February 3rd, 2021 | Andrew Hagger | News

Finance experts TotallyMoney warn that customers could be offered a worse deal if they stay with their current car insurance provider than if they were to renew with a new provider:

• £565m is lost every year due to customers being loyal to current car insurance provider
• 14 million customers are paying on average an extra £40 by renewing their car insurance with current provider
• The average car insurance premium in the UK is an incredible £816, increasing to £1449 in the capital
• All 38.4 million cars in the UK need an insurance policy by law
• The ‘loyalty penalty’ is due to come to a halt when new FCA regulations come into force. But it is unknown when this will be, so customers should switch now

No reward for loyalty

When the time comes for customers to renew their car insurance policy it seems only natural to stay with their current provider; it’s comfortable to stick to what you know, and it’s incredibly easy to do what’s familiar. However, recent figures reveal that a staggering £565m is lost each year by customers who auto renew their policy with their existing car insurance provider.

After a sustained period of cuts in the cost of car insurance, latest trends show that car premiums are starting to increase. It’s therefore more important than ever that customers search for other deals to ensure they’re on the best and most affordable one possible.

Just in time

Long-overdue changes from the Financial Conduct Authority§ are welcomed to put a stop to this unfair loyalty charge customers face when renewing, but with no official word as to when the changes are coming into force, it’s incredibly important that customers avoid being automatically rolled over onto a more expensive deal.

Finance experts TotallyMoney have partnered with comparison specialists Seopa, to launch their new car insurance instant quote service right before February‖, the month where customers are likely to find their best deal with insurance premiums being at their cheapest.

Alastair Douglas, CEO of finance experts TotallyMoney comments:

“With customers being punished for their loyalty, and a car being an essential item for many across the UK, the car insurance industry can be seen as unfair. 

“Millions of pounds are lost every year because of this, money that could be kept in customers’ pockets and better spent on other essential items. 

“Customers should be aware that their best deal is not always with their current provider, in fact it rarely is, and they should shop around before renewing their policy. 

“With a third of customers paying monthly for their policies, credit scores play an important role when insurance providers run a credit check for this purpose. Customers should check their report before applying, to raise a dispute and correct any errors. This way they can be sure that they’re getting the best deal for their true circumstances.

“At TotallyMoney, we’re on a mission to improve the UK’s credit score and help our customers move on up to a better financial future. Helping our customers save money on their car insurance is a significant step forward in achieving this goal. Whether those savings are used to pay off more of their debt, or to simply make day-to-day life a little bit easier, it’s clear how a small change could make such a big difference to the lives of many across the UK.”

January 29th, 2021 | Andrew Hagger | News

A survey by Paragon Bank found that topping up ‘rainy day’ funds and booking a holiday are two leading financial priorities for savers this year.

In a survey of more than 2,600 customers, Paragon Bank asked savers about their long-term plans for any money saved during the pandemic.

The research showed that 29% of savers will prioritise topping up their emergency fund with any savings made during the pandemic, which is reflective of Brits responding to the ongoing climate of economic uncertainty.

Booking a holiday was also a priority for 29% of savers, as many people prioritised splashing out on a trip abroad after many experienced cancelled travel plans in 2020.

Saving in a fixed rate product was the second top priority, with 28% of savers planning to lock money away in a fixed rate in order to guarantee rates during challenging market conditions. Home improvements plans took third place for 27% of savers.

A quarter of savers also had generous plans for their pandemic funds, with 15% planning to gift some of the money to a loved one and one in ten committing to a charity donation.

Purchasing a property was by far the leading priority for younger age groups still saving for a deposit for their first house purchase, with 64% of 18-24 year olds and 75% of 25-29 year olds naming this as a priority.

Half of customers able to save more during the pandemic

The survey found that one in two customers were able to put more money aside during the pandemic, with millennials in the best position to save more.

Millennial savers were most likely to be able to put more money aside during lockdown compared to other age groups, with more than two thirds (67%) of 25-29 year olds and 65% of 30-39 year olds saving more money than usual.

Derek Sprawling, Savings Director at Paragon Bank, said: 

“It’s clear from the data that the ongoing climate of economic uncertainty is impacting people’s financial plans. Topping up emergency funds and saving in a fixed rate product are two leading priorities, combining to nearly double the proportion of respondents who are looking to invest in a much-needed holiday.

“Splitting funds between an easy access ‘rainy day’ fund and a fixed rate is a good solution for those looking to have access to money in the event of an emergency, while also ensuring they get a competitive rate on a portion of their savings.”

January 25th, 2021 | Andrew Hagger | News

As millions of UK residents continue to work from home, Aviva is urging people to take extra care of their possessions when using summerhouses, outbuildings or sheds as workspaces.

ONS data suggests around 13 million UK people became home-workers last year as a result of the pandemic⁽¹⁾ and sales of sheds and summerhouses have been rising rapidly⁽²⁾.

But Aviva warns that home contents cover is often limited for items stored in sheds, garages and outbuildings, compared to the main home. The insurer is therefore encouraging “shoffice” workers to remove valuable items such as laptops, phones and tablets when not in use.

Sarah Applegate, Head of Risk, Aviva General Insurance says: “While many insurers cover home office equipment as standard under home contents policies and some are extending cover during the pandemic for people who need to work from home, cover may be restricted for items located outside the main property.

“Contents in outbuildings usually have an upper limit of around £2,500 for theft claims, so people should think carefully what they store in their outdoor rooms, particularly if they are using home office equipment.

“Tech devices are easily portable and can quickly add up to hundreds or even thousands of pounds in value. We’d encourage householders to remain vigilant when working in outbuildings and remove expensive equipment when not in use.”

Aviva has the following advice regarding outbuildings and keeping contents safe:

• Limit what you store in your outbuildings, sheds, garages and summerhouses, particularly if items are valuable. Check your home contents policy wording and be aware of cover limits for items kept in external buildings.
• Pay particular attention to portable items such as laptops, phones and tablets, if you are using an outbuilding as a home office. Tech devices can be lifted in a matter of minutes.
• Lock your sheds, summerhouses, garages and outbuildings when not in use. Replace any damaged or rusty padlocks.
• Check the access to your home and garden in case any would-be burglars are watching. Close gates and repair damaged fences – deterrents are sometimes the best prevention.
• If you’ve bought new office equipment, don’t leave packaging in a place where others can see it, such as by outdoor bins. If boxes are too large to go in a bin, store them in your home until you can dispose of them, for example at your local recycling centre.
• Inform your home insurer if you’re making substantial changes to your home – such as building an extension to provide a home office space or converting an integrated garage – before you start building works.
• Find out more about Aviva home contents cover for outbuildings here.

January 12th, 2021 | Andrew Hagger | News

Research by finance experts, TotallyMoney shows that Brits paying interest on their credit card debt are wasting hundreds of pounds by not switching to a better deal.

• Customers can save a massive £676 in interest by transferring the average credit card balance of £2,177 to a 0% balance transfer card of 21 months
• A huge 54% of active credit card accounts have interest accruing balances outstanding at the end of the calendar month
• January marks balance transfer season, the busiest month for balance transfers which sees an average of 687,000 transactions worth an average of £1.55bn each year
• There were just 60 balance transfer cards available in the market in December compared to 75 the year before, while the average number of interest-free days is at its lowest level since May 2015

54% of credit card balances incur interest – but these interest charges are avoidable for borrowers eligible for a balance transfer card.

Balance transfer cards charge 0% interest for a set period of time, meaning 100% of credit card repayments go towards reducing the debt, not paying interest.

TotallyMoney found that by transferring the average credit card balance of £2,177 to the average balance transfer duration of 21 months, customers could save a huge £676.

Customers seeking the best 0% deal to ring in 2021 should move fast — before lenders cut the honeymoon period even further. Recent figures show that as of December 1st 2020 offer durations were at the lowest level since May 2015.

Not only are the offer durations shortening but the number of products available to customers has also fallen from 75 in December 2019 to 60 in December 2020.

An interest freeze still comes with fees

Most balance transfer cards charge a balance transfer fee. This is quoted as a percentage of the debt transferred, with a minimum cash amount. For example, ‘3% with a minimum of £5’. This means if you transferred £1,000 of debt, you’d pay £30.

The golden rule with 0% balance transfer credit cards is to repay your entire debt in the interest-free period. For example, if you had £2,000 of debt and could afford to repay £100 a month, you’d need a card that’s 0% on balance transfers for at least 20 months.

Alastair Douglas, CEO of finance experts TotallyMoney, comments:

“As many look to get their finances in shape for the new year, one way that customers can save money is to stop paying interest on their debt when there’s no need to. Transferring existing debts over to a balance transfer card lets you pay off your debt while avoiding the spiralling interest charges.

“Unfortunately, balance transfer deals aren’t as generous as they used to be with both the introductory durations on offer and the number of cards available in decline.

“When applying for a credit card make sure you check your eligibility. This will help you avoid rejection and damage your credit score.

“You should also use these cards carefully. Resist the temptation to use a balance transfer card to make purchases as most will charge a high rate of interest on any new borrowing.

“At TotallyMoney, we’re on a mission to improve the UK’s credit score and help people move on up to a better financial future. Switching your credit card will mean clearing debts quicker, which will reduce your credit utilisation. Cutting your credit usage will normally have a positive effect on your credit score.”

January 12th, 2021 | Andrew Hagger | News

RoosterMoney, the pocket money app, reveals that kids received an impressive £321 pocket money (£6.18 a week) last year, and encouragingly they saved 37% of it. This is in line with adult saving rates also reaching record levels of 28.1% during the Covid-19 pandemic.* Video games Roblox & Fortnite also dominated the spending charts as kids spent more time at home.

Children are picking up lasting money habits as young as 7 years old**, and RoosterMoney is showing that a strong pocket money routine is a great way to build positive money habits early on, lockdown, or no lockdown…

• EARNING: 66% of parents gave regular pocket money last year
• Average weekly allowance was £6.18 (£321 a year)
• Kids received £52 in cash gifts this Christmas
• Families embraced chore routines: The highest earning chores were ‘washing the car’, ‘mowing the lawn’, & ‘washing windows’
• SPENDING: Video games Roblox & Fortnite rose to the top of the spending charts
• SAVING: Average saved was 37%
• Most popular things to save for were Lego Sets, Phones & Roblox
• Top Lego Sets: Star Wars, Harry Potter, Friends
• The average time it took to reach a savings goal was 45 days
• GIVING: Most popular causes were Children’s Charities, Animal Welfare & Cancer Research.

Top things to SPEND on in 2020.

Roblox & Fortnite rose to the top as kids spend more time at home.

Top things to SAVE for in 2020:

Holidays and bikes fall down the rankings.

1. Lego Sets (-)
2. Phones (-)
3. Roblox (new)
4. Fortnite (new)
5. Nintendo Switch (-2)
6. PlayStation (+2)
7. Books & Magazines (-2)
8. Holidays (-4, biggest drop)
9. Bikes (-3)
10. Xbox (-)

Will Carmichael, RoosterMoney CEO says:

“The Pocket Money Index can often provide a fascinating reflection of what’s going on in the wider world. The pandemic has shifted most of our spending online and that’s seen clearly here with kids’ spending habits too. It’s also really encouraging to see the saving rates remain so high.

Now more than ever, building financial capability into our kids is so incredibly important. The financial impact of this crisis has the potential to affect us for a generation – perhaps several. Having confidence with money, building positive habits around saving and learning to make considered spending choices will be something that sticks with kids for life.”

January 5th, 2021 | Andrew Hagger | News

M&S Bank has today launched new offers across a range of its insurance products – offering up to £150 in M&S vouchers – when customers take out a new Pet, Home and Motor Insurance policy.

Customers purchasing a new Premier M&S Pet Insurance policy will receive £50 of M&S vouchers, while customers taking out a new Standard policy will receive £30 of M&S vouchers. Customers who take out a new Premier or Standard combined buildings and contents policy from M&S Home Insurance will also receive £50 of M&S vouchers, as will customers taking out a Premier Car Insurance policy.

M&S Pet Insurance customers have access to three levels of cover; Essential, Standard and Premier, depending on their individual needs, and customers can choose either lifetime or time-limited cover. In addition, customers will receive 24-hour access to qualified nurses via vetfone^TM, as well as a 5% multi pet discount for any additional pets they insure with M&S.

Customers with M&S Premier Home Insurance benefit from cover for accidental damage, storm damage to gates and fences, and visitors’ belongings. The policy also covers the policyholder’s children when they are living away from home at university or college, or a dependent relative living in residential care.

M&S Premier Car Insurance provides customers with a guaranteed replacement car, if their own vehicle is out of action due to an accident, as well as uninsured driver protection, so they’re not out of pocket if hit by a driver without insurance.

For more information, visit: https://bank.marksandspencer.com/insurance/overview/.

December 28th, 2020 | Andrew Hagger | News

New research from Metro Bank, conducted by YouGov, has revealed the extent to which people are getting set to take control of their finances in 2021.

When asked about managing their money better in 2021 compared with 2020, more than one in two Brits (54%) agreed they are determined to start doing so – rising to two thirds (67%) of 25-34 year olds.

Two thirds (65%) of Brits also want to save more next year than they did this year, and more than half (54%) want to spend less. This rises to 79% and 62% respectively among 25-34 year olds.

Less than one in 10 (8%) say they are not planning on saving any money in 2021, with people, on average, aiming to save around £4,400 next year.

Committing to New Year, new you

When it comes to committing to a finance-related New Year’s resolution – less than one in five (18%) of Brits say they plan to set one for 2021. This is however a 50% increase on the one in eight (12%) people who said they made a finance-related resolution for 2020, with seven in 10 agreeing they’ve stuck to their resolution so far this year.

Women (21%) are more likely than men (14%) to make a finance-related New Year’s resolution for 2021, alongside three in 10 (31%) 25-34 year olds compared with only one in 10 (10%) over 55s.

After saving more (52%) and spending less (40%), the most popular finance-related resolutions for 2021 are:

1. Reduce my debt (25%)
2. Get out of debt (18%)
3. Get a better interest rate on my savings (17%)
4. Improve my credit score (15%)
5. Create a personal budget (11%)

Keeping a close eye on the festive spending

If New Year’s Eve 2019 is anything to go by, Metro Bank data shows plenty of customers keeping a close track on their spending and account balances during the festive period. There were more than 400,000 logins to the Metro Bank mobile app on New Year’s Eve 2019.

The bank’s mobile app data also reveals:

• 230,000+ logins on Christmas Day 2019 – with between 11am and 1pm the most popular time to login
• 320,000+ logins to the Metro Bank mobile app on Boxing Day 2019

• 330,000+ logins on New Year’s Day 2020

Jo MacDonald, Director of Bank Accounts & Deposits at Metro Bank, says: “We all love to start the New Year afresh and probably never more so than now, as we bid farewell to the challenges of 2020. It’s great to see from our research how many people want to start managing their money better in 2021. A bit of time spent on finding the provider that best meets your banking needs and delivers great service will be time well spent as people get set for the year ahead.”

December 21st, 2020 | Andrew Hagger | News

New research from Metro Bank, conducted by YouGov, has revealed the extent to which people worry about their personal belongings.

As Christmas is fast approaching and police warn the public not to put their presents out for others to see, it’s no surprise that a quarter of British adults that say they have a prized possession  – around 8 million people – are worried about losing their possessions as a result of theft.

Alongside the one in four people who are worried about theft, more than three in 10 are worried about losing their prized possessions in a fire and nearly one in seven (15%) worry about their items being destroyed by water damage.

What precious items are people hiding?

When asked to choose their most prized possession from a list in the survey, there was much variety in the responses received. The most popular prized possession – named by almost one in ten  – was a photo album, with wedding or engagement rings (8%) closely following behind.

When asked if there was anything else they see as a prized possession, some of the more surprising items include:

• Prized whisky collections
• Childhood teddy bears
• Wartime diaries
• Fishing rods
• Vintage Star Wars collectibles

Where are Brits keeping their prized possessions?

More than a fifth of keep their cherished item in a drawer or filing cabinet and almost one in 10 (8%) keep their special belonging in the garage, loft and even in the shed. A small percentage of the country admitted that they keep their most treasured item under the bed (2%) or in a shoebox (2%). 38% of people say they only use their most prize possession once every six months or less.

Metro Bank offers Safe Deposit Boxes in a range of sizes starting from just £20 a month. The boxes are available in each of the bank’s 77 stores, with the majority open seven days a week and giving customers unlimited access to their Safe Deposit Boxes. These are available long term or short term and provide proper security for people’s most prized possessions, whether that be jewellery, a stamp collection or confidential documents.

Jeremy Lawrey, Head of Retail Accounts and Partnerships, says: “As Christmas approaches, many of us will worry about the safety of our belongings. Whether your most cherished possession is an old family heirloom, a special piece of jewellery or even a passport or house deeds, our Safe Deposit Boxes enable you to safely store your belongings in a secure environment.”

December 21st, 2020 | Andrew Hagger | News

New research from Aldermore bank, asking 2,000 UK adults about their savings habits, reveals that the Covid-19 pandemic has enabled Brits working from home to save an average of £110 per week. This change in routine has significantly changed people’s weekly spending and indicates that Brits will be more savings savvy in the future.

Every little helps

Brits are finding that even small savings gained by working from home are adding up quickly, and over time are providing big saving rewards. The biggest savings include on average £29 per week from not commuting to and from work, £20 on not spending as much on breakfasts and lunches, £22 on not socialising with work colleagues in person, £18 by avoiding takeaway coffees, and £22 on not going out on weekdays after work. All these savings accumulate and total on average £2,860 over a period of six months working from home.

The saving habits adopted due to the Covid-19 pandemic are likely to continue beyond this period and turn into better long-term spending routines. Almost half (47%) of workers plan on cutting down on past expenses, such as work lunches, takeaway coffees or colleague drinks, when things return more to normal. In addition, almost two thirds (68%) of Brits say that in the future they will continue to implement cost cutting techniques learned during lockdown to save money. The most mentioned savings methods were; shopping less frequently for non-essentials (33%), spending less on socialising (29%) and reducing the cost of the weekly shop (22%).

Savings by workers contributed significantly to the growth in UK house deposits, which rose by a record £88bn between March and September 2020, up 183% from £31bn during the same period last year.

Ewan Edwards, director of savings at Aldermore, said: “This has been undoubtedly a difficult year with many challenges being faced, but one positive to take from 2020 is it has given some people the opportunity to reflect on how to improve their personal finances. Our data shows how little savings here and there can in the long term add up to big rewards, and many Brits are now seeing the benefits of better saving routines.

“It’s important to ensure this spare cash is working for you as best as possible, and not just lying dormant in a current account. As we look towards returning to more normality in the future, this is a good opportunity to find a savings account which suits your personal 2021 savings goals and make all those little and big savings work harder for you.”

December 16th, 2020 | Andrew Hagger | News

New research from Direct Line Life Insurance reveals that in total, parents of under 18s and their children have received £12 billion in financial support from grandparents since the pandemic began in March. This equates to receiving £2,821 between March and November from the bank of Gran and Grandad.

Before Covid-19, grandparents were giving their children and grandchildren £712.80 on average in combined support every year, meaning over the last eight months alone grandparents have forked out an extra £2,108 to help the younger generations in their family.

The financial impacts of the pandemic have affected millions of families, with a quarter of Britain’s parents of under 18s  (4.3 million) having to ask their own parents for financial support as a direct result of Covid-19. The most common reason for this was due to parents earning a lower salary because of reduced working hours, with 1.6 million parents (38 per cent) naming this as a factor. Nearly 1.2 million parents (27 per cent) said a reduced salary due to a pay cut was a big contributor and 1.1 million (25 per cent) said being put on furlough was the reason.

The study shows that help with essential food items is the main expense grandparents have been helping out with, giving £2.2 billion (£515 per family) since March. A further £2.2 billion (£507) was given for buying children presents and £1.9 billion (£454) for additional childcare items such as school books.

Financial support given by grandparents

Source: Direct Line Life Insurance 2020 Line Life Insurance 2020

Grandparents have offered more than just financial support this year, with 8 million parents of under 18s (47 per cent) having asked for some form of non-financial help from their own parents since the pandemic started. In terms of care, 3.3 million grandparents (20 per cent) were asked to look after their grandchildren. A further 1.7 million (10 per cent) were asked to actually move in to help care for their grandchildren and 1.3 million (seven per cent) were asked if their children and grandchildren could move in with them. Offering emotional support to their children (2.8 million or 17 per cent), emotional support to their grandchildren (2.3 million or 13 per cent) and running errands (2.2 million or 13 per cent) are also common ways grandparents have been helping out throughout the pandemic.

This festive period, parents will be looking for ways to make Christmas as normal as possible for their children. Over 3.8 million parents of under 18s (22 per cent) say they are giving up luxury items to ensure they can buy presents for their children this Christmas. However, 3.5 million (20 per cent) are worried that they won’t be able to afford any presents this year, while 3.1 million (18 per cent) are planning on buying less. The bank of Gran and Grandad is also set to come into use with 2.1 million parents (12 per cent) planning on borrowing money from their parents this year to buy presents. An additional 1.8 million (11 per cent) of these parents are intending to go without essentials in order to afford their children’s Christmas presents.

Chloe Couper, Business Manager at Direct Line Life Insurance, commented: “The impact of the pandemic has affected every family across the country. With people experiencing pay cuts, redundancies and being put on furlough, it is not surprising that many parents have been seeking financial help. Nevertheless, the fact that grandparents have provided a huge £12 billion in financial support to their families since March shows the true scale of the financial difficulties many parents are currently experiencing.

“This year has showed us the importance of having funds saved for unpredictable times. Many people will now be thinking about the future and how they would provide for their family if anything was to happen to them or the family members helping them emotionally and financially. While not always the easiest thing to think about, making sure you have a life insurance policy can help to provide this peace of mind.”