The stories we noticed this week: repossessions down; evictions up; holiday money boost: contactless card limit increase; buy-to-own firms slammed; pension freedom warnings.
Good news: repossessions fell to 21,000 in 2014 – 26 per cent fewer than the 28,900 in 2013, and the lowest number since 2006, according to the Council of Mortgage Lenders.
There were also fewer mortgages in arrears at the end of 2014 than at any time since 2006. Some 116,800 loans were in arrears of 2.5 per cent or more of the amount borrowed.
But mortgage broker Jonathan Harris warned: “There are still tens of thousands of homes being repossessed which begs the question: what will happen when interest rates rise?”
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Bad news: Ministry of Justice figures showed that almost 42,000 households in England and Wales were evicted in the last year - the highest since records began in 2000.
“Behind the statistics stand people who have gone through the trauma of losing their home,” said Shelter’s Campbell Robb. “The affordable homes shortage is having a devastating impact.”
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Sterling has hit a 10 year high this week on the back of the struggling euro. That’s good news for anyone planning to holiday in Europe and a massive change from six years ago when exchange rates hit a low with travellers getting just a euro for each pound.
Post Office Travel Money reckons prices are effectively up to 50 per cent less in eurozone resorts now compared with 2009 - led by the Algarve. However, people planning trips to more exotic destinations will discover their holiday money goes a lot less than before. The pound has plunged against currencies for many of the most popular destinations such as the US, Caribbean, Dubai and Thailand.
People making contactless payments will soon be able to spend up to £30 at a time with a swipe of their card. The current £20 limit is being increased in September after research showed the average plastic card transaction in a supermarket is worth just over £25.
With a contactless card, you simply swipe it on a reader instead of having to enter a PIN. Last year some £2.32bn was spent on contactless. There are now some 58 million contactless cards in the UK.
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If you apply for an account or credit card with Lloyds, Halifax or Bank of Scotland from next week you’ll be able to upload personal documents to pass identification checks. The change will mean cutting out the need to go to a branch to pass background checks.
At present, around one in three of those who apply online for a credit card or account with the banking group have to physically take documents into a branch. The new service will allow them to upload from their mobile phone, tablet or computer, documents they have taken copies of, such as passport or driving licence.
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April’s pension freedoms will bring inevitable mis-selling claims, warns Scottish Friendly. The mutual believes more needs to be done to ensure that pensioners and their retirement savings are protected.
Neil Lovatt, product director at Scottish Friendly, said: “There are great opportunities in these reforms, but also real dangers. A mis-selling scandal of some description is almost inevitable as pensioners get targeted and exploited.
“The biggest concern is that pension assets will be used and abused outside the confines of the protection currently afforded by the regulated financial services sector and individual advice.”
Only one in three people feels very confident about making their own decisions about the new pension freedoms, new research suggests. The National Association of Pension Funds has three top tips for savers ahead of the new freedoms from 6 April. They are: be informed, be realistic and take your time.
“The reforms have changed the options savers have about retirement savings but many are not sure how to use them,” pointed out Joanne Segars, NAPF chief. “You should fully understand your financial situation, think long-term, as these decisions will affect your income for the rest of your life, and take your time – 6 April is the start not the deadline,”
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You don’t need to win the lottery or Premium Bonds to make a million, reckons Fidelity. Instead using your full Isa allowance every year - assuming it increases 2 per cent each year from the £15,000 limit - could give you a million in savings in 27 years and ten months. Mind you, that also assumes annual growth of 5 per cent, which is a big assumption!
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Almost one in 10 pensioners have been targeted by financial crooks, reckons MetLife. Recent frauds have included attempting to access older people’s bank or savings accounts through vishing scams, where people are tricked into handing over bank details and cards. But there are also rogues busy flogging bogus investment and pension schemes.
The City watchdog has been urged by MPs to take action against controversial rent-to-own retailers which charge sky-high prices for household goods.
Stores such as BrightHouse, PerfectHome and Buy as you View have been accused by the All Party Parliamentary Group on Debt and Personal Finance of forcing people to take out expensive warranties and insurance when buying fridges or sofas through high street stores.
MPs have also accused the stores of possibly misselling insurance and services people don’t need.
They are today demanding the introduction of ‘health warnings’ to ensure customers are aware of the total cost of agreements and the risks of repossession.
Vulnerable customer should also be protected against losing essential items that they have mostly paid for, the MPs said.
UK households took on more extra debt last year than any year since 2004. Shocking new analysis by The Money Charity shows we each took on an average of £395 of additional consumer debt in 2014.
Average consumer credit debt stood at £6,322 in December, up from £5,938 at the end of 2013. In 2013, the average increase was just £50.
But the charity warns that as the recovery continues, consumers are rediscovering their appetite for credit cards, overdrafts, and personal loans.
Total lending, including mortgages, grew by £1,081 in the year, the most since 2008. At the height of the property boom it was growing by more than £4,000 per household per year.
In total, people in the UK owed £1.466 trillion at the end of December, of which nearly nine-tenths was mortgage debt.
What’s going to affect our investments this year? The usual economic and political problems are promised, but what should investors do to maximise opportunities or avoid disasters?
There’s a “wall of worry” that is creating opportunities despite falling oil prices and turmoil in Greece, reckons Tom Stevenson of Fidelity Worldwide Investment.
He explains why in a video interview I’ve just made with him. He also reveals which region he reckons promises most to investors ahead of the UK’s general election in May – and it’s not Europe or the UK!
To find out more watch the full video online at ind.pn/1uvWLTm
The age at which people can use a free Government service to help them better understand their State Pension has been reduced from 60 to 55.
They can request a personalised State Pension statement, giving an estimate of what they are likely to receive based on their current National Insurance record.
To get a free State Pension statement, call 0345 3000168.
If you lost your job tomorrow, how long before you’d be plunged into problem debt? A shocking study out today suggests it would take just 100 days for around 15million of us to end up in money difficulties.
The survey by charity Christians Against Poverty revealed a third of us currently owe money to their bank or credit cards but are able to afford the payments while eight per cent sometimes have to miss payments or are struggling in ‘unmanageable debt’.
“If there’s one thing that I’ve learned from our clients over the past years, it’s that the unexpected actually happens more routinely than we think,” said the charity’s Founder John Kirkby.
“The problem is, as a society, we’re just not very good at preparing for the fact that stuff happens. People lose their jobs; they become ill or their relationship breaks down; they discover they’ve been paid too much in benefits - these are the things that can drastically affect people’s income.”
If you’re planning home improvements this spring, spare a thought for your neighbours. New research from Direct Line suggests that around 3.7 million people have suffered property damage as a result of neighbours making renovations to their homes in the last five years.
Over that period, the repair bill for damages across the country totalled more than £1.5bn.
Hotel chain Travelodge is offering 40,000 rooms for £35 or less during the February half-term. For a family of four staying in a £35 room, that works out at just £8.75 per person – that’s cheaper than a children’s bowling ticket or a couple of magazines and a bar of chocolate. Details at Travelodge.co.ukReuse content