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.
Bank account providers criticised by OFT
Banks are not being transparent enough about interest rates and penalty charges for their current accounts, an Office of Fair Trading (OFT) investigation has found.According to the new report, which was released today, UK banks raise more than 80 per cent of their £8 billion per year revenue through interest and penalty fees.Of this total, £2.6 billion comes from the charges, while a further £4...Read More
Are your building society deposits safe?
Over the last few months much of our attention has been focused upon UK banking sector where there have been significant failures and concerns across the board. However, while literally billions upon billions of pounds of UK taxpayers money is being poured into the banking sector, the building society sector has to date remained fairly trouble-free. However, the ongoing demise of the Dunfermline B...Read More
Is it ever too soon to teach your children about finance?
Each and every one of us will have been through difficult financial situations in our lives, we will have been short of money at some time, we will have overspent but ultimately we should be passing on these experiences to our children. It is never too soon learn to start to teach your child about finance, about the value of money and the cost of living although you do need to be careful about how...Read More
When did you last complain about your bank?
Even though the UK financial sector touches all areas of our lives, it seems that very few people in the UK have actually followed through with their complaints regarding financial investment, financial services and the financial sector as a whole. Recent figures from the Financial Services Authority (FSA) show that while having record complaints passed to the regulator, more and more people are h...Read More
Are We Nearing The End Of Free Banking?
If you read the financial press you might be mistaken for assuming that banking has been 'free' for many years. As the UK banking sector continues to soften customers for the change from 'free' banking to regular charges for your banking arrangements many people are starting to worry. What will it mean? How high will the charges rise?
At this moment in time the truth is that nobod...