Money Swindon

Wednesday, April 25, 2007

Mortgage Advisers in Swindon

Like any town, in Swindon you have a choice of people who can help you buy your Home.

Independent Financial Advisers (IFA): Whole of Market advice on mortgages & insurance, think of them as Mortgage Advisers offering a greater range of services.

Estate Agents: Typically a panel of 10-15 lenders. Not whole of Market Insurance, tied to one company. Sold to you by a youth with gelled hair & a large knot in his tie.

Mortgage Broker: Check if independent, whole of market. Offers insurance from one insurer or limited range

Banks/Building Society: only offer their own limited range of products for mortgages and insurance.

Hope the differences betweeen various kinds of mortgage advisers is clearer.

Tuesday, April 24, 2007

Financial Advisers in Swindon II

Before setting up in business 2 years ago, I decided to do some market research and look at the quality of financial advice available on the High Street in Swindon.

I looked at 2 of the biggest financial institutions: Halifax & Nationwide.

In the Halifax, the adviser wasn't expecting me. He advised me to have a look at Halifax's Unit Trusts & Life funds on their website and to choose the funds myself!

In the Nationwide, I quizzed the adviser and was told he much preferred doing mortgages. He added his own money was invested in a Tracker fund which had lost significant amounts of money!

Conclusion on the Financial Advice at the Halifax & Nationwide in Swindon: Steer clear.

Financial Advisers in Swindon: A survey

Recently a client approached me for financial advice. The client is moving abroad & wants to take an income from their capital.

They approached their bank and another Independent Financial Adviser (IFA). The advice they got was rather worrying. My client wouldn't be regarded as tax payer in the UK, however strangely neither the bank or IFA picked up on this.

I recommended to the client using his ISA allowance and investing in Unit Trusts/OEICs. The client wouldn't need to pay income or capital gains tax on gains.

The Bank and other IFA suggested the client invest in Investment Bonds. You pay 20% tax on any gains immediately at source...also interestingly a high commission is generated.

Conclusion: Hmmm

PS Investment Bonds can be extremely useful for Higher Rate Tax payers. Basic tax payers..no.

Wednesday, April 18, 2007

Interest Rate Rise likely to control Inflation

An increase in interest rates is increasingly likely after inflation figures rose to 3.1%.

Philip Shaw, chief economist at Investec Securities, said: "Today's figures mean that a May hike is now even more of a cast-iron certainty than previously. Our forecast that rates will peak at 5.5% is under review."

Richard Woolnough of M&G expects a rise in May & one in the autumn & winter to bring rates up to 5.75%.

Conclusion: If you are buying a house or remortgaging, opt for a fixed rate option.

Friday, March 23, 2007

Buy to Let: a Goldmine?

For many years private investors have had Buy to Let Properties in their portfolios. However there are some drawbacks. You are liable to income tax on the income & capital gains tax on the profits.

Factor in maintenance & insuring the property and the returns decrease further.

Rising interest rates have eroded profits too, plus the fact you can only get an interest only mortgage because of rental incomes is a further hindrance.

If you're looking for a property based investment, try a Commercial Property Fund.....to be continued

Monday, March 19, 2007

Best fund for your ISAs?: Part II Cautious Managed

In the 1990s, the bog standard fund for Investments was the With Profits fund. However they have died a death a combination of poor performance & mysterious charhes called Market value reductions.

What has replaced With profits?

One of the options is the Cautious Managed Fund.
It invests in Gilts (loans to the government), corporate bonds (loans to companies) and shares.
The fund manager has the ability to switch between these types of assets as market conditions change.

Who has the best funds?

You know the answer...take proper advice.

Thursday, February 15, 2007

Best fund for your ISAs?: Part I Equity Income

Equity income funds usually to invest in larger more stable companies which have usually stopped growing quickly. These companies tend to be large and established, which in itself is a benefit eg BP, Vodafone, the big banks

They pay dividends to their shareholders as a means of creating loyalty; why sell your shares if they provide you with a steady income?

Which funds are best?
There are 83 UK Equity Income.
The best fund grew by 18.47% in 2006, the worst 0.1%
Over 10 years 257.59%, the worst 0.64%.

Take independent advice & don’t rely on hearsay.

Tuesday, February 13, 2007

Offset Buy to Let Mortgages

What are they?
They are Buy to Let Mortgages, where you rent the house to a tenant to pay the mortgage.

What about offsetting?
You trade (offset) your savings against the amount remaining on your mortgage (the mortgage balance)
eg £20 000 of savings offestagainst a mortgage balance of £100 000
You only pay interest on £80 000.

Usually lending rates are higher than savings rates, so you save money This works especially well for higher rate tax payers, who will pay more 40% tax on savings.

Early repayment charges are uncommon on offset mortgages…useful if better products become available & you can make unlimited overpayments.

For sole traders & partnerships the Yorkshire Bank also allows to offset business balances against residential mortgages.

The one disadvantage of offset mortgages has been higher rates than traditional repayment mortgages, however as offset mortgages have become more popular, the differential has grown smaller.

5 Common Investment Mistakes

1 Buying what you don’t understand.
What is a BRIC fund?

2 Focusing on Short Term performance.

3 Getting sucked into panic buying or selling.
Markets go & up down over time
Companies go in & out of favour

4 Believing the financial press
Financial Journalists have no obligations to Investors.
Financial advisers do have obligations.

5 Not diversifying your portfolio
All your eggs in one basket.

Based on article in “UK Investment Guide” David Berger.

Wednesday, October 11, 2006

Free Financial Planning & Money Workshop

Every Thursday, I’ll be offering a free Financial Planning & Money Workshop every Thursday 7-8 pm.

It takes place at Lawn Community Centre in Swindon.
Starts on Thursday 19 October.

Map Link to Lawn Community Centre

Tuesday, September 26, 2006

Northern Rock Mortgages: Hidden costs

Northern Rock have been advertising a Fixed Rate Remortgage at 4.49% for 2 years.

Sounds not bad….but look at the small print. “There’s a product fee of 1.5% of the loan payable for setting up this mortgage. Other fees will also apply” .

This means on a mortgage of £150 000, you pay £2 250. There is also a booking fee of £75.

Plus they don’t pay your legal or valuation Fees. Any good remortgage deal will do this

Conclusion: Avoid

Monday, September 25, 2006

Free DVD Rental

Want to rent some DVDs for free? Most of the big DVD rental companies operating by post are operating free trials.

You can get up to a month free….but remember to cancel before the end of the period…otherwise you’ll start paying.

There is a list at
http://www.uk-dvd-rental-guide.com/dvd_rental_chart.htm

Note that many of the sites are powered by Screen Select or Love Film….you’ll only get one free rental period if you sign up to any companies.

Monday, July 31, 2006

Cheaper Train Tickets

It’s well known that train fares are over priced.
However you can reduce prices by buying 2 more tickets.
If poosible split up your journey into a series of cheap day returns.

For example the normal return fare to London from Swindon is £37!
With 2 tickets, cost is £23.50

I bought a cheap day return Swindon to Didcot £6.90
Then a cheap day return Didcot to London £16.60

You can purchase your tickets online at
http://www.nationalrail.co.uk/

Also look out for bargain single tickets eg Swindon to Didcot £2.50

Tuesday, July 11, 2006

BBC Radio Swindon Travel Money

Going on holiday can be expensive, however here are some tips to make your money go furrther abroad.

Cash vs Credit cards vs Traveller’s Cheques

Traveller’s cheques are safe & secure but the exchange rateis poor compared to the other two

Cash

In the UK, most places now offer to buy back your unused notes.

Two places which offer competive rates are the Post office and Marks & Spencer. You can order currency at sub Post offices & the money will be there the next day

Credit Cards

In theory credit cards, should offer the best deal however only really with a couple of cards

The best card to use is probably Nationwide’s. There is no charge for using it abroad. Most cards will charge you 2.75% of the amount .

Saga for the over 50s offers a % charge in Europe but 1% outside Europe

If you withdraw it cash using a credit card, standard charges are 2% with a minimum of £2.

Note: if you have a Nationwide Flexaccount Debit card, there are no charges for purchases or for making cash withdrawls.

BBC Radio Swindon II: Travel Insurance

Why do I need it?

What hapens if you lose your baggage or need medical treatment....

Golden Rule
don’t get it from your travel operator!

Usually 2 choices single trip insurance or annual insurance
Annual starts to become the best buy when you make more than 2 trips a year.

Costs can vary according also to where you are going eg more in the USA because of expensive medical bills.

Who offer the best deals?

Go to a broker/price comparison site eg http://www.moneysupermarket.com/travelinsurance/?Source=MS

European health Insurance Card (EHIC)

Replaces E111, get free or discounted medical treatment in any EU country + Switzerland
Get from Post Offices, Tel: 0845 606 2030 or Department of Health Website

Wednesday, June 28, 2006

Beware of Free Gifts!

Many financial organisations are offering refer a friend scheme to get new customers. Typically this involves a £20 from Marks & Spencer.

However products are not always very competitive

Eg Priveledge Insurance offer vaious inducements such as the chance to win a butler for the day, a pair tickets for Premiership or Scottish Premier League match or £500 to spend with a personal shopper.

The Telegraph quotes the folowing example

Cover for a 56-year-old female driver with five years' no
claims bonus
Living in south east London.
Driving a Ford Ka

Budget insurance are £50 cheaper, with a premium of £157.50
Privilege's £206.85.
With 12 Insurers offering lower rates than Priveledge

Tuesday, May 09, 2006

Endowments: BBC Swindon Feature

Prudential anounced on Tuesay 9 May they are introducing a 6 month deadline for complaints about mis-sold endowments.

110 000 could be affected.

However there was recent courtcase brought by Friends Provident policyholder, who had earlier set a cut off point. The client won £1 500 in compensation although because the hearing took place in a county court, it will not create a legal precedent.

Zurich also put out a letter dated 2nd February 2006, advising customers they had to make a claim before 1st Febraury 2006!

The Which Endowment site is the best starting point for those thinking about claiming compensation.

For a good series of articles see the Guardian.

Friday, May 05, 2006

Lizard Needs New Lair

The title refers to a story featuring myself & clients Picture Lizard in the Swindon Evening Advertiser this week

The full story can be found here.

Thanks to Leigh at the Advertiser.

Thursday, May 04, 2006

AP meets the BBC

Was interviewed on BBC Radio Swindon today by Graham Seaman.

We talked about marketing & the financial aspects of running a small business
For listeners, here is a link to the 10 Ways to Get Richer in 2006 feature.

Many thanks to Graham, Kelly & Annie at the BBC.

Sunday, April 30, 2006

Insurance Homepage

Insurance is for security & peace of mind.

One person in couple dies....you have a big debt....
Can you pay off the mortgage?...Will the lender reposses the house?

What happens if you lose your job?

What about if you can;t work because of illness?

4.2m Homes with no Life Cover

What is Home Insurance?

Reduce Home Insurance Premiums

Cost of Wedding....& Insurance

Beware of Free Gifts

Related: Mortgages Homepage

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