Retired couples amass savings

Retired couples in the UK have average savings and assets to the value of £269,479, according to a survey.

The average figure for single pensioners was found to be £134,739, Prudential reports.

Despite retired people having amassed such substantial savings, the organisation states that only 17 per cent of pensioners have sought financial guidance from a professional adviser.

Gary Shaughnessy, Prudential’s managing director of retail life and pensions, expresses surprise at the amount of savings and investments held by the average pensioner.

He adds: “The average pensioner could substantially boost their retirement income simply by using their savings and assets in different ways and exploring other options such as equity release to deliver an income.”

A separate study revealed last week by Zurich Financial Services suggests that one in five of the overall population believe it is too expensive to see a financial adviser.

In addition, it found that only three out of ten single people stated they had sought professional financial guidance.

Tags: amount, Social Issues, adviser, financial adviser.In addition, ING Group, single people, cent

Some Brits losing money on savings

British taxpayers earning less than 5.4 per cent on their savings are losing money in the current economic climate, a new report warns.

With the retail price index at 4.3 per cent, consumers who are making taxable savings need to earn 5.4 per cent interest at least if they are to break even, a new report from moneysupermarket.com states.

There are currently 487 savings and current accounts which offer less than 5.4 per cent, the report notes.

Kevin Mountford, head of savings at the price comparison site, urges the government to consider ending the tax on savings as it tries to control the cost of living.

“Savers, especially those paying the higher rate of tax, should make sure they take full advantage of their annual £3,600 Isa allowance if they want to inflation proof their finances,” he adds.

Earlier this month, Nationwide Building Society released the results of a survey into saving attitudes which showed that while three-quarters of British consumers feel saving is important, just half of people in the UK do save regularly.

Tags: british taxpayers, cent, price, Brits, inflation, consumers feel saving, tax

Richest and poorest Brits hit by credit crunch

People at extreme ends of the wealth scale are being affected the most by the current economic turmoil, according to MGM Advantage.

The richest and poorest people in the UK are feeling the pinch from the credit crunch the most, the retirement income specialist has said.

According to research commissioned by the company, 20 per cent of people who are in debt and 25 per cent of those who have assets worth more than £1 million prefer to stash their cash at home rather than putting it in a savings account.

In the survey of more than 3,000 people round the country, it was found that women tend to be more likely to put their hard-earned cash in a savings account than men – 60 per cent of women said they used savings accounts compared to 48 per cent of men.

The Post Office recently reported that people who leave their money in accounts that pay a low level of interest are losing a total of about £8 billion every year.

Tags: uk, money, GBP, post office, cent, post

‘Unsurprising’ that credit crunch has hit the middle classes

Given that credit has been easily available in recent years, it is “unsurprising” that many people have been lulled into a false sense of security and are now waking up to financial difficulties, an expert at Transact has said.

Jamie Elliott, coordinator at the network committed to promoting financial inclusion, agreed that the economic downturn is hitting the middle classes and “an increasing number of people are finding that their sums no longer add up”.

He pointed out that credit has been widely obtainable in the past few years, with lenders offering 100 per cent mortgages, as well as attractive terms on loans and credit cards.

This comes just after the organisation reported that it is seeing a growing number of middle class people turn to it for financial help.

Mr Elliott commented that their difficulties are “compounded by big increases in food costs and energy costs”.

Tags: middle class, credit cards.This, middle class people, food costs, Transact, Mr Elliott, cent, Unsurprising

Pensioners likely to ‘rely more on savings’

Pensioners are expected to increasingly rely on their savings as their as pensions are gradually offering lower payouts, the director of Churchouse Financial Planning has said.

Keith Churchouse said that it is likely to become more common for people to dip into their savings as they become older and retire as they will probably be unable to rely on their pensions.

He noted that some people are hesitant about paying money into a pension scheme and those who choose not to have a personal account may find themselves dependent on the government in the future.

Mr Churchouse went on to say: “However, I don’t know whether the government has the view that if you actively opt out of the scheme, there is going to be a caveat to say that you can’t pop back to the state later.”

According to the Fidelity Retirement Index, the average household can expect to live off 42 per cent of their current income when they stop working full-time, which is far below the two-thirds that the Pensions Commission is proposing.

Tags: saving, Labor, Fidelity Retirement Index, Pension, cent

Younger people ‘nonchalant’ about their cards

Younger people seem to be less concerned about keeping their credit cards safe from fraudsters, a new report has suggested.

Two thirds of those aged under 50 said they had reported a credit card stolen compared to 78 per cent of people aged 50 years old or over, according to research by Saga.

Furthermore, a “massive” 88 per cent people aged between 18 and 34 years old said that they did not raise an eyebrow if someone took their credit card out of their sight when they were making a payment.

This is in contrast to 65 per cent of over 55 year olds saying they would not kick up a fuss in the same situation.

Andrew Goodsell, chief executive of Saga, commented: “Our study shows a worrying trend that men and younger people are generally less concerned about ID fraud than their older counterparts, and are not taking the steps to prevent fraudulent activity.”

This comes just after recent warnings from Apacs for people to make sure they keep their PINs safe.

Tags: apacs, cent, economics, Credit card, pins, someone, fraud

Cover yourself on a stag do, advises expert

People heading abroad on a stag do which may involve dangerous activities need to check that their insurance policy covers them in the event of something going wrong, Designaventure has said.

The stag and hen weekend specialist said that Britons going to a friend’s pre-wedding do need to closely inspect the clauses included in their policies so that they know whether they will be covered for taking part in dangerous activities such as machine gun shooting.

Anna Makin Made, project manager of Designaventure, said: “We advise everyone to take out their own insurance and check that they are covered for the activities that they’re doing.”

Figures from the Foreign and Commonwealth Office from 2005 revealed that 70 per cent of young British people go abroad for their stag or hen weekends and 57 per cent of them left the travel details down to the organiser, with nearly half of all them travelling without valid insurance.

Tags: machine gun, cent, Types of insurance, valid insurance, finance, office, Anna Makin Made, Exmoor

Mind: Debt can exacerbate mental health problems

Consumers who suffer from mental health problems can find their health deteriorates when they get into debt and receive letters from financial institutions, the national association for mental health, Mind, has said.

A spokesperson for the organisation said that people in debt are not just receiving one letter a week, but a barrage of phone calls throughout the day from different people, which can feel “quite intense” for some people.

Recent research by Mind found that the biggest reasons for people getting into problem debt were mental health problems (66 per cent), living on a low income (66 per cent) and difficulties in managing money (58 per cent).

Mind said that it has been working with the Financial Services Authority to change the way in which lenders treat their customers who have mental health problems and fall into debt.

“We are calling on banks to keep to… a code of practice, about responding appropriately to things like missed payments and treating people who are worried and have anxiety and depression appropriately,” added the spokesperson.

Tags: Alternative medicine, Bipolar disorder, organisation, anxiety, Financial Services Authority, cent, authority

First Direct offers mortgages to new customers

First Direct has restored its mortgage services to new customers with a number of two-year, five-year and ten-year fixed-rate deals. Read more

Tags: fixed rate mortgages, time, guardian, cent, first direct

Savers should look at alternative accounts, says expert

People who have a lot of money tied up in savings accounts may not be getting the best interest rates and should look at alternative options, a financial expert has said.

Kevin Mountford, head of savings and current accounts at Moneysupermarket.com, said that although there are a lot of good deals available at the moment, many people are probably “not getting their just returns” on their savings.

Mr Mountford warned that consumers often forget that “with most tax payers that rate of interest is subject to tax at either a standard or higher rate so the net return they are getting often is even less than the RPI at the moment”.

According to the Telegraph, many savings accounts have interest rates of around seven per cent, even thought the Bank of England base rate is five per cent.

The newspaper says that the credit crunch is largely responsible for banks being more cautious with their money and seeking alternative sources of funding through higher rates on savings accounts, which give them a ready supply of cash.

Mr Mountford warned that consumers often forget that “with most tax payers that rate of interest is subject to tax at either a standard or higher rate so the net return they are getting often is even less than the retail prices index at the moment”.

Tags: mountford, cash, interest, the Telegraph, tax payers, financial expert, head of savings, cent

Surfers worry about using credit cards online

Almost half of UK internet users have reservations about using their credit cards to make purchases online, with a third feeling concerned about the security of web banking, according to new research.

Internet security firm F-Secure has found that 48 per cent of people are not confident that their card is secure when using it online.

Banking Trojans are rising sharply and can compromise security by stealing log-in details such as usernames and passwords by providing links to websites that are very close imitations of the genuine bank site.

Increasingly complex attacks are also emerging, says the company.

“Consumers need to be aware of threats when banking online, but that is not to say that they should not do it,” says Mikko Hyppönen, chief research officer at F-Secure.

In a recent survey, Abbey found that around 40 per cent of online shoppers want banks to monitor online transactions more closely to make the internet safer.

Tags: online.banking trojans, cent, imitations, research internet, card, security firm, site, Banking Services

Tracker mortgages growing in popularity

Tracker mortgages are growing more popular than fixed-rate mortgages as a result of expectations that the base rate of interest will fall, it has emerged.

A total of 35 per cent of borrowers opted for a tracker mortgage last month, up from 33 per cent in January, according to new research from the Council of Mortgage Lenders (CML). This figure was up from 14 per cent a year ago.

Meanwhile, fixed-rate mortgages fell to their lowest level of popularity since March 2005.

“The trend away from fixed-rate products continues as expectations of further bank base rate reductions, probably starting this week, have increased,” commented Michael Coogan, director general of the CML.

The Bank of England’s Monetary Policy Committee will meet on Thursday (April 10th) amid predictions that the current base rate of 5.25 per cent will be reduced.

However, expectations of a cut in official rates have also prompted lenders to increase their rates on tracker mortgages.

The CML also reported that the number of loans for house purchase dropped by 3.5 per cent from last month to 49,200, the lowest quantity since records began in 2002.

Tags: council of mortgage lenders, base rate, Bank of England's Monetary Policy Committee, lowest quantity, trend, cent, Thursday

Personal loan costs on the up

The worsening credit crisis is pushing up the cost of taking out a ce.co.uk/loans/” target=”_self”>loan, despite cuts in the Bank of England base rate.

Moneyfacts, a financial data provider, claims that the average rate on a three year £5,000 unsecured personal loan has risen by 1.7 per cent in the past year, adding an extra £300 to the bill.

Nearly a third of personal loans taken out in the past year were for debt consolidation. A quarter of those borrowers ran into further debt, and 85 per cent of all those taking out loans were not asked to pay off existing debts by their lenders.

Worryingly, 70 per cent of loan applicants were not asked for proof of income, according to price comparison service uSwitch.com.

Mike Naylor of uSwitch.com commented: “With more than 7,716 loan repayments being missed every day and record write-offs, you might think that lenders had learnt their lesson.”

Figures released by the Bank of England last week showed that new consumer credit rose by £2.4 billion in February, compared to an increase £900 million in January.

Tags: year, comparison, cent, finance, bill, crisis

Over £1bn to be transferred between credit cards every month

Up to £1.1 billion is expected to be transferred between credit cards every month, according to new research.

Findings from a study by Sainsbury’s Bank showed that an estimated 716,000 consumers are responsible for the transfer of the sum.

The average transfer balance is £1,500 but one in ten consumers intend to transfer plans worth £4,000.

Donald MacLeod, head of cards with Sainsbury’s, said research indicates that 40 per cent of card holders think it will take longer than a month to clear their current balance.

“Although there are a number of credit cards offering introductory 0% on balance transfers, there is a considerable difference in their duration so people need to choose carefully. Also, when choosing a card for a balance transfer, it is also worth considering what else it offers,” he added.

Meanwhile, research from Fool.co.uk showed that UK spenders are more likely to use their cards than cash when paying for everyday purchases.

Tags: balance, Sainsbury, Business Finance, fool, Fool.co.uk, cent, sainsburys, Donald MacLeod

Up to 50% of Isa investors are contemplating self-select

More than half of Individual savings account (Isa) investors prefer to make their own decisions when it comes to investing, a new study has shown.

The results from Barclays’ survey reveal that ten per cent of investors would like to be more involved in their Isa.

Meanwhile, a third of Isa investors have opted for self-select and a further 24 per cent are thinking about taking one out.

Tom Ryan, director at Barclays Stockbrokers, said: “Self-select Isas have empowered investors, giving them the freedom to make their own decisions and to take control of their investments.”

The added attraction with the product lies with the option it provides to buy and sell when the consumers prefers, he added.

Up to 75 per cent of investors said they were attracted to self-select Isas because they like to make their own decisions.

From April 6th, new updated charges will come into effect for all Isa accounts for the 2008-09 tax year.

Tags: investors, barclays, ISA, Self-select, new study, Barclays Stockbrokers, cent, ISAs

Council tax expected to rise by 4%

Households in England and Wales are to face increasing strain as council tax bills are to go up by 4 per cent in the next financial year, according to the government.

Figures from the Department for Communities and Local Government (DCLG) revealed that the bill for an average household is expected to rise from £1,101 to £1,146.

Those in Band D will see the payment rise from £1,321 to £1,374 because of the increases, which the government says are the smallest there have been for 14 years.

Sir Simon Milton, the Local Government Association chairman, said that the increase would put council budgets under severe strain.

“Councils have been under a real financial squeeze during the annual struggle to keep bills down,” he said.

Sir Milton added: “The stark reality is that low council tax rises have come at a cost and many councils have had to make tough decisions on spending.”

Meanwhile, shadow local government secretary Eric Pickles said that cost of living since Labour has come into power has “gone through the roof”.

Tags: Communities and Local Government, households, association chairman, Local Government, bill, cent

Inflation ‘four times higher’ than official figures

The real rate of inflation is around four times what official figures say it is, according to a new survey.

A poll by Fool.co.uk suggests that 93 per cent of people “feel” inflation as being much higher than the current 2.2 per cent claimed by the government.

In fact, the survey puts the average “felt” level of inflation at 8.1 per cent, with five per cent of people putting the figure at 15 per cent.

People in their 40s are the hardest hit age group, experiencing inflation at an average of 8.8 per cent.

David Kuo, head of personal finance at Fool.co.uk warned: “The government can boast as much as it wants about its success over controlling inflation. However, people feel inflation through the shrinking pound in their pockets; they don’t experience it through a theoretical government shopping basket.”

In particular, the basket of goods used by the government to calculate inflation omits the cost of housing and mortgages.

The effect of inflation is being felt hardest by people in the West Midlands, where the average for all people was found to be 8.8 per cent. Northern Ireland has the lowest rate of “felt” inflation, at 6.8 per cent.

Tags: age group, inflation, fool, pockets, David Kuo

70 working days needed to pay off average debt interest, survey claims

People who borrow money using personal loans and credit cards need to work for an average of 70 days per year just to pay off the interest their borrowing accrues.

That is according to Unbiased.co.uk, which has proclaimed March 10 “Debt Freedom Day” to draw attention to amount of money consumers are having to pay just to service their debts – let alone pay them off.

Last year’s Debt Freedom Day fell on February 1, and this year’s date reflects the dramatically increased amount of unsecured borrowing British consumers are taking out.

Although credit card borrowing has fallen slightly from last year £55.6 billion to £54.9 billion from 2006 to 2007, the value of personal loans taken out has risen to £9.8 billion from £2.6 billion last year.

Combined with the effect of the credit crunch – which has pushed up the rates of interest charged on personal loans by an average of 0.5 per cent in the last year – debt and interest have soared.

Unbiased chief executive David Elms warned: “While Debt Freedom Day is of course a hypothetical point in the financial calendar, people should pay attention to it. In the current economic client is has never been more important for people to realise just how much it costs to service their debts and to ensure they have adequate funds available to do so.”

Tags: Credit Cards, cent, credit crunch, economics, Unbiased, taken out, point, GBP

Graduates ’shouldn’t have any trouble getting credit’ despite economic turmoil

Despite tighter lending conditions created by the global credit crunch, graduates should not have any trouble in getting credit, one financial expert has claimed.

Moneyfacts said that lenders consider different factors when dealing with graduates as they are viewed as customers worth attracting despite the debt they will have taken on at university.

Because of this, graduates typically enjoy low rates and high borrowing on their loans, which is unlikely to change this year, she advised.

Samantha Owens, head of credit cards and loans at Moneyfacts, said: “We don’t see any market contraction for graduates, and they shouldn’t be concerned about ridiculously high rates, or trouble getting any credit.”

She added that as a graduate is seen as a “good prospect in the long run”, these accounts are to remain static.

According to debt charity Credit Action, average graduate debt in the UK has dropped for the first time in six years.

Graduates who leave university with debt now owe on average £12,363, a decrease of £889 (six per cent) on 2006.

Tags: average graduate debt, prospect, trouble, financial expert, university, cent, action, graduate

Interest rate cuts ‘cannot be banked on’

Despite consumers anticipating that interest-rate cuts will take place throughout the year, it is likely that if further cuts are made they will be done so cautiously, one financial expert has claimed.

According to the Fairinvestment.co.uk, up to 29 per cent of consumers expect the rate to fall from the current 5.25 per cent to 4.75 per cent by the year end, while a further 27 per cent are anticipating a rate of 4.5 per cent or below.

James Caldwell, fairinvestment.co.uk director, said that consumers see the interest rate cuts as necessary to ease pressure on household budgets.

However, he said that making the decision to cut rates is not straightforward with various factors having to be taken into consideration.

“Therefore, it is likely that rates will be cut with an air of caution if there are to be further reductions this year,” Mr Caldwell concluded.

The Bank of England’s Monetary Policy Committee last voted to reduce the interest rate, from 5.5 per cent to 5.25 per cent, in February 2008.

Tags: rate cuts, consumers, money, cent, household budgets

Number of credit cards offering capped transfers falling

The number of credit cards with capped balance transfer fees is falling, according to financial experts.

MoneyExpert.com said that 12 months ago consumers could choose from 18 different credit cards with capped balance transfer fees, compared with the seven which are now available through five different providers.

Sean Gardner, chief executive of MoneyExpert.com, said: “Credit card switching is big business. Someone switches a credit card every two seconds and there are very few cards out there that still do not charge a fee for the privilege.”

He warned that those consumers looking to move their credit card provider could be “in for a shock” if they do not choose a card with a capped balance transfer fee.

According to MoneyExpert.com, the average balance transfer fee is 2.8 per cent of the amount transferred, meaning the typical cost of a balance transfer is some £74.65.

Customers with higher balances could incur much larger fees – a £5,000 balance transfer could cost as much as £150 with a three per cent fee.

Meanwhile, recent figures from MoneyExpert.com revealed that up to 5.9 customers switched credit card providers in the past six months.

Tags: provider, cent, personal finance, shock, balance transfer, consumers, finance, offering

Store cards ‘most expensive form of credit’

Store cards are probably “the most expensive form of credit that anyone can consider, claim debt experts.

Thomas Charles said that if consumers do decide to take a store card out, they should think very carefully about how they intend to pay the balance off.

James Falla, managing director of Thomas Charles, said: “My advice 100 per cent is don’t take out a store card full stop.”

He stated that this is because the average store card is 29 per cent APR, a rate which is “very, very high”.

Mr Falla also added that the credit crunch has resulted in credit criteria being tightened with some consumers claiming their limits are being reduced.

According to recent research by comparison site uSwitch, shoppers with store cards are paying an average of 62 per cent more interest than those using credit cards.

The average store card APR is 26 per cent – a figure ten per cent higher than the average credit card at 16 per cent APR.

Tags: figure, average store card, Payment systems, director, cent, anyone

Homeowners need to set aside 20% of income to pay stamp duty, say experts

The average home buyer in nearly one in three of local authorities needs to set aside over 20 per cent of their average income to pay the stamp duty bill associated with buying a new home, according to mortgage experts.

Research from Halifax reveals that in 2002 the average stamp duty bill was equivalent to more than 20 per cent of average annual full-time earnings in only one in 20 of local authorities.

Martin Ellis, chief economist at Halifax, said: “A growing number of home buyers are paying the equivalent of more than 20 per cent of local average annual earnings in residential stamp duty.

“This trend is most prevalent in the south of England. But, other parts of the country are being affected as well,” he added.

The average homebuyer in South Buckinghamshire paid stamp duty of £21,241 in 2007, equal to 49 per cent of average annual full-time earnings in the area – the highest proportion in the country.

Meanwhile, recent research from Halifax has shown that the number of owner-occupied households in England fell by 83,000 between 2006 and 2007.

Tags: trend, cent, Buckinghamshire paid stamp, south buckinghamshire, time earnings, research, equivalent

Brits to miss out on tax free savings

Many Brits will miss out on significant tax free savings this year, according to research from financial experts.

Findings from moneysupermarket.com have shown that while only 32 per cent of Brits plan to invest in an individual savings accounts (Isas) this year, only 27 per cent know the allowance for these tax free investments will be increased from £3,000 to £3,600 per year as of April 5th.

Kevin Mountford, head of savings at moneysupermarket.com, said: “It is disappointing so many Brits won’t take advantage of this excellent savings vehicle.”

“With just a third of people looking to utilise their tax free Isa allowance it looks like many people will miss out,” he added.

According to moneysupermarket.com, cash is the most popular option for those planning to invest in an Isa with 73 per cent saying this is where they will put their money.

Meanwhile, the finance experts recently said that savings providers are introducing more online products due to the increase in the number of ’silver-surfers’.

Tags: cent, online products, free isa allowance, tax free savings, savings providers, finance experts

Bridging finance has an ‘important role’ when credit is hard to get

Bridging loans can play an “important role” during tough financial times, one financial expert has claimed.

Business Moneyfacts said that bridging finance is “ideal” for any situation where funds are required quickly and for short periods.

Bridging loans can benefit property professionals looking to acquire property quickly at a time when the number of repossessions is increasing due to the amount of properties going to auction, claims the firm.

Lee Tillcock, editor of Business Moneyfacts said: “Investors buying at auction have often used bridging because they are required to complete within a few weeks of a successful bid when conventional mortgages are sometimes unworkable.”

He added that in a financial environment where credit is difficult to secure, the bridging option can provide a short term solution while that “ever-more-elusive long-term mortgage” is finalised.

Meanwhile, figures recently released by the Council of Mortgage Lenders show that in 27,100 homes were repossessed last year.

This is the highest figure since 1999 and a 21 per cent increase on the number in 2006.

Tags: cent, term mortgage, figure, personal finance, finance, loan, Bridge loan, Council

Parents can help children buy property

First-time buyers can receive financial help from their parents when paying for a property without any inheritance tax implications, one mortgage expert claimed.

Bestinvest said that if a child’s funding for purchasing a house is assisted by their parents, then they are “party” to the mortgage.

Because of this, parents would rather give them some money and ensure the mortgage is in the child’s name, stated the firm.

Peter O’Donovan, mortgage manager for Bestinvest, said there would be no inheritance tax implications if a property is in a child’s name.

“Even when the parent uses their income to assist [with mortgage payments], the mortgage might be in three names but the property will just be in the child’s name,” he added.

Research released by Abbey earlier this month found that first born children are more likely to receive financial help for a home purchase than their siblings.

Up to 17 per cent of first-borns are given money towards their first home compared with 12 per cent of second-born children.

Tags: mortgage, income, help, month, cent, mortgage expert, siblings, personal finance

UK consumer confidence at all time low

Consumer confidence in the UK is at an all time low, according to figures from the Nationwide Index.

The findings show that the number of people confident about employment dropped almost ten per cent to 36 per cent in January, a drop from 44 per cent in December.

Expectations surrounding house price growth continued to fall with consumers thinking house prices would decrease by 0.2 per cent over the next six months.

Martin Gahbauer, Nationwide’s senior economist, said: “The continued downward trend in consumer confidence in January is not unexpected in light of current uncertainties about the economic outlook.”

He said that sharp falls in share prices, the rising costs of essential items and a weak exchange rate have all combined to negatively impact consumer sentiment which could be blamed for the pessimistic economic outlook.

Despite a downturn in the Expectations index, 44 of respondents believed that now is a good time to spend on household goods, compared with 35 per cent in December.

Meanwhile, Nationwide has warned credit card holders to be careful to avoid incurring charge while using their cards abroad.

Tags: Index numbers, cent, consumer confidence, share prices, trend, downturn

Consumers switch mortgages to save money

Nearly 1.4 million consumers have switched their mortgage provider in order to secure a better deal, one financial expert has claimed.

Research from MoneyExpert.com has revealed that an estimated three per cent of the adult population has changed mortgage supplier since June last year, a figure which is thought to represent 11 per cent of all UK mortgage holders.

Sean Gardner, chief executive of MoneyExpert.com, said: “The uncertain financial climate of the past six months has forced many people to reassess their household budget with the mortgage top of the list of priorities.”

He added that swapping mortgage supplier will cost more with rising application fees and most are now uncapped, meaning you’re likely to pay a proportion of the total amount you borrow

People aged 35 to 44 are the most likely to have switched mortgage provider, while people living in the South of England are least likely to have done so.

Meanwhile, further research from MoneyExpert.com revealed that four out of five consumers are overpaying for financial products.

Tags: household budget, list, Consumers switch mortgages, order, consumers, mortgage supplier, budget, cent

A quarter of a billion pounds left in accounts says investment provider

A new initiative has been launched to reunite consumers with their lost bank accounts after it was announced that an estimated quarter of a billion pounds has been forgotten.

National Savings and Investments said that the main reason for money being left in accounts is moving house.

Ayesha De Silva, online manager for NS&I, said: “People often hold an account with two or three different providers over the course of a lifetime and when they move house, it’s the simple fact they forget to tell all the relevant people.”

She added that this situation is exacerbated by every move that a person makes meaning that the funds can just “sits there for years and years and years”.

In research carried out by TNS Phonebus last year, national statistics show that ten per cent of people believe they have lost savings they had as a child.

Only 26 per cent of these people have tried to reunite themselves with their lost money.

Tags: fact, quarter, National Savings, lost bank, inflation, cent, bank accounts, house

Men ‘take care of finances during move’

Nearly half of men in a relationship will manage the finances for moving compared with 34 per cent of women, according to a new survey.

The findings from Halifax show that 65 per cent of couples will make a joint decision when to move or sell their property while couples are less likely to consult with each other the older they get.

Up to 72 per cent of those aged between 16 and 24 consult each other while only 58 per cent of the over-65s will involve their spouse in a decision surrounding moving house.

Gordon Edwards, managing director, Halifax Estate Agents, said: “Buying a house is the biggest purchase most of us are likely to make.”

“If you are deciding to sell your home, purchase a new property or sorting the finances for a move, it’s important to involve your partner in the decision-making process,” he said.

Meanwhile, more research from Halifax shows that County Armagh has the fastest house price growth in the UK with a rise of 331 per cent over the past ten years.

Tags: new property, decision-making, house price, cent, director, finance, Estate agent, relationship

Nearly 2m pet insurance claims made by consumers

Up to 1.8 million pet insurance claims are made per year by owners according to research from Sainsbury’s Bank.

A further 18,000 claims are made for reasons including when a pet is lost or stolen.

Sainsbury’s warns that as many as 75 per cent of cats and dogs are not insured and as a result estimates that 5.5 million treatments are paid for by owners.

Claire Moyles, pet insurance manager at Sainsbury’s said: “The pet insurance industry not only deals with a huge volume of cat and dog claims every year, it deals with a staggering breadth of ailments and problems.”

She added that insurance can be more useful than expected as events when you need to claim could be “more common than you wish to consider”.

The estimated cost of owning a cat and a dog is £7,200 and £9,000 respectively while vet fees make up 19 per cent of the annual spend on dogs and 21 per cent for cats.

Meanwhile, Sainsbury’s Bank has also reported that the UK has seen an upsurge in the number of property damage claims in the wake of the recent bad weather.

Tags: cent, cat, result, annual spend, United Kingdom, sainsburys

Parents should open bank accounts for children ‘as early as possible’

Providing children with bank accounts as early in life as possible will enable them to have a better understanding of money say independent financial advisors.

MDM Associates said that opening a bank account as early as possible parents can then talk children through statements and show them where interest has been added.

Older children could receive an account with a debit card said the company.

Lisanne Mealing, managing director of MDM Associates, said: “That then starts to give them the idea of some financial responsibility – you’re trusting them because they’ll have access to that account themselves.”

Providing monthly pocket money to children can also be a good way to teach children about budgeting, she added.

According to an article on the Times Online, a recent survey by NatWest suggests that 51 per cent of young people want more advice from parents about how to manage money.

Many respondents said they were frustrated by well-trodden cliches such as ‘money doesn’t grow on trees’.

Tags: respondents, Business Finance, idea, MDM, cent, pocket, child

Consumers better barometer of inflation than statistics

Spenders maybe “a better barometer of inflation” than statistics from the government’s Office for National Statistics claim financial experts.

Findings from research conducted among Fool.co.uk’s readers reveals that many believe inflation to be between six and seven per cent rather than the two per cent stated by the government.

David Kuo, head of personal finance at Fool.co.uk, said: “We are slowly beginning to see that these inflation figures are slowly beginning to feed through.”

He added that although at the moment interest rates are seen to be coming down because the Bank of England is very worried about a recession, “we do honestly believe that there is inflation within the economy”.

This time last year, the BBC reported that inflation was at an 11 – year high as higher fuel costs helped to push up the consumer price index (CPI) to 2.7 per cent in November.

On January 10th, the Bank of England voted to maintain the Bank’s rate at 5.5 per cent, having cut the rate by 0.25 per cent back in December.

Tags: cent, bbc, government, fuel costs, Fool.co.uk's readers, head, inflation

British property market is in “danger”

The British property market is in danger zone which is set to continue beyond 2008 and into subsequent years, claims the Daily Telegraph.

Findings from the Daily Telegraph and Lombard Street Research Housing Affordability Index has revealed that house prices can no longer be classed as affordable, due to the combination of inflation and increasing debt costs.

Speaking to the Daily Telegraph, Diana Choyleva, the director at Lombard Street Research, said: “I would say that around about now house prices are in unaffordable territory – this is the danger zone for the market.

“It is still too early to say yet whether what happens next will be as bad, or perhaps even worse, than the early 1990s crisis,” she continued.

The index suggests that house prices are currently at their most overvalued since 1991 when many homes were repossessed.

Meanwhile, new research from Your Mortgage magazine has revealed that house price growth in inner London should hit 4.6 per cent with Greater London seeing 4.3 per cent growth.

Tags: growth, Affordability, crisis, housing, Economic history, cent, the Daily Telegraph, Housing Affordability Index

Over half of Christmas consumers spend too much

More than half of consumers in the UK spend more than they can afford during Christmas, according to experts.

The figures from the Department of Work and Pensions show that 55 per cent of spenders over stretch themselves financially over the festive period.

Susan Clark, personal adviser at Jobcentre Plus, said that consumers should view their personal finances in the long term.

“Struggling to pay the bills after Christmas is a situation that many people find themselves in and it can be very stressful. Short-term fixes provide temporary relief but getting a job is the best way to improve your financial situation in the long-term,” she said.

People in London and the East Midlands are the best at planning their finances for Christmas whilst those in the North East are most likely to over spend.

Meanwhile, the Consumer Credit Counselling service has advised that those struggling with debt should avoid the January sales and concentrate on paying off them off.

Tags: cent, relief, Jobcentre Plus, show, employment, term, jobcentre, adviser

Mortgages for ‘unconventional properties’ difficult to get

Borrowers can find it difficult to finance a mortgage for an unconventional property due to uncertainty over its value, claim financial experts.

Lansdown Place said that listed buildings, particularly those made from unusual materials or with a high protection rating, can be difficult to find funds for.

Simon Harris, spokesperson for Lansdown Place, said: “For listed buildings, the various restrictions on what can be done and the covenants that demand what must be done will potentially adversely affect the security in the eyes of a lender.”

He added that the main other issue is durability, which can also potentially apply to eco-friendly homes, an area of “potential growth” in the housing market.

According to English Heritage, there are 370,000 or so listed buildings currently protected in the UK. Of these over 92 per cent are Grade II – the lowest level of listing, for buildings “of special interest, warranting every effort to preserve them”.

Tags: Heritage, Grade, English Heritage, unconventional properties, mortgage, financial experts

House price ‘correction’ of 35 per cent expected

The affordability of house prices are expected to correct themselves by 35 per cent, according to an economic expert.

Firstrung have said that inflation on property, “as a phenonmenon”, is over for the present generation of consumers.

However, some first time buyers who might have a good income are going to struggle in the wake of the credit crunch, despite having clean credit histories.

Paul Holmes, chief executive officer of Firstrung, said: “Last year first-time buyers watched prices go up on first-time buyer properties by an average of £19,000.”

“We’re now reverting back to the lending standards that the banks and building societies operated within in the 1980s. It’s become that bad.”

He estimated that prices will fall by 12 per cent over the course of the next year.

Just before Christmas it was announced by the Halifax that the average house in 96 per cent of towns are now not affordable for first time buyers, and that the number of first-time buyers was at the lowest level since 1980.

Tags: Paul Holmes, buyers watched prices, first time buyers, Business Finance, cent

Expats urged to consider offshore savings benefits

While internet banking is popular with expatriates, they are not using it to take advantage of offshore savings accounts, it has been suggested.

A poll by Alliance & Leicester International (A&L International) revealed that 92 per cent of Brits living abroad used online banking to manage their finances.

However less than a third had an offshore savings account which, the bank suggested, meant they were losing out on a range of advantages including good rates of return and the potential to hold or send funds in currencies other than sterling.

A&L International managing director Simon Hull said: “With internet access now so readily available, offshore consumers should take advantage of internet banking and saving.”

More than half of homes in the EU have internet access at home, the research found.

In addition, expats wanted online banking options when setting up an offshore savings account.

Based on the Isle of Man, A&L International claims to be one of the largest offshore deposit takers and has share capital and reserves of more than £150 million.

Tags: share capital, share, Managing director, Offshore bank, online

Life insurance prices offer savings

Life insurance policy holders are wasting millions of pounds by not shopping around or sticking with their old providers, it was claimed this week.

The price of life insurance has been dropping steadily in recent years, but many of these benefits have not been passed on to existing customers who do not review their policies, according to LifeSearch.

With average premiums down 40 per cent compared to five years ago, there are big savings to be made, while the price of critical illness insurance also began to fall during 2007.

Matt Morris, LifeSearch Policy Adviser, said: “There are a number of actions that customers can take in the new year to freshen up their finances and save a bit of money. The main thing is to take action. Don’t wait until New Year’s Day 2009 comes round before you start thinking about this again.

“However, it is important to remember that price should not be the only consideration when choosing a protection product and customers should look at the policy that offers the best value for money. This means looking at the product which most suits individual circumstances and offers additional benefits.”

Tags: Insurance, round, cent, Health care reform in the United States, old providers, Life insurance policy holders

Consumers need examples of what they will have to pay back

Banks and credit card companies should provide a “practical example” of what a consumer needs to pay back, claims a debt counselling service.

Thomas Charles & Co has said companies should follow the examples set by mortgage lenders and unsecured loan lenders and show consumers what they will be paying back over a certain period of time.

“I think banks and credit card providers should be encouraged to do that off their own back. I think that if they don’t, the regulators will probably be just in asking them to do so,” said director James Falla.

He added that it would be a good idea to help the consumer as “interest rates are very confusing”.

According to Credit Action’s latest assessment of personal debt, the total UK personal debt at the end of October 2007 stood at £1,391 billion.

The growth rate increased to 9.7 per cent for the previous 12 months which equates to an increase of £122 billion.

Tags: October, loan, Credit card, personal debt, loan lenders, Charles, growth

Majority of first time buyers will not benefit from credit crunch

Recent falls in house prices are unlikely to benefit the majority of first-time buyers, says real estate provider Savills.

The company said a slowdown in the housing market will “provide some opportunities” for first-time buyers.

However, Lucian Cook, director of research at Savills, said it was unlikely to help most as they would still be reliant upon mortgage finance.

Mortgage finance is expected to be harder to acquire as a result of the credit squeeze.

“The first-time buyers who [price falls] will help are those who have accumulated relatively high levels of cash reserves, and who are well placed to buy,” he continued.

There will be less “brochure collectors” and “serial viewers” and thus less competition for property.

“The people who are going to be in the market to buy are really going to be in the market to buy,” said Mr Cook.

The November Halifax House Price Index, released today, found a 1.1 per cent monthly fall in house prices.

This is the third successive month it has reported a fall with the average UK house price now standing at £194,895.

Tags: property, house, cent, Mr Cook, mortgage finance, estate provider savills, uk

Debt becomes ‘norm’ for Brits

Getting into debt is now accepted as normal and in many cases necessary, an industry expert has said.

Alastair Mathews, director of policy educational charity pfeg, explained that if people wish to go to university or buy a house, most will rely on loans to do so and will thus not be able to avoid getting into debt.

With credit easily available to those needing it over the past few years, it has been easier than ever to build up considerable debt.

“We have almost officially built debt in to the system now,” said Mr Mathews.

He continued: “We have a changing culture from the traditional British attitude of wanting something and saving for it – where maybe you waited for half a lifetime for it – to now, where the feeling is ‘if I want something, I’ll have it’.”

According to statistics from Credit Action published this month, total personal debt in Britain stands at £1,380 billion. This figure has gone up by an impressive £120 billion (10 per cent) in the past twelve months.

Tags: industry expert, figure, cent, debt, business

Christmas costs falling

The real cost of Christmas is falling steadily after taking inflation into account.

According to recent research by Halifax Unsecured Personal Loans, the price of the UK’s favourite gifts has continued to fall.

The study found that the price of games and toys has fallen most in the last year, dropping by six per cent, with woolly jumpers and socks falling in price by four per cent.

Indeed, in the past decade, the price of toys has gone down in real terms by 45 per cent, with spirits down by 26 per cent and brussel sprouts by 18 per cent.

“Our research shows that the cost of traditional Christmas favourites has actually fallen – good news for Christmas shoppers.

“However, just because the real price of items such as toys, CDs and Christmas cake has fallen, doesn’t mean we don’t need to budget and organize our finances.”

Halifax states that Christmas is as good a time as any to sort out finances, adding that it should not need to take up more time than decoration a Christmas tree.

Tags: christmas cake, Agriculture and Forestry, Unsecured Personal Loans, uk, cent, budget

Credit cards recommended for online Christmas shoppers

Brits enjoying a more relaxed Christmas shopping experience online are advised to use their credit cards for enhanced protection.

According to Simon Crisp, director of Shopsafe.co.uk, consumers can improve their legal security by using a credit card for online purchases.

He added that, if doing so, they should also take the measure of registering the card with their bank with the new schemes available from Visa and Mastercard.

“There’s actually new schemes being launched by the credit card companies – one’s called Verified by Visa, the other is called Mastercard SecureCode.

“Both let you register your credit card with your bank, and put a password on your credit card, so that only you can use that card.”

He said that this will protect the user against identity fraud and theft as the retailer knows that only the consumer is in possession of the password.

According to consumer group Which?, 69 per cent of Brits will do their Christmas shopping on the internet this year to avoid the “crowds” and be able to “compare prices more easily”.

Tags: shopping on the internet, security, cent, fraud, MasterCard, online christmas shoppers

Festive spending not affected by disposable income

Consumers will still buy what they need to be able to celebrate Christmas properly, even if their disposable income does not facilitate such spending, an industry expert has said.

According to the British Retail Consortium (BRC), both consumer confidence and disposable income have fallen this year, meaning that people may both be and feel “less well off”.

Head of media at the BRC, Richard Dodd explained: “[This] is a result of interest rate rises and also other costs having risen sharply, as well as mortgages, including utility bills, fuel bills and tax bills.”

He added that despite people being less well off and having less to spend, people will still “have the presence of the food and drink they want for Christmas”. This means that retailers will not suffer dramatically even though it may not be a “spectacular” year.

Deloitte have released predictions for spending which, it says, will increase by seven per cent on last year’s figures, with average spending per capita estimated at £706 up from £662 last year.

Tags: tax, cent, Personal life, food and drink, fuel, fuel bills, year, disposable income

Three million use credit cards ‘every day’

Three million people in the UK use their credit cards every single day, it was claimed this week.

That amounts to nearly one in every ten of the UK’s 34 million credit card holders.

54 per cent were found to use their cards once a week, while 35 per cent use them once a month or less frequently.

The research was carried out by Abbey, itself a provider of credit cards.

Online shopping was found to be the most widespread use to which credit cards are put, with 20 million flexing their plastic over the internet.

Surprisingly, high street shopping proved to be less popular, with only 19 million spending on credit cards in real-world shops.

The research found that 57 per cent pay off their credit card bills every month in full, while only 3 per cent admit to having difficulties making regular payments.

Roger Lovering, managing director of Abbey Credit Cards, said: “There is no one way that people use their credit card and we see as many different spending patterns as there are people.”

Tags: high street shopping, director, Center for Responsible Lending, cent admit, provider

Credit card users wise up to debt risk

A growing number of credit card users are becoming wise to the perils of racking up big debts.

With recent research showing that the average Brit spent a whopping £397 on Christmas presents last year, and that 76 per cent plan to spend even more this year, concerns about debt have been growing.

However, a new survey published this week shows that one in four shoppers are determined not to let the debt build up on their plastic.

The research was carried out by debt counselling service Thomas Charles.

Director James Falla told savespendborrow.co.uk: “People are starting to think: ‘what am I going to do when it comes to paying this back?’”

“They are being told that their houses aren’t rising quite so quickly in value, and I think those things are actually starting to filter through to the general public and they are thinking: ‘If I go on spending as I am, maybe I’m not going to be able to sweep it under the carpet by remortgaging, like I did before’.”

Nevertheless, while this is a positive sign, warnings were sounded earlier this week by Callcredit, which claimed that a large number of people in debt are “in denial” about their own responsibility for it.

Tags: television, Credit counseling, Brit, debt, debts, cent

Investors getting greener

Many more people are concerned to ensure their investments are made in a firm that is socially and environmentally responsible, it has emerged.

Mark Robertson, a spokesperson for EIRIS, explains that people are increasingly considering their options when it comes to ethical finances.

“There has been a huge upsurge in interest on ethical issues from consumers generally; more people are buying organic food produce, more people are buying greener energy products, and the interest is now spilling over into finance now and issues, particularly like climate change are driving things,” he said.

There are many more options available than there once were when it comes to green finances, he explained.

This year, Citigroup committed $50 billion (£24 billion) to green projects, joining many other leading financial companies who are starting to address green issues.

In June this year, Which? found that 47 per cent of women would be prepared to accept a lower return on their investment if their bank operated ethically, compared with just 36 per cent of men.

Tags: cent, huge upsurge, energy products, business, Politics, green finances, spilling, Dow Jones Industrial Average

Credit card providers making a killing

Small adjustments to charging and fees over the past years have added up to credit card providers making a mint on their customers.

According to uswitch.com, the credit card companies will make a staggering £459 million this year on balance transfer fees alone.

It explains that the “stealth charges” racking up the money also include cash withdrawal fees, zero per cent deals and negative payments hierarchy among other things.

“It’s no great surprise that every zero per cent balance transfer credit card now levies a charge. Historically, fee free deals fuelled the switching market and marked the birth of the rate tart, quickly turning into a huge financial drain on the industry, to the tune of around £600 million,” said Mike Naylor, personal finance expert at the website.

Furthermore, the company found that £71 million is made by providers from people withdrawing money on their credit cards.

Tags: birth, fee, cent, credit card companies, GBP, people withdrawing money, finance, financial drain

Tracker rate deals gaining popularity

Fear over the fate of the UK property market has led to a significant increase in tracker rate mortgage interest.

According to GE Money, tracker and discount products are set to account for a third of all broker business, representing a 120 per cent increase from the last quarter.

The changes results from the fact that 89 per cent of mortgage brokers believe that interest rates have peaked, with nearly half anticipating a fall in the base rate in the next few months.

Subsequently, brokers are increasingly recommending discount and tracker products over longer fixed rate deals.

Gerry Bell, head of mortgage marketing at GE Money home lending, said: “Consumers and brokers alike have clearly been concerned by the recent stress in the financial sector and our research indicates that the market is now being boosted by a possible decrease in interest rates in the coming months.

“This will also be welcome news to those homeowners currently coming to the end of a fixed rate product who are concerned about re-mortgage products and rates that will be available to them.”

The UK markets have felt the far-reaching impact of the sub-prime mortgage crisis afflicting the US this year that has led to worldwide credit squeeze.

Tags: interest rates, welcome news, credit, crisis, research, Mortgage broker, mortgage

Bright Grey: Life insurance top priority

In principle life insurance is top of people’s insurance priorities but many do not put this into practise.

Recent research by Bright Grey protection specialists shows that 40 per cent of people felt that life insurance was most important, however when it comes to spending, Brits are putting there money towards home contents and holiday insurance over life insurance.

While 53 per cent insured their life, 74 per cent insured home contents and 61 per cent insured travel.

Roger Edwards, product director at Bright Grey, commented: “For most, life insurance is key when it comes to planning properly for the future. It protects your dependents if you die and they lose your income.

“And if you don’t have dependents, and really don’t need life cover, then what about critical illness cover or income protection – if you value yourself, you should be protecting yourself.”

He added that people should seek guidance on different forms of cover and how important they are, while also finding a deal that suits them.

Tags: protection, cent, practise.Recent research, Bright Grey protection, dependents

Credit crunch will hit ‘less well off’ worst

Mortgage-seekers who are less well off will be hardest hit by the implications of global credit squeeze.

According to a representative for money education charity Credit Action, the sub-prime mortgage crisis that hit the US with its repercussions reaching UK financial markets, has meant that those with the least will now find it hardest to be successful in mortgage applications.

The mortgage market has seen a widespread tightening up of specifications for people wishing to take out a mortgage after the problems that famously hit lender Northern Rock.

However, she said: “The companies that traditionally provide for the less well off, such as the door step lenders, won’t be affected because their system is so different.

“They rely on the agent network and I don’t think that is likely to be affected at all.”

She added that the sub-prime market makes up around “ten per cent” of the UK mortgage industry and it is clear this has been impacted by problems in the US.

Tags: credit crunch, United Kingdom, sub prime mortgage crisis, repercussions, tightening, uk mortgage

Figures show drop in mortgage lending

There was less mortgage lending last month than in August, according research by the Council of Mortgage Lenders (CML).

Figures revealed a fall of almost 12 per cent in gross mortgage lending in September with the new figure at around £30 billion.

Although a decline is not uncommon for the August to September, this year’s fall is significantly greater than the average of five per cent for the same period.

Michael Coogan, director general at CML, commented: “We have been expecting a slowdown in monthly lending levels in line with interest rate rises.

“In the coming months, we expect to see monthly lending levels dip below their 2006 levels for the first time this year as rate effects are exacerbated by the recent liquidity problems in the mortgage market.”

Despite an annual increase in mortgage lending from September 2006, at 2.5 per cent it is the smallest percentage rise in two years.

The gross lending estimates obtained by CML were taken from its survey of a selection of lenders representative of over 70 per cent of the total mortgage market.

Tags: Council, cent, Michael Coogan, director general, business, interest rate, percentage

Sharp decline in first-time buyers

Britain has seen a steep decrease in the number of people investing in property for the first time.

The number of first-time buyers has gone down by 20 per cent since March this year, according to research by YouGov.

Partly blamed on mounting house prices and inflated interest rates, the reduction is also put down to a swelling of the buy-to-let market and a decrease in the properties available for purchase.

Head of mortgages at moneysupermarket.com, Louise Cuming, commented: “The past month has been fraught with uncertainty and lenders have begun acting independently of the Bank of England in terms of rate pricing.

“It’s not surprising some potential first-time buyers are getting cold feet and steering clear of home ownership.”

She added that figures from the Council of Mortgage Lenders shows the proportion of first-time buyers to have dipped six per cent against total borrowing in the first six months of this year compared to the same time-frame last year.

The website reported that a total of 56 per cent of homeowners have a fixed-rate mortgage whereas over a quarter choose to go for a fixed-rate of just three or five years.

Tags: time.The number, steep decrease, bank of england, cent, fixed rate mortgage

Caution advised for first-time buyers looking overseas

As recent studies reveal more and more first-time buyers are looking to make their first steps on the property ladder overseas, it is important they are aware of the possible pitfalls.

A report from UK National Savings & Investments discovered 84 per cent of 18- to 30-year-olds believe buying property abroad is a more feasible option than buying in the UK.

But some industry insiders have been quick to point out that the situation for first-time buyers looking to invest overseas is generally similar to that in the UK.

Helen Adams, managing director of FirstRungNow.com, warned: “People aren’t going to be giving really big mortgages to people who are … renting in the UK.”

She added that “the best thing to do is to find out where you’re interested in buying and then speak to a mortgage specialist in that field”.

The warning comes as the major political parties look to bring the issue facing first-time-buyers to the forefront of the political agenda ahead of a possible election.

The Conservatives pledged recently to remove stamp duty for houses valued between £125,000 and £250,000, which currently stands at one per cent.

Tags: cent, com, possible election.the conservatives, Economy of the Republic of Ireland, first time buyers, political agenda, thing

Credit card holders ‘wasting money’ on withdrawals

Consumers in the UK who use their credit cards in order to make cash withdrawals could find they are paying way over the odds in order to do so.

According to research from Moneysupermarket, Britons withdraw £8.3 billion using their credit cards annually – but they could be paying 27p per pound in interest and charges over the year.

The average amount paid across the major providers on one £20 withdrawal a month over the course of 12 months is 15 per cent, or £36.

“At a cost of up to 27p for every pound taken out, this is an exceptionally expensive way to spend,” said the price comparison site’s head of credit cards Rob Kenley.

“Wherever possible you should only withdraw cash from your current account, but we realise sometimes people face unexpected emergencies.”

A separate study from Abbey found recently that 23 per cent of credit card holders intend to consolidate different credit cards using one that offers a good value deal.

Tags: britons, moneysupermarket, cent, wasting money, unexpected emergencies, 12 months

Stamp duty shows record increase

The total value of stamp duty generated by the sale of residential property rose by a record level during the year 2006 to 2007, a new report has said.

According to Halifax, HMRC figures reveal that stamp duty revenue rose by 40 per cent over the year to hit £6.4 billion.

The bank also claimed that the last five years have seen a 140 per cent increase in this revenue, up from £2.7 billion in 2001 to 2002.

It is the south of England that has contributed most to stamp duty revenue, the report said, accounting for 73 per cent of the total.

In addition, the higher bands for the tax – three per cent for properties over £250,000 and four per cent for those over £500,000 – contributed 79 per cent of revenue.

“The revenue generated from stamp duty on property purchases has soared as governments of both political parties have failed to link thresholds to house price inflation,” Martin Ellis, chief economist at Halifax, commented.

Addressing the Conservative Party conference in Blackpool the shadow chancellor George Osbourne pledged to increase the stamp duty threshold if they are elected, meaning only properties worth £250,000 or more would qualify.

Currently, homes with a value of between £125,000 and £250,000 are subject to a one per cent stamp duty levy.

Tags: house price, price, cent, government, addition, Blackpool, Conservative

Britons ‘banking billions’ at home

UK consumers have managed to hide a whopping £4.6 billion worth of cash around their homes, with the average Brit stashing £127 and an affluent eight per cent sitting on anything between £300 and £1,000 in cold hard currency.

That is according to new research from home insurance provider Cornhill Direct. The company found that 40 per cent of homeowners believe it is a good idea to keep money in the house, while 45 per cent believe that the recent Northern Rock situation could result in more people keeping hold of their own money.

Interestingly, Brits were not put off by feelings of uneasiness about keeping cash at home (one third), nor by the fact that one in ten have had funds go missing.

Mark Bishop, a representative for Cornhill Direct, commented: “Our home contents policy provides protection for money kept in the house, but it is never a good idea to keep large sums in the house.”

Back in May, Virgin Money estimated that Brits were keeping £3.5 billion in cash at home. Based on a forecast of future inflation, it predicted this money would lose around £200 million in purchasing power by 2010.

Tags: fact, northern rock, new research, Cornhill Direct, cent, power, Northern Rock situation

Students expect to be in debt

Young people in university education now treat debt as an expected way of life, it is claimed.

National Debtline spokesperson Becky Boden-Wilkes has commented that young people in Britain are no longer frightened and more accustomed to getting in to debt because they are used to acquiring an overdraft or student loan from the age of 18.

However, despite most graduates expecting to accrue a debt total of £15,000 by the age of 21, she said, students are not worried about the issue because they belief their learning potential accrued from university will enable them to pay of their debt later in life.

Thisismoney.co.uk recently reported that debt among UK graduates has increased by 197 per cent over the last decade to a current total debt figure of £3.2 billion.

Ms Boden-Wilkes acknowledged that students are encouraged to make friends and meet new people when they begin university, which can result in a substantial expenditure of money.

“There definitely needs to be more talk about budgeting and people working out what they need each week,” she said.

Tags: budgeting, substantial expenditure, UK graduates, Public finance, university education

Happy couples warned over insurance

People in the UK are being urged to check their wedding insurance, as gifts they received on their happy day may not be covered after the cover period expires.

According to research by Abbey, 13 per cent of home contents insurance policies will not cover the value of wedding gifts temporarily.

And even if they do, this cover tends to only last a month – so the 28,000 happy couples married last month may need to move fast to ensure they are covered.

The report also revealed that many insurers limit their wedding cover. So, with the average amount spent on a present at £43, inviting more people could mean the limit is quickly exceeded.

“Sadly the amount of cover is often not enough to cover the number of gifts received by couples, and it only lasts for a month on average, potentially leaving newlyweds underinsured,” said Prasad Shastri from Abbey.

According to the study, newlyweds with temporary insurance of up to £1,000 would hit their limit after receiving gifts from on average 23 guests.

Tags: amount, number, insurance policy, home contents insurance, cent

Average house prices approach £200,000

The average price of a house has almost reached the £200,000 mark, according to new figures, but the rate of growth has shown further signs of slowing.

According to the Halifax House Price Index, house prices increase by 0.4 per cent during the month of August, with the average cost now £199,770.

This is the third month out of four that house price inflation has dropped below 0.5 per cent and the Halifax report claims this is indicative of a slowdown in the market.

In addition, the three-monthly rate of growth fell from 4.5 per cent in March to 1.6 per cent in August.

“The downward trend in house price growth is expected to continue over the remainder of 2007 as the five interest rate rises since last summer have an increasing impact on household spending and housing demand,” said chief economist Martin Ellis.

“Sound economic fundamentals, high levels of employment and a shortage in the number of properties available for sale will, however, continue to support house prices.”

The figures also showed that mortgage approvals in the three months to July of this year were nine per cent lower than those recorded during the peak September to November 2006 period.

Oliver Gilmartin, senior economist at the Royal Institution of Chartered Surveyors, said the figures meant speculation of an imminent interest rate cut was “premature”.

Tags: cent, month, housing, United States Department of Housing and Urban Development, Real estate economics, institution of chartered surveyors, Average house prices, house price

Gapyear travellers “don’t understand insurance”

People taking a gap year do not understand travel insurance and see taking it out as an obligation, according to one industry figure.

Tony Griffiths, the founder of gapyear.com, states that although gapyear travellers are becoming more aware of the importance of taking out insurance, they do not understand “what it is or what it does”.

Mr Griffiths also said that some travellers feed they are “indestructible”, particularly males who are aged between 18 and 24. He also added that many people have a “it won’t happen to me” attitude.

“The reality is most of the claims are for things like people falling off a curb. We had an example of someone who fell off a curb in Barcelona and broke their ankle.”

Gapyear.com is part of the Gapyear Company, which is an organisation that provides free information and advice to people considering taking a year out.

It states that 25 per cent of people on a gapyear have either no or inadequate insurance, and that the average spend of 18 to 24-year-olds while travelling is between £3,000 and £4,000.

Tags: cent, com, Financial economics, advice, Gap, Australia, reality, figure

Abbey launches credit card

Abbey has marked the launch of its new credit card with an eye-catching supermarket offer.

All customers will get five per cent cashback on the first £1,000 they spend in the stores while using the card.

Furthermore, every major supermarket has been signed up by the credit card provider as a participant in the scheme.

Abbey claims that, based on average spending figures, the offer will cover around five months of family shopping at supermarkets, assuming that the new credit card is used each time.

Roger Lovering, a managing director at Santander – the company which owns Abbey – said: “Our philosophy is all about offering real value for our customers. Supermarket cashback is the first example of that commitment.

“Once somebody becomes an Abbey credit card customer they can expect to see many more initiatives which offer similarly valuable benefits.”

The offer commences on September 3rd, and will apply until the end of January, 2008.

Tags: GBP, cent, Roger Lovering, supermarket, Supermarket cashback

Mortgage lending on the rise

Figures released by the British Banking Association (BBA) show that mortgage lending has reached a total of £21.3 billion in July, an increase of 12 per cent on last years’ figures.

The average mortgage loan rose to £156,900 in July, which is a rise of 13 per cent from July 2006.

Net mortgage lending growth rose to £5.7 billion, with unsecured lending rising to £200 million.

BBA head of statistics, David Dooks, said: “With customers seeking to replace deals or fix their mortgage costs, increased remortgaging activity boosted the banks’ lending in July.

“Lower approvals volumes simply reflected the seasonal pattern, so we expect the stable trend in the banks’ lending to continue over the next couple of months.”

Building society lending is not included in the figures – which reflect higher overall levels of remortgaging activity.

Tags: british bankers association, David Dooks, statistics, cent, mortgage, stable trend, british, Banking

Poor home security affects insurance, Halifax says

Insurers at Halifax warned today that poor home security can invalidate claims.

According to statistics released by the insurance provider, claims for unforced burglary tend to rise hugely at this time of year, with a full 50 per cent increase in August 2006 over the figures for January of that year.

Received wisdom that the increase is caused by claimants jetting off on their holidays is also incorrect: 55 per cent of claims are made from those who occupied their home at the time of the robbery.

Open windows and doors due to the warmer weather was cited by the insurer as the main reason behind the break-ins.

Underwriting manager at Halifax Vicky Emmott said: “During the summer, we invariably see claims for unforced burglary increase dramatically, as people leave doors and windows open to keep their homes cool.

“Burglars can be in and out in seconds, so we are advising people to keep valuables out of sight, and avoid leaving doors and windows open when rooms are unoccupied, or when out in the garden.”

Other top tips offered by the insurer looking to boost their security, such as recommending that neighbourhood watch schemes be joined and that safety latches on windows be used.

National Home Security Week begins on August 25th.

Tags: January, cent, out of sight, August, home insurance, burglars, Types of insurance, manager

House prices to rocket by 40 per cent, new report claims

A sobering new report suggests that house prices will rise at a rate of 40 per cent in five years.

According to a report entitled Home Truths, published today by the National Housing Federation (NHF), average house prices could soon top £300,000, dashing the hopes of millions of potential first-time buyers.

The current UK house price inflation rate stands at 9.9 per cent for 2007, according to latest results from Nationwide.

Home Truths, which used research conducted by Oxford Economics, provided a searing assessment of the current housing situation in the UK as “distorted” and “dysfunctional”: citing statistics showing that the average house price represented nearly 11 times average salaries.

The report suggested that the situation will worsen the most in London, with prices distorted by soaring city bonuses and an influx of the international super-rich: a full £150,000 price rise in the average home was predicted, taking the average figure to £392,900.

The (NHF) is an umbrella body, representing 1,300 housing associations in the UK.

Tags: Nationwide.Home Truths, National Housing Federation, city, home, cent, influx, new report, umbrella body

Eight million Britons have five-figure debts

Britain’s debt crisis is worsening, new figures released today show.

According to debt consultancy firm Thomas Charles, eight million Britons – one fifth of the entire adult population – hold debts of over £10,000.

The firm largely blamed heavily advertised store cards and credit cards for the growth of the problem.

Director of Thomas Charles, James Falla, said that the figures show a “sharp increase” in debt holders over the last year.

“These high levels of debt are linked to the rise in interest rates over the year”, he added.

The Bank of England’s monetary policy committee has also announced today that it will not be increasing interest rates for August.

Rates had been raised five times in the previous twelve months to 5.75 per cent, putting the squeeze still further on indebted Britons.

The chief economist at the Institute of Directors, Graeme Leach, termed the decision “a pause for thought”, and said that a further rate rise to six per cent would likely come in the autumn.

Tags: britons, policy, fifth, cent, Thomas Charles, interest, increase

UK consumers struggle to remember pin codes

Research from high street bank Abbey has today revealed that consumers have trouble remembering their pin codes.

Fully 39 per cent of those polled by the card provider said that they write down their numbers so as not to forget them – although a big majority of this group disguised them in some way.

Making records of pin codes makes credit card fraud far more likely, as does making all cards carry the same code, as admitted to by 14 per cent of respondents.

Around 55 per cent admitted to having forgotten a number, with card holders increasingly owning more than one piece of plastic.

The survey found that six million Britons hold three cards, around three million hold four, and two million hold five cards or more.

Steve Shore, head of banking at Abbey, said that with many consumers holding multiple cards, “the challenge of remembering all those PIN codes is getting greater.

“But we really do urge you to try and commit them to memory rather than write them down. Otherwise it’s like signing a blank cheque for fraudsters.”

Tags: card holders, head of banking, card, piece, Payment systems, Credit Cards, cent

Private health insurance recovering

The number of private health insurance holders has risen for the first time in five years.

Last year, numbers rose by 1.5 per cent, taking the total close to the all-time peak of 2002.

On closer analysis, the figures actually show a drop of 2.2 per cent in the number of people taking out private cover for themselves, however a larger growth of 3.4 per cent in health schemes provided by companies cancelled this out and caused the increase.

The news has surprised many, given that in recent times NHS spending has increased and waiting lists have fallen.

Analyst Philip Blackburn at Laing and Buisson told the FT that the sector “has a sense of optimism” and that it “can look to the future with some confidence”.

Private health giant Bupa welcomed news of the increase today, with managing director Fergus Kee saying that the rise in demand “confirms the continued relevance and importance of private healthcare”.

A total of 7.4 million Britons now hold some form of private health insurance, 12 per cent of the population.

Tags: cent, health giant bupa, percentage, demand, optimism, form, cover

Barclaycard introduces ‘wave and pay’ credit card

In another small step towards a cashless society, Londoners will be able to make purchases on a combined Oyster and credit card from this autumn.

Along with more traditional transactions, the new ‘wave and pay’ card will perform the same function as the Oyster card, a ‘contactless’ payment system which has enabled quicker, cash-free payment at cheaper rates on the London public transport system.

The new product from Barclaycard, called the OnePulse, was developed in collaboration with the consortium which operates the Oyster card, TranSys.

In a further innovation , the card will be enabled for contactless payment for low value transactions. Users will be able to pay for purchases under £10 by swiping the card in a special reader, rather than having to enter their PIN.

The new technology has been successfully roadtested at Barclays’ Canary Wharf headquarters.

The card operates on the typical variable APR of 14.9 per cent, and offers zero per cent interest on products bought in the first six months.

Recent figures released by Apacs show that card spending has risen by 269 per cent in the UK over the past decade, with just a 17 per cent increase for cash.

Tags: value, barclays, OnePulse, GBP, transport

Interest rate rise reaction

The Bank of England yesterday (July 5th) announced another 0.25 per cent increase in the base rate, taking it to a six-year high of 5.75 per cent.

Mortgage holders, credit card borrowers and those with loans will be hit hardest and many industry figures are warning of the implications of the rise.

Citizens Advice warns that many people will be adversely affected by the rate rise and says that it has seen an increasing number of people visiting its local bureaux after falling behind with mortgage payments.

It says that the rate rise will tip over the edge those who are just about struggling along and is calling upon lenders to be sympathetic to their borrowers.

Despite the dangers associated with a base rate increase, many first-time buyers (FTBs) will not be deterred from trying to get onto the property ladder.

That is according to new research by Bradford & Bingley that shows 46 per cent of FTBs are concerned that house prices will become even more unaffordable in the future and so do not want to wait.

Many industry figures are predicting that the Bank of England will announce a further rate rise before the end of the year, taking the base level to six per cent.

However, this could lead to further criticism from many, with Scottish Widows Investment Partnership already saying that a further rise is unnecessary as it expects inflation to fall in the coming months.

Tags: cent increase, Loans, cent, high, advice, rate rise, local bureaux

The dangers of cycling

The Tour de France is set to kick-off in London on July 7th and that means cyclists will be out in force across the UK.

A major event such as this is likely to attract thousands of bikers to the roads but Cornhill Direct warns that many may not have adequate insurance.

The firm says that a number of people are putting themselves and others in danger by failing to ride their bikes properly and within the confines of the law.

Almost half of cyclists admit that they regularly ride on the pavement, despite the fact that it is illegal, while 14 per cent do not indicate when turning and 20 per cent regularly jump red lights.

All of this makes for a dangerous ride and 69 per cent of riders have fallen off their bike at some point, with 14 per cent being knocked off by another vehicle.

“Cycling is hugely popular in the UK and riders would be wise to make sure they have the right insurance cover,” said Mark Bishop from Cornhill Direct.

“If a cyclist were to injure someone they could face a bill of tens of thousands of pounds and if they were injured and unable to work it could cause them and their family real financial problems.

“While cycling can be great fun and good for you, it also carries risks and there is no excuse for riding recklessly and many cyclists admit to doing just that,” he added.

Tags: bikes, fact, Recreation, london, cent, adequate insurance

Financial etiquette ‘needs tightening’

British consumers need to tighten up their financial etiquette, according to a new survey carried out by CreditExpert.co.uk.

A survey of 1,500 adults shows that over two-fifths of Britons would lend as much money as possible to a friend in financial difficulties.

CreditExpert’s research shows that Londoners display the greatest generosity to their friends, with nearly half (47 per cent) indicating that they would help out a friend in need.

When buying drinks at social occasions, almost half of people also say they would buy an entire group a round of drinks.

Dating Britons also appear reluctant for someone else to take care of a dinner bill, with four-fifths contending that the person who invited the date should pick up the bill.

Jim Hodgkins, managing director of Credit Expert.co.uk, said: “We’re regularly faced with financial etiquette dilemmas and as well as being important from a social standpoint, they’re also significant financially.”

He added: “It’s all well and good buying drinks for everyone at the bar – but it doesn’t always pay to be generous. If you’re running up debts that you can’t pay off, you could be damaging your credit rating.”

Tags: group, social occasions, date, buying drinks, good, finance, credit

Brits don’t know how to detect ID theft

Almost all of us are aware that ID theft is a problem in the UK but worryingly, 42 million of us do not know how to check if we have been targeted.

New research by Capital One reveals that large numbers of us are clueless about how to discover if we have become a victim of the crime and only ten per cent know what action to take if our ID has been stolen.

“It is concerning how many people we asked had no idea how to tell if their ID had been stolen, or what to do about it if they had unfortunately become a victim,” said Sanjiv Yajnik, principal managing director at Capital One.

“The tell-tale signs of ID theft often include unexplained items appearing on bank and credit card statements, receipt of bills and receipts of goods or services you haven’t asked for, being told you are already claiming state benefits you weren’t aware of or being refused a financial service despite having a good credit history.”

The study found that 99 per cent are aware of what ID theft is and 41 per cent are concerned that they will become a victim.

However, despite this, millions of Britons fail to take precautionary action to protect themselves from ID thieves.

Around 2.5 million people still throw confidential documents away without shredding them, five million leave personal information lying around and 4.5 million regularly carry personal documents around with them in wallets and handbags.

Capital One points out that this is leaving many people open to ID theft which can lead to thieves getting credit cards and loans in your name.

This in turn can lead to problems for the victim when it comes to getting a mortgage or other financial product in the future.

Tags: Credit history, Social security, cent, Sanjiv, history, ID thieves.Around, 5 million

Wimbledon is smashing time

Tennis is soon set to dominate our lives again as the Wimbledon Championship approaches.

However, as the UK gears up for the country’s premier tennis tournament, Halifax Home Insurance is warning that it is likely to see an increase in claims.

The firm says that claims for smashed windows and other broken glass peak in July as thousands of people try to emulate their sporting heroes.

Figures from 2006 show that broken glass claims increased by 76 per cent in July, compared to January, and it is a trend that Halifax sees every year.

“Last summer we saw a particularly high rise in claims for smashed windows and other domestic breakages as Wimbledon and the World Cup coincided,” explained Vicky Emmott from Halifax Home Insurance.

“We’d advise any budding [Andy] Murrays and [Maria] Sharapovas to take care when playing racquet sports close to home and check they are insured for accidental damage should a mishap occur.”

Wimbledon runs between June 25th and July 8th and Halifax says that it expects to see most claims coming from Southend, Romford and Illford and Ipswich as these areas made the most claims last year.

Tags: Romford, Maria Sharapova, Human Interest, show, home, premier tennis tournament, world cup, cent

Brits expect rates rise

The majority of Brits are expecting interest rates to rise again this year.

Lloyds TSB has published its Consumer barometer in which it revealed that most of us (77 per cent) are fully expecting another increase.

This is bad news for those with a mortgage, loan or credit card, however, the fact that most borrowers are expecting a rise may help them to be properly prepared.

Confidence in job prospects and job security fell during May, with more people believing that their position is vulnerable compared to the month previous.

“Last month’s interest rate rise did little to convince consumers that rates had reached a peak,” said Trevor Williams, chief economist at Lloyds TSB Corporate Markets.

“In line with the prevailing opinion of the financial markets, consumers believe rates will increase further this year.

“We’re just beginning to see the impact of May’s rate rise on consumers with sentiment on job security and prices starting to cool.

“Even so, there is still some way to go before the Bank of England will be reassured – they have emphasised that for inflation to stay low, inflation expectations must be anchored at low levels,” he added.

Borrowers concerned that interest rates are likely to increase in the coming months should try to account for a rise in repayments when budgeting.

Tags: Brits expect rates, majority, interest rate rise, year, Brits, cent

Brits hide billions in the home

Millions of Brits are storing billions of pounds in their homes and missing out on the benefits of banking.

That is according to Virgin Money, which says we have a combined £3.5 billion worth of cash stashed away.

The firm has labelled it the ‘biscuit tin bank’ and says that we should all take that money and put it into a bank account as quickly as possible.

With the money just sitting in our homes, Virgin points out that we are missing out on interest which would be earned if it was in a bank account.

The £3.5 billion would earn a combined total of £174 million in interest every year if it was in an account and, based on future interest rates, our cash is set to lose £200 million in spending power by 2010.

Virgin discovered that 15 per cent of Brits have up to £1,000 in their home, while two per cent have around £5,000.

It may seem crazy to keep this amount of cash in the house but apparently we have our reasons.

Despite the massive risks associated, such as theft, six per cent say they keep the money in the house to hide it from their partner, four per cent do not trust banks and one per cent want to keep it tax-free.

Tags: total, Virgin, The, trust banks, cent, power

Brits spend billions on conversions

British homeowners have spent over £90 billion on converting ‘dead space’ in their homes.

Research by AA Financial Services shows that 20 per cent of mortgage holders have converted attics, garages, cellars and sheds to make them liveable areas.

The main driving force for the majority of people was to increase the value of their property, with 27 per cent citing this reason.

Money appears to be a major factor when it comes to conversions, with 17 per cent of those asked saying that they would have preferred to leave the ‘dead space’ as it was but needed to room and could not afford to move.

Others though were simply keen to get the most from their property, especially as house prices continue to rise.

“Many homeowners relish turning unused or ugly areas of their homes into liveable rooms as it means more space for family and less dusty boxes and clutter,” said Janet Pell from AA Insurance.

“But it is important that you ensure you have the appropriate building regulations approval before going ahead.

“And make sure you update your home insurance cover following an extension or conversion – your three-bed cottage might suddenly become a four-bed house – and of course, you’ll have additional furniture and possessions too.”

It is worth noting however, that if your property does become a four-bedroom house, it will be subject to the new Home Information Pack regulations from August 1st.

Tags: mortgage holders, home insurance, three-bed cottage, cent, possessions too."It, cover, conversions

House price growth slows

UK house prices have risen at their lowest rate this year, with Home Information Packs (Hips) and interest rates being named as the reasons.

May house prices increased by an average of just 0.4 per cent, with some regions actually seeing prices fall.

The east Midlands, west Midlands, north, and north-west of England all saw the average price come down but areas such as London and East Anglia saw strong rises.

The figures come from estate agent Rightmove and the firm says that with the introduction of Hips now just days away, it is almost impossible to predict what will happen to the market.

“It’s all rather confusing at the moment,” said Miles Shipside from the firm. “The future direction of the market is very hard to read with two external influences likely to coincide at once.

“You have the potential of Hips artificially increasing the supply of property and, within the same month, a six-year high in interest rates potentially depressing the number of buyers.”

If prices continue to level out it will be good news for those seeking to get a mortgage, particularly first-time buyers who are struggling to get onto the property ladder.

Tags: england, Economy of the Republic of Ireland, cent, Business Finance, six-year high, number, buyers."If prices, information packs

Consumers were ‘expecting’ rate rise

The latest interest rate rise is not going to have too much of an impact on consumers as most people were expecting it.

That is the opinion of Lloyds TSB and its Consumer Barometer which shows that pessimism over interest rates grew in April.

Only four per cent of those who responded to the bank’s survey were expecting interest rates to fall in the next year, with the vast majority anticipating a rise.

This, says Lloyds, should mean that most people will have taken the rise to 5.5 per cent in their stride.

“Pretty much everyone expected the base rate to rise last week,” revealed Trevor Williams, chief economist at Lloyds.

“For consumers, forewarned is forearmed and the impact is likely to be much less than if the rise came out of the blue.”

It means consumers should have planned ahead and will be able to keep up with repayments on loans, mortgages and credit cards.

Although there was also increased pessimism about increasing prices, the barometer also showed that people are optimistic about job security and opportunities.

Tags: cent, stride, interest rate rise, pessimism, Trevor Williams, inflation, barometer

FTBs benefit from landlords selling up

First-time buyers (FTBs) in the UK are benefiting from a trend which is seeing landlords selling their properties.

Statistics from Alliance and Leicester show that buy-to-let mortgage holders are beginning to sell some of their properties, with most making big profits.

According to the firm, ten per cent of landlords sold one property in the last two years, while 42 per cent of FTBs snapped up a landlord-owned house.

Head of specialist mortgages at Alliance and Leicester, Jeremy Claridge, is pleased that FTBs are taking their chance to get onto the property ladder.

“It is heartening to see that first time buyers are benefiting the most from the sale of buy-to-let properties with nearly half having bought from a landlord,” he said.

“With many believing the boom in buy-to-let has priced first time buyers out of the property market, the research highlights it is not all doom and gloom for first-time buyers. Instead, they are the group gaining the most.”

A quarter of landlords who sold their property in the last two years made a return of more than 30 per cent, with only two per cent reporting a loss.

This bodes well for the future of the buy-to-let market as does the fact that 29 per cent of landlord-owned properties sold since 2005 went to existing or new landlords.

Tags: benefit, group, United Kingdom, cent, loss, landlord, half, Head of specialist

Safe packing ahead of holiday

The holiday season is fast approaching and many of us will soon be packing our bags and heading off to warmer climates.

However, travellers are being warned that they must take out insurance before setting off or potentially face a disaster.

As more and more people can afford to fly and more flights are taking to the air than ever before, Swiftcover.com says that the chances of an airline loosing your luggage have increased.

Figures from the insurer show that around 22 per cent of UK holidaymakers have arrived at their destination only to find that their luggage has not made it.

Over half of these people have had to wait over 24 hours for their bags to be returned, while six per cent did not see their possessions again during the trip.

Travellers are being warned that they should pack valuables such as travellers cheques, cash and jewellery in their hand luggage as these items are often not covered if they are checked into the hold.

“As long as you have adequate travel insurance, losing your suitcase should not hit you in the pocket, but, for the majority of people, it’s often the sentimental value of personal belongings and the lost time on holiday trying to locate your bags that cannot be replaced,” said Craig Staniland from Swiftcover.com.

Tags: Business and Economy, Jewellery, Hand luggage, cent, cash, season, disaster

March mortgage approvals down

It seems that we may be beginning to see demand for mortgages weakening.

New figures from the British Bankers’ Association (BBA) show that the number of mortgage approvals in March fell compared to the same period last year.

In total, 198,000 mortgages were approved, signalling a fall of eight per cent on the same figures for March 2006.

However, the average mortgage amount rose by 12 per cent in 2007, reaching £150,800.

“Strong levels of gross mortgage lending reflect homebuyers and homeowners seeking out fixed rate mortgages as protection against rising interest rates,” said David Dooks, director of statistics at the BBA.

He went on to say that the drop on mortgage approvals indicated that “weaker demand is starting to emerge”.

The BBA’s figures also show that credit card borrowing fell by £0.1 billion in March, signalling a three per cent drop compared to figures for the same month in 2006.

Borrowing on personal loans and overdrafts remained pretty constant.

Tags: 800."Strong levels, personal loans, mortgages weakening.New figures, dooks, cent, rate, british bankers association

Hips will put off sellers

The introduction of home information packs (Hips) to the UK housing market is likely to reduce the number of properties sold.

That is according to the National Association of Estate Agents (NAEA) which says the ’see what happens’ seller is likely to become a thing of the past.

Research shows that around 20 per cent of homeowners, who were not even considering selling their home, have been tempted to put their house on the market after seeing their neighbour get a good price for theirs.

However, the NAEA believes that with Hips set to become a mandatory part of any sale from 1st June this year, this type of seller will be put off – adversely affecting those trying to get a mortgage on a property.

It is going to cost up to £500 to obtain a Hip and this may prove to be too costly for a homeowner who is merely interested in finding out how much their home is worth.

“A significant percentage of sales that go through start with a seller testing the water,” explained Peter King, the NAEA’s chief executive.

“The lack of ability to do this without paying for a Hip first is likely to put many sellers off.

“This will reduce the supply of houses available, cause the market to slow down and lead to additional house price inflation. Both these factors could adversely affect the economy,” he added.

The NAEA is calling upon the government to back down over the introduction of Hips.

Tags: government, cent, National Association of Estate Agents, introduction, NAEA, house, price

Every town has average house price above £100k

The latest proof that house prices in the UK are less affordable than ever before has been provided by Halifax.

The bank’s House Price Index shows that for the first time ever, the average house price in every UK town is above £100,000.

At the end of 2006 the average price in Lochgelly, Fife, was below this threshold but the latest figures put the average home in the region at £104,738.

Despite this, the town remains the cheapest in the UK, however, the same cannot be said for towns in Northern Ireland.

The province completely dominates the top ten biggest house price increases of the last 12 months, with the average price sitting at £206,495.

It has been a rapid rise for Northern Ireland to being the fourth most expensive part of the UK from being the second cheapest just two years ago.

Despite the rising prices throughout the UK, Halifax bank remains confident that we will soon see the market slowing.

“Overall, [UK] house prices increased by 2.8 per cent in 2007 Q1, well below the 4.2 per cent rise in 2006 Q4,” said Martin Ellis, Halifax’s chief economist. “There is also evidence of reduced market activity.

“We expect the higher level of interest rates, negative real earnings growth and above inflation council tax bill increases to lead to slower house price growth over the coming months.”

Tags: level, cent, real earnings growth, end, q1, Council Tax, earnings growth, House price index

NatWest overseas card hike

NatWest has hiked the cost of using their debit card abroad by two-thirds.

From June 5th, anyone using a NatWest debit card will be charged £1.25 rather than 75p for each transaction, while the maximum charge incurred for a cash machine withdrawal has been raised from £4 to £5.

“This is the latest in a long line of fees that banks are now charging to try to squeeze more money from their loyal customers. It follows closely after the RBS group’s decision to charge credit card customers £12 if they move house and do not update address details,” commented Nick White, director of financial services at price comparison website uSwitch.com.

“We estimate that this move could rake in an extra £10.18 million for the bank – a savvy move by NatWest.”

Many people prefer to use their credit card instead to make transactions as charges can be less, although withdrawing cash on credit can incur large fees.

However, NatWest said that as it had lowered its cash withdrawal fee from 2.25 per cent to two per cent, although on a £100 transaction this will only save 5p.

Tags: Debit cards, National Westminster Bank, com, transaction, withdrawal fee, cent, cash withdrawal fee

John Charcol unveils buy-to-let mortgage brace

Mortgage broker John Charcol has launched two new tracker mortgages for buy-to-let investors, with rental cover requirements which are “not too onerous”.

One of the John Charcol mortgages possesses a 90 per cent loan-to-value (LTV) rate and will track the Bank of England base rate at plus 0.74 per cent for the term.

No early repayment charges apply and rental cover of 100 per cent is also applicable to the deal.

The group’s other package has a maximum LTV rate of 85 per cent and is available to both new purchasers and remortgagers.

Its rate is set at the Bank of England base rate plus 0.39 per cent, with the fee for the package set at £999.

Ray Boulger, senior technical manager at the broker, said that with gross rental yields on many other packages seriously restricting choice, the two mortgages “have been designed with rental cover requirements that are not too onerous”.

He added: “For most buy-to-let investors the choice for the best value mortgage tracker is now primarily between taking out a cheaper two-year tracker, with a view to continuing to take up a new deal every two years, or securing the convenience of a lifetime tracker at a slighter higher rate.”

Tags: view, Loan to value, manager, package, LTV

Holidaymakers ‘losing out’ on travel insurance

Halifax Travel Insurance has reminded holidaymakers to think ahead when purchasing cover for their trips, as many people are leaving themselves out of pocket.

According to recent research, over 50 per cent of all travel policy sales are for single-trip insurance, meaning that these customers are paying extra if they take more than one holiday in a year.

Some 13 per cent of travellers are thought to go away without any insurance, with those aged between 16 and 24 the most likely to ignore a holiday policy.

Halifax states that annual travel insurance is becoming a more important provision for the many people taking advantage of low-cost air travel and internet holiday booking.

“The proliferation of low-cost, no-frills airlines has had a significant impact on our holiday-taking habits,” said Paul Birkhead, underwriting manager for Halifax Travel Insurance.

“More and more of us are taking short breaks to destinations in the UK, Europe and further afield, making annual travel insurance a more attractive proposition.”

According to the cover provider, there is “little difference” in price between annual and single-trip insurance, with some 12-month options actually cheaper than their short-term counterparts.

Tags: low-cost air travel, cent, internet holiday booking, Recent research, no-frills airlines, holiday-taking habits

Beware of credit card costs

Britain’s top 20 credit cards use 12 different ways to calculate interest, meaning that ‘cheap’ credit cards could cost more than you may think.

According to Which?, the APR (annual percentage rate) figure may not be the best way to compare cards, but it adds that this could be just one way in which firms are duping consumers.

“People believe that APRs are a dependable way of comparing credit cards, but our research shows that APR cannot to be relied upon for true credit card comparisons,” said Alena Kozakova, principal economist at the consumer watchdog.

“Two people who have two different credit cards with the same APR and who use their credit card in the same way, could be paying very different levels of interest.”

In the Which? calculations, people paying off the same amount of money with identical spending could pay 43 per cent more in interest on cards charging 15.9 per cent depending on how the interest is calculated and when it is charged, while the best 15.9 per cent card can also work out cheaper than cards charging 11.9 per cent.

Which? has now complained to the Office of Fair Trading (OFT) and Ms Kozakov added: “Consumers have to be able to make meaningful comparisons on the basis of APR. We are calling on the OFT to standardise interest calculation methods so that consumers can compare like for like.”

Tags: cent, oft, United States, consumer, rate, figure, calculation methods, Daskaloff credit card rating system

Critical illness payouts grow

The number of critical illness claims that were rejected by a leading insurer fell dramatically between 2006 and 2007.

Legal & General has revealed that the rejection rate for critical illness claims was down 19 per cent on the previous year, something the firm says is good for consumers and the industry as a whole.

The reasons behind the falling rejection rate are varied but Legal & General believes that a number of key factors have had the largest impact.

Tele-medical interviewing, which sees a nurse or underwriter speaking to the customer about their medical history, is said to have gone a long way to reducing the number of claims which are thrown out for non-disclosure.

Figures for 2006 show that claims declined for non-disclosure fell by 15 per cent, with the insurance firm paying out £92.1 million in critical illness claims in that time.

“We didn’t go into the business of critical illness to reject claims and so our latest experience is good for customers and good for the industry as a whole,” said Russell Whitworth from Legal & General. “It shows that people can have confidence in critical illness cover.

“Our claims figures demonstrate that the time and effort that we have invested in our underwriting systems to reduce non-disclosure and improve the clarity of policy definitions is paying off.”

Critical illness insurance is designed to help people financially if they are struck down with a life-changing illness or disability.

Tags: cent, disclosure, critical illness, cover, General, way, policy definitions, underwriter

Interest rates remain 5.25%

The Bank of England has decided to hold interest rates at 5.25 per cent.

It is good news for those with a mortgage, loan or credit card and will be welcomed by the majority of borrowers.

Many experts had been predicting a continued rise in base rates in the coming months, following a steep increase from 4.5 per cent to 5.25 per cent in five months.

However, a number of factors, namely falls in the stock market, commodity prices and a fall in inflation, have reduced the chances of an imminent rise.

The Bank of England’s Monetary Policy Committee (MPC) changes the base rate to keep inflation as close as possible to the government’s two per cent target.

Recent months have seen inflation running well ahead of this, sparking the quick succession of base rate increases.

Last month the MPC was split in its decision to hold rates and economists are predicting that March’s decision will also be a split one.

That does not bode well for the future, although two MPC members have come out indicated that they are strongly against any future rises.

Tags: bank, interest rates, cent, bank of england, Monetary Policy Committee, succession, future, finance

Are money worries written in the stars?

The time of year in which you are born may be affecting your banking skills and how good you are at managing your finances.

According to Credit Expert, our star signs could determine our financial futures and have huge effects on our personal lives as a result.

Research from the firm has found that Scorpios become so concerned with money problems that they are more likely than any other sign to split from their partner over financial worries.

Cancerians, on the other hand, have the least rows about money but this is likely to be down to the fact that 17 per cent regularly lie to their partners about how much they spend.

The most honest signs when it comes to finances are Capricorns and Arians, while the most confident about their credit rating are people born under the sign of the Taurus.

“Regardless of whether you take astrology seriously, the survey shows that there are a lot of people with great concerns about their spending and borrowing,” said Jim Hodgkins from Credit Expert.

“Instead of looking to horoscopes for solutions to their financial problems, they’d be better off looking at their credit reports.

“Your credit history is part of your financial CV and if it doesn’t reflect your current status, lenders may be less inclined to offer you credit in the future,” he added.

If you are unsure of your credit rating it may be worth finding out so that you know exactly where you stand and can correct any wrong information that may be held against your name.

Tags: expert, wrong information, hand, personal lives, financial worries.Cancerians, cent, money worries

Card holders wasting millions on holiday

Credit card holders are being warned that they may be wasting millions of pounds on fees by making purchases while abroad. Read more

Tags: Credit card holders, holiday, research, purchases, cent

Car insurance gets more expensive

The cost of car insurance has steadily grown in the past year, with figures showing a 2.1 per cent increase.

Figures released by Sainsbury’s Car Insurance show that the average premium in January 2006 was £462.72.

By July of the same year this had risen to £466.63 and by the end of the year it had grown again to £475.52.

That means that the average premium was £9.80 more expensive in December 2006 compared to the same premium just 12 months earlier.

“It always pays to keep a close eye on your car insurance premiums and shop around to make sure that you are paying a competitive rate because you could enjoy significant savings of over £100,” said Steve Johnson, head of car insurance at Sainsbury’s Bank.

The data also highlights the fact that the gender gap in car insurance premiums remains as vast as ever, with men paying an average £499.06, while women pay £434.46.

Motorists aged under 25 saw their premiums increase by the most, with the average cost rising by 5.8 per cent.

The only group to see their premiums fall were those aged over 65, with the average premium dropping by 0.5 per cent.

The easiest way to ensure that you are getting the best deal on your car insurance is to shop around and find the deal that best suits your needs.

Tags: cent, Sainsbury's Bank.The data, Business Finance, premium, GBP, close eye

Casino to affect house prices

The news that Manchester has been chosen as the site for the UK’s first super-casino has led some industry experts to predict a rise in house prices in the city.

Nationwide Building Society described the award as a “vote of confidence” in Manchester and said the number of jobs created will affect house prices.

“This could be good news for house prices in Manchester,” said Fionnuala Earley from Nationwide.

“It will bring new jobs to the city and the decision clearly represents a vote of confidence in Manchester’s infrastructure and the city’s ability to support a new super-casino. New jobs will lead to an increased need for housing which will support local demand and house prices.”

The news is undoubtedly good for those who already own houses in Manchester as they will see the value of their property soar.

However, first-time buyers will struggle to purchase a property in the city as prices rise, while Ms Earley also says the casino may have a negative impact on the value of some homes.

“Depending on the location of the casino, there could still be some negative impact on local prices if factors, like noise, for example, become an issue,” she said.

House prices in Manchester have risen by three per cent in the last year and by 101 per cent in the last five years.

Tags: building society, site, rise, Manchester, need, year, cent, noise

Credit card spending set to rise

The amount of money spent on credit cards is set to increase sharply in 2007, according to Morgan Stanley.

New research from the firm has led to predictions of a 68 per cent increase in credit card spending in the first three months of the year compared to the same period in 2006.

The Morgan Stanley Card Index shows that Brits intend to spend £1,228 on their cards during the first quarter of the year, a vast increase when compared to the £730 spent between January and March last year.

One reason for the rise is said to be increased comfort with spending on plastic, with consumers happy to buy everyday products such as groceries using their credit card.

Morgan Stanley’s research makes for positive reading, with repayment figures at the highest they have been since 1998, meaning consumers are using their cards sensibly.

“The results of our research show an increased confidence in the use of credit cards as a financial aid,” said Patrick Muir from Morgan Stanley.

“It is encouraging to see that people are using their credit cards sensibly, with credit card spending and repayment figures increasing in tandem.”

Mr Muir also pointed out that consumers appear to be becoming more skilled in using their credit cards to maximum personal gain.

“Cardholders are becoming increasingly clever when it comes to being rewarded for the purchases they make, and with a wide variety of reward schemes available, ranging from collecting points to cash back, spending on credit cards is fast becoming the most appealing way to pay when compared to other methods,” he added.

Tags: card index, variety, Mr Muir, Cardholders, cent, GBP, spending, first quarter

Record breaking cash withdrawals

Data from Link shows that cash withdrawals over the Christmas period were not affected by gloomy predictions about consumer spending.

Many analysts had anticipated a quiet festive period on the high streets but, according to Link’s figures, more cash was withdrawn than ever before.

The firm operates the UK’s cash machine network and found that a record number of withdrawals (152,929,048) were made in December.

The amount of money withdrawn was 7.3 per cent higher than the same period in 2005, with the average consumer withdrawing around £64 each visit.

“This was a record year for seasonal cash machine transactions with figures reaching new heights this Christmas,” said Graham Mott, head of planning and development at Link.

“Despite pessimistic predictions about consumer spending, it appears that UK consumers began their Christmas shopping and socialising towards the end of November this year.

“As is tradition, the last Friday before Christmas was the busiest day recorded this year despite the fact that there were still two remaining shopping days before Christmas. It appears that people were keen to get all their shopping out of the way and enjoy the festivities,” he added.

Tags: High Street, finance, cent, quiet festive period, firm, Christmas period

HSBC offers new 5-year mortgage

A new 5.55 per cent, five-year fixed rate mortgage plan has been launched by HSBC.

Following the base interest rate rise to 5.25 per cent last week, the package replaces HSBC’s Green Sale mortgage with a fixed rate of 5.17 per cent, which has sold out.

The new plan offers the incentive of no booking or exit fees, with interest charged daily.

Rob Chesters, head of mortgages at HSBC, said: “Following the recent increase in interest rates, we are pleased to be able to announce immediately our new five-year fixed rate mortgage, which comes with a very competitive rate and no booking fee.

“Our Green Sale mortgage proved to be very popular with the many homeowners spring cleaning their finances this January, selling-out in the first two weeks of the sale.”

The fixed rate reverts to 6.25 per cent variable once the five-year fixed rate period has expired.

HSBC serves 15.6 million customers in the UK and over 125 million customers worldwide.

Tags: Green Sale mortgage, United Kingdom, rise, rate rise, cent, rate, green, uk

Internet card fraud is down

Internet card fraud fell during the Christmas period, despite a huge increase in the number of online transactions.

Figures from internet fraud-prevention specialists Early Warning show that although shopping on the net increased by 40 per cent, fraud fell.

The data has caused widespread surprise in the industry as many figures expected to see online credit card fraud increase with the number of internet shoppers.

“This is really an unexpected and encouraging first in internet fraud statistics,” said Andrew Goodwill, managing director at Early Warning.

“As e-commerce goes on rising, we are used to corresponding increases in fraudsters’ activities to capitalise on it.”

Mr Goodwill went on to say that he believes increased awareness among consumers about the dangers and safety measures associated with the internet had been a big contributing factor.

“I am encouraged by these figures and hope this is not just a blip but the start of a downward trend for internet card fraud,” he added.

Tags: Early Warning."As, Technology Internet, cent, internet card, Deception, law, trend, online transactions.Figures

Credit card charges likely to rise

Credit card customers are likely to feel the squeeze as companies try to recover the £1 billion per year which will be lost as a result of a cap being introduced for penalty charges.

The Office of Fair Trading introduced the £12 cap, leaving a £1 billion shortfall for card companies which PricewaterhouseCoopers (PWC) says will be made up through increased charges and fewer zero per cent deals.

A report, released by PWC, says card companies are likely to make up the shortfall in this way, although there is disagreement over what effect an annual charge will have on consumers.

Some firms are not concerned that they may lose the custom of non-profitable card holders, while others do not want to anger these customers as they see an opportunity to sell other financial products to them.

Richard Thompson, one of the report’s authors, said he finds it difficult to see how the firms will be able to recoup the lost revenue.

“We are likely to see a waterbed effect, whereby charges pushed down in one area pop up somewhere else,” he said.

“Card issuers would have to levy annual fees costing the average credit card user £35 a year to recoup the potential £1bn loss.

“If lenders tried to recoup this through interest rates alone, we would see APRs increase by two percentage points on average,” added Mr Thompson.

Tags: cent deals.A report, loss, credit card user, area, card