Research  from Sainsbury’s Bank Life Insurance reveals that four in ten parents with children under the age of 18 do not have any life insurance in place. Around two thirds of these parents do not have any critical illness protection.

The findings highlight the life insurance gap for families who may be unable to cope financially and afford the same lifestyle if one parent can no longer provide.

Surprisingly, of those without life insurance, 21% do not believe it is necessary and almost half (49%) say they cannot afford it, with 7% saying they used to have it but the increasing cost of living has made it no longer affordable. One in ten parents (14%) claimed they plan to take out life insurance cover but have not got around to doing it.

The research showed that among those with life insurance, 36% say they have never reviewed their cover and just 10% increased their life insurance cover as they had children.

Scott Gorman, Head of Sainsbury’s Life Insurance said:  “Life insurance is an important financial safety net and should not be overlooked. Families should consider life insurance with critical illness protection  as early as possible to cover their mortgage, any borrowing  and other day-to-day commitments to ensure financial stability, if the worst happens.”

Nearly a third of over-55s expect to be in debt in retirement or are unsure whether they will have paid off all their financial commitments, new research by equity release lender more 2 life shows.

Around 60% of those surveyed had applied for some form of credit within the last two years, including 58% of those aged 65 and above, but one in eight have been turned down with some reporting that their age was a factor in the decision (18% of those aged 65 and over said they were refused credit on the basis of their age).

The nationwide study underlines the growing need for increased flexibility from lenders as well as a recognition that increasing longevity and rising house prices mean more people owe money on their mortgages past traditional retirement ages.

more 2 life believes there is growing demand – and a need – for lending solutions aimed at over-55s who may need to borrow past traditional retirement ages. Its research shows there is strong demand for credit among the over-55s with more than 58% borrowing in some form in the past two years.

There is also demand to continue to borrow into retirement with nearly two-thirds of those questioned welcoming the ability to borrow in retirement without necessarily wanting to use it.

A spokesman for more 2 life, said: “Given the high levels of those who expect to be in debt at retirement, it is crucial that pensioners and those in the run-up to retirement focus on having sufficient income to support them once they retire.

“However that can be more easily said than done and the industry needs to focus on enabling people to borrow responsibly as well as open up the opportunity for those approaching retirement to make the most of the equity in their property.

“Mortgage debt is a particular issue and the concern about interest-only mortgages needs to be addressed. In many cases those people are entirely able to service their debts but just need lenders to take a flexible approach.”

The days of the best man chasing the groom’s mates to get their contribution to a weekend of revelry, a tatty envelope going round the office collecting cash for a colleague’s birthday gift, or a jam jar stuffed with cash in a shared house could well be a thing of the past with the launch of KiTTi, a brand new money management app from Santander.

This is the first app in the UK that brings the good old cash kitty up to date, and allows up to 100 friends to contribute and keep an eye on their money all at the tap of a button.

Customers of any UK bank can download the app, quickly and easily set up a KiTTi, invite their friends and get started.

How it works

KiTTi is accessed exclusively through a smartphone app, available on both iOS and Android and users do not need to be an existing Santander customer. The service is available to anyone over 18 with a UK debit card and works in the following way:

  • Download the app from either the Apple or Android app stores
  • One person registers as an owner to set up a KiTTi and is sent a KiTTi prepaid contactless MasterCard
  • Each KiTTi can be given a name, target value and payment milestone(s)
  • The owner invites friends to join the KiTTi via the app (text message is sent to their smartphone)
  • The owner and friends pay into KiTTi by entering their debit card details, which they need to do only once, through the app’s secure payment process
  • A small fee of 35p is applied whenever a payment is made into the KiTTi
  • Using the KiTTi prepaid card, money can be taken out or used to pay for anything the group wants – in the UK and overseas
  • A single KiTTi has a maximum balance of £4,000

A Santander spokesman said“We’ve all been through the hassle at the end of a fantastic meal with friends when it comes to splitting the bill. You get a pile of notes, coins and cards in the middle of the table and then have to divvy up the change. And you know at least one of your friends is secretly annoyed because they feel they’ve paid more than they should.

 

The latest current account switching numbers from Bacs reveal that 1.10 million people moved banks in the last 12 months, up by 4 per cent on the corresponding figures a year ago, but nonetheless disappointing with most customers choosing to stick with their existing provider.

Santander, Halifax, Nationwide Building Society and Tesco Bank are winning the biggest share of current account transfers whilst Barclays and NatWest continue to see the most customers walk out the door to join rivals.

New research this week from Aimia the marketing and loyalty analysts reveals that 33% of people say that loyalty rewards are the biggest influencers when choosing a current account and this marries up with the latest Bacs switching statistics where Halifax (£5 monthly reward) and Santander (cashback on utilities and up to 3% credit interest) are both beating the competition hands down.

One of the biggest problems is that even with the faster switching rules and switch guarantee in place, people are confused about which account to choose and are scared that they may end up with a product that isn’t any better than what they already have.

Although each bank and building society has its own tariff and rate details listed on its website and marketing literature, working out which account is best can prove a big headache.

The dilemma for consumers is that no two accounts are the same, and difficulty in trying to compare the different rates and charging structures is probably one of the major reasons that customers have remained loyal and put up with a below average service.

There is not one bank account that works out as the best for everybody, it’s more about weighing up the individual elements of that are most important to you.

For some people a low cost overdraft will be the priority, while for others interest payable on credit balances or a debit card offering low cost transactions abroad will be key.

We’ve carried out some research to try and establish which accounts are strongest in each of the different areas.

If it’s a cheap overdraft that’s most important, then it’s worth considering First Direct (first £250 interest free) or M&S Bank (first £100 free).

For those seeking interest on credit balances or reward for their custom, for balances of £2000 or less consider Halifax Reward or TSB Classic Plus and for £3,000 take a look at Tesco Bank.

Lloyds Bank and Santander 123 are tops for those with balances of £3,000 plus, with the latter clearly the market leader for balances over £5,000 – paying a very attractive 3% gross up to balances of £20,000.

Whilst some people may be put off the Santander 123 account because of the monthly £2 fee, remember it also pays cashback on your utilities direct debits, which in many cases will more than offset the cost.

If you’re seeking a cheap debit card for use overseas then Norwich & Peterborough Building Society offers this facility for free worldwide whilst Nationwide Building Society and Metro Bank are much cheaper than the main banks in this area.

Yet for others it’s not the nuts and bolts of the account that concerns them, all they desire is the ability to talk to a human being at a UK call centre 24×7 and to receive a good level of customer service, day in, day out. Consistently top performers for service continue to be First Direct and The Co-operative Bank.

If you think it’s time you gave your bank the elbow, make sure you do your homework before jumping ship and pick an account that reflects the way you run your finances – and try not to be swayed by the offer of short term incentives.

New research from Churchill Home Insurance reveals thousands of British workers would be forced to survive on the Governments’ statutory payments, for loss of earnings and expenses, when completing jury service.

One in twenty (five per cent) employers will not pay any wages for an employee attending jury service, leaving those completing their civic duty to survive on £32.47 or less a day.  Over a third (34 per cent) of UK employers would not pay an employee’s salary for more than five days if they were called up for jury service.   One in ten (11 per cent) UK employees would be paid their usual salary for only one day when completing their civic duty by serving on a jury.

There is no legal obligation for firms to pay employees while on jury service, although those not paid can claim a loss of earnings allowance from the court.  However, the maximum daily amount a juror can claim for the first 10 days when serving for less than four hours is £32.47, with the figure capped at £64.95 per day for those serving longer hours during this period. The research reveals that only 12 per cent of employers would cover an employee’s wages for the duration of their jury service.

With approximately 178,000 people in England and Wales called up for jury service each year, people could find themselves struggling to meet their financial commitments if their employer does not maintain their salary and they are forced to survive on statutory payments.  With the Government highlighting jurors could potentially have to serve over half a year (in excess of 201 days)the financial ramifications can be significant.  People can only defer jury service once and will need to prove they have a genuine reason to do so, such as having an operation booked.

Martin Scott, head of Churchill Home Insurance, said:  “Completing jury service is a civic duty that many Britons take pride in, but our research reveals it often leaves them out of pocket.  For a juror sitting on a long trial, with an employer not paying their regular wages, surviving on the statutory payments while meeting their regular financial commitments could be very difficult.

“Churchill Family Legal Protection is available as a policy add-on for Churchill’s home insurance customers. This covers a salary while on jury service up to the value of £100,000. One freelance lawyer claimed over £5,000 from their policy for lost wages when they were called to serve on a jury for eight days.”

Interest rates have never been cheaper if you want a five figure personal loan from your bank, but if you only need borrow a smaller sum it’s far more expensive.

The battle for personal loan business has seen lenders cherry picking and concentrating on the higher value end of the market.

Rates are at rock bottom if you want to borrow £10,000 for example, with lenders currently battling it out at the top of the best buys enticing customers with interest rates as low as 3.6% APR from Sainsbury’s Bank, M&S Bank and Nationwide Building Society.

For lower value loans it’s a very different picture, with many lenders charging double digit rates on a £3,000 advance with Barclays and Halifax amongst the most expensive at 22.9% APR and 18.9% APR respectively.

There are cheaper options available, but research shows you’ do well to steer clear of the established providers if you want get the best deals.

There are a handful of borrowing options that stand out, if you want to borrow a smaller sum of money, as follows:

Zopa, the biggest peer to peer lender (P2P) in the UK and RateSetter one of the fastest growing lenders in the same market offer some of the best value deals at 5.8% APR and 8.8% APR respectively for a £3,000 loan over 3 years whilst Lending Works a relatively new P2P player is charging just 5.7% APR.

Just because you’re not familiar with the names, it doesn’t mean you should discount them – the peer to peer sector is now regulated and has established itself as a credible alternative to the big banks – and the low interest rates are much better than you’ll find on the high street.

Another option to consider is the Low Rate Credit card from MBNA, although this isn’t strictly a personal loan, there’s nothing to stop you using this credit card in the same way you would a loan.

If you make your purchase with the card and set up a monthly standing order from your current account, it works exactly the same as a personal loan.

The interest rate is 6.6% APR and unlike many deals there’s no balance transfer fee to pay.  It remains one of the cheapest ways to borrow a smaller sum over 3 or 5 years.

The potential cost savings on a loan of £3,000 at 6.6% APR is £742 over a three year term when compared with the personal loan with Barclays, charging 22.9% APR.

The golden rule with personal loans is don’t automatically sign up with you own bank without checking out some of the less obvious alternatives, as there’s a good chance that you’ll be paying over the odds.

Figures released this week by the Association of British Insurers (ABI) reveal that in 2014:

  • Insurance companies detected 130,000 fraudulent claims, equivalent to 350 every day. The value of these frauds was £1.32 billion, a 3% increase on 2013. Between 2009 and 2014 the overall value of frauds detected has risen by 57%
  • Dishonest motor insurance frauds were the most common and of highest value – 67,000, up 12% on 2013, valued at £835 million, up 3% on 2013.
  • The number of liability insurance frauds detected jumped by 75% to 19,800, with a value of £330 million, a 20% rise on 2013. This reflects insurers’ greater focus on bogus liability claims, including ‘slip and trip’ claims, and industrial deafness.
  • The fall in the number of detected fraudulent property insurance claims (both domestic and commercial) reflects the strong deterrent message hitting home to potential cheats. In 2014 the number of detected property frauds at 24,533 was down 29% on 2013, with the detected value at £108 million down 21%.

A spokesman for the ABI said: “Insurers are determined to do whatever it takes to identify and take tough action against fraudsters to protect their honest customers. The vast majority of customers are honest, and should not have to pay for the fraudulent minority. The insurance industry invests heavily in its counter fraud defences, and the results are helping to keep motor and home insurance competitively priced.

“Insurance cheats are now more likely to get caught than ever before, whether they are making a dishonest claim or lying when applying for cover to get a cheaper premium, and face long-lasting and  serious consequences. As well as the possibility of serving a custodial sentence, they will find it difficult to obtain vital financial services such as mortgages and loans, future job prospects are likely to be adversely impacted and family relationships suffer.

 

As we approach the main holiday season with millions of families set to travel overseas, new research shows that failing to pack the right plastic could see you pay over the odds for your holiday spending money to the tune of £68 or more.

If you’re someone who takes a couple of holidays a year, that’s a saving of over £680 over the next five years – surely a big enough incentive to check that the card in your wallet isn’t an expensive dud when it comes to using it outside the UK.

Much of the current travel money talk is focused on the economic uncertainty in Greece where increasingly the advice has been to take cash rather than plastic, however this is an exception rather than the rule and for most travellers the security of a cost effective pre-paid travel card will always prove a safer and cheaper option.

Too many people simply rely on their existing bank debit or credit card without realising how expensive it can be, but in many cases it can take a huge bite out of your holiday money as highlighted in the table below.

Cheapest Prepaid currency cards Saving against most expensive debit card £1356.39 Saving against most expensive credit card

£1373.70

Ukash Travel Money Card**

£1305.39

£51.00 £68.31
Centtrip

£1306.43

£49.96 £67.27
Cash Passport Multicurrency

£1307.86

£48.53 £65.84
Cost saving based on 1800 euro spend including 6 x 200 Euro ATM withdrawals and 12 purchase transactions – exchange rates and fees calculated by MoneyComms 24.06.2015

**New cards temporarily unavailable

The cheapest prepaid deal in my research from Ukash is not currently issuing new cards, but both Centtrip and Cash Passport (see table above) beat the majority of debit and credit cards hands down.

Even on a smaller spend scenario of 1300 Euros there was a wide difference in the level of the overall spend (including charges) with Ukash at £942.78 and Cash Passport at £944.14 both more than £38 cheaper than a credit card from Virgin Money and £30 cheaper than debit cards from banking giants Halifax, TSB, Santander and Lloyds Bank.

It’s not just in terms of cost that prepaid cards come out on top, but many providers are also more geared up to step in and help if your card is lost or stolen abroad.

For example more than a dozen debit and credit card providers either won’t send a replacement card abroad or will only consider it in exceptional circumstances whereas 10 out of the 14 prepaid card users offered this service, and two of the others give you a spare card at the time you apply.

The majority of prepaid companies charge a fee of around £5 or £6 for the replacement service with Cash Passport and Travelex the only two providers offering the delivery of this holiday lifesaver free of charge.

Most of us take time to research the best value flights, resorts and accommodation when organising our holidays – so it makes sense to apply the same logic for your holiday spending.

At least you can relax in the knowledge that you’re not being ripped off and that your holiday budget will spread that little bit further.

In a week when the chancellor unveiled his latest austerity measures, the banks showed no signs of pulling their horns in as a raft of low cost personal finance deals hit the shelves.

In the personal loans market Santander and Cahoot both cut interest rates for loans of £5,000 to 4.5% APR, and have closed the gap on market leader Zopa in number one spot at 4.3% APR.

If you’re in the market for a slightly larger loan then the 3.6% APR rate from Cahoot will be good news as lending rates continue to hit new lows for borrowers with a good credit record.

The 3.6% rate means Cahoot now shares the top spot with M&S Bank, Nationwide Building Society and Zopa.

The fight to win new customers in the credit card sector shows no signs of fizzling out either as Virgin Money this week launched what it called its most boring credit card with no interest to pay on purchases, balance transfers or money transfers for 24 months.

Barclaycard, the dominant player in the 0% credit card balance transfer market has just reduced the balance transfer fee on its 36 month platinum card from 2.39% to 1.99% a move that will cut the cost of every £1,000 switched by £4.

Unfortunately it’s not all good news. If you only need to borrow a smaller amount the market has become more competitive but rates are still much more expensive than those seen at £5k and £7.5k plus.

For example on a loan of £2,000, Zopa at 7.6% APR and RateSetter at 8.3% APR are cheapest but most high street lenders are still charging interest rates well into double figures.

A different but cheaper option for smaller sums is an MBNA platinum credit card where you can transfer money from the card to your bank account for 0% for 2 years subject to a one off 1.70% money transfer fee – on £2000 that’s just £34 over 2 years if you clear within the 2 year term.

When you realise that Barclays and NatWest are charging 22.9% APR for a £2,000 loan and over 2 years and will charge you more than £461 in interest charges, the MBNA money transfer option looks like a smart move if you’re financially disciplined.

Now doubt George Osborne would like to see this low cost credit boom continue to keep driving consumer spending and helping the wider economy.

However these deals won’t be around for ever, so if you’ve got a major purchase in mind that needs financing it may be better to make your move sooner rather than later.

More than 500,000 UK current account holders have switched to Santander since the Current Account Switching Service (CASS) was launched in September 2013, according to new figures from the bank this week.

A spokesman for the bank said: “We know from talking to our customers that many are attracted by our award-winning 123 Current Account and our improved customer service.  As you can imagine, we are delighted that half a million people have switched their current accounts to Santander since the Current Account Switching Service launched.

“There are still people reluctant to switch but, for those customers still concerned, the introduction of the CASS Guarantee, coupled with Defaqto’s five star rating for our switcher service have helped provide peace of mind. Customers simply choose their own switch date, up to 60 days in the future, and Santander then manage the process for them, with the switch completing in just seven working days.”