After the goldrush, get back to brass tacks

By Steve Lodge personal finance editor
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The Independent Online
WE COULD all save up to pounds 175 a year just by looking after our small change better, claimed a survey out last week, while one in three people believe there is pounds 20 a month to be had from being efficient with basic financial administration such as checking bills and bank and credit card statements.

These figures may or may not be an exaggeration, but they do give me the opportunity to gee up one of my favourite money hobby horses (and I don't mean where to collect those coppers).

This is that rather than just hunting for the latest whizzo investment opportunity - the next building society to pay a windfall, the best PEP (sorry, it really does depend), or simply where to switch your savings for more interest - it is also worth spending time reviewing the boring financial basics that already devour your loot: insurance, mortgage, utilities, credit cards and the like.

By and large this is easy money - savings with little or no risk that don't require great expertise to identify (although a little research will help) - and in some cases the amounts can be significant.

The biggy is your mortgage. There are probably hundreds of thousands of mortgage borrowers paying a lender's "standard variable" (headline) mortgage rate who could save as much as thousands of pounds by switching (remortgaging) to a discounted deal, whether with their existing lender or a new institution. Many of these may have stuck with their existing lender while waiting for windfall shares. But in the cases of the Halifax, Woolwich and Alliance & Leicester, there is absolutely no reason windfall- wise not to switch now.

On the back page we look at ways of cutting the cost of calling mobile phones (and of making long-distance and international calls) and of using credit cards abroad. Here we are talking about saving smaller sums, but these are savings that a broad cross-section of people could benefit from and which take little time to arrange.

The same survey mentioned above also found that while two-thirds of people spend a lot of time comparing prices and back-up guarantees when buying TVs, washing machines and computers, less than half shop around for home or car insurance.

While this relative apathy for financial purchases may be understandable, it does mean that millions of people could be spending as much as hundreds of pounds a year more than they need to on something they probably wish they didn't need to buy at all.

How then to achieve the same enthusiasm for saving on financial affairs as finding a bargain in the shops? Put the money saved on one side, and then spend it on something that's got absolutely nothing to do with the world of finance.

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