Many retirees have a second home

Over recent years many non-homeowners have found it more and more difficult to get onto the property ladder, with lenders becoming more stringent about lending money to first time buyers and demanding higher deposits, which most first time buyers cannot afford. This has resulted in many non-homeowners giving up on their dreams of homeownership for now and having to settle for renting a home instead.

However, whilst the younger generation struggles to even get a big toe on the property ladder many people that are coming up to retirement are the proud owners of second homes. A recent survey revealed that one in seven couples in their fifties and early sixties own a second home, with an average £250,000 tied up in their second homes, not including any mortgage on the second home and not including the value of their main home.

At the same time their grandchildren and in some cases even their children are struggling to get the chance to own even one home. Many are unable to secure the deposit that they need to get onto the property ladder and many others cannot afford the repayments on their current income. This has left them facing the toughest challenge to buy a home out of any other generation. The figures were released recently by the Office for National Statistics. This is the first time that calculations have been carried out to see how many people within this age group own a second home.

Overall 13 percent of people in that age group were found to own a second property, which in some cases was abroad. Many will have purchased these properties before the boom, with the average price when they purchased the home being £30,000 but the value for the same property today being an average £163,000.

Tags: main home, boom, time, percentage, time buyers, couples, grandchildren

Negotiating a Settlement When Your Job Has Become Redundant

Job losses have occurred in all sectors of the economy in recent months due to the global recession which is taking its toll on companies of all sizes. Read more

Tags: percentage, job losses, good idea, employer, Britain

Fifty Percent of UK Shoppers Don’t Shop Online

According to a recent survey of the shopping preferences of UK consumers, over half of those surveyed say they are fearful of shopping online because they have to enter their credit card details on Internet shopping sites. Read more

Tags: internet security, percentage, privacy policy, credit card details, Don't Shop, Visa, online shopping

Inflation hikes are making life “tougher”

With inflation rising higher this week than analysts predicted it would, an expert has said that the situation is making life “tougher” for many people.

According to Ann Robinson, director of consumer policy at uSwitch.com, some consumers have seen their food, energy and other essential bills increase by 20 per cent over the past year.

Ms Robinson commented that many people are feeling the pinch as living costs continue to rise yet salary increases lag behind.

“We are working harder than ever before but we are not getting any richer.”

Ms Robinson warned: “With inflation misery set to continue this summer, this is a difficult time for consumers.”

Earlier this week inflation went over three per cent and Ms Robinson advised consumers to carefully review their household budgets and try to make savings wherever possible.

She pointed out that people could save an average of £1,500 on essentials by doing so.

Tags: inflation, Business Finance, essential bills increase, time, consumer, salary increases

Store cards reduce their APR’s – just

Following new regulations made by the Competition Commission, retailers have had to reduce the annual percentage rates (APRs) on their store cards to below 25 per cent, however, many have continued to hover just below this rate, it has been reported.

According to Fool.co.uk, a number of store cards offer only just below 25 per cent APR, including Jaeger’s card (24.9 per cent), Russell and Bromley (23.9 per cent) and Marks and Spencer (23.9 per cent).

The research found that some companies even increased their rates after the new rules came in, such as Marks and Spencer which hiked its rate by four per cent.

Ed Bowsher, savings expert at Fool.co.uk, said: “Store card-holders should be aware of the high interest rates which come hand in hand with introductory offers – and should remember that these cards are designed to make you spend, rather than help you save money.”

According to Halifax, the average balance on a credit card at the end of the month stands at £1,859.

Tags: high interest rates, interest, Fool.co.uk, percentage, hover, Bromley, 25 per, expert

Millions of Brits miss credit card payments

Approximately 5.5 million credit card customers missed payments in the last year according to research from Moneysupermarket.com.

The findings revealed that 13 per cent of spenders skipped a bill payment while credit card payments are the most likely to be missed with seven per cent going unpaid.

Steve Willey, head of credit cards at moneysupermarket.com, said: “Close to three million credit card holders will have paid out over £35 million between them in penalty fees.”

“But it is the damage to their credit rating that is more costly to them and to the other 2.5 million consumers who have missed payments elsewhere,” he added.

Credit card bills are the most likely debts to be missed by those aged 25, while the 25 and 34 age group also proved the worst at repaying with 12 per cent of respondents not keeping up to date.

The 18 to 24 age-group are most likely to miss mobile phone payments.

Meanwhile Moneysupermarket.com has also warned that specialist insurers can be the most expensive insurance agents.

Tags: group, cellular telephone, Mobile phone, bill, Steve Willey, percentage, Credit card holders, Credit Cards

Possession insurance more common than life insurance

More Britons insure their possessions than their own life, according to recent research from Legal & General.

A full 66 per cent of those surveyed said they had house insurance, but just 41 per cent said that they had taken out life insurance, the survey found.

Additionally, while 22 per cent of respondents reported having insurance for their mobile phones, 17 per cent had critical illness cover.

Bonnie Burns, Legal & General’s protection product marketing director said: “The nation’s priorities seem misguided, with people more worried about losing their mobile than about how they would cope financially if they had a critical illness.

“We all know that it is difficult to face up to our own mortality, but when insuring possessions is prioritised above insuring lives, then something has to be done.”

In 2005-06, a total of 212 workers were killed in accidents, according to the Royal Society for the Prevention of Accidents.

Tags: business, total, Possession insurance, Financial services, mobile phones, legal, percentage, critical illness

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, percentage, Michael Coogan, cent, interest rate, August, business, director general

Savers missing out on tax breaks

Almost half of all British adults are knowingly paying too much tax, but refuse to do anything about it, Britannia has claimed.

New research from building society revealed that 48 per cent of UK adults have never had an ISA account and are failing to make the most of tax free savings.

Of those without an account, Britannia was shocked to discover that as many as 30 per cent did not even know what an ISA is.

“Our research reveals that there are many misconceptions about ISAs and people just don’t understand how they work,” said Neville Richardson, Britannia Group chief executive.

“It’s a shame that many of those who are saving are unnecessarily being taxed twice – firstly on their income and then again on their savings. This means 48 per cent of adults are financially worse off by missing out on tax free returns on their savings.”

Customers can open an ISA at any point during the year and are allowed to save £3,000 in cash and invest £4,000 into stocks and shares every year without paying any tax.

As of the beginning of the next financial year (2008/09), adults will be able to save up to £3,600 in tax-free cash and £7,200 in tax-free stocks and shares every year.

Tags: shame, half, income, anything, neville

100 per cent-plus mortgages safe

A predicted slow down in house prices should not dampen the optimism for 100 per cent plus mortgages, experts have claimed.

Bestinvest, a financial advice firm, claim that even if house prices stabilise, 100 per cent borrowers will not be at risk of negative equity.

However, the company maintains that this type of borrowing is not for everyone and advice should be sought before taking up such a loan.

Peter O’Donovan of Bestinvest said: “Eventually house prices will continue to increase. And hopefully as they pay off their mortgage, of course, they reduce that burden on the loan-to-value.”

He added: “It’s down to affordability – speaking to a client, getting to know them properly and being able to recommend these sorts of products knowing that you aren’t putting them in any sort of danger.

“Lenders themselves do say ‘no’ if they don’t think its right. They don’t want to have to repossess in a year’s time, it’s not good business.”

However, the Royal Institution of Chartered Surveyors warned that there may be a one in ten chance of a housing market crash in the UK.

Tags: Mortgages, donovan, risk, housing market crash, percentage, equity, lenders, danger

London’s ’stingy’ parents best at saving for kids’ futures

New research of parents’ spending habits by Engage Mutual suggests there is a direct trade-off between giving children generous pocket money allowances and saving for their future.

The study reveals that London is the bottom of England’s pocket money league – with just a third of the capital’s parents giving their children an allowance – but conversely it is the region where parents are most likely to save for their children’s future, with four out of ten doing so.

By comparison, in the East Midlands fewer than a fifth of parents make such provisions and yet they are the most generous on the pocket money front, with 55 per cent dishing out regular allowances.

Scottish parents, meanwhile, scored consistently low on both fronts, with only 37 per cent handing out pocket money and 40 per cent setting aside savings.

On a national level the proportion of parents saving for their child’s future stands at 32 per cent, its highest level for over a year.

Karl Elliott, 3GB spokesperson for Engage Mutual, commented: “In a credit card society that is driven by a have-it-now culture, it is pleasing that so many parents are saving for their kid’s future”.

He added: “Those children in areas where parents are the tightest on pocket money will thank them in years to come when they enjoy the benefits of a healthy, matured savings fund.”

Tags: Allowance (money), child, percentage, money, league, london, highest level, generous pocket money

Study: Home-buying process ‘fraught with difficulties’

A new study by AA Insurance has found that prospective homeowners are increasingly wary of buying a new home.

The survey found that buying a house tops the list of daunting prospects among young people ahead of getting married or divorced and starting their own business.

Discontent stems from a range of sources, with 29 per cent saying they found the whole home-buying process difficult while one in ten harboured serious concerns about hidden faults.

Estate agents in particular do little to assuage the fears of homebuyers as 62 per cent of respondents said they did not trust them, placing them only marginally behind politicians (73 per cent) in terms of general unscrupulousness.

And even once homebuyers have taken the plunge it seems almost three in ten find they are unsatisfied with their new dwelling after moving in.

Janet Pell, head of AA Home Insurance, commented: “For most people, buying a home will be the most important purchase they make in their lifetime, so it’s really important to get it right and make sure you have no regrets once the contract is signed.”

She added: “Once you’ve found your dream home, make sure you shop around for the best deal on your mortgage, surveys and home insurance”.

Tags: survey, economics, AA Insurance, percentage, in.janet pell

Bank of England makes quarterly report

The Bank of England’s latest Quarterly Inflation Report, published today, seems to hint at future interest rate rises.

Charts in the report seem to suggest that inflation will not drop to the bank’s desired level of 2 per cent if rates stay as they are.

The base interest rate has been increased five times in the last 12 months, and currently remains at 5.75 per cent.

Economist James Knightley at ING said that the report was “mildly on the hawkish side”, and signalled that “interest rates have to rise”.

He predicted a rate of 6.25 per cent by the beginning of 2008.

With interest rates whole percentage points lower two or three years ago, mortgage holders on variable rates are currently being faced with big hikes in their monthly payments – a situation which will get worse still if rates rise yet again.

Analysts Morgan Stanley estimate that 70 per cent of mortgage holders in the UK are now on variable rates, compared with 20 per cent just five years ago.

Tags: quarterly inflation, mortgage, base, interest rate, Morgan Stanley, percentage, inflation

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

Stamp duty ‘puts off’ first time buyers

Bradford & Bingley says that stamp duty, a charge which many buyers must pay on top of the fee for their new home, is putting off first time buyers (FTBs).

Terming stamp duty a ’stealth tax’ and ‘wholly unfair’, the mortgage lender points out that 68 per cent of FTBs currently either have paid or will pay the duty.

Using the monthly figures from the Council of Mortgage Lenders also released today, Bradford & Bingley’s report highlighted the finding that 11 per cent of FTBs had to reduce their deposit in order to cover stamp duty.

Andy Wiggans, director of mortgages for Bradford & Bingley, said that the tax “is seriously hampering [FTBs'] ability to get a foothold on the property ladder.

“The average first time buyer now has to find over £1,000 to pay this tax, at a time when most are struggling to even fund a deposit.”

He also drew attention to the finding that 11 per cent of FTBs had their stamp duty paid for by their parents.

Tags: parents, percentage, ability, GBP, buyer, tax, Council, charge

Uni sacrificed for mortgage

The difficulties associated with getting onto the property ladder are forcing many youngsters to abandon their education.

New research shows that ten per cent of 18-24 year olds are choosing not to go to university so that they can save some money towards their first home.

With house prices seemingly on an endless upward curve, it is now more difficult than ever to purchase a first home and the costs of university are an unwanted burden for many.

Lloyds TSB carried out the research which highlighted that many youngsters are making big sacrifices in order to get a mortgage.

One in five say that they have abandoned the dream of forging a career in their preferred sector, opting instead for a better paid job that they do not enjoy.

In addition, a further one in six say that they are doing two jobs to save some money, while 54 per cent are living at home indefinitely.

“The fact people are willing to forgo their education highlights the importance of homeownership to the younger generation,” said Alison Burns from Lloyds TSB. “However, these extreme measures may not always be necessary, as the research shows a number of misconceptions about the modern housing market.

“Almost 65 per cent of those we spoke to believe a ten per cent deposit is an essential requirement but this is not the case. Mortgage providers are becoming increasingly flexible to accommodate the changing circumstances of first time buyers.”

Tags: house, addition, percentage, deposit, year

Drivers not going hands-free

Many British drovers continue to use their mobile phones while driving, despite recent changes to make punishments harsher.

A survey, carried out by Which?, found that 33 per cent of drivers are still making and receiving calls while behind the wheel.

In addition, 32 per cent admit to sending or reading text messages while driving, running the risk of prosecution or, even worse, having an accident.

New laws introduced in February state that drivers can be hit with a £60 fine and three penalty points on their licence if they are caught on their phone while driving.

This can have a big effect on insurance premiums for drivers and the fact that they continue to talk and drive cannot be put down to ignorance of the laws.

In a separate Which? survey, it was found that 90 per cent were aware of the penalty changes.

“Although people seem to be aware of the higher penalties for mobile phone use behind the wheel, many either don’t understand or don’t obey the revised law,” commented Richard Headland, motoring editor at Which?.

“The penalties for using a handheld phone when driving are now stiffer, but to be effective the government must change driver behaviour through better education as well as enforcement.”

The survey also highlighted that only one in ten drivers are aware that it is still legal to call the emergency services while behind the wheel.

Tags: prosecution, editor at Which, cannot, accident, effect, percentage, Insurance, state

Savers may be missing out

The recent 0.25 per cent interest rate rise was bad news for borrowers but was more warmly received by savers.

The Bank of England’s decision to increase the base rate to 5.5 per cent should mean that savers earn more interest on their money.

However, the Post Office is warning that many people are not benefiting because banks and building societies are failing to pass on the new rates.

“It’s easy to become a base rate loser when account providers fail to pass on interest rate rises in full to their customers, leaving people hugely out of pocket,” revealed Richard Norman, head of savings at the Post Office.

“Interest rates have risen sharply over the last year, and many experts believe there are further hikes to come.

“As people tighten their belts due to rising mortgage payments, they should make sure any money they have in savings is working as hard as it can for them,” he added.

The Post Office claims that many of the largest high street banks and building societies are failing their customers in this way and the financial losses can be huge.

The firm points out that a saver with £5,000 in a typical instant access savings account may have lost out on £145 in interest if their bank has not implemented the one per cent rate rise we have witnessed in the past year.

Tags: bank, building society, one per cent, finance, GBP, percentage

Burglaries, vandalism on the rise

The latest figures show that overall crime in Britain has fallen by two per cent but homeowners will be concerned that burglary and vandalism rates are up.

Home Office statistics reveal that burglaries rose by eight per cent, while vandalism increased by 11 per cent in the final quarter of 2006.

These figures have led to a leading insurance firm carrying out its own research in which it found that one in ten Brits have had their property vandalised.

According to research by Lloyds TSB, half of the population believe that vandalism is one of the biggest problems currently facing modern British society, while 22 per cent are concerned that they will become a victim.

The most common form of vandalism is the ransacking of homes, while smashing windows, damaging fences, putting graffiti on walls and smashing garden ornaments are also popular.

“Prevention is always better than cure when it comes to crime and it is great to see evidence that crime appears to be falling in some areas,” commented Phil Loney from Lloyds.

“However our own research backs up today’s crime survey figures which show that vandalism is a problem on the rise. Insurance is vital in this equation and home owners can’t afford to cut back on their cover.”

The perceived causes of vandalism are varied with many Brits blaming a lack of discipline at home (79 per cent), boredom (74 per cent), alcohol and drug abuse (70 per cent) and the lack of a deterrent (44 per cent).

A further nine per cent even blame modern music for the rising crime.

Tags: research, modern british society, Law Crime, deterrent, insurance firm, burglaries, society

Rural demand ‘outstripping supply’

Bad news for anyone looking to get a big house in the country as demand is outstripping supply by an average of 15 to one, rising as high as 29 to one in some areas.

Competition is so fierce that even before considering a mortgage to obtain such a property, anyone bidding in Tunbridge Wells, Ascot and Worcester is likely to be competing against 28 others, estate agent Knight Frank said.

Manor houses, farmhouses and country cottages have risen by £4,516, £13,474 and £34,241 per month on average since December while the number of interested buyers has risen by 21 per cent since January.

“The current average price of a manor house has now broken the £3 million barrier,” commented Knight Frank’s head of residential research Liam Bailey.

“Payment of City bonuses together with an increasing international presence in the country house market has aided price growth.”

This means that this is three percentage points ahead of the number of available houses, giving an annualised growth rate of 12.4 per cent.

Tags: Rural demand, percentage, Business Finance, month, manor house

Parents turn to kids for cash

It used to be the case that children went to the bank of mum and dad to help them out of sticky financial situations.

However, new research suggests that the trend is reversing, with mum and dad now beginning to turn to the bank of son and daughter in order to live comfortably during retirement.

Yorkshire Bank looked into the financial relationship between children and their parents and found that 27 per cent of people with children are hoping that their offspring will help them out when they retire if need be.

That would seem to be likely considering that 40 per cent of those asked said that they have no real savings for when they retire.

A total of 60 per cent of these people say that they know they should be saving but just cannot afford to as the cost of living continues to rise.

“By not saving for the future, parents appear to be aware they’re storing up hardship for themselves,” commented Gary Lumby, head of retail at Yorkshire Bank.

“Many are already presuming their children… might be the answer to all their financial problems. However, the easiest solution is to start saving now.”

Mr Lumby went on to say that people approaching their 30s should be thinking about putting ten per cent of their income into a pension so that they can live comfortably in retirement.

Tags: finance, answer, financial situations, percentage, business, cash, retirement, dad

Fifth paying higher stamp duty

Almost a fifth of us are being forced to pay stamp duty at higher rates because house prices are soaring.

That is according to Halifax which says that the government should act by moving the stamp duty thresholds so that they better reflect the current housing market.

The bank says that in the past five years the number of homes in England and Wales which have been sold for more than £250,000 has increased fourfold.

Halifax points out that this means 19 per cent of homebuyers are paying at least three per cent tax, a vast increase compared to the six per cent who were doing so in 2001.

“Stamp duty revenue raised from home sales continues to rise rapidly,” said Tim Crawford from Halifax.

“Bracket creep has been a key factor as a growing percentage of property sales now occur above the higher stamp duty thresholds of £250,000 and £500,000, which have not been changed since their introduction in 1997.

“Nearly a quarter of postcode districts in England and Wales now have an average price above the three per cent stamp duty threshold of £250,000, compared to only one in 20 districts five years ago,” he added.

Stamp duty is only applicable to house sales above the £125,000 threshold, with buyers paying a one per cent tax. The higher duty comes in when a property is bought for £250,000, while an even higher duty of four per cent is levied on properties above £500,000.

Tags: stamp, percentage, property, finance, stamp duty, house prices, england, higher duty

Insurers still have work to do

A new survey shows that most of us are pleased with the service we receive from insurers but many firms are still failing to deliver in specific areas.

The Association of British Insurers (ABI) asked thousands of people to take part in the Customer Impact survey and the results were generally positive.

However, despite the majority of customers (55 per cent) saying that they would be “extremely” or “very likely” to recommend their insurance firm to a friend, 20 per cent responded with a negative “not at all” or “not very likely”.

A massive 85 per cent of those questioned said that their company was easy to do business with, while 53 per cent were either “extremely” or “very satisfied” with the service they received.

Customers generally rated the insurance sales process as “very good” or “excellent”, with 58 per cent of people responding in this way.

Despite these positive figures, customers said that the thing most lacking in the sales process is clarity of information at the point of sale.

In addition, the complaints process was also highlighted as being in need of fine tuning, with four per cent of people having complained in the last 12 months and 50 per cent of these describing the handling of their complaint as “poor”.

“This year’s survey shows a strong position in several areas, and room for improvement in others,” said Stephen Sklaroff from ABI.

“Each company will review their own performance against the industry results, and where necessary take action to improve.”

Tags: economics, year, room, British Insurers, industry results, sale.In addition, Impact, percentage

Car Insurance Extra Charges – Worth The Cost?

Losing their No Claims Discount is probably the issue that causes the most issues to a car insurance policy holder. Usually they will do anything to hold on to it. This is why insurance companies have now responded with No Claims Discount insurance as part of their overall car insurance package. But is the extra in the premium worth it and what about all those other charges? Read more

Tags: car insurance package, extra, Claims Discount, two ways, feel-good factor, accident