Do I really need an overdraft?
Many people in the UK will have access to "interest-free" overdrafts for which they may be charged a small administration fee on a monthly basis. However, do we really need an overdraft or is it simply a long-term extension of our own credit facilities?
The ideal of an overdraft should simply be access to emergency credit at very short notice. However, it can be very easy to fall into the trap of accumulating your overdraft facility with your income on a monthly basis to arrive at "accessible credit limits". This can often lead to situations where we fall into our overdraft facility earlier and earlier each month which can often lead to extended overdraft facilities which are often more expensive and attract higher interest rates.
Even an interest-free overdraft facility, although often very useful at the time, can be the first step towards more debt and more charges in the future. We all need to be vigilant and keep within our budgets and not automatically assume that our overdraft facilities are part of our "everyday budget". It is easy to suggest that a £100 overdraft is simple to pay back but this could become £200, £300, etc and the situation can easily get out of control.
Dunfermline Building Society rescued by government
The UK government was today forced to bail out the Dunfermline Building Society with a £70 million hit for the UK taxpayer. There have been rumours for some days that the building society had hit trouble with losses of over £26 million from alleged risky lending in the commercial sector and sub-prime loan market. The society itself has 250,000 savers and 35,000 borrowers although the UK governme...Read More
When did you last move your bank account?
The vast majority of people in the UK are unlikely to have moved their bank accounts within the last decade and indeed many have remained with the same bank for most of their lives. However, while in the past it may have been a little difficult to transfer bank accounts, direct debits, etc, the situation has now changed and many websites now offer you the chance to move banks and they will look af...Read More
Northern Rock and Bradford & Bingley merger
Northern Rock and the Bradford & Bingley will be merged together by the UK government in an attempt to increase the pace at which UK taxpayers can expect to receive repayment of the loans offered by the government during the credit crunch. In effect the two "bad banks" from Northern Rock and Bradford & Bingley, which contain potentially toxic mortgage arrangements, will be brought together under a...Read More
UK government seizes £4 billion of Icelandic assets in UK
In a move which has been welcomed in the UK but may well backfire in the overseas political scene it has been confirmed that the UK government has seized £4 billion of Icelandic assets held in the UK. The £4 billion figure is in excess of the £3 billion which is said to be owed to UK investors by Iceland's financial system. So what next?
While initially the Icelandic government...
Is the humble cheque set to be terminated?
Despite opposition from small businesses and consumer groups, UK banks are set to vote next week on the possible abolition of cheques as a method of payment in the UK. While this has been an ongoing situation for some time, there are still around 3.8 million cheques written every day in the UK although this number has fallen by 66% over the last 20 years. So why are the UK banks looking to abolish...Read More