September 15th, 2020 | Andrew Hagger | News

Fears and concerns around financial scams has increased over the past three months as over a third (36%) of UK adults say they their worry levels have increased – this compares to 26% when Canada Life, the financial services firm, last ran the data in May.

The data reveals the situation is getting worse as the pandemic continues, with on average six suspicious or fraudulent messages having been received by people since March, up from three suspicious contacts reported in May.

The scamming activity has led to one in 10 (11%) UK adults either knowing someone or admitting they have fallen for a scam since the start of the Covid-19 outbreak. On average, of those who have been scammed, people lost £587, although nearly one in ten has lost over £1000.

The research also reveals the most common type of scams people have fallen victim to are banking related ones, with more than  one in three (38%) reporting this type. Pension related fraud is also common with over one in four (28%) of people stating this type of scam.  22% of victims cited an insurance scam as the cause, followed by romance scams at 15%. The Governments Track and Trace service has also been used as a platform to scam people with over one in ten (15%) of people reporting they were either a victim of knew someone who had fallen for this type of scam.

Being scammed or knowing someone who has during the outbreak has left many feeling foolish (52%), although over half of those polled (62%) felt the scams are so convincing they are hard to spot. This experience has an impact beyond the financial consequences; with two-thirds (68%) agreeing that it’s taken a toll on their mental health and one in two (50%) feeling like their trust in people has completely gone.

Andrew Tully, technical director at Canada Life, said:

“The scamming frenzy appears to be gathering pace as fraudsters use the cover of Covid-19 to prey on innocent victims. Falling prey to scams hits victims financially, but there are also hidden costs with people’s ability to trust others shattered and, for some, a detrimental affect on mental health. Despite the public message campaigns and the ban on cold-calling, the scammers are either simply ignoring the law or using increasingly sophisticated ways of finding convincing ways to con people. The rise of romance scams and using the Track and Trace service only serves to show we all need to be vigilant, scam aware and follow the simple rule of thumb – if it appears too good to be true, it inevitably is. Simply walk away, hang up, or delete the email or text.”

Tips to help avoid financial scams

1. If you receive an offer to help you access your pension savings before age 55. It is only possible to do this in rare situations, for example if you are very ill, so always check with your pension provider before making any decisions.
2. Warnings that the deal is limited and you must act now. This is a pressure tactic, and making any financial decisions should not be done under pressure.
3. HMRC will never contact you by email, phone or text informing you of a tax refund, so simply delete or ignore any contact made this way – HMRC will only contact you via post.
4. You are discouraged from seeking professional financial advice or talking to Pension Wise or The Pensions Advisory Service (TPAS). An adviser would be able to explain the rules and tax implications of different options and help you make the best choices for your personal circumstances, so be very suspicious if this is discouraged.
5. A recommendation to take a large amount of money, or your whole pension pot, in a lump sum and invest it elsewhere. Seek professional financial advice, and be very wary of unsolicited offers of ‘amazing investment returns’

September 9th, 2020 | Andrew Hagger | News

The latest data from Admiral home insurance reveals the average value of a contents claim for university students is more than £700, with the most common items claimed for being laptops and phones, as well as personal valuables such as bikes, Jewellery and games consoles.

With students heading off to university over the next few weeks, the insurer is urging them to make sure their personal belongings are protected, before leaving home, to avoid being left out of pocket.

Noel Summerfield, Head of Home at Admiral, said: “Thousands of students across the UK will be heading away to university over the next few weeks, many for the first time. But with most likely to be taking expensive belongings like laptops, bikes and games consoles with them, it’s vital they have the right insurance in place to protect them against accidental damage, loss or theft.

“Our home insurance data from the last two years shows students could be out of pocket if their personal property is damaged or stolen, with the average value of a contents claim for students more than £700. The most common items claimed for include student essentials like laptops and mobile phones, so it’s worth being extra vigilant when it comes to taking care of high-value items like these.

“Personal valuables like bikes, Jewellery and games consoles are also frequently claimed for, which is why it’s so important for university students to take out insurance to cover their belongings. Without it, they could end up with the unexpected cost of having to replace their missing or damaged items.

“Students also shouldn’t assume their belongings at their university accommodation are covered by their parent’s insurance – it’s always best to double check first. More specific cover, such as Admiral’s tenants insurance could be a worthwhile option, as this would cover contents or personal belongings in a shared home or flat, or university halls.

“Although heading to university is an exciting venture, it can also be daunting as it may be the first time many students are living away from home. With lots of new responsibilities, perhaps insurance isn’t a priority, but it’s important that they leave home feeling secure in case the unexpected happens. By having the right cover in place, students will be protected from the stress of paying out to replace their belongings.”

According to Admiral data, the most common items claimed for by students are:

• Laptops
• Bikes and cycling accessories
• Mobile phones
• Jewellery
• Games consoles

September 3rd, 2020 | Andrew Hagger | News

Research from Hodge has revealed that those under the age of 35 are the least likely to seek professional financial advice, with just 20% saying that they have previously sought advice from an IFA.

According to the research – which asked over 3000 people about their attitudes to finances – family and friends are the biggest source of financial advice for those under 35, with 70% of this age group claiming that this is where they seek guidance.

In contrast, the number of people who seek financial advice from an IFA doubles to 40% for those over the age of 55. In turn, the number of people in this age group who consult with family and friends about their finances drops to 53%.

Emma Graham, Business Development Director at Hodge said on the findings, “It’s clear from the research that family and friends have a huge influence on all generations when it comes to finances, and in particular, the younger generations. However, it’s important to remember that well-meaning views or personal experiences doesn’t necessarily mean good advice.

“Seeking advice from family and friends is the most subjective form of guidance, as those closest to you often have thoughts or opinions on how you should live your life, that don’t always match up with your own plans.

“Getting independent advice from a qualified and experienced financial adviser not only ensures you receive objective advice that takes into consideration your own personal circumstances and plans, you’ll receive real value from accessing their expertise and can make those important decisions confidently, knowing you have considered and looked at all the options available to you.”

The findings come from an intergenerational study conducted by Hodge, who interviewed over 3000 people about their attitudes towards finances and their aspirations for the future. The study “It’s all relative” is part of a campaign from Hodge to get families being more open about their finances. The full research findings can be found at https://hodgebank.co.uk/2020/05/19/money-its-all-relative/.

September 1st, 2020 | Andrew Hagger | News

The economic impact of the coronavirus crisis has been far reaching with millions of people unable to work due to lockdown restrictions.  New research shows that nearly a third (31%) of UK adults have seen their income cut as a direct result of the crisis.

The research, commissioned by GoCompare Money, reveals that 8% of people are seriously worried about their future, with 7% concerned that they won’t be able to pay their bills.   Almost 1 in 10 are worried about losing their job.

Faced with economic uncertainty, most (71%) Brits have tried to find ways to reduce their monthly outgoings.  Popular tactics people have used to save money involve finding ways to buy the same products for less, either by swapping branded goods for supermarket own-brands or by downshifting supermarket, and making the most out of loyalty schemes, cashback offers and other discounts.

Collectively, the nation’s money saving tactics could have netted up to £3.5bn a month.  The average monthly saving is £95 but just over a fifth (21%) estimate they have reduced their monthly outgoings by more than £100.

The financial uncertainty caused by the pandemic has changed many people’s attitudes to money, 13% said they now think more carefully about their finances.

Commenting on the research, Lee Griffin, founder and CEO of GoCompare said, “While the coronavirus is primarily a health crisis, lockdown measures have had far reaching economic consequences, with millions unable to work and living on reduced incomes.  The resulting economic slump has officially pushed the UK into recession and, with the winding down of the Government’s furlough scheme along with ongoing restrictions, further redundancies are likely if businesses are forced to close or downsize.

“Our research shows that many people are worried about their jobs and financial security, and have used their time in lockdown to take a fresh look at their finances to find ways to make their money go further.  Whether it’s reducing grocery bills, cutting take-outs or cancelling subscription services, people are embracing a wide range of money saving tactics.

August 25th, 2020 | Andrew Hagger | News

Metro Bank has announced its first ever ‘Refer a Friend’ switching offer. Existing Metro Bank customers can receive up to £250 each by referring their friends to open a Metro Bank account using the Current Account Switch Service (CASS).

The bank – which recently celebrated its 10^th birthday after becoming the UK’s first new high street bank in more than 100 years back in 2010 – is on a mission to become the UK’s best community bank.

Existing customers will receive £50 for every friend that switches, up to a maximum of £250 if five friends switch. New customers that switch to the bank will also receive £50 as a warm welcome to Metro Bank.

To get involved, existing Metro Bank customers must register via the bank’s website here. Once registered, customers receive a unique code to share with friends and family. The offer runs until 11 December 2020, with full terms and conditions available on the bank’s website.

Kat Robinson, Director of Bank Accounts at Metro Bank, adds: “At Metro Bank our purpose has always been to create fans and bring the banking revolution to more people. We’re excited to launch our new ‘Refer a Friend’ switching offer to do just that, helping us give something back to our existing customers whilst welcoming new customers too.”

August 9th, 2020 | Andrew Hagger | News

New research from Caxton, the travel money specialists, reveals how the coronavirus pandemic has changed the way people are managing their finances.

In a survey response from almost 16,000 cardholders, the key findings were as follows:

• 39% of people say they are deliberately saving more.
• 59% of those aged 18-25 say they are deliberately saving more, whilst for those in the 56-65 bracket the figure is less than half at just 26% whilst the percentage for over 65’s is only 19%.
• Young people may be saving more, but 61% of 18-25’s still hope to travel abroad on holiday this year.
• One in five 18-25’s said the crisis had made saving more difficult, compared with just 6% of those aged 65 or over.
• However, in response to the question ‘have your finances been impacted by the pandemic’ only a fifth of 18-25’s said their finances hadn’t been affected, compared with 55% in the 56-65 age group and 70% for over 65’s
• Older customers have not been affected as much financially but are the most nervous about going overseas on holiday – with only 1 in 3 hoping to travel abroad in 2020

Alana Parsons, Chief Operating Officer at Caxton FX commented on the findings: “It’s positive to see younger people making a conscious effort to save more, although the uncertainty of employment after the furlough scheme ends is no doubt a factor here.”

Despite the financial and economic disruption our customers are facing, there remains an eagerness to holiday overseas, with 52% of respondents still hoping to travel abroad this year”.

August 4th, 2020 | Andrew Hagger | News

Finance experts TotallyMoney are advising people that if they need to make large purchases, they should do so with their credit card, to protect their finances during the coronavirus crisis.

• Section 75 of the Consumer Credit Act makes both credit card lenders and retailers responsible for when a service or product between £100 and £30,000 isn’t delivered
• Retailers such as Debenhams and Laura Ashley have gone into administration, causing doubt for shoppers, as well as the collapse of Thomas Cook and Flybe in the past year
• Alarmingly, nearly a third (29%) don’t realise Section 75 covers them for credit card purchases
• Over three in ten (34%) don’t know that PayPal transactions aren’t protected

With many retailers and services struggling due to coronavirus, customers are being warned to protect themselves if the company collapses or can’t deliver the service or product.

When you can use Section 75

If consumers bought an item and it doesn’t arrive due to the company filing for administration or failing to deliver, this can be refunded. For example, if someone bought a sofa on their credit card but it was never received, this is covered.

Even if customers only use their credit card for partial payment, they can still claim back a refund. That means if the sofa was £400 but an initial £50 payment was made on a card, a full refund is still available.

Faulty or damaged goods are also protected. If a mobile phone is bought online and it arrives with a cracked screen, Section 75 covers this too.

As well as goods, cancelled holidays and events are also protected by the act. Plus, any additional expenses that may have been booked for an event. For example, accommodation or train tickets to a festival.

Breaking the chain 

Any payment made on a credit card between £100 and £30,000 is covered under Section 75, providing the link between the customer, the credit card company, and the service provider hasn’t been broken.

This means that purchases made through third parties, such as PayPal or a travel agent, aren’t protected under Section 75.

However, using your credit card for a contactless payment, including on a digital wallet such as Apple Pay, doesn’t break the chain. In this situation, you’re still directly using the credit card to make the purchase. That means customers using contactless payment for part of a purchase over £100 are protected.

Alastair Douglas, CEO of finance experts TotallyMoney, comments:

“It’s important to be aware of Section 75, not just for previous purchases made, but also to protect yourself in future.

“At the moment, many companies are struggling and unfortunately, some might not make it through this crisis. Customers should make sure they’re protected in the event this happens, by making large payments on a credit card.

“This allows people to rest assured they won’t be left out of pocket, especially at a time when many people are struggling to make ends meet.

“Before applying for any credit card, it’s important to check your eligibility. This shows you how likely you are to be accepted, so you can find and apply for a card you have a higher chance of being accepted for. This can also help to protect your credit score, and reduce the need to make multiple applications. 

“At TotallyMoney, we’re on a mission to improve the UK’s credit score and help people move on up to a better future. Section 75 is always a good way to protect your finances, but particularly right now, when many people can’t afford to lose out on money if something should go wrong.”

Section 75 Top 10 Tips

To protect your purchases, here’s all the information you need about Section 75.

1. Limits on claims

Individual items and purchases costing more than £100 and up to £30,000 are covered under Section 75. So, whether it’s a cancelled holiday, or piece of furniture that never arrived, it’ll be covered.

2. Pay a deposit, get full value cover

When a deposit for goods or services is required, use a credit card — even when the deposit is less than £100. Should anything prevent you from settling the balance (like the company goes bust or the seller vanishes), Section 75 lets you claim the full amount. Not just the paid deposit.

3. We’re talking credit, not debit

Section 75 doesn’t cover anything bought using a debit card. Chargeback protection is as good as you’ll get with debit.

4. They’re bust. You’re not broke

Buying from a company that goes bust before they deliver doesn’t mean your money’s lost. Section 75 requires credit card companies to get your money back.

5. Pay part credit and part cheque, get full value cover

The same goes if you decide to pay part of the balance by credit card and the rest by cheque. Consumers can reclaim the full value of the qualifying goods and services even if the total balance wasn’t paid using a credit card.

6. Stay protected on closed cards

Say you buy an item, close the credit card you bought it with, but something goes wrong with the qualifying goods or services, Section 75 means you can still make a claim.

7. Extra expense cover

If you book a holiday and the flight is cancelled, through Section 75 you could claim back additional accommodation and food expenses, providing those consequential losses were reasonable.

8. Section 75 loopholes

Buying through a third party (like online marketplaces or travel agents), additional cardholder purchases, or cash that’s withdrawn from your credit card account won’t offer Section 75 protection. You need to have paid the company directly (so purchases made through PayPal, for example, aren’t covered).

9. Section 75 applies to all credit cards

When it comes to Section 75 there’s not one rule for one credit card company and something different for another. All credit cards come with Section 75 benefits.

10. The claim process

First port of call: the retailer you bought the goods or services from. Failing that, go to the credit card company — this might be your bank or building society, not Visa, Mastercard or AMEX. They’ll get you to fill out a claim form and your money will be refunded.

July 28th, 2020 | Andrew Hagger | News

Brits are planning to spend an average £195 each on the high street on life-after-lockdown treats – equating to £9.3 billion¹ across the UK – according to new research from American Express. Shoppers are hitting their local high street to treat themselves to meals and drinks out, along with some new items for their wardrobe.

The top treats people will be spending their money on are restaurant meals, new clothes, followed by drinks at the pub.

Top treats for adults shopping on the high street

Brits hitting the high street in search of little luxuries can earn up to £50 in statement credits with the American Express Shop Small offer, which gives eligible Cardmembers a £5 statement credit when they spend £10 or more at participating small businesses. The offer requires enrolment and is valid once per participating small business location, up to 10 times, until 13 September 2020. Full details can be found here.

FOMO (fear of missing out)

Brits have experienced a case of FOMO during lockdown. Nearly half (49%) of UK adults said they longed to go out for professionally cooked meals and more than a third (36%) admitted to missing trips to the hairdresser and regular hair treatments. Lockdown locks became somewhat infamous during the past few months – with almost one in five  (19%) attempting their own haircuts at home.

Other sorely missed activities included drinks at the pub (33%), going to the cinema (24%) and browsing in bookshops (18%).

Getting ready to shop in-store

As a nation, our love for local has been stoked by the lockdown measures. Half of those who increased their online spending during lockdown plan to spend more on their local high street now that restrictions have eased.

Steph McGovern, journalist and television presenter, is backing the American Express Shop Small campaign. She said: “Lockdown gave us the opportunity to think about how we spend and what we buy. Now is a really good time to take stock of your spending habits and think about how you could spend more wisely by taking advantage of offers, discounts and benefits. And there’s no better way to show some love to our much missed independent retailers by popping into their store and seeing what’s new.”

American Express offers the following tips for shoppers looking to spend wisely when they return to shops

1. Get to know your local shop assistants

Many local and independent shops are run by small teams, maybe even just the owner in some cases. When you get to know them you appreciate their service even more and they are more likely to tell you about new products, sales etc.

1. Grab a bargain

To make your money go further, keep a look out for upcoming summer sales and discounts. Also remember to check for offers such as the American Express Shop Small promotion, where you can earn a £5 statement credit for spending at least £10 at a participating small business. Full details can be found here.

1. Earn points every time you shop

If you are going out shopping, it’s best to put your spend on a Card that earns cashback, rewards or points for your purchases. This means every purchase can count towards something else – a treat for yourself or someone important in your life.

1. Check online, check out at the till

Retailers have become much more inventive during lockdown, finding lots of new ways to communicate with their customers at home. Make sure you check in with the latest offers, and exclusives before you head in store so you know exactly what you want.

July 23rd, 2020 | Andrew Hagger | News

Almost a fifth (18%) of people aged 50 and over say that the COVID-19 pandemic has already or may impact their retirement plans, according to a new study from Co-op Insurance.

Of these, a quarter (25%) said they’ve not been able to retire due to their finances, a fifth have had to use some of their retirement savings after being out of work and a 10% have retired sooner than planned due to being made redundant during the pandemic.

Meanwhile, the study reveals that the pandemic has encouraged almost a third of people aged 50 and over yet to retire to do so sooner.

Of those people over the age of 50 who have retired, almost a quarter (23%) said the disease has affected their plans to spend time with friends and family and a fifth have not been able to travel as they’d planned.

When looking at how this impact on retirement plans has made people aged 50 and over feel, almost half (49%) have realised how important friends and family are, over two fifths (44%) say they feel annoyed and over a quarter think they need to make up for lost time.

Graham Ward Lush, Head of Life Insurance at the Co-op said: “It’s perhaps no surprise that so many people over the age of 50 are disappointed with how the pandemic has affected their retirement plans, with so many envisaging more of this time being spent with friends and family.

“It’s encouraging to hear though that despite this situation being frustrating and disappointing for so many, the majority of people are now planning to make up for lost time.”

July 16th, 2020 | Andrew Hagger | News

Paragon Bank has urged savers to ensure they are making the most of tax-free savings as figures show that the number of ISA openings has halved this year.

According to data analysed by Paragon, British savers opened a total of 932,000 new ISAs between February and May 2019. During the same period in 2020, only 490,997 ISA applications were processed, a 47% decrease year-on-year.

This slump in ISA activity doesn’t stop at account openings, as the total growth of ISA account balances is down 32% on last year.

This is despite savers saving more money during lockdown, with a staggering £22.6 billion stashed into non-ISA easy access saving accounts between February and May 2020, an increase of £15.8 billion compared with the same period in 2019.

However, some product types are performing better than the market average and have seen success this year. While fixed rate and easy access ISA openings were down by 36% and 42% respectively, the take-up of notice ISAs has grown rapidly.

Certain financial providers, including Paragon Bank, are also bucking the trend and have seen a successful ISA season. Paragon Bank saw a 65% increase in ISA account openings between February and May 2020, compared to the same period in 2019, following the introduction of a range of new product features tailored towards supporting customers make the most of their ISA allowances.

This included the launch of the ISA Wallet, a feature that allows savers to spread their £20,000 annual ISA allowance across multiple Cash ISAs with Paragon. The provider also introduced the Flexible ISA feature, which allows savers to replace funds withdrawn from their ISAs without it impacting their tax-free entitlement.

Derek Sprawling, Savings Director at Paragon Bank, said: “We know that the current savings landscape is driving up levels of inertia, and there is less of an incentive for savers to look for the best deal and move their money around.

“Even in the current market, receiving tax-free interest on savings is invaluable now and in the future. We would urge savers to look at ways they can maximise the return on their ISA allowance.

“It’s also the responsibility of financial providers to support people by making sure ISAs are as straightforward and flexible as possible. Introducing features on accounts that will allow people to find a way round some of the traditional limitations on ISAs, for example the limit on account openings per tax year, is one of the ways providers can support their customers.”