Simon Read: RBS should not withdraw service from the vulnerable

Hard-up families were hit by a major banking blow this week. Royal Bank of Scotland - which owns NatWest - said it will ban customers with basic accounts from using cashpoints operated by other banking groups.

The bank's move is to save money and it rightly points out that Lloyds Banking Group - which includes Halifax - already restricts its basic bank account holders from using rival cash machines. But if RBS does enforce the ban, it could lead to all the other companies offering basic bank accounts doing the same, according to Nationwide.

It warns that the Bank's move could be the tipping point for other current account providers to follow. "When one player withdraws from the market it increases the cost burden on the others," says the building society's head of policy, Gary Follis. "It's not hard to see how this could quickly become a slippery slope, and if it does, it will be the poorest members of society that lose out."

If it happens it will be bad news for vulnerable people. Basic bank accounts are offered to people who otherwise wouldn't qualify for a bank account. They were set up by the banks - with some major government nudging - in the middle of the last decade to tackle financial exclusion. They don't allow overdrafts, but do give people on low incomes crucial access to basic financial services.

That access is important as it means they can pay bills electronically - saving money - and start to budget properly, rather than having to pay by cash. The theory is that anyone using a basic bank account may graduate to a full banking service in due course.

If they lose access to free cash withdrawals - a privilege enjoyed by everyone else - that would penalise them and make them second-class citizens. That is precisely the opposite of what should be happening to such people. The more they are treated as second-class citizens because of their low-income, the more they will stay on the fringes of society. And the recent riots show what can happen to those who feel excluded from the mainstream.

The average age a first-time home buyer expects to be when they can afford to buy a property is now 35, according to research issued today by the Post Office. Half a century ago the average first-time buyer was actually just 23. Is this trend towards young adults being a decade older before making a first step on the property ladder something to lament? I'm not sure that it is.

Buying a property is a massive investment and potential risk. Someone in their early 20s taking on the financial responsibility will quickly discover that the expense of maintaining a property – on top of massive mortgage costs – can outweigh the benefit, especially in light of the potential detriment to their lifestyle. The mantra that you should get on the property ladder as soon as you can is totally flawed when prices aren't rising, as is the case now.

For that reason youngsters strugglign to get on the mortgage ladder should concentrate on enjoying the advantages of renting. The key financial one is that landlords have to cover maintenance costs, which can be thousands in a year. But there's also a lifestyle advantage in that moving to a different rented home is much easier – as well as being much less costly – than buying a new home.

Shares: Is now the time to be greedy?

on thursday the Footsie suffered its worse one-day fall since the height of the credit crunch in November 2008. But the volatility could be a great opportunity for investors with spare cash to pick up some bargain shares, according to one financial expert.

"The opportunity to buy quality stock at great value doesn't come along very often and right now looks like a pretty good time to stock up on cheap shares," says Ray Black, IFA and Managing Director of Money Minder.

"Of course, there is every possibility that there will be even better bargains presenting themselves over the next few weeks and months but waiting for the botto' is a higher risk strategy that rarely pays off.

"Instead, I believe that recognising when buying opportunities present themselves and taking advantage of them whenever you can is a much better option for the majority. Therefore, in true Warren Buffett style, I find myself reminding investors to 'be greedy when others are fearful and fearful when others are greedy'."

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at

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<b>Kathryn Williams</b>
When I was supporting Ray La Montagne I was six months pregnant. He had been touring for a year and he was exhausted and full of the cold. I was feeling motherly, so I would leave presents for him and his band: Tunnock's Tea Cakes, cold remedies and proper tea. Ray seemed painfully shy. He hardly spoke, hardly looked at you in the face. I felt like a dick speaking to him, but said "hi" every day. </p>
He was being courted by the same record company who had signed me and subsequently let me go, and I wanted him to know that there were people around who didn't want anything from him. At the Shepherds Bush Empire in London, on the last night of the tour, Ray stopped in his set to thank me for doing the support. He said I was a really good songwriter and people should buy my stuff. I was taken aback and felt emotionally overwhelmed. Later that year, just before I had my boy Louis, I was l asleep in bed with Radio 4 on when Louis moved around in my belly and woke me up. Ray was doing a session on the World Service. </p>
I really believe that Louis recognised the music from the tour, and when I gave birth to him at home I played Ray's record as something that he would recognise to come into the world with. </p>
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