Ask Sindie: How can I keep tabs on my credit card?

Your money problems solved

All became clear when, after contacting my other lender, I found my credit card had been cloned and used abroad to buy thousands of pounds worth of clothes in designer shops in Tokyo. Unfortunately, a recent move had meant the bills never got to me.

After sorting out this mess, my lender advised me to keep an eye on my rating with a credit-reference agency to stop any more setbacks.

But sending off £2 for a written statement that can take days to come through seems a pretty hopeless gesture.

I feel my card could easily be cloned again and money spent within hours; even if I checked up on it every month, it would still give me little protection against a repeat performance.

It seems a waste of time and money.

BE, Bath

A: The £2 option for anyone wanting to see where they stand with their credit may be the cheapest, but it's also the slowest.

Any of the three main credit-reference agencies - Experian, CallCredit and Equifax - will send you a copy of your file, but, as you've found, it can take a long time.

Unfortunately, the alternative - online access to records and/or regular updates - is expensive and of limited use.

For example, if you wanted to access your file online, it would cost you £8.25 with Equifax. You would be able to view this on screen for 30 days from the time of your request, but the data is not updated during this time, so a fraudster could strike without you knowing about it.

For constant online access or text and email alerts each time your file changes, there is an even higher comparable cost. The most expensive, Equifax, charges £60 a year for instant online access as well as texts to your mobile phone.

In June, the consumer body Which? said it was lukewarm about the value of such services, noting only that regular updates could "prove useful, if expensive".

In your case, what action you take depends on how important your credit file is to you.

For peace of mind, it might be worth paying the extra to be able to check at a moment's notice. After all, no one wants the inconvenience of finding that their credit file has been damaged - particularly if they are about to make a big purchase - and then having to go to the trouble of restoring it.

Bear in mind, however, that unless you have behaved negligently - by, for example, keeping a note of your Pin number in the same place as your (stolen) credit card - you will not be responsible for any losses on your plastic; the lender will be liable for these.

In the final analysis, your own vigilance is your best protection against fraudsters spending your money without anyone noticing.

Q: The recent birth of our third child, Charlie, has made us realise that our first-born, James, will be the only one of the three not to qualify for the £250 child trust fund [CTF] voucher.

Our daughter, Mia, was born in 2003 but James arrived in early 2002 - too soon for the scheme [which was set up for children born after 1 September 2002].

Are there any tax breaks available for him?

JI, by email

A: James can still benefit from a couple of products. Tax-exempt special savings plans - unique to friendly societies - let you save up to £25 a month tax-free, usually in a with-profits fund. But they carry an element of life insurance, whose cost eats into the returns. There are also financial penalties if the cash is withdrawn before the child is 18.

An alternative is National Savings & Investments' Children's Bonus Bonds. While these are backed by the Government, the latest issue pays just 4.1 per cent, fixed for five years, and you are restricted to putting in a lump sum at the outset; there is no monthly savings option.

If neither of these appeals, you could simply stash the cash in a savings account on his behalf.

Like everyone else, your three-year-old has a £4,895 personal tax allowance, so he won't have to pay tax on the interest earned.

To arrange for interest to be paid gross, you must complete form R85 with your son's details, sign it on his behalf and give it to your chosen bank or building society. This form is usually available from the savings bank, or can be downloaded from this Inland Revenue website: www.hmrc.gov.uk/forms/r85lp.pdf

However, if interest earned from money donated by a parent tops £100 a year, the taxman treats it as if it was yours - and James's account will be taxed according to your income band. Retired grandparents can invest on his behalf, though, since this money won't be taxed at all.

To choose a decent savings account, look beyond marketing hype for special "children's accounts" with furry freebies; examine the interest instead.

The Halifax Children's Regular Saver offers 10 per cent and has a deal with the Revenue so that you won't have to bother filling in an R85.

If you need help from our consumer champion, write to Sindie at The Independent on Sunday, Independent House, 191 Marsh Wall, London E14 9RS or email sindie@independent.co.uk. We cannot return documents, give personal replies or guarantee to answer letters. We accept no legal responsibility for advice.