Savings And Investments
See also Pensions and Benefits

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General disclaimer

NOTICE : I understand that the Financial Services Authority does not like unqualified people giving financial advice.  I would like to state that none of the following should be considered as advice.  I just like to point people in the direction of useful information. To find an Independent Financial Adviser (IFA) try www.unbiased.co.uk. Details on this page are, to my knowledge, correct at the time of uploading but are supplied as information only and in no way implies advice and the author cannot be held responsible for any actions which you take as a result of what is written. Also, as interest rates and investment charges can change at any time, it is imperative that, before acting on the information below, you check with the organisation concerned. If you find any of the rates are inaccurate or you get a 'Page Not Found', please email me by clicking Here

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A separate page on Pensions and Benefits has been developed and these matters are now at Pensions and Benefits
Retirement cartoon

The Halifax have introduced a Junior ISA which pays 6%.  Junior cash ISAs are limited to £3000 per annum, which is very good.  There IS a point to Junior ISAs because if a parent puts money in a children's account it is subject to the "£100 rule". i.e. anything over £100 per annum is subject to the PARENT's tax rate. If a grandparent put something in the tax would be at the child's full tax allowance each year.  But the ISA is not taxable, whoever puts in the cash.  Bearing in mind that children can start and ISA now and have another £3000 in April some parents may wish to act rapidly.

February 2012 M & S are offering a 3% variable cash ISA.  What I like about this is that it does not have any strings and involves no bonus.  Transfers in are allowed.  With many (most) organisations offering less this seems attractive.  They even allow you to put some in this ISA and some in one of there higher paying fixes. It is not a bank, of course but, for some, this may INCREASE the attraction!

February 2012 First Direct on line bank is offering £100 if you transfer your bank account to them and pay in £1500 a month.  They are so confident you will stay that, if you are not happy after 6 months they will help you transfer out and pay you another £100 !  Not only that they have a regular saver of up to £300 a month paying 8% and their maximum cash e-ISA for £40,000 pays 3% tax free.  For £12 a month they offer the usual package of travel (up to 70) and mobile phone insurance and roadside help

January 2012 Any instant access savings offered these days appears to be on a bonus basis (Santander, Leeds, Ing). New bank, Aldermore offers 3.1% on 90 day notice and The AA gives 3.6% on a 1 year fix. There are higher (almost inflation) rates if you lock cash up for 5 years. But nothing spectacular is happening.

A new site which summarises best savings at http://www.savingschampion.co.uk/ and stresses the need to move them if/when the rate drops. Has a warning system.

Santander are trying a new tack.  They will pay you three years' interest six weeks after you deposit £10,000 or more See http://www.santander-products.co.uk/savings/bonds/upfront/onlinebank.html  This amounts to 8.33% up front on your cash.  You can do anything you like with the interest but you must leave the original sum untouched for 3 years.

Dec 2011 Tesco Bank is offering investors is issuing a retail corporate bond that will deliver an RPI-linked return, plus 1 per cent to 2019. Investors can put in a minimum of £2,000 and can get a tax-free return by holding the bond within a tax-free investing Isa wrapper, with the corporate bonds available through brokers and investing platforms. Read more: HERE Of course, bonds can go up and down.

23rd November 2011 Nationwide Mysave online Plus issue 4 offers 3.12% for a year including 1.58% bonus - one free withdrawal. Coventry BS is slightly better at 3.15% (bonus 1.15%) and four free withdrawals.

14th November 2011  I rarely venture into the field of investments - even to take up my ISA allowance, and certainly not to give advice, but I received this albeit temporary) information from the Halifax :  HERE

http://www.uswitch.com/investments/ displays some investments which can be sheltered in ISAs. Surprisingly these can pay as much as 7% but there is some risk involved.

7th November 2011 A number of places are offering one year fixed ISAs at 3.25%, which I suppose is the best that a taxpayer can expect at the present. Natwest is still offering its 2 year fix at 3.7% for transfers in.

1st November At long last the Junior ISA's are beginning to show with Nationwide paying 3% including a small bonus until 2013. No withdrawals until they are 18 then only the child has access to the funds. Skipton , Bucks and Furness BS are also offering one (all around the same rate). No doubt others will follow soon. But it is not much to shout about as children have sizable tax free allowances, anyway.
In view of the variation in compensation allowed in different 'off-shore' places (Guernsey, Jersey, Isle of Man, Cyprus plus off-shore schemes run by British Banks) a Daily Mail article suggests it may be safer to bring savings back to home shores. At one time such schemes tended to pay a little more interest

27th October 2011 Angela Markel 's triumph in pushing through a package to save the Euro from meltdown was short lived.  Briefly, the stock markets around the world appeared to approve.  But the Greek PM promptly put a damper on things saying he would ask his people. Unfortunately his people are too fond of big cars and early retirement, which varies from 55 to 61 according to how long they have worked and, in some cases how hazardous their occupations are said to be. So Europe is in turmoil again, with most people wishing the Greeks would just go away. The UK is said not to take a hit from the arrangements, except for the banks who have lent money to Greece, which may result in continued low savings rates and higher mortgages. Beware of Greeks bearing debts as they say.

26th October  Chelsea BS Fixed Rate Online ISA pays 3.30% until 31st December 2012. The ISA can be opened with a minimum investment of just £100 and you can apply for and manage the account online. You can also transfer in any ISA funds held in existing ISA accounts held elsewhere. Withdrawals are not permitted during the fixed term. You can close the ISA early or transfer your money to another provider if you want to, but you will lose 90 days’ interest on the amount withdrawn.  

9th October 2011 With the RPI now at 5.2% those people who grabbed the National Savings Indexed linked savings will be pleased they did. And one wonders how long other indexed linked offers will last. The Post Office say their Indexed linked bonds will be on sale until 20th January 2012. Interest, paid on maturity, is taxable, but will pay RPI + quarter percent for the 3 year bonds and RPI + 1% for the five year bonds. This is a little less than their previous offer.  Obviously these are unsuitable for people wanting monthly income and could fall if RPI falls. We will have to see what the effect of The Bank of England printing £75 billion five pound notes has on this!
The stock markets took heart from the fact that the Germans and French appear likely to approve trillions more support for cash strapped Euro neighbours. The FTSE is 500 points higher than last month.

Another government backed index-linked deal : the generous payments for electricity generated by solar panels was bound to be short lived.  See the revised article at MoneySavings Expert

14th October 2011 If you have money in Halifax Savings account you can register for a monthly Prize draw (probably more chance than the lottery)  go to http://www.halifax.co.uk/savings/savers-prize-draw/ They aggregate (tot up) your savings accounts to qualify. But you HAVE TO REGISTER. If a couple have two big savings accounts you could both register.  

7th October 2011  Banks shares moved lower after Moody's downgraded the rating on such big names as Lloyds/Halifax/Bank of Scotland, RBS, Santander, Nationwide, The Coop and 7 smaller Building Societies. (which?) Moody's stressed its review did not reflect a deterioration in the financial strength of the banking system. 'Moody's believes that the government is likely to continue to provide some level of support to systemically important financial institutions, which continue to incorporate up to three notches of uplift,' it said in a statement. 'However, it is more likely now to allow smaller institutions to fail if they become financially troubled.'
n.b. Norwich and Peterborough and the Yorkshire Building Society are joining forces. The FSA scheme to guarantee savings up to £85,000 per person per institution still holds good.  But people who have more than that when Building Societies combine must check their situation. An article at www.thisismoney.co.uk suggests that "Those worried about private sector banks might consider National Savings bonds, savings accounts or Premium Bonds - which are directly guaranteed by the government - as possible homes for spare cash".

26th September 2011 With the Bank of England signalling that interest rates will remain low (and even fall) due to the parlous state of the economy, any fears that opting for longer term savings, for fear of being locked in, have flown away. NatWest's 3 year 4% ISA is beginning to look more attractive. n.b. Applications and transfer requests have to be in by 1st November. And they WANT your transfers from other organisations. Minimum £1000. http://www.natwest.com/personal/savings/g2/isas/fixed-rate.ashx

 Halifax offers fixed rate ISAs from 1 to 5 years, paying 2.25% to 4.4% but it is a one-off lump-sum deal with a swingeing loss of interest if you close the accounts. Transfers in are allowed.  See HERE 

25th September 2011  In these days of austerity there may be ways of saving money apart from looking for meagre savings accounts.  If you have enough cheek - and you know that you have got retailers over a barrel, you could try your hand at bargaining (especially if you have just come back from a Mediterranean market !) Here is a chart of what some people have saved just by asking (with confidence)

Haggling results

1st September 2011 Update on Junior ISAs at http://www.hl.co.uk/investment-services/new-junior-isa?

For people who qualify and have some cash to spare, the government's scheme to encourage solar generation of electricity pays better than any savings account !  See my new page at Solar.htm. There are also new grants to help with hot water systems., but only if your house is NOT heated by gas.(it is all to do with carbon emissions).

NEW: An article in the Mail on Sunday (11th Sept 2011) confirms what I suspected that, providing you are willing to spend around £12,000 (and no longer have access to that cash), there is money to be made from this Solar Panel scheme. The report mentions a particular case where someone in Southport (not the sunniest place in the UK) paid £12,500 for his installation and, in the first year received Feed-in Tariff (FIT) from his electricity company of £1,400 and is saving 50% on his electricity bill - a total yield of around 14% tax free. This will increase as electricity prices rise and the FIT is inflation linked. 14% tax free !  Find me an ISA that pays that - PLEASE.

One or two fixed savings deals have edged up: Nationwide now pays 2.5% on its 6 month ISA and 2.85% on its one year version. Yorkshire now have a two year cash ISA at 3.35%

If your spouse has low earnings it might be a good idea to either transfer a part of their allowance to you OR make sure that any tax deductible savings are in their name.  They may then be able to complete a form to ensure the interest is paid gross.  Otherwise the tax is deducted at source.

The Financial Services Authority has a useful comparative site at  www.moneyadviceservice.org.uk (was MoneyMadeClear) dealing with many different financial offerings.  Just fill in what you want to do and it will show an up-to-date list of what is available. Incidentally I am making efforts to block all adverts which related to debt counselling and PPI miss-selling, apart from official ones.  If you see any, please ignore them (and tell me)  

13th August 2011 Stock markets the world over are suffering and hopefully there are signs that the bottom has been reached with a decent rebound on Friday 12th. Inflation is a worry as it is almost impossible to find anywhere to beat it. So savings are generally being gradually eroded, whatever people do. The Bank of England interest rate remains low (and most pundits think it will stay that way for many months). Good for mortgage borrowers, bad for savers. If you can get a better deal on a fix the advisers are saying you won't be kicking yourself in a few months because all the rates went up !
The Daily Mail (10th August) had an article "How safe are my savings?". Although there seem to be worries about French banks right now the article made reassuring noises about the protection of amounts in banks of £85,000 or less per person, per bank (or building society).  Let us hope no big financial organisations go under as I cannot see where the scheme could find all that cash. I suppose with a triple A rating the government could borrow even more money from the Chinese. we are being advised to make sure that large amounts are split between qualifying organisations. To see which banks are independent see the chart HERE  Incidentally, The Daily Mail states categorically that Post Office Savings are now covered by the British Financial Services Compensation Scheme, despite the fact that they are backed by the Bank of Ireland. That is a relief!

To cheque or not to cheque, that is the question. Campaigners have saved the cheque as a form of payment for now, but for how long ?  Cheque guarantee cards have been scrapped so the process of attrition goes on.  I suppose you can still show a Debit Card.

4th August 2011 The government is dribbling out more information about Junior ISAs. The amount allowed for cash or stocks ISAs has been upped to £3,600 per annum. Junior Isas will automatically be converted to standard Isas when the child reaches 18. They will only be available to kids born in 2011 or later, or before 1 September 2002. Anyone born between those dates is instead eligible for a child trust fund (CTF) which is also a tax-efficient vehicle, though this is closed to new joiners.
Child trust fund future In March, the Government announced the limit for CTFs as £3,000 but it has today increased that in line with the junior Isa to £3,600 on 1 November (see the Junior Isa plans unveiled MSE News story).The Government has not yet confirmed whether a CTF can be converted into a Junior Isa, instead stating further details will be announced later this summer. The worry is banks may not offer their best rates to CTF holders as they are not available to new customers so there is little incentive to gain business. We will have to wait and see.

24th July  Back in May National savings re-introduced their 5 year Index Linked Savings.  Up to £15,000 for anyone over 7 years of age. It paid 0.5% over the Retail Price Index, which stands at 5.0%. This made 5.5% TAX FREE. For a standard rate tax payer this was equivalent to savings of  over 7%.  A higher rate tax payer would have had to find something paying 9%.   At the time I said I wondered how long this offer can last and it has now been withdrawn.  You have to be quick off the mark these days. The best they off now is a 2.5% ISA

There are some ISAs paying over 3% (AA, Santander, Kent, Halifax) but all are 'introductory' rates. One year fixed rate ISAs may pay a little more and seem to be confined to smaller building societies

Northern Rock has an on line no strings (no bonus, no restriction) 2.75% gross account.  First Save 2 year fix is 3.8% or 3.5% for one year. The Post office offers 3.76% on 2 year (on line). All are 'protected' by the FSCS. Coventry BS (Poppy account) is paying 3.15% gross (taxable) with 4 withdrawals per year. But the bonus is 1.15%, so you would be down to 2% after 12 months 

11th July In view of the popularity of the NS & I Index Linked Savings (now closed) there are a few more around though, after tax, they may not be as attractive to some people.  BM Savings pay RPI + 0.25% for 3 years or + 0.5% for 5 years.  The Post Office does a little better with RPI + 0.5% for 3 years and + 1.5% for 5 years (reduced in October 2011). But both are taxable and with the RPI falling slightly to 5% this month some folks may wonder what they would be getting at the end of such a long period.  Halifax is paying 4% fixed for three years. But few people can beat inflation at the moment.

4th July  I find it hard to believe but it seems that the best way to use £5000 these days is on solar panels. Where else can you get £500 ? tax free from HMgov for that sort of money.  But read http://www.moneysavingexpert.com/utilities/free-solar-panels and see if you qualify 

Going Abroad ? If you don't want to be left stranded when your credit card is refused it is advisable to tell your bank you are going.  Most also have an emergency number you can call and some even can let you have a code to get cash from a machine. So get their emergency number and add it to your mobile phone list or keep a note somewhere.

Some current accounts sound better than others. Santander gives a 0% overdraft for 12 months and £100 cashback when you switch. In addition you get a £25 Amazon voucher if you apply through moneysupermarket.com They also give 5% on amounts up to £2,500 but you must pay in at least £1,000 into your account each month.

KRBS stands for Kent Reliance Building Society. It is offering a 3 year fixed 4% ISA with a monthly interest payment option. Although it is a fixed rate, withdrawals are possible with just 100 days loss of interest on the amount withdrawn. They are protected under the FSA scheme and transfers in of ISAs are allowed. See HERE. If you have been tucking away your ISA's regularly and had £40,000 in there this would yield £1600 p.a. or £130 a month tax free.

May 2011  Despite high inflation the Bank of England once again kept their rate at 0.5% and, after 30 months of the same, one does wonder whether it will go up by the end of this year.  Good news if you have a mortgage but not so good if you are hoping for a decent rate on your savings.  Even with ISAs it is difficult to keep savings intact, never mind living off the interest. The old game of searching for the best deal and making sure it doesn't run out after a year still applies. Some organisation make it easy to swap ISAs and one should certainly not be accepting anything less than 2.5%.

 PPI Mis-selling Lloyds Bank has come clean on the mis-selling of Personal Protection Insurance, either to people who couldn't claim it or did not have it fully explained. What to do? Beware of companies who will claim on your behalf.  They may make off with up to 40% of the payout. Mis-selling occurred if you (to quote the Mail): "were too old to make a claim, were unemployed when you took out the loan, were self employed, did not need it because you were protected in some other way, or if it was attached to your loan and you didn't know you were being charged interest on it". If the loan was from Lloyds TSB, Halifax or the Bank of Scotland, and haven't complained, contact Lloyds TSB on 0845 300 5599 or Halifax BoS on 0845 725 3519. Personally, I would write and keep a copy. There is a template letter at http://www.thisismoney.co.uk/reclaimppi If you don't get satisfaction within 8 weeks contact the Financial Ombudsman on 0300 123 9123 or 0800 023 4567 or click on www.financial-ombudsman.org.uk

Are my savings safe ?  Recently a spokesman for the government said that, in future, banks should not assume that the taxpayer will bail them out. This is taken as a shot over the bows to banks which are still acting as if they are 'too big to fail'. In view of this new stance should we ask 'are my savings safe?'. An excellent article on this subject can be found in Martin's money tips at  http://www.moneysavingexpert.com/savings/safe-savings. After all, the Financial Compensation Scheme is known to have too little cash to be able to compensate the customers of even a small deposit taker. Now the amount covered has been increased to £85,000 per customer, how would they raise the money ? Martin explains this mystery.

If you wonder why you rarely see adverts on my pages for 'Debt Help' sites it is because I actively filter them out.  This has proved to be a wise course. Recently the OFT has closed 19 sites which targeted disabled people and those in debt with offers of 'financial help'. Examples include (and I quote Computer Active) Loansforpeopleondisability and Samedayquickloans. If you have money problems, although they are very busy, your first port of call should be the Citizens Advice Bureaux.  You can report suspicious loan sites to http://www.oft.gov.uk/

The Daily Mail points out that banks are taking advantage of the ISA rules, which make tax payers feel that they SHOULD take up their annual allowance.  Certainly one is hard put to find a decent rate without strings - usually a bonus which runs out after a year, meaning that you have to constantly move your money.  If you do not, the chances are that you will continue to get a miserable rate.  It is as frustrating as having to move fuel supplier every year. This 'churn' must cost the companies money and is certainly a nuisance to the consumer. But the banks hope lethargy (or confusion) will rule and they will get your cash at 1% or less. The Mail article pointed out that, even after tax, many savings rates beat the ISAs on offer. One of the 'strings' is that most banks and building societies do NOT allow the transfer of existing ISAs.  They are after NEW customers and NEW money.

April 2011  We are now in the new ISA year. It may be time to invest but also time to check that you are not being ripped off by getting a miserable rate for existing ISAs. Top easy-access: tracker ISA is Santander's Flexible ISA paying 3.3% AER (some existing customers get 3.5%) and tracks UK base rate for a year, so if that rises, as many pundits predict, so will this. But NO transfers in from existing ISAs. Barclays' 3.25% AER Golden ISA is similar, but is branch application only, except for existing Barclays online customers. The AA's ISA pays a higher 3.35% AER (min £500), but doesn't track. Nationwide's offer is 3.1% (with transfers in) and MUCH higher for customers willing to tie up their cash. Northern Rock is offering up to 4.5% for a 5 year fix (transfers in) with 180 days loss of interest on amounts withdrawn. Lloyds is offering 3.6% fixed for 2 years (on over £3000 )- transfers allowed.  Cheltenham and Gloucester are even offering 3.95% tied up until 29th April 2014 -120 days loss of interest on any amount withdrawn.  

All these have year-long temporary rate hikes, so you have to keep an eye on them or you will be ripped of again.

March 2011. The Bank of England has kept the rate at 0.5% yet again, despite rising inflation, so no chance of dramatic increases in savings rates.  Halifax and Nationwide obviously feel safe to offer a 4.3% four year ISA fix. They also offer 3.75% fix for 18 months (if your transfer £25,000 in; 3.55% for smaller amounts). There is an on line 3.1% (inc 1.35% bonus) at Nationwide ISA (transfers allowed). Halifax is offering 3.2% ISA to current account holders. But with a 2.5% bonus included one certainly has to keep an eye on it after one year. But it is a lot of hassle. The AA Internet access ISA is 3.35% including the 1.65% bonus.  Taxpayers (especially higher tax payers) who have anything to put away may choose ISAs rather than straight savings accounts.  But check the difference.  Take a fifth off the non ISA rate before committing yourself. You may be surprised.  And, if you are NOT a tax payer you can get as much as 5% fixed for 5 years with someone like The AA. It IS possible to get your cash out early but it will cost you dear in interest. Do bear in mind that, when it comes to the compensation scheme, the AA, Halifax, Bank of Scotland, Birmingham Midshires, Intelligent Finance and Saga| are all part of the same scheme.

The C & G (part of Lloyds TSB) is offering 3.95% fixed to 29th April 2014. Transfers in are allowed and the only drawback is the loss of six month's interest but only on the amount withdrawn.

Now in the new ISA year, so what are you thinking ? Surprisingly, in spite of all the doom and gloom, the Stock Market has done quite well over the past year,. If you think that you might take a punt on an investment ISA a good article can be found at http://www.moneysupermarket.com/investments/how-to-invest-stocks-and-shares-isa-guide/ Certainly, despite the financial turmoil, most of the 'funds' have outshone any cash ISAs over the last three years. But if you are more likely to stick with cash ISAs then, if you are not prepared to lock them in for a year or two,  you are likely to get under 3% and even those have to be searched for. So, to fix or not to fix ? The word out there is that, with inflation running at 4% + and likely to go higher, the Bank of England may feel unable to keep its rate down at the 0.5% mark. This MIGHT push the ISA providers to be a little more generous. In the word of The King and I : "It's a puzzlement"

10th January. The Mail suggests the following links for financial help :  As a rule Org Uk addresses are 'not for profit'

15th January  Junior ISAs. This month sees the end of the Child Trust Fund scheme whereby children received vouchers which were put into funds until the child was 18. Parents may continue to contribute to the funds but no children born after January will not get the vouchers. Replacing CTFs are the Junior Individual Savings Accounts. Junior ISAs will be tax free and available to  parents of all  under 16s. They can be in cash ISAs or Stocks and Shares but will not be cashable until the children until they are ? 16 or 18. We shall see what the governement and financial institutions come up with in the way of (a) limits and (b) rewards. For now it is a question of  "Watch this space"

It is a good start to the New Year from one point of view, if you're a saver, as the level of protection UK savers benefit from is increasing to from £50,000 to £85,000 per bank. This should help provide reassurance to those who are worried about the safety of their savings. The new higher limit covers 98% of people. However, if you are one of the 2% that has more than £85,000 in cash savings, it's worth considering spreading your money around between different banks and building societies to ensure it's all protected.  To see which banks are independent see the chart HERE . n.b. if this link fails (due to a change) have a look at the MoneySupermarket site above

Some Credit Cards charge zero percent to new applicants for up to 13 months (e.g. Tesco)

Lloyds TSB Current Account with Vantage. is still managing a NET saving of 3.1% (almost inflation rate!)  You have to pay in £1000 a month.  And the higher rate (4% AER) is for amounts between £5000 - £7000.  If you want extra 'benefits' you have to pay £7.95 a month for these. These are European Travel Insurance (you AND your partner to 65), AA roadside cover and Card and mobile phone cover. I reckon on around £6000 kept in you would come out £100 p.a. to the good and probably save another £100 on the extra cover (even if you are over 65 and can't use the travel cover). If you want worldwide cover you have to pay a bit more.

Halifax Children's Regular Saver pays 6% and can be registered for payment gross (no tax deducted). Fixed interest guaranteed for the 12 month term. One account per person. You can only open one account for one child. However, other people can also open an account for the child too e.g. relatives, friends. Accounts can only be held by 1 or 2 trustees jointly on trust for a child. Only one account per trustee per child. Eligibility: UK resident personal customers aged up to 16 years (but accounts can continue following the child's 16th birthday). Standing order: Regular payments must be made by standing order from your current account or an account with another bank or building society. The amount allowed is £10 to £100 a month. No withdrawals during the year.

You can put £2000 to million in Tescobank.co.uk and get 3.4% fixed for two years. This would pay a standard rate tax payer £54.40 p.a for every £2000 or £5.36 a month. Every little helps. Call 0845 678 5678. You would think they could make it an 0800 number.  

Coventry BS (a big one) has a 3% one year bond .

Saga are still offering a 3 year over 50s postal ISA at 3.75% or 3.69% monthly. Withdrawals are allowed (with loss of interest). Transfers in are allowed.  So if you have an ISA 'pot' of, say, £30,000, you would get annual interest of £1,125 or you would get £92.75 monthly.  All tax free.  It is with Birmingham Midshires, so watch that your money is covered by the £50,000 rule.

Remortgaging is getting cheaper. If you have a good credit rating some lenders are improving their offers.  Barclays have increased their maximum loan to value to 75%.  People paying the SVR (Standard Variable Rate) may save money by moving to a tracker mortgage. For instance Royal Bank of Scotland is lending up to 60% of value at Bank of England rate plus 1.49%.  So that amounts to 1.99% ! A bit better than credit card rates at ten times that.  But there is a £999 fee. One can even get a five year fix from Natwest at 3.75%.  I can remember feeling smug when,  years ago, I was only paying 6.75% when others were paying twice that. Times have changed.

1st December. There are slight signs of better savings rates with the Post Office (Bank of Ireland) raising its Instant Access online saver to 2.9% (includes 1.25 first year bonus. They also do a 3% one year bond. Although the Bank of Ireland coverage gives even higher coverage in case of defaulting it will shortly be covered by the British scheme. It is authorised and regulated by the British FSA 
Progressive Building Society launching a 5 year fixed rate bond to 4.15% (monthly income), Nationwide is doing a 3 year fix at 3.5 to 3.85% and Barnsley (YorkshireBS) with a one year fix at 3.01%.  Nationwide has an 'Easy Access' 2.99% account on £1000 + but only one withdrawal per annum and it includes a 1 year bonus of 1.45%

Most HSBC savings rates are very parsimonious.  You are lucky to get 0.01%. It is therefore surprising that they pay Regular Savers an inflation beating 8% gross ! But you have to be a Premier, Advance, Graduate (Advance) or Passport customer. Basic regular savers can still get 4%. They also have a fixed rate saving of 'up to' 3.65% with various conditions.

22nd October. The Spending Review I waited a few days to let the "Spending Review" sink in and am still wondering whether I should chance my arm.  Who knows? least of all the policy makers, whether the result will be applauded by the world and "The City" and, therefore result in an eventual brighter future? The jury is still very much out and the verdict will depend on the results over the next few months AND YEARS. If the jobless count spirals and the economy sinks into that dreaded "double dip", Osborne will be blamed. But, so far, there are no burning cars in the streets and trucks going slow on the motorways like across the Channel.  To that extent, up until now, he appears to have pulled it off. Education and Health have been substantially ring fenced from cuts. But the it will be massive cuts in Local Government finance and services (which are the ones we are all directly affected by). If the rubbish piles up in the streets and the homeless become visible in every town, what then? If, as is suggested, the hospitals cannot discharge patients because there is absolutely nowhere for them to go, what will happen to the shrinking waiting lists ?  Also Wales, Northern Ireland and Scotland will be disproportionately hit by cuts in grants and in public service jobs.  In some areas over 50% of the working population is in this area.  We can only wait and see.

Unless (or until) the services for older people dry up, OPs came off quite well. They SHOULD get an inflation proofed increase in pension in April but WILL have to pay more VAT. But most of us are not affected by increased National Insurance payments, increased unemployment, reduced child benefit or higher taxes on those earning £45,000 (though my heart bleeds for them). Most benefits for the not-so-well-off are untouched (housing, council tax, mortgage interest), although there is likely to be a lower cap on the amount of housing benefit allowed. And it wasn't much of a shock that I am only able to stache away £50,000 a year tax free in a pensions fund (instead of £250,000). A Conservative 'budget' ? It doesn't seem like it. But it could be a good time to review your finances. The Telegraph points out that moving a mortgage from one lender to another for a fee of £99 could save some folks £350 a month.  OK, so you haven't got a mortgage?.... Some credit cards charge 20.9%, others as low as 6.8%. One Building Society pays 0.01% on their ISA Direct, another pays... see next para.  One bank pays zero on credit balances, another pays 5% (up to £2500) It is a nuisance to have to move things around and certainly not worth it for half a percent but one should look into such things and, with the net, it is easier to research them.

17th October 2010 The only bright lining I have found on the savings front this week was the  new Halifax Direct Reward Cash ISA at 2.8%. Transfers in are allowed and they will even pay you interest from day one while the ISA is being set up. Minimum deposit £1, withdrawals allowed.  Barnsley (Part of Yorkshire BS) has launched a 3.05% fixed one year bond but, at current inflation rates, even that barely keep your savings level.

Saw an article in the Sunday Mail which mentioned that some parents and grandparents are helping youngsters get on the property ladder, by using their savings in an "Offset Loan" arrangement.  Their cash earns no interest (well, it is pretty low these days) but is taken into account in the mortgage.  In one example their daughter's payments were cut by £250 a month, meaning that she was paying no more than she had been paying to rent one room in a house. Try Newbury, Market Harborough or Yorkshire Building Societies.    

12th October 2010. The fact that the Retail Price Index of inflation has stayed at 4.6% may sound bad news.  But as this was in September take heart that the government is committed to tying any increase in State Pension to that rate. And my pension is also tied to that.  Last year they claimed the rate was zero in September and my pension was frozen.

September 2010  How would you like to make £317 a year tax free without paying a penny? e.g. By choosing the best version of an energy supplier's schemes compared with their worst you will see that people on the best E-on deal pay £317 less than people on their worst (which is their Age Uk deal!)  http://www.moneysupermarket.com/utilities/results.aspx?Id=12505762

September 2010  The tax mess. The tax authorities have admitted to giving out incorrect tax codes to employers, which will have resulted in over 5 million pay more or less tax than they should. They are beginning to send out letters demanding more or paying some back.  The people most likely to be affected are those who have had more than one source of income during the last two years.  It is less likely to affect the self employed or pensioners (unless they also have a job).  The period over which repayment is required seems uncertain.  There was vague talk of people owing over £2000 being asked to pay more quickly than those asked to pay less. There has also been talk about people being charged interest if they do not pay on time.  This adds insult to injury for a mistake that is THEIRS and there has been hostile reaction to this.  If you go to the Low Income Tax Reform Group site at http://www.litrg.org.uk/news/index.cfm?id=807 you can download instructions by clicking on the link at the bottom of that page entitled P800 calculations guidance

9th September Aviva has made a study of the state of savings and indebtedness of older people, with some alarming results.  A good place to study various forms of pension is at http://www.thisismoney.co.uk/pensions-tips-and-guide. For people have time to avoid this situation, especially look into SIPPS, which are taking over from traditional schemes.

6th September The 500,000 savers with Post Office savings accounts, which are in fact provided by Bank of Ireland, are receiving letters telling them that the bank is completing a restructuring that will see it operate through a UK-regulated subsidiary. That means savers will enjoy the same depositor protection as British bank customers. In theory the previous arrangement gave greater protection than the UK's £50,000 limit because the Irish scheme had no nominal cap. But in practice the value of the protection was questionable because of the parlous state of Ireland's economy. Since the credit crisis, the country has been viewed as one of the weakest members of the eurozone.

4th September. 2 million people have underpaid tax and 4 million have paid too much because of errors by the tax authorities. If you get a demand you should check the facts carefully.  If you have to pay you will be allowed to do over a period of a year. A new site which tackles financial matters is at www.savvywoman.co.uk

27th August. Banks are taking a hard line on giving refunds for breach of contract because of a loophole in consumer protection law. The law in question is the Consumer Credit Act (CCA), and under section 75, retailers and card issuers are equally liable for any breach of contract or misrepresentation; providing the transaction exceeds £100 but not £30,000. But Computeractive is warning people that, despite a widely held belief, spouses and partners of the card holder who opened the account do not have the same rights when they use their allotted secondary card.

11th August  You can see a run down on the Bank of Baroda, one of India's largest banks, at http://en.wikipedia.org/wiki/Bank_of_Baroda.
Saga, part of the HBos, Birmingham Midshires group has no notice 2.6% ISA on offer (2.57% monthly) and transfers in are allowed.  It includes a 1% bonus but it runs for 18 months.

6th April 2010 Stamp Duty on the sale of houses is 1% for houses between £125,000 and 250,000 (except for first time buyers for whom it is still zero.  The next jump is to 3% for houses between £250,000 and £500,000. Above that it is 4%, with a higher rate due to be introduced for houses over a million

The Budget. A VAT rise to 20% from 4th January 2011 may give shops an unexpected Christmas boost. Pensions will be linked to wage rises (but not those of bankers - sorry) and not less than 2.5%. Child Benefit is frozen for three years (why not taxable ?) Personal income tax allowance is to be increased by £1,000 in April 2011 to £7,475 - worth £170 a year to basic rate taxpayers. Capital Gains Tax will rise from 18 - 28% for people earning over £40,000. Housing, Tax Credits and Disability Benefits are all likely to be reduced.  But households getting less than £40,000 may get more. That'll be a nightmare to administer.  Is young Johhny part of the household or not ? Maybe he will be kicked out at last !

Purchased Life Annuities   :(Article extracted from www.thisismoney.co.uk) Hard-pressed savers were given no cheer last Thursday when the Bank of England base rate was kept at 0.5% for the 15th successive month. Continuing low interest rates are forcing savers to consider new ways to generate the income they need. And, for older people, returns of up to 14% have put Purchased Life Annuities (PLAs) firmly on some savers' agenda. A PLA involves handing over capital in exchange for a regular income. While the cash cannot be recovered, unlike a bank or building society savings account, the income is guaranteed for life. Buyers also gain from the unique tax rules surrounding a PLA.  A large part of the regular payment is treated not as income, but as a return of the buyer's capital. This element is not taxed.....
Take the case of a man aged 70 who buys a £20,000 purchased life annuity. The gross annual income from this is £1,444. But £1,194 of this income is called the 'capital content', so the buyer is taxed only on the remaining £250. This means a net income for a 20% taxpayer of £1,394. To earn the same after tax, he would need to find a savings account paying 8.7% gross. The equation improves with age. The same £20,000 earns a man aged 80 an income of £2,260 a year after basic-rate tax. Matching this requires an account paying an improbable 14.1% gross. Annuity rates are slightly lower for women because they have a longer average life expectancy. A woman aged 70 investing £20,000 would receive £1,376 a year and an 80-year-old would get £2,099. But people with health problems may be able to get an even better deal.  See rates at http://www.sharingpensions.co.uk/annuity_rates_purchased.htm

n.b  Annuity rules changed in April 2011, allowing more flexibility. Under the new rules, someone retiring are not forced to buy an annuity by age 75 but are able to invest their pension pot under the new "capped drawdown" rules. The can still take out 25% as a tax free sum (as before). But for the better off (well, this is a 'blue' government), they can draw any amount from their fund providing they can prove a secure (pension) income of not less than £20,000 p.a. (although they will have to pay tax (at 55%) on amounts withdrawn). Cash taken into account towards the £20,000 must be from State and Occupational Pensions plus any annuity income. The big difference is that when someone dies with money left in their pension, this can be used to provide and income for dependants or taken as a lump sum.  Previously, on death,  all annuity cash has been taken by the company providing the annuity,

Saga reckons their annuity, at £1383 per annum for life for a woman of 60 with a £25,000 pension pot, is better than most. You would get even more if you are a smoker and positively unhealthy.

Regular Saving Accounts used to be attractive but they are no longer easy to find (at anything like a good rate). Halifax is now down to 2%. Unusually they accept up to £500 a month.   .

Under the matress savings  and there is always this option of course

Sunday 29th. There can't be too many people looking for non ISA savings with the miserable rates on offer.  After all, if people have any cash to save there is a £10,200 ISA gap to fill in April.

24th March Budget.  Not a lot for oldies. A little relief for first time buyers and a heavier duty levied on house sales over a million. A little more on alcohol and tobacco and the 3p per litre increased duty on fuel will be brought in gradually over the year. The current level of Cash ISAs has not been changed but ISA limits should now rise annually in line with inflation.   Winter Fuel Allowance : If you were born on or before the 5th July 1950 you should apply.  Over 65s will  continue to receive £250 while the over-80s will get £400 next winter.

The current Income Tax rates can be found HERE

March 2010 ISA's It is the ISA time of the year... making sure that, if you want to, you use all of this year's allowance. It is reported that 16% of savers haven't invested in ISA's because they find them confusing.  Another 35% are put off by the low rates.  But it is estimated that savers have missed out on £13 billion since they were started 10 years go. And yet ISA's are tax free, do not have to be declared and are even exempt from Capital Gains Tax. So, they are not much help to a non tax payer, are more attractive to a 20% tax payer and extremely attractive to someone paying a higher rate than that.
From 6th April this year everyone over 16 will be entitled to the ISA allowance of £10,200, of which £5,100 (p.a.) can be put into Cash savings.  The rest can be used to 'shelter' investments (including some bonds) or, if you don't use your Cash ISA allowance, the whole £10,200 can be put in ISA investments. Although you can add to your cash ISA during the year, up to your limit, you cannot start another ISA (say, with a different company) Many (but not all) organisations allow you to transfer your previous holdings to their scheme. Some ISA's are 'Instant' while others are fixed for a longer period. Generally these pay more.

A good site that deals with GRANTS of various kinds is at http://www.moneysavingexpert.com/protect/grant-grabbing Includes the new grant for laptops and broadband for kids from poor households.

Credit Cards. I use a Debit card and have always considered Credit cards to be an invention of the devil.  But they are hugely popular, so is there any way in which you can win? If you take a look at http://www.moneysavingexpert.com/loans/plastic-loans you will see that MBNA and Virgin offer exceptional terms for transferring cash to your bank account, providing (a) you are looking for a longer term loan (up to 16 months) (b) pay a one-off fee, (c) make a direct debit covering the minimum monthly payment and (d) tie up the whole thing by the end of the period. To quote from the site: "Top Short Term: The Virgin card is 0% for 16 mths with a 4% fee (slightly higher than for normal transfers) so it wins provided you can repay in that time" But don't use the card for purchases unless you want to pay more.
Credit Cards also vary quite a lot in the length of zero interest on purchases (e.g. Tesco is 13 months for a new card), their interest rates (6.8% to 11.9% or more) and in the interest free period (from zero days (Lloyds TSB) to 59 days (Halifax)

11th December 09  One of the features of the Pre Budget was a promise to raise the State Pension by 2.5%.  However, this does not affect the SERPS element of the pension

25th November 2009 The news is finally out : It has been decided that the banks did not charge for unauthorised overdraughts unfairly.  People who were hoping that they would have these charges repaid will get nothing, unless they feel so strongly that they are willing to take on the banks themselves.

NS& I (National Savings) Growth or Income bonds are now available by phone, post or on line and are up to 3.95% gross (one year fix) and 4,25% for a two year fix. So, even for basic rate tax payers the minimum received would be 3.16%, so beating their Direct (on line) 2.5% ISA. If you are a non tax payer (e.g. a non working wife) you should be sure to apply to have the income paid net of tax. Get form R85 from HERE. For a non tax payer this might be the best move. On £10,000 the monthly income on a five year Income Bond would work out at £37.50 and this would be fixed, regardless of how other interest rates vary.  You CAN get your money out early at the cost of some interest. Mind you Nationwide is offering 4.75% for a five year bond and Yorkshire is even topping that with 5.3%. On that, £10,000 would yield £530 per annum for a non tax payer.

Check for the latest Benefits, Pensions and Jobs at Department of Works and Pensions page.

Credit Card proposals Although credit card debt has reduced slightly it is still running at £54 billion. A third of card holders fail to clear their debt each month, resulting in punitive charges. Around 11% just pay the minimum charge of around 2% of the debt (to avoid the even more punitive charge), which means their debt gets ever larger even if they stop using the card. The government proposes to crack down on credit card companies. They propose that companies should use payments to pay off the most expensive items (such as cash withdrawals) first; that they should demand a higher minimum payment each month; that they should not increase borrowing limits or issue cheques without a request from the card user; or increase interest rates on existing borrowings.  And that they should issue an annual statement showing all charges made. If you have an opinion on this you can email your thoughts to cscr@bis.gsi.gov.uk

9th October 2009  New ISA rules  It is quite complex so this is extracted from the "Brilliant with Money" page HERE "A new £10,200 annual limit comes fully into force (for everyone) on 6th April 2010 for the start of the 2010/11 tax year. This new annual ISA allowance works in much the same way as the old £7,200 limit – up to half can go into cash and the balance of the allowance can go into investments within the ISA tax wrapper. This means a maximum of £5,100 in the cash ISA component and the balance (another £5,100) in the stocks and shares component. But watch out for the rules : Only ISA managers can transfer ISAs. If you try to do this yourself, it will be treated as a withdrawal and you will lose the related ISA allowance. If you want to move money between providers then you should ask your ISA provider for the relevant transfer form and let them process this on your behalf. You can transfer part of a previous tax year ISA to a new provider but if you want to transfer the current year ISA you have to move the whole lot at once. Partial transfers of your ISA for the current tax year are not permitted."

16th Sept 09. Despite the widespread condemnation that Obama and Brown had to put up with, the shout over the water is "Why did you let Lehman Bros go to the wall?" You can please some of the people some of the time....  Personally, I am quite pleased that my life's savings didn't go up in smoke last year, no matter what the papers say.

Equity Release Schemes.  These are the ones where people agree a loan on the equity of their house.  But the interest on the loan, which can be at 7.34% (e.g. Aviva) or as much as 16%, compound, is usually added to the mortgage (this is termed a 'roll-up equity release'). So, if the loan is taken out when someone is around 55 it can grow ever more rapidly until it equals (or exceeds the remaining value of the house (especially at times when house prices have fallen).  Even if house prices rise slowly the value of the house may not equate to the loan by the time the borrower reaches 85. At such a time the lender may try to evict the householder and sell the property to regain their cash. To quote the well known financial adviser, Mark Dampier "These deals should be an absolute emergency, a last resort, and even then only for the very elderly"

However, if you are keen to explorer this avenue take a look at http://www.equityrelease.net/ It is independent and explains the pros and cons

11th August 09 Piggy's bankruptcy information website was launched after Mark Davis trained to help others,  following his own bankruptcy in 2006.  It is a 'not for profit' site.

The Halifax Reward current account, launched on Monday, rewards savers with a monthly net cash payment after tax of £5 when accounts are funded each month with at least £1,000. This is the equivalent of a credit interest rate on that £1,000 of 7.5% for lower rate taxpayers, but, uniquely, the payment is handed-out irrespective of balance. So the £1,000 does not need to stay in there.

With savings rates getting lower by the week folk are looking round for something better.  The best ISA's now pay as little as 3.0%, barely keeping pace with inflation.   http://www.thisismoney.co.uk/corporate-bonds, mention that some 'Investment Grade' Bonds (considered pretty safe) are paying over 5%. What is more they suggest that Cash ISAs might be transferred into these.  And, by the way, there is a much higher limit because they are related to the Stock Market. Not wanting to give advice, I can only suggest that you take a look at the link and see for yourself.

**IVPPs  Hargreaves Lansdown sent me information about Immediate Vesting Personal Pensions (IVPP) where people under 75 can arrange an annual pension payment at a far higher rate than is now available from savings. There is a limit each year that you can put away and the money is lost on death but, as an example a man of 74 would receive as much as £211.21 a year for the outlay of  less than £2000, which is over 11%. Younger people and women would get less but even at age 50 a woman would get over 6% for the rest of their lives.  The pension is taxable and, once committed cannot be withdrawn. But, if you feel you will beat the odds and expect a long life, this is where an IVPP would pay off handsomely !

USEFUL LINKS:

Chelsea ;  Anglo Irish Bank phone or post (0845 455 2222); The Bank of Scotland ;   Birmingham Midshires  (08456 03 66 01) ; Saga (0845 603 2292) ;   Alliance and Leicester (08000 68 66 99); The AA ;  Halifax ;  Nottingham BS (0800 077 6777) Nationwide ;  Ing Direct ;  Intelligent Finance ;  Natwest ;   Tesco ;   Yorkshire BS ;   Abbey (Santander) ;  Kent Reliance BS (08451 22 00 22)  Nottingham BS  (08008 22 38 50) Norwich and Peterborough BS  ;  National Savings ; HSBC  Barclays

End of Savings Section  ****************** 

The Financial Services Compensation Scheme assures savers that savings in UK banks and building societies are safeguarded to the extent of £50,000 per person (£100,000 for a joint account). From 31 December, 2010 this will rise to up to €100,000 (nearly £85,000) held in savings accounts will be covered at any UK bank and building society. But any temporary protection for amounts up to £100,000 held by one person in two merged institutions will finish at the same time.

Read more: http://www.thisismoney.co.uk/savings-and-banking/safe-savings/article.html?in_article_id=511892&in_page_id=53946&ito=1565#ixzz0wVBaMckh  This only applies to each organisation which has a banking license. But, with so many amalgamations recently, how is your money covered ?

The following share only ONE License so cash in more than one of the organisation in each line is only covered to a TOTAL of £50,000 per person's account

The Bank of Ireland/British Post Office and Anglo Irish Bank are covered by the Irish Government.   (but shortly to come under the UK scheme (11/2010)
Ing is covered by the Dutch Scheme.  
National Savings is covered to 100% by the UK government

The ongoing tale of woe which I catalogued from April to November 08 is now ancient history so has been cut from these pages.

Which banks and building societies have not weathered the storm ? (Current owners in brackets) Alliance and Leicester (Abbey/Santanda), Barnsley BS (Yorkshire) Bradford and Bingley (Mortgages nationalised, Savings went to Abbey) Catholic BS (Chelsea) Cheshire BS and Derbyshire BS (Nationwide) HBoS (Merged with Lloyds) Heritable/Landisbanki and Kaupthing Edge (Savings to Ing) Icesave/Landisbanki collapsed, savings assured by HM Gov. London Scottish Bank (In administration) Scarborough BS (Skipton BS) Northern Rock (Nationalised) Anglo Irish Bank (nationalised).The Financial Services Compensation Scheme.  Where would the £50,000 per account come from?  Under the scheme the FSCS has the facility to demand cash from ALL major financial organisations. Currently it has an annual limit of £4 billion. As this is nowhere near enough to cover one of the bigger banks the government has the power to lend further cash to the scheme, but would require interest and repayment from those institutions over the years to come. In theory the compensation will not be paid for by the taxpayer. This is not the case where a bank is nationalised, where the government has to fund it from debt (or reserves - if any) and would undoubtedly mean a higher tax burden in the long run, unless the bank can be later sold off to reduce the national debt..

5th October 08  Got a dormant account ? The government is pressing ahead with legislation to use the £400 million lying in dormant accounts (untouched for 15 years) for 'good causes'.  Savers, who discover they have such dormant accounts will no lose out, however.  Want to check ?  Try www.mylostaccount.org.uk.  They get 800 claims a day !

Did you know that under section 187 of the Social Security Administration Act 1992: it an offence for banks to take bank charges out of the accounts of people who are on social security benefits. So, if your bank has taken charges out of your Benefits eg: if you are in receipt (and totally dependent on) of any of the following benefits:   Income Support; Tax Credits; Child Benefit; Job seekers allowance;  Incapacity benefit;  Disability living allowance;  Attendance Allowance ; CSA payments;  Other DWP payments....   then you should get onto them and point this out

Married Couple's Allowance  Click on http://www.hmrc.gov.uk/incometax/married-allow.htm You should be getting this tax allowance where at least one of a marriage or civil partnership was born before April 6th 1935.  For marriages before December 5th 2005 the allowance goes to the husband. (For marriages on or after that date the allowance goes to person with the higher income. The maximum allowance (2009 - 2010 is £6,965 but this is reduced if the person claiming it is has an income in excess of £22,900. BUT the actual tax saving is only 10% of the allowance i.e. £696.50 (less for high earners). If you do not pay tax and your spouse does then you can transfer any unused allowance. If you think you are not getting this allowance you can write or phone your tax office. Claims can go back as far as the 2004/5 tax year

Did you know that under section 187 of the Social Security Administration Act 1992: it an offence for banks to take bank charges out of the accounts of people who are on social security benefits. So, if your bank has taken charges out of your Benefits eg: if you are in receipt (and totally dependent on) of any of the following benefits.

.The Financial Services Authority has a useful site at www.moneyadviceservice.org.uk (was MoneyMadeClear) dealing with many different financial matters. This service, which can be accessed on 0300 500 5000 will give free advice on money matters and may also be access via the Citizens Advice Bureaux.

I really do recommend that people sign up to get regular emails from the Money Savings Expert at http://www.moneysavingexpert.com/site/money-tips-email-faqs

From 6th April 2008 all PEPs became ISAs; the annual ISA investment allowance increased; there are no longer be Mini and Maxi ISAs (just Cash ISAs and Stocks and Shares ISAs). You can transfer Cash ISAs to Stocks ISAs (but not the other way)  See http://www.thisismoney.co.uk/isacentre

BEWARE : A little known fact about credit cards.  If the company gets concerned that you are getting seriously behind in your payments they can apply to the courts to get a charging order put on your home, turning the debt into a loan secured against your house.  A number of Building societies are becoming concerned that repossessions are being triggered by other lenders who are after their money. In fact Newcastle BS found that 28% of repossessions were triggered by other lenders (even , in some cases, when their customers were up to date with their mortgage payments.)

Inheritance Tax (IHT) In 2008 this was raised to £325,000  per person ( £650,000 for a couple).  This now makes my section on Inheritance Tax (below) somewhat out of date, especially with regard to the Nil Rate Discretionary Trust, which was always a hassle to get almost the same result. It is tough on singles (and those fond elderly sisters who have lived in the same house (jointly owned) for many years and cannot legally be married). But it can be claimed retrospectively by widows and widowers.  

This month banks will begin to share credit information about customers, so tightening up on loans to people who have accumulated debts with various agencies.  

There is a useful site at http://www.taxvol.org.uk/retired.htm/ (free tax advice to older people by volunteers)Tel. 0845 601 3321 email taxvol@taxvol.org.uk. They may even make home visits for disabled people See http://www.direct.gov.uk/en/MoneyTaxAndBenefits/index.htm 

The current tax allowances can be seen at http://www.hmrc.gov.uk/rates/it.htm  (IHT, Income etc)

For older people a good site is the AgeUK site  or phone their SeniorLine on 0808 169 6565 for free advice on financial matters.

A good general site which will give you links to most financial sites is www.77finance.co.uk

There is about £466 million lying idle in National Savings accounts.  If you think you might have similar savings lying around you can ask NSI to try and trace it. Click Here.  There is also around £30 million of unclaimed Premium Bond prizes.

That Overdraft and Credit Card Charge Business
Swingeing charges on Credit Cards and unauthorised Overdrafts have been a safe bet for banks, with one making 40% of its card company profit from these. Not content with this card companies are increasing interest rates, scrapping interest free deals and reducing the number of days before you have to clear the debt.  If you think that you have been charged unfairly TAKE ACTION.  See HERE how to go about it.

Personally, I can't see banks being willing to write off charges more than once.  People who have overdrawn once are likely to overdraw again.  I think that the next time they plead with their bank that charges are unfair they are likely to get 'a flea in the ear', just the same as people who fall for phishing more than once. One recent judgment turned down an application because it was made on behalf of a client by a 'no fix, no fee' company, on the grounds that the company had acted unlawfully as it was not a qualified solicitor. "Which?" recommends, therefore, that people should make their own applications.

So, Watch Out for charges from Banks and Credit  (and Store) cards. Some charge over £30 for a missed payment or going over the credit limit, £10 for a replacement card and £15 extra for the letter telling you they have charged you !  Some of these cheaper options may turn out to be very expensive indeed. Introductory rates of 0% (Halifax, B of S, M & S, Lloyds) are very tempting but they have to get their money back somehow.  The lowest standard rate is now up to around 9%  but only if you are considered to be 'low risk' and many charge as much as 11%. The OFT has now banned 28 credit card companies from claiming their low introductory rates were their APRs. Bank charges can be equally high.  The rates charged for each bounced cheque can be huge. HSBC £25; Barclays £30, Lloyds £35, Natwest £38, Halifax £39. Unauthorised overdrafts are charged as a percentage of the amount and it can be as high as 30%.   So, now you know how the banks can write off huge bad debts that they unwisely loaned and still make even bigger profits. The Financial Ombudsman  http://www.financial-ombudsman.org.uk/ is receiving complaints at the rate of 5000 per week.

The Loan Insurance Business (PPIs)

The news (April 2011) is that the courts have found in favour of the customer when the insurance was sold inappropriately.
Some lenders - even well know names - tried to make cash with additional insurance in case you get sick or lose your job. On a £5000 loan over three years one (Internet) Bank charges nearly £1000 for insurance, more than doubling the cost of the loan, whilst another (Building Society) not only charged half that fee but also offers the loan at 10% less than the bank! This made the cost of borrowing almost precisely half what it would cost from a big bank. What the Mail on Sunday described as a scam is the fact that many of those they telephoned added the (voluntary) insurance automatically and did not even mention that they were doing it or even what it was for. Always bear in mind that the profit margin on loan insurance is estimated to be around 70%.  So they will sell it to you if they can. Most self employed people would not be able to claim if they had no work and pensioners probably couldn't claim anyway.  But did you know that you can obtain this sort of protection from separate companies such as Paymentcare.co.uk and britishinsurance.com for much less than most banks charge. Shop around if you feel you need this.

In Jan 07 the FSA went undercover to find out which organisation are selling PPIs to people who cannot possibly benefit. It is thought that the number and total of claims against lenders (for miss-selling) will outstrip the number claiming against banks for 'higher than reasonable' charges for unauthorised overdrafts. Of course there is always someone who see they can make easy money out of this so the companies wanting to 'help' you with such claims are queuing up for your business.  Better to do it yourself.

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Equity Release  (5/08) You can get a free booklet on this subject. The Mature Times guide, produced in association with In Retirement Services, is the first step to finding out. Call freephone 0800 082 65 70 quoting MATN080507.
Equity Release is where you release part of the value of your house but still remain in it. The money is then used for living or invested to produce income. No repayments have to be made until the person dies, when all the cash and rolled up interest is taken from the value of the house.  This would not be done whilst the spouse still lives in the house. The cumulative interest can mount up considerably over a period of years but the total sum will not exceed the full value of the house (so beneficiaries of the will will not be left with a debt)  It may be particularly suitable for people without dependents and who do not have children to which they wish to will the property or for single people who wish to reduce their IHT liability (see above). People on means tested benefits should be aware that these would almost certainly be affected.  Two alternatives to releasing equity are downsizing to a cheaper property and/or taking in a lodger.
Financial Mail also has a free guide called Home Truth  (Tel 0800 068 6065) .  The government's Financial Services Authority (FSA) also have one called Raising Money from Your Home  (0845 606 1234 or www.fsa.gov.uk) And IFA (Independent Financial Advisers) can put you in touch with members on 0800 085 3250 or www.unbiased.co.uk   Norwich Union (Aviva) has launched an informative film (available in VHS or DVD format) available to consumers and intermediaries alike. To request a copy consumers can call 0800 404 7137.

EQUITY RELEASE  Age Partnership is the UK's leading over-the-phone specialist in equity release.
Some equity release plans impose an early-repayment charge, so you could incur charges should you wish to pay them off before your death. However, like a standard mortgage, these will vary from plan to plan, reinforcing the benefit of Age Partnership’s specialist equity release advice before you proceed

Compare the entire Equity Release market at Key Retirement Solutions, the UK Equity Release specialists. They do a booklet about remortgaging to release money called Home Truths. Phone 0800 531 6027. But they ARE in the business and you may be also offered a 'no obligation consultation'. A basic consultation is free but if you require an in depth one they will charge and they will charge a percentage of any loan raised.

Buying property abroad);  0845 450 9190 (Private Medical Insurance); 0870 830 3421 (Investments); 0800 068 6065 (Releasing the Wealth in your Home).

More useful websites: www.express.co.uk/money/  www.arrow1066.co.uk,  www.moneysupermarket.com  www.moneyexpert.com  www.mortgages.charcol.co.uk (a broker)  www.learnmoney.co.uk  www.thisismoney.co.uk  (Daily Mail) which has links to the whole world of finance or  www.virginmoney.com  or  www.bestinvest.co.uk  http://money.guardian.co.uk http://News.ft.com/yourmoney (Financial Times). www.moneysavingexpert.com & www.yourmoney.com  

http://www.surf4finance.com/. This site provides links to useful sites dealing with Debt Management, Mortgages, Insurance, Bank charges etc.

See also : www.mortgagerates.org.uk and also daily updates on all the latest rates at www.mortgagerates.org.uk/news/

For other savings rates check Teletext Page 255 on BBC 2

Investing for Grandchildren
Each child has their own annual personal allowance free of tax and a capital gain allowance. Grandparents have the advantage of being able to make gifts to grandchildren, whereas parents who purchase investments or savings on their behalf are taxed on a child's income in excess of £100.  Whenever possible you should save in the child's name to avoid paying tax. Parents should complete Inland Revenue form R85 as that tells the taxman that the saver is a non-taxpayer and interest will be paid tax-free. Young children cannot have ISAs in their name as they are only open to the over-16s.

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Check for Benefits, Pensions and Jobs at Department of Works and Pensions page.  

INHERITANCE TAX

 (9th Oct 2007 - This section has been amended due to the sudden increase of tax free allowance to legal couples. The situation is complex and you should consult a financial advisor)

As from October 2007 a substantial change was made in the rules governing Inheritance Tax.  Hitherto the value of the estate left by the last survivor of a legal partnership was taxed at the punitive IHT rate of 40% if it was more than £300,000. The 2008 allowance is £325,000 or £650,000 for a couple, as legal partners 'inherit' the partner's tax exemption. This is retrospective, so it applies to partners who died a while ago.  But the exemption would only amount to the level that was relevant at the time of their death and would be less any amount that they willed to (say) their children.  The site below gives examples and can be consulted as to the level of exception in any particular year.

There is a very useful site on this question at http://www.squareonefinancial.co.uk Work out your liability and the best way to deal with it.  Another useful article  on you liability to pay for care is at http://www.caredirections.co.uk/

You can give away as much as you like during your life but the money would still be taxable if you do not survive seven years after the gift. If you survive over three years the percentage taken by the tax man is reduced.  For example, if you gave £100,000 (and died) your heirs would have to pay £40,000 to the tax man. Between 2-4 years this would be reduced to £32,000. 4 -5 years £24,000. 5 - 6 year £16,000. 6 - 7 years £16,000.  Do check these figures as they are likely to change.

You can give away a total of £3000 per annum without any tax worries (or £5000 as a wedding gift to one of your children (before they marry), £2,500 as a wedding gift to a grandchild or great grandchild and £1,000 to anyone else). And you can give any number of £250 gifts to individuals. In addition you can make  regular gifts from normal income and this, too, is exempt from IHT but you must give it regularly and 'not materially reduce your standard of living' (pretty vague that). So you could put, say, £25 a month in savings for each grandchild, if you can afford it.

Copied from a government site : Q: "Can I carry forward any unused annual exemptions (for cash gifts)?"
A: Yes. If the total value of gifts in any one tax year is less than £3,000 any surplus can be carried forward to the next tax year but no further. You can even carry forward last year's £3000 allowance.  
So, If you gave someone £6000 in one year and nothing the following year it still would not be taxed on your death. But if you gave away £12,000 one year and nothing the following year £6000 of this would still be taxable if you did not survive 7 years from the date of the gift.

One of the worst aspects of the IHT problem is that, if you are over the limit and you die (without a legal partner) the tax has to be paid before "probate". So nothing can be released to your heirs until the tax bill is settled.  If you have not left enough cash to settle the bill then assets such as property may have to be sold in order to raise the necessary funds. And, even with a straightforward will, probate can hang on for a year (as I know to my cost).

For the (many) people who have fled to warmer climes things get complicated. You are still considered to be 'domiciled' in the UK if your FATHER was born here (!) You may be considered to have left only if you are away for over three years, sell all your UK assets and give up your passport. Then you may be liable to taxation in the country to which you fled.

A novel way to reduce your liability is to have a new type of mortgage. In Switzerland and Japan the lifelong interest only mortgage is popular and you may be able to obtain one over here. Basically you just keep paying the interest on the loan but the mortgage then passes on to your heirs, who could then sell the house and settle the debt.  With the way house prices go the chances are they will still inherit some cash but their IHT liability would be considerably reduced (as would their inheritance) - but, at least, the Government would not get their hands on 40% of it.

You cannot be taxed on any money that was never yours, so you can consider making out life insurance plans in trust to others. Even a legacy can be diverted to another person within two years of your receiving it.  
One does not have to pay tax on the death of a spouse but people who just live together (without being registered under a civil partnership) do not have this benefit and could be caught having to pay IHT just to stay in their joint house.  From December 2005, however, it was possible for couples (of any sex) to register under civil partnership laws. Unfortunately a test case turned down any help for sisters who have lived together all their lives (seems unfair!).

Nil Rate Discretionary Trusts. In view of the fact that in most cases the new rules allow a couple to have a much larger IHT Allowance I have cut the section which referred to Nil Rate Discretionary Trusts. For people who jointly own a house but cannot take advantage of the new, more generous,  rule because they do not wish (or are unable) to marry it is probably worth them investigating this further
 
Lastly, you may wish to consider taking out an insurance which will help your heirs pay the IHT bill when it arrives. Such insurances are tax efficient in their own right.

I state (again) that I am not giving financial advice.  For that you should find a professional financial adviser.

Education Maintenance Allowances (EMA) are available to students of 16 and 17 who are studying more than 12 hours per week and whose parents earn less than £30,000 per annum.  The allowance is not  affected by the student's own earnings.

Child Trust Funds. From 2005, children born after 31st August 2002 received a voucher for either £250 or £500 (depending on family income at the time). It is intended that this should be invested and is not available to them until they are 18.  This can be topped up by parents or grandparents. So, if you are feeling generous watch out for this. 2010. This scheme has now been drastically amended and is to be cut out shortly, although money already paid in is safe. 

In debt ?

May 2010 Credit Jungle, is a new website designed by former employees of the Leeds based credit reference agency Callcredit, . It offers users free credit scores and geo-demographic information about their neighbourhood only usually seen by lenders. It costs nothing to retrieve the score and the secured loan/debt management applications are entirely optional. A useful tool especially if you are unsure of your credit rating and how it works.
(It is important to realise that multiple applications for credit may leave a 'footprint' of those applications which may be taken into account when a company is considering your creditworthiness but with Credit Jungle you can view your score as often as they like without a footprint being left.)

http://www.thinkmoney.com/debt/   Thinkmoney also has a useful link at http://www.thinkmoney.com/tag/pension/
http://www.surf4finance.com/.  This site provides links to useful sites dealing with Debt Management, Mortgages, Insurance, Bank charges etc.

Piggy's bankruptcy information website was launched after Mark Davis trained to help others,  following his own bankruptcy in 2006.  It is a 'not for profit' site

www.nationaldebtline.co.uk provides a national telephone helpline for people with debt problems in England, Wales and Scotland offering free, confidential and independent advice (Telephone 0808 808 4000). They have a downloadable information pack, debt management plans and sample letters to creditors. Or you can e-mail them.  But I also recommend that you have a good look at the site run by Martin Lewis at http://www.moneysavingexpert.com/loans/debt-help-plan

I never suggest ideas for dealing with debt .  There are experts in this field who MAY suggest things like moving credit card debt to a new card which has a nil interest demand for as much as 15 months. There is likely to be a percentage one-off charge (around 3%). Obviously, they are after your business and, after the free period, the rate will return to the usual stinging percentage normally charged by credit card companies.  But it might give you time to get things straightened out.

Going for broke ? Individual bankruptcy is becoming popular as people get out of their depth in debt. It is not as shameful as it used to be and it seems more and more individuals are opting for that as a way out of their (sometimes self-inflicted) financial problems. It is not recommended for everyone, as it can have lasting consequences, such as the inability to get a credit card or mortgage and the debt collectors can be after you for years. And folk might also think about the people who will lose out. I know it cost me many hundreds of pounds when I was in business when companies could no longer settle their bills.
However, if you ARE contemplating bankruptcy it would be a good idea to look at the following site:  Piggy's bankruptcy information website was launched after Mark Davis trained to help others,  following his own bankruptcy in 2006.  It is a 'not for profit' site
However, a less painful way has recently gained in popularity.  A Debt Advisor may recommend that insolvent people with huge unsecured debts (such as Credit and Store Cards) arrange an IVA. This is an Individual Voluntary Agreement.  For a fee, the Debt Advisor may strike up a deal with your creditors to pay off an agreed (and lesser) amount.  And this way you don't actually go bankrupt, even though you are insolvent.  Banks and other creditors might agree this so they get something.  If you go bankrupt they will probably get nothing at all.  So you CAN have your cake and eat it! You can rack up £60,000 on credit cards (despite being on a small pension) and then say "Sorry"! Another reason for the rise in IVAs is that a Debt Advisor gets no commission from advising bankruptcy and can get as much £6,000 from arranging an IVA!  So everyone is happy, the debtor, the Debt Advisor and the Banks (who have set aside millions for this purpose, but are still raking in vast and increasing profits). Before jumping in to this  do go and see your Citizens Advice Bureau

There are some organisations which may help tackle a debt problem. One is the free Consumer Credit Counselling Service  www.cccs.co.uk/ and the other is the Credit Action charity www.creditaction.org.uk. But one should first visit your local Citizens Advice Bureau. Unfortunately there is no easy way to tackle debt.  Consolidating your debts is one method but the chances are that the repayment term will be longer, so you finish up paying more.  Remortgaging may also seem to be a good way of reducing payments. But what you are doing is converting expensive short term unsecured debt against long term debt which is secured against the roof over your head. So be careful.

Loans
Ever wondered what your credit rating is ? Experian (www.creditexpert.co.uk) and www.equifax.co.uk are the people who know everything about you r financial activities.  I recently did a check on my own credit rating, using a free introductory offer from Experian, above. It wasn't too difficult but you have to wait for them to post you a Pin number.  The on screen report could be printed out and it told me whether I had been late in paying up on my credit card and whether I had an overdraft on my current account.  It also told me which companies had enquired into my credit rating (such as an insurance company).  It would have told me what my credit rating was if I had forked out £4.99.  Equifax recommend a regular checkup in case someone has nobbled your persona (is using your name to get credit at your expense) - and this seems to be happening more frequently lately. Even if you don't have to settle someone else's debt you might find it difficult to get your credit rating back up to scratch.  One couple couldn't get a mortgage because they had been erroneously listed as owing one penny on a bill!  I am not sure how one goes about correcting incorrect information. My report said I had an MBNA credit card and I was not aware I had one, even though these things drop through the letterbox like confetti.

The endowment policy mis-selling scandal. Recently some very large organisations have had their knuckles rapped because of the 'shambolic' way in which they have been dealing with people who believe they were mis-sold endowment policies.

If you think you were mis-sold an endowment policy e.g. one that was supposed to cover your mortgage, you can ask an Endowment Investigation Company to take up your case for you.  But they will charge a percentage of what you are awarded. This can vary between 10% and 50%!  Or you can follow the procedure suggested in Financial Mail.

The Financial Ombudsman  If you feel that you have exhausted all possibilities when dealing with a financial organisation you can consider complaining to the Financial Ombudsman at www.financial-ombudsman.org.uk

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Pension books are being phased out and people receiving state benefits will have money paid either into a bank or building society account or, if they cannot be persuaded to open one, will receive a Post Office Card account. Money will be paid out by the counter clerk 'swiping' the card.

News : Lost cash ?  There is a free tracing service for cash lost in various bank accounts. Maybe granny left a fortune.  A single form is circulated to 45 banks. Download the form from  the British Banking Association - www.bba.org.uk

Remortgaging  Impartial booklet from http://www.moneysavingexpert.com/mortgages/remortgage-guide
The cheapest way to borrow money - for house owners - is still to re-mortgage. Vast sums are being borrowed in this way (mortgages represent the vast majority of the trillions that we owe in the UK). A number of Building Societies will lend money to Owner Occupiers at reasonable rates, keeping the same rate for a year or so. But see the Sunday Telegraph or Mail for the fees charged and whether there is a tie-in period ('redemption penalty') after this initial low rate. Those which don't tie in may still charge a low rate. But compare this with other forms of longer term borrowing and you can see the advantage of remortgaging.  With deals like Intelligent Finance  (Halifax) , Natwest or www.oneaccount.com (RBS) you can reduce mortgage payments even further by linking your current account to the mortgage, so you only pay interest on the balance. It is a question of whether you are prepared to put the house up as collateral or are keen to keep the house value intact.  There may be an arrangement fee, which would make it uneconomic if you are borrowing a smaller amount.  It is difficult to imagine why ANY house owner would borrow large sums on credit card and store cards at their high rates.

Capital Gains Tax.  This is a complex subject and the government has upset a lot of business people by trying to make it simpler.  From April 08 the tax on a capital gain is at a standard 18%.  Currently small businesses have a more generous regime.  However, from the point of view of private individuals who have bought second homes to let or in the hope of making a killing as house prices rose, this is likely to be a benefit, especially if they pay income tax at the higher level of 40%.  It is not quite such a benefit to those on the standard tax rate. A Capital Gain has always been considered as part of your income.  So, currently, someone who is on the lower tax scale would still have only paid tax at that level providing the capital gain (over and above their basic annual CGT allowance - currently £9,600 in 2008) did not bring them into the higher tax band in the year in which they sold.  If their total 'income' in that year brought them into the higher tax band they would have had to pay tax at 40% on the excess. Once again, this is all very complex and time to seek professional advice as the amounts of tax can be substantial.  

From April 2008 any 'indexation' allowance is lost and the capital gain will be the complete gain since purchase (less your annual CGT allowance of £9,600)  See the government site HERE  

Investing Get a free guide to the stockmarket from The Share Centre 0870 400 0266 www.share.com/freeguides   or See Here
If you have investments in stock and want to keep an up-to-date record of your folio go to www.iii.co.uk. You have to register your name but then can enter the details of investments, which will be kept up to date for you.

A good site to help with stock market decisions is http://www.share.com/  You can join for a small quarterly fee, look for suggestions or find prices (either by searching the stock market code or by typing in the name of the company).  Very clear site. 

Exchange Traded Funds If you buy Unit Trusts you will pay an administration fee every year. This is taken out of the value of the units (whether they rise or fall) The percentage taken is likely to be in the range of 1.75. Unit trust funds are normally administered by a Fund Manager. They vary in their ability to foretell what will happen to the shares or bonds which they buy. Quite frequently they get it wrong, so the value of the units goes down, even more than the general stock market. EFTs usually concentrate on a specific market e.g. Japan, Europe, UK, USA, and merely follow whatever that market does. Without a Fund Manager, their charges are lower - more like 0.4%. Recently these have become more popular with small investors.  They can be sheltered in an ISA. For more detail see http://uk.ishares.com/en/rc/about/what-are-etfs.

The Daily Mail share tipper is Midas, which has a Midweek extra at www.thisismoney.co.uk/midas-extra

Independent Financial Advice?  It may be independent but it isn't free.  Advisers have to earn a living and they will want you to buy something that pays them a commission. Purchasing Unit Trusts, for instance, involves initial charges and it is from these that the adviser gets his cut. Try  www.unbiased.co.uk   Other sites well worth a look are www.fool.com  and www.moneyextra.com. Free investment guides are also obtainable from www.share.com  

Unit Trusts :  Used to be a slightly safer way for the small investor is the Unit Trust.   These are funds which are managed by companies which invest in the stock market but spread the investments over a number of companies.  They may specialise in a particular area, of industry or the world, and some may be consistently more successful than others.

Is it worth using the 'net' for buying and selling shares ?  Looking at the charges of on line trading companies it certainly seems to be the case. Take a look at www.halifaxsharedealing.co.uk as an example.

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Wills (please check these amounts) : If you do not leave a will your estate will be divided along a set pattern which distributes cash to your relatives. At present, in England, a spouse would only get the first £125,000 of your estate (£200,000 if there are no children from either party) In Scotland the law has increased the amount which automatically goes to a spouse to £300,000.  It is expected that this will soon be increased  in England to £350,000 or £650,000 if there are no children. You can imagine a situation, at present, where, if a house is in the name of the husband, and he dies without a will, children of either party would have a claim and the widow might have to sell up in order to pay them. So the change is overdue. Incidentally, if you don't leave a will and there are no known relatives the Queen gets the lot - and she doesn't need it. But it does show that making a will can be important. If you want to make a will on line see http://www.tenminutewill.co.uk/main.cgi  The charge is around £30.  ~
If you would like a free will writing information pack you can get one from www.bluecross.org.uk.  Obviously they hope you will put in a little something on behalf of your darling moggie or pooch.. and why not ?

Will Writing from £48: http://www.halifaxlegalexpress.co.uk/halifax/ The page also offers legal advice at fixed costs
Will Writing for a fixed £69 http://www.glosslegal.co.uk. Each Will is checked by a qualified solicitor, and is then professionally printed, bound and sent to you by post to make sure it does not get invalided by the probate office -- as happens with online downloads improperly printed and stapled at home.

November each year is WILL MONTH !  It has become usual for solicitors to off free will writing services in November, with the expectation that you will donate something to a charity instead of a fee to the solicitor.

For more details on taxes, including IHT (Inheritance tax) see http://www.hmrc.gov.uk/rates/it.htm

Annuities, Stakeholder Pension Schemes, SIPPS (Self Invested Personal Pension), GARS (Guarantee Annuity Rate Policies), Life Insurance and Endowments have now been moved to the Pensions and Benefits Page  

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