Weekly Money: round-up of the personal finance stories you may have missed 20-24 October


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The Independent Online

Discount motors; trust in financial services; ethical investment; tax avoidance; striking lecturers: fixed-rate energy deals; the stories we noticed this week

24 October

If you’re thinking of buying a motor take plenty of money for a discount. Research published today reveals car salespeople will cut their prices for someone paying in cash.

One in five said they would hand a discount of 5 per cent or more on the price of a second hand or new car for those paying by cash.

The research by Sainsbury’s Loans also reveals that the best time to get a discount is in the last three days of the month, as salespeople will be keen to meet their monthly targets.

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Cambridge properties are doing better than London with prices rebounding more strongly in the city than in the Capital.

At £348,300 on average in September, property values in Cambridge have climbed 32.5 per cent higher than they were at their previous 2007 peak. Meanwhile those in London are 29 per cent above their pre-financial crisis high at £398,700, according to Hometrack.

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Reader Julian Clover emails following our Wednesday Midweek Money feature on investing ethically. “It’s great to read that 57 per cent of people prefer ethical investments,” he writes, “but it’s still quite hard to get information about them. Can you tell us more?”

A good place to start is the website goodmoneyweek.com, but it’s also worth checking out www.eiris.org where you’ll find plenty of research into environmental, social and governance issues for investors.

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For 20 per cent off at M&S online – although only on clothing, homeware and beauty and not on food and drink – use the code OCT14EM at the checkout at www.marksandspencer.com by Monday 27 October.

23 October

New freedoms and revolutionary changes in the way we save for retirement hasn’t helped alter people’s perception of the pension industry. After years of enduring high charges and poor-value products we simply don’t trust pension firms.

Just one in five of us trust long-term financial products like pensions or investments while three in five are understandably worried about the value of their pension, according to new Which? research published today.

The consumer group points out that in the past too many consumers were left with a raw deal through the broken annuity market. Ahead of new reforms coming in next April, it calls for urgent action.

Which? executive director Richard Lloyd, said:  “The Government’s pension reforms are the biggest opportunity for years to make this market work in the best interests of consumers. With only six months until they come into effect, the Government, industry and regulators must ensure people get a good deal.”

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Do you use a landline anymore? If not, you’re far from alone.  More than a third of UK people purposely ignore landline calls while a quarter can’t even recall their phone number, despite paying out for the service, reckons broadband firm Relish.

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A quarter of us don’t trust banks with our money while a third have no idea how banks invest our savings. But few know the alternatives to traditional banks, according to eToro.

Haven’t heard of it? It’s a social investment network that - surprise, surprise - sees itself as an alternative to banks. It allows you to see what other traders on the network are doing and copy them. Or as it says, “tap into the wisdom of the crowds”.

22 October

The net is closing in on people who have invested in deliberate tax avoidance schemes. HM Revenue & Customs reports it has sent out 600 Accelerated Payment Notices - which gives recipients 90 days to pay tax - to those it believes may have used the schemes.

It will be sending 2,500 a month by January and expects to have targeted 43,000 people, covering £7.1bn of disputed tax, by April 2016. The average demand is around £155,000, but in some cases may be more than £1m.

Treasury Secretary David Gauke said: ”It is only fair that those who use avoidance schemes should have to pay their tax upfront, like the vast majority of other taxpayers who don’t try to shirk their responsibilities.”

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Parents with adult children still at home spend £1,200 a year more than those whose kids have left.

That’s because their household spending is £100 a month more than empty nesters, reckons think tank Centre for the Modern Family, set up by Scottish Widows.

Its research suggests around 2.7 million households in the UK have adult children still living in the home they grew up in.

“Many parents are raiding their savings or putting their retirement plans on hold to cover the cost of adult children still living under their roof,” said Carolyn Fairbairn of the Centre for the Modern Family.

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Bad news for motorists: the cost of car insurance has started climbing for the first time in two years.

A typical quote for someone who shops around for an annual comprehensive policy climbed £6 or 1.2 per cent over the three months to September 30, to reach £531, according to the AA Insurance Index.

“This small upward move in premiums will lead to further modest increases over the coming months,” warned Janet Connor, managing director of AA Insurance.

North-west England is still the most expensive region to insure a car, with the average cost of an annual policy at £786. Scotland, at £380, is the cheapest.

21 October

University lecturers are the latest group to plan a strike in response to a downgrading of their pensions.

The Universities Superannuation Scheme is for staff at the UK’s ‘old’ universities. Proposed changes - prompted by an expected deficit - would reduce benefits but the University and College Union claims the changes don’t take account of the scheme’s underlying strengths.

Talks are planned for tomorrow but if the strike goes ahead it could lead to a marking boycott and a refusal to set exams,

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More than half of us have experienced an online crime, according to new figures published today as part of Get Safe Online Week.

Meanwhile the National Fraud Intelligence Bureau reports that more than £670m was lost nationwide to the top ten internet-enabled frauds in the year to the end of August.

Detective Superintendent Pete O’Doherty, the City of London Police’s fraud chief, said: “Anyone who has fallen victim to an online fraud should report it to Action Fraud. Only by doing this will local police forces be able to track down offenders.” Call Action Fraud on 0300 123 20 40.

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Smoking doesn’t only hit your health, it hits the cost of life insurance too. The AA says a smoker who pays the same premium as a non-smoker will have 50 per cent less cover.

Mark Huggins, of AA Life Insurance said: “Smoking isn’t a cheap habit and it certainly isn’t healthy – that’s why smokers pay more for life insurance.

“Lots of people take out life insurance to pay off a mortgage or provide a lump sum or regular income to family if they’re no longer around. But smokers should be aware that non-smokers get the better deal when it comes to life insurance.”

20 October

A new campaign calling for banks to stop funding fossil fuels and climate change has been launched today by campaign group Move Your Money.

An online letter to Britain's Big Five banks, HSBC; Barclays; RBS; Lloyds and Santander warns that they each have three months, until the end of January 2015, to commit to ending their support for fossil fuels otherwise customers will leave them.

“People’s everyday savings and investments are being used by banks to fund climate change, something we’ve found the public simply don’t want,” said Charlotte Webster, campaign director, Move Your Money. “Our Divest! campaign is everyone’s opportunity to tell their bank to clean up its act, or they will walk.”

To find out more about the campaign go to www.moveyourmoney.org.uk

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At the end of October, 12 fixed energy deals will finish, leaving an average annual bill increase of 10 per cent - or £104 - for consumers who haven't taken action and shopped around for a new deal.

Suppliers with tariffs expiring at the end of the month are: British Gas, Scottish Power, Npower, Sainsbury's Energy and iSupplyEnergy.

Those who are currently on Npower's Online Price Fix October 2014, and live in Yorkshire, could see the largest average bill increase of £205.01, or 20.67 per cent, warns GoCompare.

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The Government has announced a consultation on its plans to include peer-to-peer loans in tax-free Isas. These loans offer much higher returns to savers than normal deposit accounts, but come with much higher risks.

Savers can get 6-10 per cent returns, compared with around 2 per in savings accounts. The money is lent to small businesses or individual borrowers. But fears have been raised that including them in an Isa could leave people unsuspectingly taking on too much risk.

At present, people can invest up to £15,000 in a tax-free Isa, whether in shares, funds or deposit accounts. It is expected that any investments in P2P Isas would have to be included as part of that overall £15,000 allowance.

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