It is commonsense that more and more people have unpaid and accumulated financial obligations that lead into people finding themselves in debt. As a consequence, creditors frequently call them in order to pay up. But similarly, we can talk nowadays about more and more complaints regarding abuses coming from the collections agencies. This is because people who are in debt are vulnerable, they are between wind and water, and they generally do not know how to handle abusive debt collectors. So for those who are annoyed with harassing debt collector calls, who feel pressured or even threatened, there are some useful tactics to keep in mind!

Read the rest of this entry »

With mortgage loans, borrowers can purchase real estate without the need to pay the full value of the property immediately from their own resources. Mortgages have an interest rate and are scheduled to amortize over a set period of time.

Read the rest of this entry »

The new tax year is approaching, and with it comes a new top rate income tax, meaning that those fortunate enough to be earning over £150,000 will be required to pay 50% income tax on anything above this amount.

In addition, higher rate on dividends will move from 32.5% to 42.5% of the grossed up income (equivalent to 36.11% of the net dividend) for taxable income above £150,000.

As a result of the changes to become effective from 6 April, private banks and wealth managers have been advising those who will be affected to act now in order to protect their income. Many are taking steps to bring forward earnings to this tax year, or plan their finances in an attempt to lower the impact.

Below are some tips outlined by Which4U that higher earners should consider:

1. Make full use of all your tax allowances Many of us complain about how much tax we pay, but forget to take advantage of tax free breaks. The truth is, many of us could be missing a trick when it comes to tax relief.Always ensure you have used up your allowances by the end of every tax year. A popular tax free savings incentive is your first port of call, in the form of individual savings accounts (Isas), with an annual allowance of £10,200 (or £7,200 for those under 50 until April 6th), as well as tax-free National Savings & Investments products.No income tax is required to be paid for any interest or capital gains earned using Isas, so make sure you shop around to find the best Isa rates, or alternatively if you wish to invest in a stocks and shares Isa, do some research into the market.

   Transfer investments that provide an income to your spouse, if he or she does not work or has earnings that fall in a lower tax band. This now not only applies to spouses on the basic rate tax but also those paying 40%, if the other spouse currently earns above £150,000 per year.

2. Close your bank account According to advisers at Deloitte, those that have a savings account paying interest on an annual basis that is due to be paid after April, should consider closing the account before the new tax rules kick-in in, allowing the interest payment to be subject to a lower rate of income tax. After, you can simply open a new bank account.
3. Donate to charity in the new tax year After 6 April, high earners making donations using the Gift Aid scheme will qualify for higher tax relief, which means that more money will be given to the charity. However, you should think about the potential impact delaying your regular donations could have on the charity, especially in the current financial climate.
4. Accelerate your income Some employers have chosen to pay employees their salaries early to avoid the higher tax. Consider asking your employer if this is a possibility. This may be easier for those in entrepreneurial or family businesses.You can also make use of any share options you currently hold, as these attract income tax so you will pay the lower rate. Those already getting pension income are able to opt to receive annual payouts as a lump sum before the changeover date in April.
5. Add more to your pension fund in the new tax yearIt has become apparent that pensions are looking more of an unattractive option to higher earners, with tax relief cut to 20% on some contributions.However, if you do fall into this category, you may want to act fast. In the 2010/2011 tax year, those earning more than £150,000 will be eligible to put in at least £20,000 and up to £30,000 with 50% tax relief, before the new restrictions come into play in 2011.Advisers at Deloitte have suggested that people earning between £100,000 and £113,000 – who will effectively be paying 60% tax from April as a result of their personal allowance also being eroded – should also add to their pensions.
6. Consider venture capital trusts (VCTs) Although these start-up investment schemes can be quite risky, they are being labelled as an alternative to a pension fund for higher earners because contributions attract 30% tax on the way in.
7. Move your assets into an offshore bondOffshore bonds are investment bonds that are operated by life insurance companies and also have some life insurance attached to them. This enables you to avoid paying any tax until you encash the bond. The idea is that by the time you come to encash the bond, you may be subject to a lower rate of income tax, for example when you’re retired – or if you have become an expat or a non-dom, you may not have to pay any UK tax whatsoever. Many well known financial advisers are using this approach for clients.
8. Change from income investments to Capital Gains Tax In 2008, capital gains tax was lowered to 18%, and investors have since been looking to acquire returns that are taxed as capital gains rather than income. According to advisers, the 50% income tax band has sped-up this switch. Over the past year, demand for products such as zero dividend preference shares has significantly risen, as well as funds that work on a total return basis instead of generating income, such as absolute return funds.
9. Consider leaving the countryThis may seem like a rather extreme measure – but advisers at Cazenove and Schroders Private Bank have said that many of their clients are considering this option in response to the substantial tax demands.

Savers seeking the most effective way to save should not only build up a tax free savings pot using ISAs, but also be aware of the rates paid on balances to ensure they are earning the best ISA rates. bmi credit cards

This usually means transferring cash ISAs to get a better deal, but what are the rules around moving your cash between ISAs?

Which4U is aware that many savers are either baffled by the rules around ISAs, or not given useful information from providers. Read the rest of this entry »

Read the rest of this entry »

To mark the start of the 2009 National Consumer Week we have focussed on a handful of laws that you may find extremely useful when buying products and services, especially during these turbulent times.

You may or may not  have noticed it, but consumers are fighting a war against the firms they have to deal with after falling victim to mindless companies, whether it be due to faulty products that need replacing, or out-right poor service. Read the rest of this entry »

Investment bonds have proven to be a hit amid the financial crisis, after the Bank of England cut its base rate to 0.5% – the lowest on record, forcing banks to reduce the amount of interest paid on regular savings accounts.

Investment bonds can vary significantly, but the general rule around them is that in exchange for some kind of risk, they provide the potential to earn higher returns that those offered on standard savings accounts, as your investment is not generally tied to fixed interest rates, but on the success of the area you invest in. Read the rest of this entry »

Fuel Prices

1. Keep your tyres fully pumped-up and cut your air-conditioning usage

It is estimated that half of all drivers in the UK are driving with under-inflated tyres. This increases the resistance and therefore raises the amount of fuel used. The RAC advises that your fuel bills will increase by up to 2% if your tyres are not fully inflated to the recommended pressure.

Ensure your tyres pressure is kept at the correct level by checking them once a week. You can find out the recommended pressure readings for your tyres by consulting your car manual.

According to the National Energy Foundation, using air conditioning will increase your fuel consumption by up to 25%, so only use it when absolutely necessary. An alternative method to stay cool is opening the air vents, or even simply opening the windows. However, if you’re travelling over 60mph an open window will increase drag which can end up costing more than having your air-con on.

2. Service your vehicle

If you fail to service your vehicle regularly you could be reducing fuel economy by over 10%. Some of the key areas that must be covered are changing the air filters, as according to the RAC, dirty filters can seriously increase fuel usage; and regular oil changes, as clean oil will reduce the wear caused from friction of all the moving engine components, thus improving fuel economy.

Both of the tasks mentioned above are inexpensive and can help to drive your fuel costs down.

3. Change your driving habits

Changing the way you drive can drastically reduce fuel consumption, and this isn’t just about refraining yourself from putting your foot down.

Try to keep you gears higher. This will allow the engine to not have to work as hard and thus reduce the amount of fuel required. When using this technique ensure you are in a safe environment to do so, as using higher gears gives you less control over the car.

The RAC claims that if you avoid braking sharply then accelerating, you could save you up to 30% on fuel costs. The National Energy Foundation recommends that those driving a petrol car should change up a gear at 2,500rpm and at 2,000rpm for diesel cars to get the best fuel-efficiency. When starting from a stopped position, accelerate slowly as this will keep your revs down.

If you drive at 85mph you will use approximately 25% more fuel than at 70mph, so keep to the speed limit, especially on long motorway journeys.

4. Lose unnecessary weight and reduce the drag

Remove things from your car that you don’t require for your journey, such as removable seats, roof racks, and boot luggage such as sports equipment. Reconsider installing accessories that will add significant weight to your car and wide tyres that will add rolling resistance. According to the website save-petrol.co.uk, on average, each additional 50kg in weight will increase your petrol consumption by 2%.

Novelty flags and fancy sun roofs will also effect the aerodynamic drag of your car, thus increasing how much fuel your car will guzzle. Another interesting fact is that the weight of the fuel you carry will also effect how much fuel is required to move your car, so never fill your tank up to the top.

Always shop around for your fuel to find the best prices, you will be amazed at the difference in prices between cities and suburbs. But don’t defeat the object of cutting your  costs by driving too far out of your way to find the best fuel prices, as this will cancel out your savings. Try to tie your trip to the petrol station in with a regular trip, such as your weekly supermarket shop.

5. Helping the environment will help your wallet

Try to get into the habit of using other means of transport when making small journeys as these can be the least fuel efficient of all, especially in towns where you are constantly stopping and starting. Cars also use more fuel when cold, so a car that would usually do 40 miles to the gallon when motorway driving, may fall as down below 15 miles per gallon on a short journey. If you could walk or even cycle these short journeys you will notice the difference.

If you have to use your car to commute to work, if possible it is definitely worth considering car sharing with a colleague, as this can cut your fuel bills in half. Alternatively, look into park-and-ride schemes. If you can’t do either of the above, plan your journey to make sure you are taking the most cost effective route, and keep an eye on traffic reports to avoid hold-ups.

Something also worth noting it that a small car will consume a litre of fuel every hour when stuck in a traffic jam, but larger cars guzzle double this amount

When looking to buy a new car, look around for the greenest in your price range as this will not only give you major savings in fuel costs, but also give out lower CO2 emissions which directly effects how much your car will cost to tax.

6. Clubcard points on your fuel

Supermarkets tend to offer the most competitive fuel prices, and they are very conveniently placed allowing you to kill two birds with one stone by doing your grocery shopping and filling up in one journey.

As well as offering good rates, some supermarkets also offer clubcard points for every pound spend, on petrol as well as in store. This means that if you stick to the same filling station, you can accumulate points later used to purchase goods that you wouldn’t have otherwise had.

To increase your reward points you could take out a Tesco Clubcard credit card, offering 5 points for every £4 spent. At the end of each month you receive clubcard vouchers based on the amount of points you’ve earned, which can be spent in-store on your petrol or at Tesco Direct. You can even turn Points into Airmiles!

The Tesco Credit Card also comes with a range of other attractive features and discounts, so it might be time to switch your card and make the most of your savings.

Those looking for a good home for their savings may be interested to hear about a new product launched by Egg.

The Egg savings account was launched today (June 26th), as its new Bonus Savings Account, allowing customers to open an account with an initial balance of at least £1 and is available to both new and existing Egg customers.

This competitive savings account offers an interest rate of 2.8%, which includes a fixed savings rate bonus of 1.55 per cent for the first 12 months.

Furthermore, this savings account does not come with any limits or charges on cash withdrawals.

Sharon Maguire, head of banking products for Egg, states: “During times of unprecedented low interest rates, customers need to have the peace of mind that their savings account is making their money stretch further.”

Those on the search for an online savings account may also wish to consider the second issue of the Principality e-Saver, launched earlier this month.

A survey carried out by department store John Lewis reveals that 18-24 year olds are the one of the most ‘house proud’ age groups, with almost a quarter of those that took part in the survey revealing that they are reluctant to entertain at home for fear of potential party accidents – close to three times  those aged 65 and over, with just 8% worrying about damage, and more than double 55-64 year olds (10%).

The study, involving 2,014 adults from Greenbee Home Insurance (part of the John Lewis Partnership), also found that 26% of this age group ask guests to remove footwear before entering their homes, almost double that of those aged 65 and over (14%) who have been found to have a more relaxed attitude.

It has been suggested that this new age of thinking has been brought on by the credit crunch, as 14% of Brits said they could not afford to replace damaged or broken items based on their current financial situation.

These findings may come as a surprise, turning stereotypes on their head, with a new breed of CHAPS – Cautious Hosts Against Party Stress.

It appears that the Midlands is Britain’s most house-proud region, with an above-average concern in all areas. Over a fifth (21%) of Midlanders make their friends remove their shoes when visiting (compared to 15% of people in South East/London) and 16% prefer not to host house parties, fearing that a party could result in damages caused by party accidents (compared to just 10% of Scots).

These results confirm that the financial crisis has turned the Britain into a nation of paranoid party poopers, but this view can be seen as well justified, as 14% said they’re more worried about household accidents or breakages than ever before as in the current economic climate as they can’t afford to replace any damaged items – rising to one in five (20%) of 45-54 year olds and 17% of women (compared to 11% of men).

James Furse, managing director, greenbee.com said: “It’s no surprise that people, regardless of their age, are cautiously house-proud, particularly with financial concerns foremost in the thoughts of a significant proportion of people.

“While those without cover are understandably concerned about the cost of an unfortunate accident while entertaining, even those with home insurance may want to consider checking their policy small print to make sure they’re covered for all eventualities. Ensuring you have the right home cover in place may offer peace of mind, along with valuable protection.”

There are a number of insurance providers offering cover that will help to offer peace of mind when hosting such an event, so if you fit into the ‘concerned host’ group, be sure to check them out!