Financial Packages Must Filter Through Says Age Concern

Thursday, November 20th, 2008

It is vital that governmental plans to lift the UK economy out of a recession provide adequate support for older generations, Age Concern has warned.targ

According to the charity, the government is at risk of plunging a generation of people into financial difficulty unless arrangements are made to protect them in the upcoming pre-Budget report. The group warned that because older people often face higher inflation costs and can struggle to meet the costs of keeping homes warm during the winter, there is a danger that they will be particularly hard hit if the UK enters into a recession.

It noted that while provisions such as lowering income tax will likely be welcomed by many families and workers, it will have very little impact on those of pensionable age. As such, Age Concern warned that specifically targeted measures were needed to support older people through this difficult period.

Among the recommendations made was the introduction of a higher winter fuel payment subsidy, in addition to increases in the basic state pension and pension credits. It noted that such a move was necessary to reflect the real rates of inflation that old people are commonly exposed too. By enforcing such measures, it is possible that older people could find the strain on their finances is reduced, allowing them to meet other costs such as food bills or outstanding personal loan and credit card payments more easily.

In the meantime, Age Concern warned that half of all pensioners are cutting back on essential items such as food and clothing in an effort to make ends meet, while some ten per cent have been forced into debt as the credit crisis and soaring inflation have become an indomitable burden.

Commenting on the situation, Gordon Lishman, director general of the organisation, urged: “Millions of older people will be looking to the government to deliver a pre-Budget report that lives up to its rhetoric on fairness and eases their financial pressure and uncertainty. Alongside tax cuts, which are unlikely to help the majority of pensioners, the chancellor must also announce specific measures to help pensioners such as increases in the winter fuel payment and pension credit that truly reflect the high cost of living. The government must ensure that its fiscal stimulus package does not ignore the needs of millions of older people who are quickly running out of ways to pay their bills.”

Meanwhile, Age Concern also called for improved protection for those who are nearing the end of their working life after research indicated that older employees are likely to bear the brunt of the majority of redundancies as the country heads into a recession. In such a scenario, it could be possible that more people are caught out by the pensions pinch. According to the Life Trust Foundation, increased life expectancy presents a growing risk that millions of older workers will be unable to save for their retirement. The group warned that the current economic climate has exacerbated this problem as people have begun saving less as their incomes are absorbed by food and fuel bills, in addition to other commitments such as mortgages, personal loans and credit card repayments.

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Britains Financial Standing Slumps

Friday, November 14th, 2008

The nations financial wellbeing has hit a record low, it has been revealed.

In figures released by the Alliance Trust Research Centre in its latest financial reality index, it was indicated that the standing of British households economic situation plummeted during the third quarter of this year. According to the research centre, the score tracking consumers fiscal standing continued the sharp decline that had first begun in 2007 reached 43.4 - the lowest point it has ever recorded since it began the research more than ten years ago. Such a figure, it was also revealed, is below the “critical” level of 100. Overall, declines in all three of the indices that consist of the organisations financial reality index were noted.

It was noted that a particularly dramatic fall occurred within the sub-index tracking British households budgets. This measure of the financial reality index was shown to have fallen from the 31.9 noted in the second quarter of this year to stand at 22.9 between August and October. Such a figure, the Alliance Trust Research Centre reveals, is an all-time low and is a continuation of the indexs habit of being “consistently below” the critical 100 level that has been seen since 2002. Such a fall was reported to be driven a by fall in real earnings and inflation for basic goods reaching 15 per cent.

Meanwhile, the net wealth index was revealed to have fallen by some 34.6 points during the last three months to stand at 6.9. The decline was largely attributed to dropping property prices and equity values over the course of this year, which in turn have contributed to “drastically reducing” consumers net wealth. Meanwhile, the increasing unemployment rates and a slowdown in gross domestic product growth have resulted in the economic background index dropping from 122.6 to 114. This fall, it was pointed out, is the fourth consecutive quarterly decline.

As a result of such negative figures with regards to finances, it may be possible that consumers find they are increasingly struggling with keeping up with various monetary commitments. Such areas could well include personal loans, credit and store cards, household bills and mortgage repayments.

Commenting on the figures, Shona Dobbie, head of the Alliance Trust Research Centre, said: “Our financial reality index shows very clearly how greatly the drop in household wealth over the last quarter has hit consumers financial wellbeing. Sharp falls in house prices and share prices mean it is the household wealth index that performed worst last quarter, alongside the other two key factors that are families budgets and the economy. Poor figures across the board in all three categories mean that consumers are now facing the worst financial reality in the course of our 11-year study.”

It was stated that since the index was launched the research centre has witnessed a “very close relationship between consumer spending and financial reality”.

Ms Dobbie added that during the past three years this trend has been impacted upon by those Britons who have continued to “spend despite increasingly worsening financial circumstances”. However, it was stated that people are now beginning to get a realistic grip on their finances and are starting the process of spending within their means once more.

For those consumers holding concerns about their ability to manage their money in the months to come applying for a cheap loan might prove to be of assistance. By selecting this kind of loan, borrowers could find they can meet various spending commitments - such as mortgage arrears and outstanding credit card bills - quickly, allowing them more disposable income at the end of each month. This could prove to be particularly useful after Axa recently revealed that some 20 million Britons have dipped into their savings schemes in order to meet various costs over the course of this year.

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Consumers Cannot Put Cash Aside Says Nationwide

Thursday, November 13th, 2008

Millions of Britons feel they are not putting enough money aside to save for a rainy day, Nationwide has found.

According to the group, one quarter of respondents to a recent study felt they are able to save a sufficient amount, while just over half (52 per cent) were hopeful that they would be in six months. However, while it noted that relatively few people feel they are in a sound position at the moment in terms of stashing spare cash, there has been a slight increase in the number of people who are optimistic about their saving prospects over the next half year. It noted that last month, fewer than half (47 per cent) of people said they were confident they would be saving enough in six months. It noted that this five per cent improvement could be taken as a positive sign of growing consumer confidence, particularly considering that the festive period - one of the most expensive times of year - is drawing near.

For consumers who are unsure of their ability to meet Christmas costs this year as adverse economic conditions have stifled cashflow, taking out a cheap loan may be an effective way to do so.

And while consumers may be cautious about paying off personal loans and other such responsibilities, Nationwide has noted that there has been a marked increase in peoples perceptions of their future economic situation. It claimed that last month, the expectations index - which is used to measure sentiment surrounding economic prospects - registered a 17 per cent increase. Nationwide claimed that this rising confidence may be a strong contributing factor to the growing belief that people will have more disposable cash to save in six months.

Commenting on the figures, Matthew Carter, director of savings at the company, said: “The fact that half of consumers are still failing to save or are only saving occasionally is a concern [...] However, our latest research shows a slight increase in the number of people who are feeling positive that they will be able to save the correct amount in the future, which is small step in the right direction. I hope more consumers put firm savings plans into action soon. The current financial climate will have raised awareness about the importance of having savings and we hope this, combined with joint industry and government education programmes, will encourage people to save regularly going forward.”

For those who are struggling with costs as the Christmas period approaches, taking out an unsecured personal loan may be an effective way to purchase presents, food and wine without risking defaulting on other payment responsibilities. And with a low-rate personal loan, consumers could even put any money left over into a high-interest savings vehicle to shore up their finances as a year of economic turbulence comes to an end. Parents may also like to send some money their childrens way to teach them the value of saving after Halifax revealed that many youngsters feel their pocket money is insufficient to support their spending habits.

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ONS Tracks Rise In Unemployment

Wednesday, November 12th, 2008

The proportion of people in the UK who are out of work has risen, new figures from the Office for National Statistics (ONS) have shown.

In the period from July to September 2008, the group recorded rises in the number of unemployed people and the number of Britons who are claiming benefits while they are out of work. Meanwhile, the number of available jobs has fallen, indicating that employment opportunities are contracting in line with the overall economy.

For the three-month period, the rate of unemployment in the UK stood at 5.8 per cent of the total number of people who are economically active. This represents an increase of 0.4 per cent on figures for the previous quarter and 0.5 per cent over the year. This amounted to an additional 140,000 people entering unemployment during the course of July to September.

As more people enter unemployment, it is possible that a growing number begin to experience difficulties keeping up with financial responsibilities. Such areas of commitment could well include mortgages, credit cards, utility bills and personal loan repayments.

Indeed, the ONS noted that as the number of people who are out of work rose, so did the number of people claiming jobseekers allowance, indicating that Brits are keen to tide themselves over while look for more work.

And while the statistics have caused alarm in some circles, the Department for Work and Pensions (DWP) has urged consumers to remember that in a relative sense, the employment position in the UK remains strong.

The organisation stated that there are thousands of jobs still available, while governmental funding can support people while they search out new work.

Tony McNulty, minister for employment, said: “Every time a worker loses their job it is a personal tragedy and the government is doing everything it can to get those people who have become unemployed back to work as quickly as possible. People who are worried about the current downturn need to know that there are jobs out there - the claimant count may be rising, but large numbers of people are also moving off benefits and into jobs. Those people who do find themselves unemployed are getting real help early on and today we are doubling the funding for Jobcentre Plus.”

For those who have been struck off in recent months as the world enters a period of economic slowdown, the DWP assured people that there are plenty of opportunities to re-enter the workforce. It explained that more than 10,000 job postings are generated through Jobcentre Plus everyday, while other regional recruitment portals produce thousands more. During the three-month period to October, it estimated that there were 389,000 unfilled vacancies.

Meanwhile, commenting on ONS figures showing that the country has entered a period of economic contract, independent financial advice site the Motley Fool warned that many Britons are struggling to put money aside for the future as payment responsibilities wipe out their wages. For those who have found themselves in such a situation, taking out a debt consolidation loan may be an effective way to get back on the road to financial recovery.

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Britons Tell Fibs About Finances Says Study

Tuesday, November 11th, 2008

While money has often been considered a private matter, a new study suggests that when it comes to discussing their financial position, many Britons are less than truthful.

According to AXA, more than one in three UK residents have misled a partner, friend or familymember about the stability of their finances. Furthermore, the group warned that with the global economic outlook appearing less rosy, many more may feel it is necessary to spin a few tall tales when it comes to discussing their cashflow position.

However, a leading psychological expert has claimed that now is actually the perfect time to come clean about debts and look to take a fresh approach to managing money. Commenting on the findings of the AXA study, Andrew Kinder explained that hiding the facts about financial insecurity is likely only to exacerbate them in the long term.

Indeed, he warned: “This is the worst possible time to be in denial about your finances. Unburdening your financial transgressions, even anonymously, can be a crucial first step to taking better control. There is often much more behind a deception, even a relatively trivial one. You tend to find that when people make a confession theyre much better able to deal with these underlying problems.”

For those who have found themselves overburdened by mounting payment responsibilities in recent months, taking out a consolidation loan may prove an effective tool in scaling the debt mountain. In applying for this type of loan, consumers could find they are able to stretch repayments over a longer period, thereby increasing monthly cashflow and reducing the likelihood of being drawn further into the red by missed payment charges.

Meanwhile, Alison Green, a spokesperson for AXA, urged people to come clean about their finances, claiming that the only people they are deceiving are themselves.

“With harsh times ahead, people are likely to be in an ongoing cycle of panic and denial. Now is the ideal time to come clean and kick-start a more proactive approach to managing your cash and planning for the future,” she commented.

Further findings from the group indicated that it was common for many people to hide major purchases from their friends and family, with one parent even confessing to raiding his childs savings account and claiming that the money was a bonus from his work. His actual bonus had been cancelled as the credit crunch bit down.

Meanwhile, another lady who responded to the AXA study said that she had splashed out 70 pounds on face cream and decanted it into the bottle of a cheaper product to hide the purchase. Another respondent said that she had felt it necessary to lie about the size of her paypacket because her partner hoped to live off her income.

For those who have not been able to cope with the costs of supporting their household as bills rise and access to credit diminishes, taking out a debt consolidation loan may prove an appealing way to get back on their feet financially. Applying for a consolidation loan may be necessary for a growing number of Brits, as a study from the Motley Fool warned that many residents are unprepared to cope with a recession.

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Christmas Blues For Hard-Up Brits

Wednesday, November 5th, 2008

As the festive season approaches, the struggles that everyday people go through have been highlighted.

David Kuo, head of personal finance at money website Fool, said that there are large numbers of people across the country who are simply living “from hand to mouth” and are therefore struggling to put any money aside in time for Christmas.

The continuing squeeze on finances being caused as a result of the credit crunch is behind such difficulty in the run-up to Christmas, Mr Kuo said, arguing that this increased expenditure on everyday household bills has stopped people from saving any of their hard earned cash for Christmas.

Rising costs associated with energy bills, motoring, mortgage payments and insurance, as well as food price inflation, has meant that peoples everyday outgoings have risen and disposable income left at the end of each month has fallen away. Therefore, it is increasingly difficult to plan ahead for events such as Christmas where expenditure increases, as there is less ability to put money to one side each month, Mr Kuo said.

One way that people may be able to plan their finances so they have funds available over the Christmas season is to take out a low rate personal loan, as this may help them to budget payments over a longer period of time.

And it is budgeting for the festive season that Mr Kuo suggests for those that are in a situation where they have not been putting money aside each month. “There are so many people who are just living from hand to mouth at the moment, one of the big problems is while it is ideally the right thing to do to put money to one side, practically it becomes very difficult to do so. What people need to do between now and Christmas is budget in some ways,” he said. Mr Kuo added that it may be wise for individuals to try and find the money they think they will spend on Christmas presents from somewhere. By budgeting successfully, large amounts of debt spread over a number of different credit cards, for example, may be avoided.

However, despite these tips for a successful Christmas, research from a number of building societies has shown that people are currently planning on cutting back their level of expenditure for this festive season.

Birmingham Midshires research found that some 78 per cent of Britons are taking steps to make this Christmas an affordable one. Overall, budgets for Christmas have fallen by 102 pounds, with Britons planning on forking out just over 600 pounds this year on their celebrations. There has also been a drop in the number of people that plan to put their Christmas spending on credit cards, the research found, noting that 11 per cent of people plan to use their plastic for spending this season - down from 41 per cent of people in 2006.

It seems, however, that it is not just Christmas that is a concern for individuals. Recent research from Close Investments suggested that the majority of people are concerned about the country suffering from recession during the winter months.

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Watchdog Says Banks Need To Put People First

Tuesday, November 4th, 2008

The government should take the opportunity to ensure that consumers are put at the heart of UK banks business model, Which? has insisted.

An announcement from the group came as it launched a major new campaign to reform the UK financial services industry. Research carried out by the firm has found that for many Britons, there is little faith that the current organisational structure of the banking industry can prevent another downturn from occurring. When questioned, more than four-fifths (81 per cent) of the 1,001 adults questioned by the group said that they thought reform is necessary to avoid the recent financial turmoil from resurging in the future.

Indeed, more than two-thirds (67 per cent) of respondents said that they blame the banks directly for the current economic contraction and the dwindling availability of credit and loans. Meanwhile, 73 per cent of people said that they had personally been exposed to banks and other loan providers offering money in an irresponsible manner.

Following the survey, Which? embarked on a new campaign urging the government to do more to ensure that consumers are protected from unsound lending practices and other similar problems. In a letter to chancellor of the Exchequer Alistair Darling, the group demanded that banks are required to do more to insulate their customers from recent corporate failures. Among the requests made by the watchdog was that all of the UK institutions which have received public funding as part of the recent bailout should be required to pass on cuts to the base rate of interest immediately. Such action could relieve strain on consumers by increasing the availability of cheap mortgages, personal loans and credit cards.

So too, the group also insisted that there should be an internal review into retail banking practices to make sure that the interests of UK customers are integral to the operations of all financial institutions.

Which? chief executive Peter Vicary-Smith commented: “Banks have had their bailout - now its time for them to deal sympathetically and fairly with the plight of ordinary consumers, many of whom are anxious about their savings or struggling with their mortgage. It is the governments duty, as a major shareholder, to ensure this happens. The government cannot afford to pass up this unique opportunity to make long-term, consumer-focused changes to the banking industry and in the short-term were after a fairer deal for consumers. We want to see an independent review leading to an overhaul of an industry that is characterised by weak competition [and] irresponsible behaviour.”

He said that many banks have a poor track record of making sure that customer services and support standards are up to scratch.

The announcement from Which? follows a raft of measures designed to add buoyancy to the banking industry. This was matched by a cut in the base rate of interest enacted by the Bank of Englands monetary policy committee, which slashed rates by 50 basis points last month. Such a move may soon be followed by a fall in mortgage and personal loan interest rates.

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Customer Satisfaction Plummets As Energy Prices Soar

Wednesday, October 29th, 2008

With two rounds of price hikes witnessed so far this year, customer satisfaction levels are plummeting for the UKs major energy suppliers.

Such is the claim of uSwitch, which has noted that while price rises have been a strong cause of discontent, Britons are becoming increasingly dissatisfied about a range of other services and facilities offered by the big six utility giants.

Overall, it found that consumers are less likely to recommend their energy provider to a friend or family member, while 41 per cent are distrustful of whether their company has put them on the best tariff. So too, fewer than half (46 per cent) of all energy customers said that their provider was offering good value for money.

For those consumers who have found themselves struggling to keep up with bill repayments as food, fuel and energy prices have risen, taking out a debt consolidation loan may prove an attractive option.

According to uSwitch, the recent price hikes - combined with a perceived slump in service levels - have caused growing resentment among customers, with more than two-fifths (41 per cent) of people saying that they are dissatisfied with their provider. At the same time last year, this proportion stood at 33 per cent.

The first company to introduce the hikes, npower, was said to have borne the brunt of consumer discontent, with an overall 17 per cent decline in satisfaction levels. It saw its customers grow increasingly unhappy with a range of services such as metering, customer support and billing options.

Commenting on the findings, Ann Robinson, consumer policy director at uSwitch, stated: “Price rises were never going to be a vote winner, but this years increases have hit people exceptionally hard and inevitably it has damaged their perception of the industry. Sadly this has undone a lot of the hard work suppliers have put in to improving service, setting them back to where they were a couple of years ago.”

However, she added that while energy suppliers need to do more to increase customer satisfaction, consumers have a role to play too.

“If you are not happy that you are on the best deal or getting value for money - speak to your supplier. If you are concerned about estimated bills then make sure you give your supplier an up-to-date meter reading,” Ms Robinson continued.

She concluded by advising that if, after this has been done, consumers are still unhappy with their supplier, they should consider switching to take advantage of a cheaper tariff.

For those consumers who feel they are unable to change suppliers because of outstanding repayment obligations, taking out a debt consolidation loan may prove an effective way to spread debt obligations over a longer period of time, thereby relieving the burden of large bills. Meanwhile, a home improvement loan may be of interest to those who are looking to upgrade household appliances as the winter draws in. According to a recent report from Confused, it is vital that consumers check that household heaters and other devices are in a good state of repair before bringing them into use for the colder months.

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First Home Buyers Make A Comeback

Thursday, October 23rd, 2008

The residential property market has been buoyed by the return of first-home buyers, new figures have shown.

According to the National Association of Estate Agents (NAEA), new entrants to the market helped to push up total house purchase sales for the first time since January. Figures from the group indicated that while estate agents typically handled five home sales during August, this rose to seven in September. This increase was in part attributed to the abolition of stamp duty tax on properties worth less than 175,000 pounds last month, which was said to have encouraged cautious first-time buyers to put in bids on property.

Indeed, Chris Brown, president of the NAEA, said that for those who can secure finance in these difficult lending conditions, now is the perfect time to get their foot on the first rung of the property ladder. Consumers who are looking for an effective way to boost the deposit on the home of their dreams may find that taking out a personal loan is appealing.

However, he noted that many current homeowners are hesitant about making moves on the market at the moment.

“It is clear that certain factors are in motion within the property market, with a decision being made on stamp duty last month, but this is still not enough. As property prices continue to drop the government needs to take action and make some drastic changes to restore confidence. It is evident from the results that despite some positive indicators, consumers are still cautious, with many continuing to adopt a wait and see attitude and are only moving if it is necessary. Those who are not desperate to move are staying put in their homes and waiting for some stability to be restored across all sections of the market,” he said.

The group went on to point out that with many homeowners still nervy about plunging house prices, figures indicate that estate agents are now being forced to work harder to secure deals. While the average time between instruction and sale stood 8.64 weeks in September 2007, last month average turnarounds took 14.13 weeks. However, while many consumers are showing a reluctance to commit fully to moving home, the number of people showing provisional interest continued to grow.

According to the NAEA, the typical estate agent had 211 house hunters on its books in September, up from 207 in August and 192 in July. However, such a figure is still down considerably on the average 326 people on the search for a home registered with estate agents around the country in September 2007.

For consumers who are keen to put in an offer on a property but are finding it difficult to get finance from cautious mortgage lenders, taking out a personal loan may prove an effective way to increase the size of initial deposit and reduce the perceived risk of extending finance for the sale of a home. Potential buyers may be particularly interested in applying for a loan after the monetary policy committee slashed interest rates earlier this month.

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Consumers Use Cards To Counter Lack Of Loans

Tuesday, October 21st, 2008

As the number of unsecured loans being made available to consumers withers, many are turning to their credit cards for cash they cannot find elsewhere, uSwitch has claimed.

According to the group, there are far fewer personal loans on offer than there have been in the past, with the credit crunch making lenders decidedly risk averse. Indeed, it noted that the total borrowing approved on unsecured loan arrangements plummeted by 13 million pounds last month. And with inflation still soaring like an albatross circling overhead as the UKs finances head towards glacial waters, many consumers are looking to plug the gap left by the shrinking personal loans markets by ramping up spending on credit cards. The price comparison site claims that during September, plastic expenditure rose by 130 million pounds.

However, uSwitch warned that people may be putting themselves at risk of some heavy financial blows by neglecting to use their credit cards wisely. The group claimed that many credit providers are ramping up rates for cash withdrawals made using cards, with a 41 per cent increase noted in typical repayment rates imposed for doing so. The group explained that the average annual percentage repayment for cash withdrawals now stands at 29.97 per cent, meaning that consumers are forking out an additional 161 million pounds in interest when compared to typical rates seen in 2005.

For those who have found themselves losing their grip on their finances in recent months, taking out a debt consolidation loan may be an effective way to reorganise outgoings and stem the tide of rising repayment responsibilities.

Meanwhile, Simeon Linstead, head of personal finance at uSwitch, said that consumers need to be on their toes when checking out a credit card provider.

“The credit card market is constantly evolving and even the savviest of consumers could be forgiven for not keeping pace with providers tactical tweaks to terms and conditions. However, providers count on the fact that their attempts to safeguard their margins through subtle fees and charge increases will simply be met with confusion and apathy - not action. As consumers are likely to only start feeling the full impact of the global financial meltdown in 2009, now is not the time to be naive when shopping around for a new credit card or lethargic when it comes to reviewing existing borrowing,” he said.

Mr Linstead explained that it is more important than ever to reorganise finances and seek out the most competitive arrangements, as economic indicators point towards a recession and a sustained period of belt tightening. He concluded by urging consumers to remember that the more that is spent on interest repayments, the less money can be put towards clearing debt burdens, something which will become increasingly important in the coming months.

For consumers looking for a way to reorganise their outgoings as money markets tighten and spending soars, taking out a debt consolidation loan may prove effective. Applying for this type of loan may be particularly useful for those who have found themselves stung by uncompetitive energy tariffs. Earlier this month, Confused warned that consumers are wasting millions because of a failure to switch suppliers.

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Car Insurance Premiums Move Up A Gear

Monday, October 20th, 2008

The burden of car insurance premiums does not look set to lighten any time soon, the AA has warned.

New data from the group has shown that for the third quarter in a row, the typical cost of car cover has rocketed, with a 3.1 per cent rise recorded in the last three months. Such an increase is equivalent of an additional 22 pounds for annual cover. For the average motorist in the UK, annual car insurance will cost a typical 724 pounds and 28 pence, the firm noted.

And while average policies have risen, the AA warned that not even searching around will insulate drivers from car cover inflation. Its Shoparound index - which measures usual premium quotes for those who have compared different providers before committing to a deal - showed that even bargain-hungry drivers can expect to pay an extra ten pounds for their car cover, taking usual annual policy prices to 486 pounds. While this represents a two per cent increase on figures from the previous quarter, it also marks an 8.7 per cent rise when compared to prices last year, equivalent to 39 pounds.

In being exposed to escalating car insurance costs - in addition to an increased fuel burden - consumers could find their ability to keep up with other financial commitments is compromised. Such areas could range from personal loans to heating bills.

The AA pointed out that trying to cut back on cover in an effort to reduce motoring costs will also bring less rewards than in the past. According to the group, typical quotes for third-party, fire and theft cover are 11.6 per cent higher than they were a year ago. Such a rise amounts to a hike of 62 pounds and brings typical minimum cover to 591 pounds.

Commenting on the statistics, Simon Douglas, director of AA Insurance, said: “Despite these rises the car insurance industry continues to make an underwriting loss: for every 100 pounds taken in premiums, more than 105 pounds is paid in claims. Insurers are particularly concerned about increasing legal costs and personal injury claims which last year rose by 22 per cent.”

He added that young male drivers are a particular drain on the industry as a whole, although they also pay the highest premiums.

“The average car accident insurance claim for a young male driver is nearly 4,500 pounds compared with 2,700 pounds for their female peers. For drivers aged over 30, the average claim is 1,400 pounds for men and 1,200 pounds for women. The withdrawal of another insurer from this arena suggests that companies are carefully looking at their costs,” he claimed, referring to Allianz recent departure from the market.

For those who are looking to buy a smaller car in a lower insurance bracket, taking out a car loan may prove a cost-effective way of raising the cash. Meanwhile, whether buying a new motor with a car loan or cash, Sainsburys Bank has noted that failing to haggle over forecourt prices could end up knocking drivers finances back into first gear.

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Consumers Warned To Get Prepared Before Winter

Wednesday, October 15th, 2008

As the nights grow colder and longer, it is important to make sure that heaters and other winter warming appliances are in good working order, it has been warned.

Confused has alerted Brits to the fact that failing to do so could leave them with a decidedly chilly feeling when looking at the costs of repairing damage done by faulty oil burners, electric blankets and similar devices. It urged consumers to make sure that they carry out a thorough safety check when bringing out appliances for the winter season. In addition to removing the gathered dust - particularly from elements - it is also vital that people check for frayed leads and cracked fuses to avoid a costly and potentially dangerous fault with the device. For those who find them to be in a state of disrepair, a personal loan may be an effective way to purchase a new appliance quickly before the cold weather gets into full swing.

In addition to making sure heaters are in good working order, the price comparison site also recommended a number of good practice guidelines when using heating devices. Making sure that they are not left on for extended periods of time was said to be particularly important, as was making sure they were situated away from any exposed flammable sources such as potpourri.

Meanwhile, to avoid the potential catastrophe of a fireplace fire, Confused urged consumers to make sure that their romantic visions of roaring log fires are seen through safety glasses. It pointed out that open fires can easily send sparks out of the hearth and on to any nearby carpets. As such, it advised Brits to make sure the surrounding fireplaces were kept clear to avoid the risk of a toasty night in resulting in a speedy departure into the cold night air. Furthering this, it urged consumers to invest in a fireguard to make sure such circumstances do not arise.

Confused also reminded people that while chimneys may be out of sight, they should not be out of mind as the winter months approach. Flues that have not been cleaned for a long period can develop dangerous levels of creosote residues which in turn increase the likelihood of chimney fires. So too, the deposits also cause chimneys to overheat, which can lead to cracked walls and fire damage, the group pointed out.

Darren Black, head of home insurance at the price comparison site, commented: “Dusty electric heaters, roaring fires and boilers which havent been turned on for most of the summer heighten the risk of claiming on your home insurance during the winter. We are also seeing the evenings getting darker earlier, which provides the perfect concealment for opportunistic burglars. In addition to being increasingly vigilant over the next couple of months, having the right home insurance is an integral part of securing peace of mind. Confused customers could save an average of 193 pounds per year on home insurance policies, which demonstrates the importance of shopping around.”

For those who are looking to overhaul their home heating this winter for safety and comfort, taking out a homeowner loan may prove an effective way to meet the costs of new equipment and installation. Meanwhile, those keeping an eye on energy costs may do well to shop around for a new provider in the coming months. Earlier this month, Confused claimed that Brits are potentially wasting billions of pounds because of a failure to do so.

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Communities Come Together In Tussle With Crunch

Tuesday, October 14th, 2008

Despite widespread reports of economic crisis, it seems that Britons are banding together and battling on.

Such is the claim of the childrens charity Ray of Sunshine, which has suggested that throughout the country there seems to be a reversion to an earlier era of kinship and austerity, with the older generations leading the charge into community togetherness. While 76 per cent of 18 to 24-year-olds said they tend to keep themselves to themselves and not socialise with their neighbours, more than nine out of ten (93 per cent) of Brits over the age of 55 said that they know something about those living close to them.

Not content with getting to know nearby residents - 81 per cent of Britons could greet their neighbour by name - Britons of all ages are even friendly with their local pets. According to the charity, 33 per cent of people know the name of their neighbours animals, which the group said added weight to the perception that Britain is a nation of animal lovers.

Furthermore, Ray of Sunshine claimed that as a country, UK residents are a trusting bunch. It noted that while incidences of crime are on the increase, many Britons are happy to let their neighbours know where they keep a spare key. According to the study, ten per cent of the population knows where keys are kept, while a further five per cent even know their neighbours alarm codes.

Consumers who are unfortunate enough to have been caught out by crimes such as burglary and theft in recent months, the costs of replacement may well have compounded their ability to keep up with other burgeoning demands such as food and fuel costs, credit cards and personal loans.

But despite growing financial pressures and rising crime levels, the childrens charity insisted that the nation is refusing to let this hurt their sense of community spirit. Residents in Scotland were said to have proved particularly resilient in the recent doom and gloom, with 95 per cent of respondents north of the border saying that they have got to know their neighbours. Meanwhile, 85 per cent of citizens in the south-west said they had done the same. Furthermore, the group claimed that while London may have something of a reputation as an impersonal and anonymous city, a "surprising" 83 per cent of consumers in the capital said they knew something about their neighbours.

Commenting on the statistics, Tim Shaw, chief executive officer of Ray of Sunshine, claimed: "From our work granting wishes for children living with serious illnesses, we know that people tend to band together and support each other in difficult times. It is encouraging to see that communities are doing this in response to the tough economic climate. Just greeting someone by name, or inviting them in for a cuppa can bring a ray of sunshine to their day and give the whole community a boost."

For those who have found an increased need for financial support as well as community spirit as the economic climate has grown more miserable, taking out a debt consolidation loan may be of interest. Opting for this type of loan may be particularly useful for the 42 per cent of respondents to a recent study by Abbey which claimed that managing repayment responsibilities was now their biggest concern in their household.

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Scottish Savings Forgotten In Battle Against Debt

Monday, October 13th, 2008

With the cost of living rising and the availability of credit withering at an alarming rate, many Scots have prioritised keeping their finances protected against rising debt in the battle with the crunch.

Such is the claim of Lloyds TSB, which explained that while many consumers have attempted to slay their debt demons, savings efforts have dwindled substantially. According to a study conducted by the group, more than two-fifths (41 per cent) are now saving less than they were six months ago, with 36 per cent of people saying they had concentrated on clearing debt as inflation has risen and fears of recession have circulated. Indeed, the bank notes that while the current economic crisis may put a forced end to the buy now, pay later culture which has pervaded Britain, it seems that many people north of the border have struggled to put more of their money aside. More than a fifth (21 per cent) said that they currently have less than 500 pounds in their savings. So too, residents throughout the UK were found to have struggled to stash the cash as the financial climate has grown ever more inimical.

On average, 37 per cent of consumers throughout the UK are now saving less than they used to, with this proportion rising to 43 per cent in the 45 to 54 age group. However, younger generations were said to have bucked the trend, with nearly a third (32 per cent) of under-25s currently saving more than they were six months ago.

For those who have been unable to put money aside in recent months as inflation has soared and payment responsibilities mount, taking out a debt consolidation loan may prove an effective way to get finances back on a firm footing. Taking out a loan for the purposes of debt consolidation may prove particularly appealing for the one in three people who were said to not to save on a regular basis. Of these, 57 per cent said that a lack of spare cash was holding them back from upping their savings efforts.

Commenting on the figures, Mark Cockburn, retail network director at Lloyds TSB Scotland, said: “Saving is a must for everyone. With economic conditions set to become more challenging, having the comfort of a savings nest-egg could be a lifeline for many Scots families during these difficult times. But it is difficult to put money aside with rising bills and ever increasing household expenses. While everyone understands the good sense in saving, what consumers told us they need is more guidance and advice on how to save more when their finances are being squeezed.”

According to Abbey, managing debt commitments has become the number one priority for households across the country. The group noted that 41 per cent of respondents believed paying bills on time was now the biggest aim, compared with nine per cent of people who placed saving at the top of the list.

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Consumers Seek Help As Winter Nears

Friday, October 10th, 2008

The number of people struggling with their home heating costs has escalated dramatically, Citizens Advice has claimed.

According to the organisation, there has been a notable increase in the number of people looking for advice regarding ways to keep energy costs under control as they slip into debt to their supplier. So too, as the number of cheap personal loan for house purchases has dwindled, instances of people slipping into arrears has also increased.

For those who are struggling with demands such as mortgages and utility bills as they eat into monthly expenditure, taking out a debt consolidation loan may prove an effective way to get finances back on track.

Meanwhile, Citizens Advice has called upon mortgage providers to show a little leniency during times of considerable financial turbulence and afford struggling homeowners the support necessary to keep them in their homes. Indeed, the group pointed out that lenders may need to begin extending assistance to more people after figures showed that the number of enquiries made about secured loans arrears assistance rose 35 per cent in the last 12 months.

And more short-term figures show that this problem has become particularly acute in the last few months. The group noted that in the second quarter of this financial year (July to September), the number of secured loans arrears enquiries shot up 51 per cent across Citizens Advice Bureaux across England and Wales when compared to the preceding three months.

Commenting on the figures, chief executive of the group David Harker said: “While we are pleased to see the number of consumer credit problems going down, the increase in the number of enquiries about basic essentials is worrying and these figures show how the current economic situation is hitting vulnerable and low income households the hardest. To prevent this situation worsening, it is vital that mortgage lenders and fuel companies do everything in their power to help people in arrears to come to a workable solution over repayment arrangements, rather than piling on extra charges. All creditors should treat borrowers in arrears fairly and sympathetically.”

He went on to say that anyone who is worried about the state of their finances should seek out professional and impartial advice immediately. It noted that while loans providers should always be flexible in their negotiations, it was important that people also sought guidance from free, fair and confidential services such as Citizens Advice or another similar organisations.

For those who have found it difficult to keep their feet on the ground in the recent financial shake up, taking out a debt consolidation may prove an effective way to stop financial obligations from spiralling out of control. Meanwhile, Co-Operative Financial Services pointed out last month that many consumers are smartening up to the benefits of the web in the fight against rising costs.

According to the organisation, more than two-thirds of Britons (68 per cent) have used online services in order to help get their finances order, with many citing the onset of the credit crunch as a principal reason for doing so.

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