switch from two incomes to one?

Pay off all your debts as soon as you can. If possible, get rid of debts before your income reduces because you might find it difficult to do so afterwards. Servicing debts is fine when you have enough money coming in every month but it can become very difficult if you’re struggling. Plus, when it comes to something like an overdraft or credit card, it’s far better to have that credit available to you should you need it than to already be right up to the limits. And don’t be tempted to take out new loans to cover unnecessary items – it will only put extra financial pressure on you.

Eliminate all unnecessary expenditure. This means stripping back your spending so that your money really is going on only the essentials. The daily take out coffee is the often-used example of an unnecessary expense where cutting it out could save you a lot of cash. However, this isn’t the only one – everything from riding a bike instead of taking the bus, to stopping your Netflix account or downgrading to own brands at the supermarket could make a difference to what’s left in the pot.

Start seriously prioritising your spending. When your income drops by half you need to make sure that your basic costs are covered first. This is especially so in the first few months when you’re still adjusting to the transition. First, allocate your cash to your essentials, such as food, energy and a roof over your head. After that you might need to look into transport, childcare and tax payments. Any other spending that comes next is unlikely to be as essential, from new clothes, to socialising and saving – these are the items that you can funnel your money towards if you have any left at the end of the month.

Sell everything that you don’t need. Many of us have a lot of objects that have some inherent value just sitting around the house. Selling these could create a buffer zone for you financially that could make this transition to a one income household much more comfortable. Do you have a huge collection of old smart phones just sitting around after you’ve upgraded to a new model each year? You could get £100 or more for these if you sell them to a company like Mazuma Mobile that recycles and refurbishes digital products. Have a yard sale, put old furniture on eBay, sell all your old work outfits if you’re not planning to go to an office anymore. The more you have in the bank to support the drop in income, the easier managing it is likely to be.

Be a budgeting whizz. If you’ve never really mastered the art of budgeting, now is the time to start nailing it. Set your budget for the day/week/month and stick to it, no arguments. Regularly review the budget to see if it’s working and to assess what you have left and make adjustments.

Learn to find the best deals. If your budget just isn’t stretching on this new, reduced income then one way to help create more wiggle room is to cut down what you spend on the things that you need to buy. So, become the person who knows where to find the best deal on dog food or where to buy bulk toilet rolls at the cheapest price. Use apps such as MySupermarket to see where your weekly shop would be the cheapest and make use of vouchers and cash back cards to keep costs down and generate cash back to replenish your accounts every time you spend.

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Key financial issues to consider if getting divorced or permanently separating Sat, 16 Dec 2017 12:41:31 +0000 Alex Hartley Separation, divorce and break ups are a very difficult time. Emotions tend to be running high and there may be children involved, which can complicate everything. However, when it comes to this stage in the ending of a relationship it’s important to ensure that you are protecting yourself. These are some of the important financial things to consider if you’re about to go your separate ways.Separation & Divorce financial issues

Splitting the assets (& liabilities)

A key part of leaving a current partnership, whether it’s a marriage, a civil partnership or you were cohabiting, is splitting up the assets and liabilities. These could be anything that you’ve purchased together or anything that you’re jointly responsible for or own including:

  • Joint debts, such as a mortgage or credit card
  • Possessions that you own jointly, such as furniture or a car (including the car finance!)
  • Bills that you’re jointly responsible for
  • Any investments that you have made that you share (e.g. a Buy to Let property)
  • Cash in the bank and/or savings

These are just a few examples of the kinds of assets and liabilities that need to be taken into account when you’re separating from a partner. It can be a lengthy process but the first step is to make a list of everything you own together and then everything that you pay for together. After that you will need to work out a fair split of who gets what and who pays for what.

Providing for children

If you share responsibility for children together then providing for their future will be a key financial consideration. Child maintenance will be payable – the first step is to try to agree between you how much this should be and when payments should be made. If that’s not possible then Child Maintenance Service may step in, to work out how much is due and/or facilitate the payments. Children make splitting finances very complicated. Even working out how custody of the children will be split has financial implications, with one partner potentially less able to work or taking on an increased burden in terms of bills or food and transport costs. There are many different factors to consider when it comes to children and the agreement may need to cover eventualities that haven’t yet occurred, such as the cost of university tuition fees or a first car. It’s often at this point that separating couples choose to seek the advice of a solicitor.

The shared home

How you deal with a property that you’ve shared will depend on whether it is rented or owned, who owns it and whether there are children who might need to continue to live in it. If the property is rented then one partner can move out and reimburse the other for a share of the rent until the end of the contract. If the shared home is jointly owned then there are a number of different options: one partner buys the other out, value is transferred from one partner to another, ownership remains the same until the youngest child turns 18 or the property is sold and the profit split. If there is a dispute over a jointly owned home and there are children involved then there are a number of different claims that can be made to the courts by one parent, including the right to stay in the home.


If you’ve been cohabiting then your pension is usually protected from your other half. However, if you have a civil partnership or a marriage then pensions are often the second biggest asset after the family home to come into contention during a financial split. Personal pension schemes, occupational pension schemes and Additional State Pension (but not the basic State Pension) can all be divided as a shared asset on dissolution or divorce. There are many ways in which pensions can be split, from a percentage share through to being entitled to a proportion of the pension payment when it starts being paid out. It’s worth noting that it is the entire pension that is taken into account, not just that accumulated during the years of the relationship.

Protecting your assets

Sometimes partners don’t behave particularly fairly during a separation or split. So, it may be necessary to go to the courts to protect your assets. If you think that there is a risk your partner may sell, transfer or get rid of certain assets (for example, by moving them abroad) then it’s important to take legal advice as a court may be able to prevent this from happening.

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Are there better odds than simply playing the National Lottery? Wed, 13 Dec 2017 14:01:47 +0000 Alex Hartley Lotteries are a type of gambling that has been enjoyed for centuries. Their history can be traced all the way back to the Chinese Han Dynasty between 205 and 187 BC and it was the Romans that first brought this sport to European shores. In the UK we were quick to embrace the idea of the lottery. Although the National Lottery is the most famous UK lottery, we Brits have actually been gambling like this since the mid 1500s when Elizabeth I organised the first official lottery.UK Lotteries

What are your UK lottery options?

There are literally hundreds of lotteries in the UK – The Gambling Commission has records of at least 520 licensed UK lotteries. Larger games tend to have bigger prizes but may also attract a much wider range of participants and charge more for tickets. Playing a smaller lottery normally increases the chances of a successful win. However, with fewer players the prizes are smaller too. Some lotteries select the winner via post code, others via ticket. Then there are the causes – you might want to play a lottery that also donates to something worthwhile. There are many different options. So, which UK lottery should you choose? These are some of the best known.

The National Lottery

This was the first nationally organised lottery – launched in 1994 – and a number of different games now come under its brand, including Lotto, Lotto Hot Picks and Thunderball. Jackpots are always six figures – not surprising given that it’s estimated around 70% of the UK population plays the National Lottery at a cost of £2 per ticket. Six million people win a prize of some sort on the National Lottery every week and almost 5,000 millionaires have been made since the game began. However, the odds of winning are quite low – you have a 1 in 14 million chance of winning the Lotto jackpot, for example.


There are 13 different prize tiers to the Euromillions, which is part of the National Lottery group. Your odds of winning any prize come in at around 1 in 13. However, if it’s the jackpot you’re after then these odds drop to 1 in 139.8 million! Tickets cost £2.50 each and include entry into the Millionaire Maker draw. As Euromillions is played right across Europe the jackpots can be huge – so far a jackpot of £167 million has been the biggest on offer.

The People’s Post Code Lottery

Entry for this lottery is your post code, as well as a unique three digit number. There’s no automatic entry and you have to buy a ticket – when you win, you win with all the players in your post code area. Tickets are £10 per month, which covers 10 draws over four weeks. A monthly jackpot of £2,000,000 is divided up in the winning areas with a maximum per person of £400,000. The odds of winning the People’s Post Code Lottery are closely protected by the brand, which says this is commercially sensitive information. However, experts put this at about one in 162,000.

The Health Lottery

Launched in 2011, the Health Lottery isn’t a national lottery but a partnership between 51 different lotteries that represent a local authority in the UK. Tickets cost just £1 or 50p and a proportion of each ticket sale is donated to local good causes. There was some scandal about this at one point, as just 20p from every £1 made it to these good causes (the National Lottery gives 28p) but the amount has now apparently gone up. You’re seven times more likely to win on the Health Lottery than the National Lottery. However, the prizes are also significantly smaller with winnings capped at £100,000 per draw.

European lotteries

The UK lottery actually has some of the best jackpot odds in Europe but is it worth playing other European lotteries too? Most European lotteries don’t require players to be residents in their country to play and it’s fairly simple to choose the numbers online. Jackpots can be high. Some of the jackpots recorded for European lotteries include SuperEnaLotto (Italy) £125.7 million, EuroJackpot £63.5million, Spanish Lotto £25.9 million and Swedish Lotto £18 million. If you want to venture into the European lotteries then the best odds are the French Lotto (a one in six any prize chance of winning) and Spanish Lotto (a one in ten chance).

A new approach to lotteries

Lottery games and prizes continue to evolve, partly driven by the need to attract more players and partly to offer better prizes. Camelot, the operator of the National Lottery, for example recently decided to introduce a very different prize: £10,000 a month for life. Around ten of the UK’s lump sum winners have blown all their winnings since the game began. This new prize is geared towards avoiding that and also appealing to demographics looking for different things from a lottery prize, perhaps to top up a pension.

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Where to shop for your Christmas & Boxing Day food and drink essentials Mon, 11 Dec 2017 11:34:04 +0000 Alex Hartley According to Good Housekeeping magazine, in 2017, the annual Christmas dinner will cost around 18% more than it did last year. The survey looked at a Christmas dinner for eight people with all the trimmings and found that factors such as inflation and Brexit had pushed the overall cost up from £19.82 to £23.53. Christmas is a very expensive time of year for everyone but no one wants to go without those celebratory essentials. If you want to make sure you have everything you need to celebrate this year – at the best price – where can you find it?

The Christmas dinner

In terms of getting the entire package of Christmas food, the Good Housekeeping survey revealed the best places to shop. This included a whole turkey, potatoes, brussel sprouts, parsnips, carrots, stuffing, cranberry sauce, Christmas pudding, mince pies and brandy butter. The cheapest supermarket for purchasing the entire Christmas dinner is Lidl with a basket that comes in at £25.53 for all the Christmas Day essentials. Second is Aldi at £25.68 and after that Iceland (£28.12), Tesco (£28.48), Asda (£31.17) and the Coop (£33.48). The priciest place to buy your Christmas feast is Waitrose with the same items costing £41.47 (60% more than Lidl).

Higher welfare meat is becoming a priority for many – i.e. turkeys that have been raised seeing some daylight or completely in the wild. These will never be the cheapest turkeys to buy but offer a more ethical option and, many believe, a tastier meat. Only the free range and organic turkey has actually lived the natural turkey life (a free range turkey could still have been almost completely confined). This year it’s not just the expensive retailers offering consumers the option to make a better choice – Morrison’s, Asda and Lidl have free range turkeys from £8 and you can pick up a free range, organic turkey at Ocado or Tesco from £30 – £50.Christmas turkey

The Christmas cake

If you’re not making your own cake this year then there are lots of different options on the high street. For a fully iced, full size Christmas cake Aldi is a popular choice – its £9.99 boozy Christmas cake comes complete with icing snowflakes and glittery baubles. Iceland has a simple, stylish gold and white iced Christmas cake from just £7.50 and Lidl’s luxury two tier cake is £9.99. If you want to impress your guests, the M&S six month matured Christmas cake (£20.00) is a bit of a showstopper.

The Christmas fizz

A bit of celebratory fizz is something of an essential to mark Christmas Day. If you’re pushing the boat out this year but don’t want to pay through the nose for your booze then Lidl has launched its Christmas magnums. These 1.5 litre bottles of real champagne come in at £29.99 – which is half what you’d pay for a regular champagne magnum. If you’re more of a prosecco fan then Lidl also has a 1.5 litre magnum of prosecco for just £12.99.Christmas prosecco & champagne

Alcohol can be the most expensive part of the Christmas shop but this year the supermarkets are going all out on deals to try to attract customers to their stores. There are some great bargains to be had, including:

Waitrose – free champagne with orders over £100

Asda – 6 wines for £25

Tesco – 2 bottles of Tesco Finest for £12

Sainsbury’s – £2.50 off

M&S – 25% off when you buy two bottles

Morrison’s – cases of wine for £25

Iceland – 2 for £3

The Boxing Day ham

The traditional Boxing Day ham is an essential for many – if you’re willing to glaze and roast it yourself then you’ll always find it cheaper. Tesco has great deals on its Woodside farm smoked gammon joints, from around £4 and if you’re happy to roast your own then Asda’s joints start at just £3 – even Lidl can’t beat that price.

The Christmas chocolate

Having a tray, tin or box of chocolate treats to dig into while you’re watching the Christmas film has become something of a tradition. Right now, a 750g tin of classic Quality Street is cheapest at Tesco, Asda and Morrison’s (£4). You’ll pay £5 for the same tin at Waitrose unless you buy two for £8. If your treat of choice is a Terry’s Chocolate orange then you can get this for just £1 at Asda or Morrison’s, which is half the price that you’ll pay elsewhere.

The Christmas spirit

Not the booze but the feeling of time off work with family and friends and lots of delicious food and drink to enjoy – that’s priceless.

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This year’s Christmas spending is set to hit over £800 per family! Fri, 08 Dec 2017 10:26:48 +0000 Alex Hartley The cost of living may be rising, Brexit may be looming but when it comes to Christmas it seems most of us are determined to spend more. While two years ago in 2015, spending by British households on Christmas dropped down to £796, this year it’s set to reach £820. From gifts and food, through to festive travel and alcohol, there is plenty to help you part with your cash during the festive season. But why do Brits spend so much?Christmas shopping & spending

The tradition of festive spending

In the UK we have established something of a tradition when it comes to the annual festive Christmas splurge. 1 in 4 Brits end up spending too much at Christmas and this is a prime time for getting into debt. As a country we spend roughly 54% more than our European neighbours on Christmas festivities and this can result in some pretty depressing credit card statements come January. According to RetailMeNot, UK households expect to spend a whopping £473.83 on Christmas presents alone this year – that’s almost double what our counterparts in France will spend. Much of this amount is generated by expensive kid’s toys and games, as well as stocking fillers. We’re even planning to spend £25 on gifts for our kid’s teachers according to a survey last month.

The cost of Christmas is definitely going up

Part of the reason for an increase in spending could well be attributable to rising consumer costs. If there is one item that sums up a Christmas purchase it might be the Terry’s Chocolate Orange. For most of us, this is an annual edible, whether you get it in your stocking on Christmas day or as a Secret Santa gift. Well, research from The Grocer has found that the humble Chocolate Orange has now doubled in price. Last year at this time it was being sold by Sainsbury’s for just £1. In 2017, the cost is £1.95. Not only that but the Terry’s Chocolate Orange is now also 10% smaller than it was two years ago so you’re paying more and getting less.

Why do we spend so much on Christmas?

Undoubtedly, increased costs are having an impact on what British households assume they will have to spend for a good Christmas 2017. However, are there other reasons why we tend to splurge at this time of year?

Competitive spending – no doubt there is an element of keeping up with the Joneses when it comes to a British Christmas. From kids wanting the best toys to show off to their friends, to neighbours competing for the best lights displays or Christmas parties there are plenty of opportunities to accidentally blow your budget when you’re trying to be the best.

Emotional spending – Christmas is a pretty emotional time of year and this can all get a bit overwhelming when it comes to bypassing normal thrifty logic. You might be seeing people you haven’t laid eyes on in months, or wanting to give a sick relative the best Christmas ever. It’s very easy for emotions to drive spending on items, which, at the time, seem important to have.

Guilt spending – if you’ve had a difficult year and want to make it up to the people you love, or maybe you don’t have much time at home this Christmas, the temptation is often to spend big. From divorced parents to absent children many people are easily affected by guilt, which can result in spending that is somewhat out of control.

How to curb the Christmas splurge this year

If you’re one of the many people affected by changing economic circumstances or dealing with existing debts this really isn’t the time of year to go all out. Even if you’re not, there are some smart ways to avoid blowing the budget this Christmas.

  • Home made gifts – this doesn’t have to be bad knitting. Everything from bath salts to candles can be created at home for half the cost of shop bought.
  • Discounted products – Black Friday and Cyber Monday are over but many stores will start their Christmas sales in the run up to December 25th, which offer plenty of opportunity for discounts.
  • Stick to your budget – create your budget now, before the madness begins, and stick to it.
  • Shop around – you can often find what you’re looking for cheaper elsewhere (especially online) so shopping around really is worth it.
  • Have one gift each – no one needs 10 presents to open on Christmas Day so set a rule that everyone gets just one really good gift each.
  • Do things that don’t cost money – go for a walk, play board games, watch your favourite festive films, just be together.

Get into the spirit – Christmas is about people not stuff so make this the year you focus on what the Christmas spirit is really all about.

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What does the recent Budget mean for UK households? Wed, 06 Dec 2017 11:32:34 +0000 Alex Hartley Two weeks aso saw the Chancellor Philip Hammond’s first budget since the general election in June. This budget was intended to get Britain “fit for the future” and was notably geared towards trying to attract the attention of younger voters. But what did it deliver for UK households in this essential period in the last quarter of the year? How will the Budget affect you?

UK budget 2017Autumn Budget 2017 – the headlines

  • Stamp duty – the Chancellor abolished Stamp Duty for first time buyers up to a limit of £300,000. Properties over this cap – and up to £500,000 – will be Stamp Duty free for the first £300,000.
  • Brexit – the government plans to set aside £3 billion for preparations for exiting the EU.
  • Universal Credit – £1.5 billion will be applied to remove the seven day waiting period.
  • Economic growth – the forecast was revised down from 2% to 1.5%.
  • NHS – the government will put just £2.8 billion into NHS England.
  • The Living Wage – an increase to £7.83 an hour.
  • Duties on wine, spirit and beer have been frozen.
  • Income tax thresholds have been increased.

How will the Autumn Budget 2017 affect UK households?


The temporary Stamp Duty holiday in this budget is particularly aimed at young first time buyers trying to get onto the housing ladder. Stamp Duty has been identified as a major obstacle to increased home ownership in the UK. The average £300,000 property would attract 3% Stamp Duty on the first £250,000 and then 5% above that so the move is significant. Substantial investment is also being made in home building, including £28m on three new housing pilot schemes in the West Midlands, Manchester and Liverpool. For renters there will be £125 million of funding, which should support around 140,000 people on low incomes over the next couple of years.


Income tax thresholds moved upward with this budget, leaving more room until higher tax bands kick in. From April next year the basic rate threshold will be £11,850 and the 40% threshold £46,350. The lowest paid workers will also see a small rise in income as the Living Wage goes up by 33p an hour. In this budget the duty on alcohol has been mostly frozen, with the exception of cider and perry with alcohol content between 6.9%-7.5%, for which a new tax band has been created. Those households planning on travelling abroad next year will see a freeze in air passenger duty – unless going on a premium ticket or private jet, in which case duty is increased.


Brexit uncertainty still remains and the Chancellor had a difficult task this budget to try and reassure the British people that it would be properly dealt with. Formerly just £700 million was set aside to manage the transition out of the EU. In this budget, £3 billion has been earmarked. Of course, while this is a more realistic sum, critics of Brexit have highlighted how much good this cash could have done if applied to other areas, such as the NHS.


As George Osborne did in nearly every budget, Philip Hammond also cancelled the fuel duty rise once again. The duty rise was scheduled to come into play in April next year so the move should save the average driver around £160 a year. There were some fairly cautious measures to encourage consumers away from diesel vehicles and towards more energy efficient, greener cars. For example, £400 million is set aside to establish an infrastructure for charging electric cars and people charging electric cars at work won’t face any taxes. At the same time, diesel cars face a one percentage point increase in company car tax and diesel cars that don’t measure up to standards will also see a rise in tax costs – up one tax band. As part of the campaign to attract younger voters there was also a new rail card for those aged 18 – 30 (the previous upper limit for the rail card was 25). Those with the rail card can get a third off rail fares.

Education and health

Slipping standards in schools has been a major theme for many in previous years. In this budget the focus was on maths – with £40 million earmarked for maths teachers – and technology, with the number of computer science teachers is to be trebled. The Budget also had some incentives factored in to help encourage schools to direct pupils towards certain subjects, including a £600 premium for schools for each student taking A-level maths. The NHS is another controversial topic in almost every Budget. While £2.8 billion might seem like a substantial sum it is just half what was required according to Simon Stevens, the chief executive of NHS England.

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Winner of first Solution Loans Photography Competition announced Tue, 05 Dec 2017 14:05:41 +0000 Amanda Gillam We are very happy to announce that after receiving literally hundreds of entries from all over the world we have a winner of the first Solution Loans photographic competition!

Over a period of 3 months to the end of October we received photo entries via our website and via our social media channels (Facebook, Instagram and Twitter). We used a “popular” voting process to reach a short list of 25 and then our judges reviewed these to decide on a final winner and two runners up.

The theme of the competition was “On a Journey”. Entrants interpreted this theme in dozens of ways and put their own cultural spin on it too given that we had entries from all over Europe and Asia in particular.

Our First Winner

We are proud to announce Jay Birmingham is the winner with a dramatic shot of the Winnats Pass in England’s Peak District.

First winner of the Solution Loans photo competition
Winnats Pass, England

Our Judges said:

We found this image more dramatic the more we looked at it. The early morning fog in the valley is in itself rather eerie. Watching the cars on their journeys descending into the valley only for their red tail lights to be swallowed up by the mist is also disconcerting. The photographer can see what the cars cannot – until the last minute. But they are so far away that even if they wanted to warn them there is nothing they can do.

We admired the overall composition with the red tail lights drawing the eye towards the fog in the valley. The slowly rising sun’s red glow helps to enhance the overall feel of the shot. Great work!


Our Runners Up


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We’d Love to hear your comments about Jay’s photo and those of the runners up. Use the comments section below, or use the Facebook comments section on our main competition results page.

Future Competitions

Given the success of this competition we’ve decided we’ll be running two competitions each year running over an extended period in each case. We want to maximise the reach of our competitions so we’ll be continuing to accept entries via social media routes (esp. Instagram and Twitter) as well as traditional means. This also serves to democratise the competition as entering via your mobile phone becomes extremely easy.

We’ll be announcing our next competition soon so we suggest you bookmark our photo competition page, and check back occasionally to see when it goes live. Good luck!

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Could your favourite soap & sitcom characters really afford to live where they do? Mon, 04 Dec 2017 12:00:11 +0000 Amanda Gillam For many of the UK’s most popular soaps and sitcoms the gentrification of their districts has passed them by. And when watching episodes of the old favourites it’s easy to wonder whether they would now be situated in their original locations given the rapid rise in property prices since those shows ended.

So we thought we’d play a game to see what the reality is.

EastEnders characters short of £700/month!

There’s something implausible in the dark heart of the average EastEnders episode. It’s not the East End hardmen who never swear, the terminally ugly who manage to have affair after affair or even that bench they all go to sit on to have a cry.

It’s that none of them could even afford to live there in the first place!The Queen Vic, EastEnders

An average London market trader earns £1,746 per month, £684 short of the average rent of £2,431 in trendy East London.

The residents of Coronation Street fair little better. Earning an average of £1,326 every month and paying an average rent of £1,043 they’d be left with a mere £283 per month. After food and other essentials they’d barely be able to afford to dampen their sorrows in the Rovers Return, let alone drown them.Rovers Return, Coronation Street

EastEnders Coronation St.
Area East London Salford
Avg. Monthly Salary £ £1746 £1328
Avg. Monthly Rent £ £2431 £1043
Surplus/(Shortfall) (£686) £285

Where could our favourite TV characters afford to live in 2018?

While soap characters might struggle to make ends meet, what about some of our other favourite TV creations?

Del Boy (Only Fools & Horses)

Derek “Del Boy” Trotter famously lived in rough and ready Peckham until finally making his fortune and moving to the country.Del Boy in Peckham

Would a modern-day Derek Trotter be able to afford to live in Peckham? Sadly it seems not.

Character Derek “Del Boy” Trotter#
Type of Property 3 bedroom flat
Geographic Area Peckham
Job Market Trader
Average Rent in area £1747
Average Income £1747
Surplus/(Shortfall) £0
Affordable Rent* £1153
Where he’d be living now 2 bed flat in Crystal Palace

With rent nearly matching his income and without the help of a bad credit loan Del would be forced to live elsewhere, or at least give up Uncle Albert and Rodney and move into a one bedroom flat by himself. If he insists on three bedrooms it would be Crystal Palace rather than hipster Peckham:

Delboy & Rodney - Only Fools & Horses

Given that nowadays he’d be more likely selling his wares on eBay and competing with goods from China, it’s debatable whether he’d even manage that.

Absolutely Fabulous

Ab Fab’s Edina Monsoon lives in a large house in Holland Park, unlike the others on this list who rent Edina has bought her house and owns it outright. Unfortunately though, even in the 90s when the show began this would have set her back £1.5 million which would have been unaffordable even given her well paid job as head of a PR company.

Given her likely wage of around £100k, she’d get about £450k for a mortgage, just enough for a three bedroom flat in Lewisham.

Character Edina Monsoon
Type of Property Very Large House
Geographic Area Holland Park
Job Owner PR Firm
Property Cost £1.5 million
Average Income £100,000
Available Property Price £450,000
Where she’d be living now 3 bed terrace in Lewisham

Still, Lewisham is so now darling!

Patsy will be visiting Lewisham more

Sherlock Holmes

Sherlock Homes wouldn’t fare much better. While he famously resides at 221b Baker Street the reality is that he couldn’t afford it. On a average private detectives salary of £1,865 per month he’d be £1,580 short of the average rent of £3,445 for a three bedroom apartment in Baker Street.

Character Sherlock Holmes
Type of Property 3 bedroom apartment
Geographic Area Baker Street
Job Private Detective
Average Rent in area £3445
Average Income £1865
Surplus/(Shortfall) (£1580)
Affordable Rent* £1231
Where he’d be living now 1 bed apartment in Tooting

To live affordably he’d have to downsize to a one bed in Tooting. Still there’s probably enough crime in Tooting to keep him busy.

Sherlock Holmes - new property in Tooting

Vince & Howard (The Mighty Boosh)

While the location of the Zooniverse is never revealed, Vince and Howard’s flat is, and the pair reside in trendy Dalston. Sadly, as professional musicians they’d be earning around £1,096, doing a couple of gigs per week (we reckon their pay from Naboo is negligible given they never sell anything and cause him no end of problems).

Characters Vince Noir & Howard Moon
Type of Property 2 bedroom flat
Geographic Area Dalston
Job Musicians
Average Rent in area £1950
Average Income £1096
Surplus/(Shortfall) (£854)
Affordable Rent* £723
Where they’d be living now Studio apartment in Camden

While Dalston may be unattainable, a one bed in Camden is just about manageable. But it could be a mighty squeeze for the Mighty Boosh.

Mighty Boosh move to Camden

Alan Partridge

Alan was always a tragic figure, but from being within striking distance of a five-bedroom, mock Tudor house in series 1 by the end he was living in a caravan next to a building site.

But could Alan even have afforded the Travel Tavern? Sadly, it seems not, unless Lynn stumped up for a guarantor loan:

Character Alan Partridge
Type of Property Standard room at The Holiday Inn
Geographic Area Norfolk (just off A47)
Job Local Radio DJ
Average Rent in area £2213
Average Income £1888
Surplus/(Shortfall) (£325)
Affordable Rent* £774
Where he’d be living now YHA (hostel)

We’d love to see the episode where Alan moves into a youth hostel (with or without Chris Eubank). Given his aversion to the Mini Metro though we suspect he’d put up a fight.

Youth Hostel for Alan Partridge

Joey Tribbiani (Friends)

It’s not just UK characters that face the demands of high property process. New York is famous for many things, but cheap rents aren’t one of them.Monica's apartment in Friends

All the characters in Friends (at least at the start if the show) have jobs that make it unlikely they’d be able to afford the (huge) apartments they live in.

Monica inherited hers and apparently has rent controls in place (we’re still not quite convinced she’d be able to afford it). Chandler always did well for himself and had a bit leftover to bankroll Joey from his jobs as an IT procurement manager and later an ad man. But given that even small New York apartments require serious money, even Chandler stretches credibility.

Joey is, by the end, the only one who might plausibly be able to afford his apartment. Joey goes from being poor and leeching off Chandler to being a soap star (with a few hiccups) who, if he wanted too, could probably pay for the all of the friends combined.

Character Joey Tribbiani
Type of Property 2 bed apartment
Geographic Area Greenwich Village
Job Actor
Average Rent in area $1706
Average Income $10,870
Surplus/(Shortfall) $9164

Of course, how long they’d stay friends once they were financially beholden to him is debatable.

Down to Business

While TV characters may be struggling to pay the rent, how are the ones trying to run a business fairing?

We looked at the per year lease costs of business premises for two TV businesses to see if their business models stack up.


Bernard Black

Through a combination of very irregular opening hours, extremely poor customer relations and refusing to order new stock, its hard to imagine Black Books made much money to start with. Once you factor in the annual costs of leasing even a small shop in posh Bloomsbury, its even less plausible that Bernard would make ends meet:

Character Bernard Black
Business Premisis Book Shop
Geographic Area Bloomsbury
Lease they’d pay now £175,000 p.a.

Bear in mind this is just leasing the shop and doesn’t include stock, business rates, running costs or insurance, it seems unlikely Bernard would be making ends meet. This doesn’t even factor in paying Manny or the cost of Bernard’s colossal booze habit.

Given these factors, it looks like Black Books would struggle if it were a real business.


Brian Potter

Brian had a lot of overheads running The Phoenix Club, mainly in the form of pay for his long-suffering staff. Lucky for him though, property prices are a bit more reasonable in Bolton than London so he doesn’t have to sell too many bottles of beer to turn a profit.

Character Brian Potter
Business Premisis Club
Geographic Area Bolton
Lease they’d pay now £125,000


New Phoenix Night club

Again, this is just the lease and doesn’t include business rates, running costs, staff costs or insurance or stock. Given that Brian does manage to get a few customers through the door, he may have a shot at successfully running the business, especially with his trade mark corner cutting.

What if they Bought?

As a final thought, if Del Boy had bought his council house in 1981 (the year the show started and one year after right to buy was introduced) he would have spent around £30,000. He could sell the same now for around £400k, that’s a 1,233% investment growth. Better than the money you’d make from crash turbans, inflatable dolls or chandelier cleaning.

The moral of the story is TV show economics don’t have much in common with real ones. Still, a TV show about Del Boy making well considered property investments over a 30 year period probably wouldn’t have been much fun to watch.


  • * reflects typical 66% of income being spent by London & New York residents on rent; 41% in UK outside of London.
  • # assumes Del Boy is sole breadwinner in the household. Rodney is entirely dependent on him.


  • Property prices & rental value:,,,,,
  • Income data:,,,,
  • Other data:,,,,,

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Brexit Update: At what stage are negotiations? Fri, 01 Dec 2017 11:22:24 +0000 Alex Hartley Brexit remains one of the most difficult topics of conversation in the UK right now. Negotiations concerning the way that the UK will retain its ties with the EU have been very publicly criticised for their slowness and the confusion about what rights will remain and what rights will go. So, what do we know about Brexit so far and what is there left to negotiate?

Brexit – what we know

The one feature of Brexit that is relatively certain is that Britain will depart the EU at 11 p.m. GMT on March 29, 2019. And that’s it – currently that is the only degree of certainty that anyone has about what life will look like in this post-referendum age!Brexit news update

Brexit – the main issues and what we think we know

Outside of the exact date and time that Britain will depart the EU there is still a lot to negotiate. However, although there has been no confirmation about what rights British citizens will have after March 29 2019, some progress is being made.

The “divorce bill.” This is one of the trickiest subjects because, although it doesn’t relate to UK citizens’ rights in Europe, it will have an impact on the national budget and, consequently, the wealth of the UK as a whole. Prime Minister Theresa May has said that the UK will honour the financial commitments that it made while a member of the EU but has gone no further. No agreement has yet been reached on exactly how much Britain should be paying to leave the EU – estimated sums come in anywhere from £20 billion to £100 billion!

British citizens abroad. There are roughly 1.2 million Britons who have made their home somewhere in the EU outside of the UK and one of the key questions for the negotiations has been what rights they will have post-Brexit. Although nothing has been confirmed the two sides are said to be within “touching distance” of a deal. Given that this is one of the first issues to potentially be resolved many experts are speculating that this is a sign that the rights of Brits abroad won’t be affected.

EU citizens in the UK. Britain is home to around 3 million EU nationals and their rights after Brexit are another point of contention. Although, initially, there were fears that large numbers would be asked to leave, the UK government has very recently sought to comfort EU citizens based in the EU who are fearful about their ongoing status. It has said it is looking to create a straightforward and low cost way for EU nationals to apply for settled status in the UK, including how to appeal if an application is unsuccessful.

Northern Ireland. Effectively, the border between Ireland and Northern Ireland will also become a border between the UK and the EU and this is becoming an increasingly contentious issue. Practically zero progress has so far been made in negotiating how this should be handled.

What will life be like post-Brexit?

Right now, all anyone can do is speculate on what life will be like in post-Brexit Britain in key areas such as these:

The right to work in the EU – restricting the right of EU nationals to work in the UK was a central plank in the Leave campaign’s rhetoric but what will also disappear as a result of the vote is the right of Britons to work freely in the EU. The issue of free movement of people within the EU is tightly tied to trade. It’s likely that the UK will be forced to continue to allow EU immigration to keep trade links open. The up side of that is that it may not be as difficult as anticipated for Brits to live and work in the EU after all.

The influence of EU bureaucracy – again, getting rid of the influence of EU bureaucracy on British daily life was seen as a major selling point for Leave campaigners. Of course, that bureaucracy has brought us the right to compensation for delayed flights, the power to crack down on big corporate tax avoiders, an end to mobile roaming charges, reduced VAT on energy bills, climate change targets, better banking regulation and limits on working hours. Some feel we’ll actually be left with less protection, rather than less red tape, as a result but as yet no one really knows which of these will stay and which will go.

Retiring to Europe – although nothing has yet been confirmed, many fear that retiring to Europe after the UK leaves the EU will no longer be possible. In fact, financial firm Blevins Franks – which offers advice to retirees locating to Europe – said it has seen an uptick of 20 – 25% in people looking to do this before 2019.

Previous Reports on Brexit Developments

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Your consumer rights if your airline lets you down Wed, 29 Nov 2017 10:40:33 +0000 Alex Hartley Booking flights seems to get easier and cheaper as the years go by. However, recently, it’s also become a bit of a risky business with the likes of Monarch ceasing to trade and Ryanair cancelling multiple flights. So, what happens if you find yourself caught up in airline drama, whether that’s a delayed flight or something more serious?compensation for cancelled flight

Compensation for a delayed flight

The right to compensation comes via an EU regulation (Regulation 261/2004) so you’re only entitled to it if you’re departing from an EU airport on any airline, or arriving at an EU airport on an EU carrier (including Iceland, Norway and Switzerland). You’re entitled to compensation if your flight was delayed by more than three hours. If your flight gets cancelled and you take an alternative flight then the right to compensation arises if the second flight was two hours later than either your original arrival time or the original flight. There are specific amounts of compensation available under the regulation:

Delays of 3+ hours for a short flight – €250 (£230)

Delays of 3+ hours for a long flight (1,500 – 3,500km) €400 (£365)

Delays of 3-4 hours for a flight of 3,500km+ – €300 (£275)

Delays of 4+ hours for a flight of 3,500km+ – €600 (£550)

How can you get compensation?

Ultimately, it’s up to the airline – at least at first – and airlines have many ways of avoiding paying out under the regulations. There is an exception, for example, for “extraordinary circumstance,” which will mean that the airline doesn’t have to pay a penny. This will cover extreme situations like war or civil unrest but could also ensure you don’t get compensation as a result of bad weather, strikes or something as basic as an airport’s failure to de-ice the aircraft on time. Technical faults tend to be the airline’s responsibility and so you’re much more likely to get compensation if that’s the basis for your claim. You can claim compensation for any flights over the past six years.

Can you challenge “extraordinary circumstance”

Yes, you can always challenge decisions made about your rights as a consumer. Obviously, airlines are not keen to pay compensation where they don’t have to so it’s often worth challenging a decision that you think has been wrongly made in case it’s a stalling tactic. Whether you’re successful will depend on the airline and how much time and energy you have to pursue them. Ultimately, if the airline still refuses you compensation you believe you were entitled to then you would need to go to court.

Compensation for connecting flights?

If you miss an ongoing flight as a result of delays to an initial leg of your journey then you should be able to claim compensation if everything is under the same booking reference. You’ll also need to have made the connection at an EU airport.

Flights cancelled by the airline

It’s usually possible to get a refund and potentially compensation when your flights are cancelled by an airline. If you had flights booked with Ryanair, for example, and they were cancelled by the airline then you should have the right to a refund. Ryanair has confirmed that all those who were affected by its recent problems have the right either to change their flight for another or to get a full refund. And it’s not an empty promise for some point in the future, as the airline also said that where a refund was requested this would be processed “within 7 days.” Compensation for these cancelled flights would be on the basis of the EU regulation mentioned above. However, there is a caveat – if the flights were cancelled and the airline notified passengers two weeks before departure then there is no right to compensation.ryan air cancellations

How to protect yourself from losing money with airlines

  1. Buy your flights on a credit card – under the Consumer Credit Act your credit card provider shares responsibility with the seller if there’s a problem with something you’ve purchased. The minimum amount covered is £100. If the airline goes bust or a travel company goes under and you lose your flights or holiday then you can make a claim for them from the credit card company.
  2. Take out insurance – most insurers don’t offer much compensation for delayed flights but it’s possible to take out a policy to cover you for the failure of an airline.
  3. Look for the Atol protection scheme mark – if you buy a package holiday or a seat-only ticket on a charter flight then the Atol protection scheme is one way to arrange a refund. Under the scheme you can also get repatriated if you’re stranded abroad as a result of issues with the airline or travel operator.


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Winners of Summer 2017 Writing Competition Announced Tue, 28 Nov 2017 15:10:18 +0000 Amanda Gillam Our first short story writing competition was such a great success that we decided to run another this summer. This has exceeded our expectations. We doubled the number of entries received while the quality of the entries stayed very high.short story writing competition winner

The competition closed at the end of September and after a much deliberation we can now announce the winners of our Summer 2017 competition. The winner and the three runners up all won cash prizes and have their short stories published on our website (read their stories and tell us what you think of them in the comments below).

The winning story “The Eternal Coin” was a striking piece moving the reader through 2000 years of British history in just 2000 words! It won the writer David Stokes £200. As our judges noted:

We really liked David’s response to our theme. We’ve probably all looked at items in museums at some point and wondered how they arrived there. In his story, David takes us on an epic journey describing  this. The writing is packed with beautiful, evocative description and credible historical references. It’s a rollercoaster of a read, spanning many centuries and it left us feeling rather humbled by our own, comparatively short, human existence.


We’d like to thank everyone who took time to prepare their entries and we hope that you’ll enter future competitions.

Our next short story writing competition

We expect to launch our winter competition at the start of January 2018 and it will run until the end of March. Watch this page to find out the theme of the upcoming competition.

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