Out of the six major energy companies supplying power to residents of the UK, only Scottish Power has not yet announced plans to cut prices.  Industry insiders, however, suspect that such an announcement is coming soon.

With less of their income going to fund gas and electricity purchases, Britons should be able to begin retiring some of their debts.  An individual with more money at his disposal, for example, may decide to pay down a bad credit loan or even a secured loan, though some will no doubt choose to use the extra money for more frivolous purposes, such as going out to dinner more often.

According to E.ON, the rate reduction will provide a benefit to the vast majority of its electricity customers, with more than 3.5 million out of 4.5 million total seeing a lower bill.  The average savings per customer will work out to approximately £31 per year.

E.ON’s Chief Executive for the UK, Dr Tony Cocker, commented that “Reductions over the last few months in the wholesale price that we pay for our customers’ energy have now allowed us to help as many of our customers as possible by cutting our electricity price.”

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Electricity Price War Spreads to E.ON

Most Britons who have payday loans outstanding or who owe car finance obligations can maximise their available funds by first paying off existing obligations before placing money into savings.  This is because the typical loan obligation is accruing interest at a rate in excess of 2.85%.

The Virgin Easy Access Saver account comes with some additional conditions.  Unlike many similar accounts available, it offers no bonus for signing up.  In addition, no more than £100,000 can be deposited into such an account.  UK residents who have that amount on hand, however, would do well to remember that the Financial Services Compensation Scheme will only guarantee the first 85% of that since there is a £100,000 limit for funds held within a single institution.  This limit applies to an individual account; a joint names account is guaranteed up to twice the individual level.

Customers interested in the Virgin Easy Access Savers account can register for this service in a number of ways, including online and using their phones.  Northern Rock branches will also offer the account to customers who prefer to do their banking in person.

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Virgin Money Offers Easy Access Saver Account

Consumers are concerned that competitors of Virgin Money will see the move as an opportunity to establish their own monthly fees on current accounts that were formerly free.  At this time, there are more than 50 million current accounts in the UK, and approximately 20% of them carry charges.

Such charges are sometimes coupled with benefits, but many consumers regard those perks as dubious because they consist of unwanted products such as insurance policies on holidays or mobile phones.  Consumer groups insist that those consumers who do want such arrangements can purchase them on their own without the use of a voucher codes.

In Virgin’s case, the bank has indicated that customers paying the charge may be entitled to perks such as discounts on internet services, health club memberships or airline flights.  No firm decision has been announced as to the exact nature of these discounts.

Virgin has defended the fees as “necessary.”  Jayne-Anne Gadhia, who works as Chief Executive of Virgin Money, remarked that “Most people know there is no such thing as free banking.  Banks have to cover the cost of free current accounts with hidden charges such as overdraft fees.”

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New Customers of Virgin Money to pay Fees

Andrew Tyrie, the Committee Chairman, expressed concern about the impact this would have on basic bank account customers, writing to both banks “Your decision has major implications for access to universal banking customers and appears to target vulnerable customers who are most at risk of financial exclusion.”

Basic Accounts Versus Standard Current Accounts

While basic accounts do offer most services that come with standard current accounts, they lack features such as cheque books and the ability to temporarily overdraw an account.  RBS has approximately one million holders of basic accounts and their new policy would mean that most such account holders would lose access to thousands of cash machines.

RBS has defended the new policy as a measure needed in order to reduce costs associated with basic accounts, explaining that the bank pays a fee when customers use the cash machines of other banks.  RBS held out hope that customers in remote areas and those with disabilities might still be able to access a wider range of cash machines.

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Cash Machine Policies Questioned by UK Government

From credit cards to mortgages, consumers have a much wider range of options than in times past.  In order to attract attention, many providers offer special terms or discounts that save consumers money.  This means that the local bank no longer is the only option you have, and in fact may not even be the best one.

This does not mean that your local bank is not worthy of consideration.  By all means, determine if they have what you need and what types of terms and conditions apply.  But instead of assuming you can’t do better elsewhere, take the time to do a little comparison-shopping.  Use the terms offered by your bank as the standard that is applied to any other options you entertain.  In short order, it will become obvious whether the bank’s services are a better deal that the services you can obtain elsewhere.

When comparing financial services provided by several different institutions, do look below the surface and make sure you are comparing like with like.  For example, added fees and other assessments that occur later in the contract may considerably reduce what may appear to be a highly competitive interest rate on the front end.  When compared to an offering where those later fees are not included, going with a plan that has an initially higher rate but saves money on the back end may be your best bet.

Keep in mind that you may find your bank does offer the best option for your needs.  If so, do not hesitate to take advantage of the option.  As long as you’ve made an informed decision, and not one based merely on convenience, you’ll be happy with your choice for many years to come.

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Shopping Around For Financial Services

First, never shop at an online site that is not secure.  The potential for the site to be breached and your information stolen is higher.  With sites that take adequate security measures, the potential for any unauthorised person obtaining your card information is much less.

When withdrawing funds from an automatic teller, make sure no one is close enough to take note of the code you enter on the keypad.  Today, most pads are situated so it is very difficult for others to see the string of numbers you enter, but thieves can be ingenious when it comes to finding a way.

Never keep the same personal information number (PIN) for more than a couple of months.  Your bank can provide you with instructions on how to change the code from time to time.   In most cases, the process takes only a few seconds, and will make it a little harder for anyone to make use of your card.

Debit cards do help eliminate the need to carry a lot of cash.  If the card is stolen, it is relatively easy for a financial institution to cancel the card and provide you with a new one.  However, the inconvenience of dealing with unauthorised purchases, as well as waiting for the new card to arrive, can be frustrating.  By taking steps to protect your card, you can enjoy all the advantages while avoiding the potential pitfalls.

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Keeping Your Debit Card Safe

First, look closely at your variable expenses.  These are your monthly obligations that do not come with a fixed payment.  Examples would be the money you set aside for food at home, meals out, and home utilities like gas and electricity.  Because these are not fixed expenses, you have some control over them.  Find ways to reduce those expenses below the current budgeted amounts, and divert those funds toward covering fixed expenses.  Even minor changes, such as eliminating one meal out each week, or taking a packed lunch to work rather than running out for something will make a significant difference over the course of a month.

Next, reign in your credit card spending.  Use the cards only when necessary.  If possible, transfer the open balances to the card with the lowest rate of interest, then put those other cards away for emergencies only.  You will have fewer obligations to meet each month, and may find it easier to manage the one credit card payment rather than deal with six or seven going to different providers. As a bonus, that one minimum payment is likely to be less than the cumulative payments on all the cards, which frees more of your funds to cover necessary expenses.

Last, don’t be too proud to seek professional financial assistance.  Whether you need someone to help you rework your budget, or require the services of a debt management company like Cut Your Debt to function as an intermediary between you and your creditors, take heart in the fact that everyone needs help now and then.  If it takes outside assistance to help you get control of your finances once more, then take that first step.  A year from now, you’ll be very happy you did.

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How to Make Ends Meet

But what does one do when the credit limit is suddenly reduces, sometimes drastically?  Unfortunately, many consumers, even those who make payments faithfully and on time, are facing this very issue.

The answer is that if using the cards is no longer affording the convenience that it once did, rethink the way you manage to cover household expenses.  There are actually a couple of ways to go about this process.

First, look into using a prepaid credit card, like a Bread Card..  You set the limit you need, based on the amount of funds you deposit.  There are never any worries about late payments or other such issues, since you only have to reload the card when it is time for another round of bill paying.

Next, do without the cards altogether and pay cash.  While decidedly low tech, this approach is still quite effective.  You may even find a few merchants that offer slight discounts to customers who pay cash, since they are not incurring a fee to process a credit card payment.

In order to make this transition, you may have a rather tight month or two.  If you can arrange your finances to get by on less for that month, then you will soon find there is enough money on hand to meet expenses as they appear, thus eliminating the need to use your credit card for day to day purchases.  This will allow you to set aside that credit card and its lower credit limit for emergencies, and still enjoy a decent standard of living.

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Depending Less on Your Credit Cards

Since phishing often relies on individuals clicking on what appear to be perfectly legitimate links in an email, make it a point to never click links that are purportedly from a banking institution.  Often, these links are accompanied by dire warnings that something is amiss with the account, and ask the recipient to click on the enclosed link to verify their account information.  Be aware that no bank uses this approach to resolve account issues.  Instead, contact your bank or credit card company, report the fraudulent email, and forward it to the address provided by the institution.

Also be aware of unsolicited offers from businesses that you do not know and cannot find much online about.  This is especially true if those offers require you to enter your private information, including financial data, to proceed.  There is a good chance that the email solicitation is an attempt to collect your information for unauthorised use.

Even if the name looks somewhat familiar, don’t assume it is legitimate.  One popular strategy phishers use today is to create a junk domain name that either has an added word to the name of a well known bank or retailer, or to spell the name of the institution with one incorrect letter.  Conduct an Internet search and you will soon find the correct spelling of the institution’s URL, and will know if the email you received is from a legitimate source.  As with any type of attempt to defraud you, forward the email to the fraud division of the business that the phisher is pretending to be.

A good rule of thumb is that if something does not seem right about the email, provide the sender with no data whatsoever.  Assume the email is not legitimate until you can prove otherwise.  This one simple approach will go a long way toward keeping you, your money, and your credit rating from harm.

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Protecting Yourself From Phishing Expeditions

With the increased selection of homes on the market, your chances of finding the ideal home in the ideal location are much better than even a few months ago.  While some of the properties may require some repairs, that is actually a good thing for you.  Homes that could do with some minor repairs and cosmetic touches are likely to go for a lower price.  With a small investment of your time and resources, you could emerge with a home that is easily one of the nicest in the neighbourhood, even if it was not the pride of the community when you made the purchase.

Taking the time to look at what is available in an area where you wish to live may yield some unexpected bargains.  One time-honoured approach is to focus your attention on the best neighbourhoods, and look for homes that need some tender loving care in order to reclaim their past glories. If the homes have been on the market for some time, there is a good chance you can make an offer that is lower than the current published sale price, and actually secure the property.

Before heading out to look for homes, make sure your finances are in order, and that you can secure a mortgage for your new home.  Work with your banker in advance to get an idea of what you can reasonably expect in terms of a mortgage, including the deposit you will need in order to qualify for the financing.  Arranging the finances in advance will make the overall process much easier when you find the home you want, and allow you to complete the transaction in considerably less time.

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Is Now a Good Time to Buy a Home?