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Common excuses that stop you from budgeting 22 Oct 2019 6:41 AM (5 years ago)

Most people want to manage their money in the best way possible. However, the idea of putting a budget together can stir up feelings of anxiety, discomfort, and out-and-out rebellion!

To be truly money-savvy, you need a thorough understanding of your income and outgoings. A budget is the best way to achieve this. Let’s take a look at why budgeting can be so difficult, and how to combat those common excuses. 

Why is budgeting so HARD?!

There can be many reasons why budgeting isn’t always easy. Some common ones include:

• Not knowing what your most important bills are
• Not having a realistic budget
• Feeling like you’re being punished by cutting down on stuff you love
• Not having a big financial goal to work towards. 

The human brain is a mess of contradictions. It can obsess so much about what the future holds, but it sometimes struggles to see how small, daily efforts can add up to long-lasting, positive changes.

There’s also good old-fashioned impatience. One of the reasons why a new exercise regime can often fail is because it takes time to form the healthy habits we’re working towards. You need to do the same routine, day in and day out, and be assured that you’ll see results down the line. 

Budgeting can present a similar problem. It’s easier to cut down on social outings and takeaways if you know it’s going to pay off in the form of being debt free, having money set aside for an emergency or being able to pay for that holiday you’ve been dreaming of. However, goals like this can seem an awful long way away, which can affect your long-term motivation.

While you’re putting your budget together, think about:

• How much money you truly need for your living expenses
• What goal you’re working towards
• How you’re going to ‘be your own cheerleader’ and keep yourself motivated

So now we’ve looked at why budgeting can be difficult – and how to make it easier – let’s unpack those common excuses that can stop you living your best financial life!

1) “I find budgets too restricting”

If you’ve found budgets unworkable in the past, it may be because they weren’t realistic to your needs. Your living expenses are paramount, no matter how much debt you’re trying to pay off or how big your savings goal is. 

When budgeting, people often want to see results fast, such as a big fat emergency savings pot or all of their debts paid off quickly. These are fantastic goals to have, as long as they’re worked on in a realistic way. As examples, the following ways would be unrealistic:

• Drastically cutting down your food and supermarket spending. You can’t master your finances if you’re wasting away or getting ill because you’re not eating properly
• Denying yourself any money for new clothes. Having good quality clothes is about more than keeping you warm (and not getting arrested by leaving the house naked). What if you need new smart clothes for a job interview? What if your favourite shirt shrinks in the tumble dryer? Even if it’s a bumper pack of undies, you need to have money available for new clothes from time to time
• Not allowing yourself any money for transport. What if you need to get somewhere in a hurry? What if auntie Ethel takes a fall and you need to travel from St Ives to Southport to visit her in hospital?
• Not setting any money aside for sports, hobbies and entertainment. You need to relax and have fun, and that requires at least a little bit of money. By all means, seek out and enjoy free entertainment and cheap days out where possible, but have some money available for a trip to the cinema or the occasional night out with your mates

Take a look at what you spend each month, and think about what truly makes you happy. If it’s going to a music festival once a year, or treating yourself to a new pair of shoes, then think about how to set a bit of money aside each month to cover these expenses. Remember; this isn’t about depriving yourself!

2) “I can’t get my partner to stick to a budget”

It can be very frustrating when you’re trying to be more money-savvy but your significant other doesn’t want to follow your budget. It’s a free country, and they have a right to spend their income as they see fit. However, you also have the right to make sound decisions with how you spend and save your own money.

If your partner’s unwilling to follow your budget, you could try:

• Building a budget based only on your income and expenditure. For example, if your partner pays all of the bills, but you give them money towards housekeeping, put ‘0’ in your budget for each of those bills you don’t pay towards. You then put the amount you give your partner in ‘housekeeping’
• Making stealth savings wherever you can. Are you in charge of the big food shop? Try switching one or two items to cheaper alternatives each time and see if your partner notices (chances are they won’t, as many own brands are just as good as the premium brands). Do you have children? Suggest free activities that you could do as a family (your local council website should list free or upcoming events that are happening near you). Take packed lunches where possible. Give charity shops a try. Look out for BOGOF deals. It all adds up
• Having an honest chat about budgeting with your partner. Have they tried budgeting in the past and it wasn’t for them? Do they have a lot of stress around money and find it easier to ignore it? If you share some of your worries around money or hopes for the future, you may find that they’re more receptive to budgeting with you.

3) “Putting a budget together feels like more work – I’m busy enough!”

When you look at a finished budget, it can seem like a lot of hassle. If that’s the case for you, why not try and tackle it one bit at a time?

There’s no rule saying you have to finish your budget in one go. In fact, our 7 Days, 7 Ways email support programme can help you put your budget together step by step, over a number of days. There are also budgeting apps you could try. 

You can get up-to-date balances on your debts pretty quickly. All you need to do is check your credit file through one of the three credit reference agencies – Experian, Credit Karma or Equifax. 

As for your bills, take ten minutes to go through your recent bank statement. You should find the regular amounts you pay out for council tax, rent, mortgage and other important costs.

For food, you can work out your monthly average by counting up what you spent in the supermarket over an average week. 

Building a budget isn’t usually a rip-roaring roller coaster ride through Funtown, but sometimes you have to do the boring stuff to make big changes to your life. 

4) “I’ve tried and failed to budget in the past. It’s not for me.”

Sometimes when you give something a try for the first time, and you ‘fail’ at it, it can be tempting to give up on it completely.

One of the childhood rites of passage for many people is to learn how to ride a bike. Was this the case for you? Cast your mind back to those first few tries. Remember when the trailing wheels finally came off, and how wobbly you felt riding on just two wheels? Remember falling off and scraping your knees? Remember crying and wanting to give up?

Budgeting is like riding a bike. Yes, you might feel wobbly and uncertain at first. Yes, you might ‘fall over’ and spend too much one month or not put enough in savings the next. Eventually though, you’ll find your balance and it’ll all kick into place. You just need to stick with it!

5) “I just don’t have enough money!”

Like many people, you may find that there’s just too much month at the end of your money. Daily expenses such as food and petrol get more expensive, and not everyone gets a wage rise when inflation hits.  

Have you checked to see what benefits you may be entitled to? We have a benefits checker than can help you do just that. There may also be ways you can make some extra money.

Please note: any extra earnings must be declared to Her Majesty’s Revenue and Customs (HMRC). 

6) “I’ve managed fine without one so far…”

This might be true. However, there’s a difference between ‘managing’ and ‘optimal financial fitness’, which is what a budget can help you achieve.

As you’ll learn through our 7 Days, 7 Ways email support programme, it’s the difference between thriving and surviving. We’re guessing that you want to do more of the former.

7) “I have an irregular income”

The job market is changing all the time, and self-employed and zero contract gigs are becoming more common as a result. Take a moment to think of your food delivery driver or parcel deliverer, as they’re working to a zero-hours contract. This is a relatively new type of employment, but it can make a person’s income pretty unpredictable. 

Having an irregular income shouldn’t stop you from making an effective budget. You could try:

• Thinking of the lowest ‘net estimate’ of your income each month, and building your budget based on this figure. By doing this, you can ensure that your priority expenses are covered, and any extra money that you get can go into savings or towards any debts you’re trying to pay off 
• Putting extra money into a ‘Hill and Valley’ fund. This is a fund you can dip into if you have a particularly lean month. When you have a great month with a higher than expected income, set some of the extra money in this fund so you have something to fall back on if times are tough. 

(Please note: StepChange Debt Charity is unable to give debt advice to self-employed/zero-hour contract clients. Business Debtline can give you free and confidential debt advice solutions that’s tailored to your circumstances)

8) “I’ll never be any good at budgeting and that’s the end of it!”

Humans tend to be very ‘all or nothing’ in our thinking. If there have been a few ‘failed’ attempts at budgeting in the past, it can create a feeling of shame that’s very difficult to shift.

The fact you’re here, at the end of this article, means that you have what it takes to make an effective, realistic budget that can help you turn your finances around for good. Thousands of people have made positive changes to how they manage their money, and so can you! 

Looking for more great ideas to boost your budget? Sign up to the MoneyAware newsletter and we’ll send your our best tips and ideas each month!

The post Common excuses that stop you from budgeting first appeared on StepChange MoneyAware.

Procrastination: is it keeping you skint and in debt? 4 Oct 2019 12:00 AM (5 years ago)

Right now I’m putting off doing three things. Two drawings that people have offered to pay me for and a meter reading. I like drawing, so there’s no reason for me to not be doing that. And the meter reading is a two second job.

It doesn’t stop there. Only yesterday I cancelled my TV subscription. That seems thrifty but my TV broke in December (I fell on it) and I haven’t replaced it. That reminds me I should cancel my TV licence too.

I wonder how my life might be different if I wasn’t so good at procrastinating. It’s pretty obvious to see that I’m throwing money away through my own laziness. Money that I really need.

So what day-to-day tasks that we put off end up costing us money? Here’s the list of shame.

Procrastination problem 1: Getting debt advice

Did you know that it can often take people a year after realising they have a debt problem to get advice? This could be for a number of reasons, including:

• Feeling anxious about talking to a debt advisor over the phone
• Having to face up to their debt problem
• Worrying about how creditors might react
• Fears over how a debt solution might impact their life
• Not wanting loved ones to know they have a debt problem

As with many worries that keep people awake at night, getting debt advice doesn’t have to be traumatic. In fact, debt advice charities such as StepChange are here to give free, confidential and non-judgmental advice and support.

If you feel anxious about talking over the phone about your debt, you’re by no means alone. StepChange has a confidential online debt advice service that you can use in your own time, at your own pace. There’s also webchat so you can have a natter with one of our friendly debt advisors if you get stuck or have any questions. Pretty neat-o, right?

Unsure if you even need debt advice? If you have a minute spare, try the 60 second debt test. By answering a few quick questions, you’ll know if you’ll benefit from taking a closer look at your budget and any debt solutions that might be beneficial for you.

Procrastination problem 2: Meal planning

Planning meals throughout the week helps save money. That’s obvious. If we only buy the ingredients we need it helps reduce food waste. We’ll also be less likely to order a sneaky takeaway if we’ve already got food in the house.

It’s not that simple though. While I salute the food planning gurus, who religiously stick to their food plans, that life is not for me. I need food flexibility. How will I know if the food I planned for Wednesday is the food I’ll want to eat on Wednesday? It never is, guys. IT NEVER IS.

The answer to this problem is simple. Freeze some meals in advance and have a few ‘store cupboard’ options in your plan. As long as you keep monitoring your food to make sure it’s not going off, you can mix up your food plan and make it more realistic. Money-wasting disaster averted. Phew.

Procrastination problem 3: Paying bills

Getting home to find a bill at your doorstep is the worst. Remember when you were a kid and post used to be fun? I miss those days. Where are my old pen-pals now? I feel so abandoned. The bank is probably the worst pen-pal I’ve ever had.

Setting up Direct Debits for bills means you can avoid late payment charges and your bills are sorted without you even thinking about it.

Obviously you need to make sure you’ve got enough money in your account to cover the bills, but that should be fairly simple if you set up a budget. Some places even offer discounts for paying by Direct Debit. I’m definitely going to do this – as soon as I get round to it.

It’s worth mentioning that certain bills are considered priority bills because of the actions that can be taken by the creditor if you don’t pay them. So make sure you’re paying these first, you can find out what priority bills are on our website.

I thought I’d mention that our 7 Days, 7 Ways email programme can help you deal with bills that you’ve been avoiding. Give it a try!

Procrastination problem 4: Decluttering

Decluttering is one of the few things in adult life that I’m actually good at. I love throwing or giving stuff away. That’s the problem. Instead of giving stuff to charity shops, why am I not trying to sell it on eBay? Because I never get round to it, that’s why.

eBay has even simplified the selling process by creating an easy to use app. But then there’s the whole situation of going to the post office to send it off.

However, with a host of simple online selling apps making it easier to sell your stuff, isn’t the post office a small price to pay for some extra cash? MoneySavingExpert.com has some great online selling tips, so there’s really no excuse.

Procrastination problem 5: Cancelling contracts

I’ve already mentioned my TV subscription cancellation situation and yeah, I feel pretty bad about it. Especially as I can’t afford to be throwing money away on a service I don’t use. But I don’t think I’m alone in delaying cancelling contracts I no longer use.

Why do we do it? We sign up for a free trial, then forget to cancel and end up paying for something we don’t use.

Then there’s the gym. If you’re anything like me, you enter into a year-long contract and go about three times before giving it up as a bad idea. And then you end up paying to be reminded of how unhealthy you are.

Cancel unused contracts as soon as possible. If you’re leaving a contract early, check the agreement for early cancellation charges. If cancelling costs a lot, it might be cheaper to ride the contract out. If that’s the case you should make use of the service. If that means moving into the gym then so be it!

Procrastination problem 6: Meter readings

Again, something I mentioned I’m guilty of. (Well, I’m guilty of this whole list aren’t I?)

Taking regular meter readings means energy companies won’t use an estimate to base your bill on. As a result, you should only be paying for the energy you actually use. Hooray!

You don’t even have to write the reading down, just take a photo of it on your phone. Then upload the number to your online energy account. So simple.

Procrastination problem 7: Forgetting to pay fines

Parking and speeding fines are a whole different kind of nightmare. I don’t even drive and they haunt my dreams. If you forget to pay the fine can rapidly increase and get out of hand.

If you’re not disputing your fine, get it paid as soon as possible. Pin the ticket to your fridge. Make it the background on your phone. Frame it on your desk. Do whatever it takes. If you remember one thing for the rest of your life, make sure it’s to pay that fine.

Procrastination problem 8: Health check ups

Did I ever tell you about the time I didn’t go to the dentist for about ten years? Yeah. That happened. By the time I was finally able to register with an NHS dentist (after a three year waiting list) it was a miracle my teeth were perfectly fine.

Others have not been so lucky. A few of my other dentist-deprived pals have visited the dentist to be told they needed fillings but had narrowly avoided a root canal and any later would have resulted in costly treatment.

Make sure you allow some funds in your budget to pay for stuff like the dentist and eye checks. Then, make sure you schedule in appointments so you can avoid any disasters.

Procrastination problem 9: Checking your bank account

My bank account is either my best friend or worst nightmare. Around pay day, we get along great. Towards the end of the month, we don’t even make eye contact.

The thing is, it’s important to keep an eye on your account so you can track your spending. Avoiding the situation doesn’t make it go away. Instead, you’re at risk of overspending and could face overdraft charges as a result.

There are easy ways to keep track of your money. You can get a budgeting app, or you can download an online banking app and some banks even send weekly texts of your account balance so you know the situation.

Procrastination problem 10: Not buying insurance

I’ve got a little secret for you. I don’t have contents insurance. Every time I get to work and try to remember if I’ve turned the oven or my hair straighteners off I imagine my flat burning down and taking all my stuff with it into a fiery grave.

I can’t afford to replace my things, so why don’t I have insurance? I’ve even written before about the importance of forking out for pet insurance (RIP Pepe the cat) and holiday insurance after a mosquito mishap in Turkey ‘09.

It may seem annoying to pay for something you don’t use month after month. But when something does go wrong, you’ll thank your sensible self for sorting it out.

I’m going to get contents insurance today. Let’s just hope today is not the day my flat burns down.

—

As we reach the end of this list I think it’s pretty clear I need to make some serious changes to my lifestyle. If you’re like me, we should probably be friends. But also, you should probably read these tips that can help us stop procrastinating when it comes to money related things and hopefully save us some cash. (Procrastinating with homework and other non-money related stuff is fine obviously.)

1. Set reminders on your phone to complete certain tasks
2. Remember, avoiding a task doesn’t make it go away. You’ll have to do it one day so just do it now
3. Sign up to apps to help you budget and keep track of your finances

If you’d like to receive more money saving tips, why not sign up to our newsletter?

Save

The post Procrastination: is it keeping you skint and in debt? first appeared on StepChange MoneyAware.

Student loans overpayments: How to claim a refund 29 Aug 2019 6:40 AM (5 years ago)

Student loan repayments can be a burden, but for the most part they tick along quietly in the background. As they’re deducted at source, and can often be spread across many months, it’s not easy to track just how much you’ve paid over time.

It might be time to take a closer look, as it recently came to light that there’s over £28m of unclaimed overpayments on England-based student loans.

Wondering if this applies to you? Over 500,000 students are said to have been affected.

How student loan overpayments happen

If you were making student loan repayments between 2009-10 or 2017-18, there’s a chance that your student loan deductions continued after your loan was paid off.

The Department for Education says that data sharing has recently been improved to prevent overpayments from happening in the future. However, the overpayments work out to an average of £600 per affected person, which isn’t small change!

You may have overpaid on your student loan if:

• You made a mistake when giving information on your student loan to Her Majesty’s Revenue and Customs (HMRC), such as the wrong date for when you finished your studies.
• Your employer set up student loan repayments too early

You may also be owed a refund if your annual income was below the threshold, or you started paying off your student loan before you needed to.

What’s being done to resolve the issue?

The Student Loans Company (SLC) is in the process of contacting those who’ve been affected in order to arrange refunds. However, as some time has passed, they’ve found that some graduate contact details aren’t up-to-date. This means that lots of people are potentially missing out on overpayment refunds that they’re owed.

I think I’ve overpaid my student loan – how do I claim for a refund?

If you believe you’ve overpaid your student loan, you can get in touch with the SLC to seek a refund.

Before contacting the SLC, take some time to check your payslips and your P40 forms for the last few years. This will give you an idea of how much you’ve paid already. Having these to hand will make it easier for the SLC to check your payment history. They may need your PAYA and payroll reference number, so keep those nearby as well.

You can find more information about getting a student loan overpayment refund on the SLC website.

MoneySavingExpert have also put together a helpful guide on how to deal with a student loan overpayment depending on when you graduated, and how much is left of your student loan balance.

A claims company says they can get me a refund on my student loan. Should I trust them?

If you’re owed a refund on your student loan, you can discuss this directly with the SLC. You don’t need a third party to facilitate this for you, and you shouldn’t pay a fee for any such service.

I’m dealing with debt from university. What should I do?

If you have debt such as loans, credit cards or overdrafts from when you were in university, free online debt advice is available.

You can also chat to one of our friendly debt advisors about your situation. Once we know what you’re dealing with, we’ll take a look into any debt solutions that may be right for you.

Have you received a refund for an overpayment on your student loan? How did you find out that you were eligible? Please tell us all about it in the comments!

The post Student loans overpayments: How to claim a refund first appeared on StepChange MoneyAware.

Clone firms: why would a company pretend to be a debt advice charity? 29 Aug 2019 2:48 AM (5 years ago)

If you go online to look for debt advice, you should feel confident that the companies listed in the search engine results are genuine.

However, a new type of scam is on the rise, and it’s catching people out at a time when they need help the most.

Clone firms are websites that imitate real, trustworthy companies or charities, such as StepChange, National Debtline and Citizen’s Advice. They’re set up by companies who want to capture your personal data, and they can look very close to the real thing.

What makes clone firms so effective?

When searching online for a service you really need, such as debt advice, you may be in a hurry or feeling anxious about your situation. This makes you more likely to click the very first link at the top of a search engine page. After all, why would a search engine put an imitation website at the top of their page?

But here’s the thing – the comapnies that create these imitation websites will often pay for the advertising space at the very top of a search engine page. They do this because they’re counting on you clicking the first link you see – which would be their website, in this instance.

Next time you search online, look at the first couple of links at the top of the results. Chances are that they’ll have a small icon with the letters ‘Ad’ for advert.

Of course, legitimate debt advice charities do use ads to promote their services, and are doing everything they can to stop clone firms appearing on search pages. With that said, it always pays to be extra careful when clicking search engine links.

Why would companies use clone firms to get my personal data?

Your personal data (such as your name, address and bank details) is highly valuable. There are many reasons why a clone firm may want to get hold of it.

However, in this case, they want to sell your data to debt management companies who may ‘sell’ solutions that make money for them rather than helping you. These companies aren’t always regulated by the Financial Conduct Authority (FCA) either.

A clone firm couldn’t fool me…could it?

Don’t be so sure! Remember; the aim of a clone firm is to look as legitimate as possible.

When you click on a link through to a clone firm, all may seem well at first. The website looks professional enough. It mentions debt solutions and freezing interest and charges. They even have handy online tools and great reviews of their service…but it’s all fake!

The reviews may have even been written by the scammers themselves or by ‘review providers’ who’ll write bogus reviews of a company for a fee.

“I was taken in by a clone firm…” – Steve

Steve was looking for debt advice when he encountered one of these clone firms. He’s still having problems since sharing his data with them.

Listen to Steve’s story on BBC You and Yours.

How can I protect myself from clone firms or scam websites?

By following these simple steps, you can easily spot a clone firm and prevent them from getting hold of your data.

WHAT’S THE WEB ADDRESS?
For example, if you’re looking for StepChange Debt Charity, the correct web address is www.stepchange.org. If that’s not the web address that you’re seeing, it could be a clone firm.

WHAT INFO DO THEY HAVE ON THEIR WEBSITE?
Do they have full contact information on there? Have they mentioned being registered with the Information Commissioner’s Office (ICO)?

WHAT ARE THEY CLAIMING THEY CAN DO?
Are they offering a ‘Government-backed debt advice scheme to write off your debts’? No legitimate debt advice organisations would make claims like this.

Have you been contacted by a clone firm? We want to hear from you!

The StepChange Media team want to talk to anyone who’s accidentally used the services of a clone firm. This’ll help StepChange prevent these firms from taking advantage of people who need debt advice.

Please send an email with as much detail as you can provide!

The post Clone firms: why would a company pretend to be a debt advice charity? first appeared on StepChange MoneyAware.

How to get a better deal on your bills 19 Aug 2019 1:02 AM (5 years ago)

Unhappy with what you pay on bills each month? You may be tempted to switch to another provider. But what if you could stay where you are and still pay less?

Our friend Adam from ismybillfair.com shared some top tips to help you get a better deal with less bother…

Switching vs. staying put

Everyone wants a good price on their energy bills. Regularly switching suppliers is often encouraged, especially as it’s now fairly easy to switch.

Most switches can be done in a matter of days, and you don’t even have to talk to your current provider. Your new provider will do all of the talking for you behind the scenes, and they’ll often keep you updated on how they’re progressing. Yay for great customer service!

However, apart from what you’re paying each month, you may be quite happy with your current supplier. You might just be a bit annoyed that new customers are getting a better deal, and that you should be rewarded for your loyalty – which you should!

Many energy suppliers know that it’s just as important to keep existing customers as well as attract new ones. Ismybillfair can help you negotiate a better price without moving suppliers.

It can also help you save money on your mobile phone contract, insurance, broadband bill and digital TV subscription too!

Before you contact your supplier, make sure you:

1. Get evidence that you should be on a cheaper bill

By using the ismybillfair Priceometer, you can compare what you’re currently paying to the deals your supplier’s offering to new customers. Take a screengrab of the deals you were shown, as this’ll support your request for a cheaper monthly payment.

2. Get clear on what you want from your contract

By doing your research, you can be specific on what a good deal looks like to you. Write it down as a list so you can refer to it during the call.

3. Stay friendly and upbeat

Sales staff are human too. If you’re rude to them, they might not put that extra effort in to get you the deal you want. Be polite and respectful, no matter what happens. If you feel unsure or if you don’t understand what you’ve been told then politely ask the salesperson to explain it again.

4. Tell the salesperson what you’re dealing with and how they can help

Make the salesperson aware of any vulnerabilities you may have. The more your supplier knows about the challenges you’re facing, the better equipped they are to help you.

5. Don’t rush to accept the salesperson’s first offer

If the supplier offers you a deal that’s not as good as you hoped, don’t be afraid to reject it. The salesperson will probably have more than one offer available to you, so make sure they go through everything before you make your decision.

6. Call to negotiate at the right time

Try calling your provider near the end of your contract or once you’re out of contract. Your provider will want to keep you, and are more likely to give you a better deal.

7. Ask for any extra services you’re interested in

If your provider can’t drop your price, don’t end the call. Instead, ask them if they can throw in some additional services or upgrades to your plan. As the old saying goes, ‘If you don’t ask, you don’t get!’

8. Try to get rid of what you don’t use

See if you can remove any parts of your contracted service that you aren’t using. For example, you might have unlimited texts on your mobile phone contract, but you don’t need them if you mainly use messenger apps such as WhatsApp. If you don’t watch sports, why pay for expensive sports channels?

Trim your contract right down to the bare essentials, but make sure that you’re still getting what you need. There’s no point being on a basic broadband contract if you’re an avid gamer who needs lots of broadband allowance. You’ll just end up paying more in charges!

9. End the call and try again if you’re not getting anywhere

When you call a utility provider, it really can be ‘the luck of the draw’ in terms of who you end up speaking to. You might get a really helpful salesperson who’ll work hard to keep you as a customer. However, there’s also a chance you’ll speak to someone who refuses to negotiate. If this happens, don’t be afraid to call back some other time. You may be lucky and get someone who will put the extra effort in to help you.

If you’re not happy with the service, you can always put a complaint in. Just be sure to give the company enough time to sort the issue out and get back to you.

If they don’t resolve the issue in a reasonable time frame, then you should follow their complaints procedure and stick to your guns.

Have you haggled for a better deal with your current supplier? How did you get on? Tell us all about it in the comments!

The post How to get a better deal on your bills first appeared on StepChange MoneyAware.

FCA warning: are you at risk from a pensions scam? 16 Aug 2019 2:39 AM (5 years ago)

Scams and fraud come in various forms, and fraudsters are now targeting people’s retirement savings. New research suggests that 42% of pension savers – around 5 million people across the UK – are at risk of falling for a pension scammer’s tactics.

In 2018, victims of pension fraud reported that they had lost an average of £82,000. To combat this, the Financial Conduct Authority (FCA) and The Pensions Regulator (TPR) are working together to protect the public from pension scammers.

• 

What tactics are pension scammers using?

Scammers are always looking for new ways to take advantage of people, but there are six common tactics to be aware of. They include:

1. Cold calls about your pension: 23% of 45-65 year old pension savers would engage with a company who calls them unexpectedly to discuss their pension. These types of cold calls have been illegal since January 2019.

• Free pension reviews: 10% of 45-65 year old pension savers would agree to a pension review from a company they’ve never dealt with before.

• Claims of guaranteed high returns on investing your pension. 13% of 45-65 year old pension savers would be tempted by potentially high returns.

• Exotic investments, such as overseas properties and renewable energy bonds. Such investments come with a high risk.

• Time-limited offers. This puts pressure on the victim to make a quick decision. The scammers sometimes offer to send a courier with paperwork to be signed immediately.

• Early access to your pension pot before the age of 55. Accessing your pension too early can result in an expensive tax bill. 

Make sure you’re ‘ScamSmart’

Most of us are confident that we could spot a scam straight away, but even the most financially savvy people can be caught out.

You can find out how ‘ScamSmart’ you are by taking this short quiz on the FCA website. It’ll teach you how to spot and avoid the six common pension scam tactics.

Be sure to share the quiz with others so that more people can be kept safe from pension scams.

The FCA also has an active warning list that can tell you if this company is behaving dubiously. If you’re unsure about anything that the company’s offering, please check it against the warning list.

How else can I protect myself from pension scams?

While these findings may be daunting, you can protect yourself from pension scammers by following these four simple steps:

1. Reject unexpected pension offers whether made online, on social media or over the phone.

1. Before making any changes to your pension, always check who you’re dealing with.  You can search for the company  on the FCA Register or call the FCA contact centre on 0800 111 6768. If they don’t appear on the register then they’re not authorised and you won’t be protected from any action they take with your pension.

1. Don’t be rushed or pressured into making any decision about your pension. A legitimate pensions advisor will give you time to consider your options. Remember, if it sounds too good to be true, it usually is.

1. Consider getting impartial information and advice on your pension. The Pensions Advisory Service provides free and impartial information and guidance to help you make an informed decision. If you’re aged 50 or over you can contact Pension Wise,  provided by the government and Money and Pensions Service (MAPS).

I’ve dealt with / I’m a victim of a pension scammer. What should I do?

If you suspect that you’ve been contacted by a pension scammer, you can report them to the FCA via the form on their website. Please provide as much detail as possible.

If you’ve lost money to a pension scammer, please report it to Action Fraud as soon as possible. You can do this by calling 0300 123 2040 or filling in the form on their website.

The post FCA warning: are you at risk from a pensions scam? first appeared on StepChange MoneyAware.

‘Credit-building’ credit cards: are they a bad idea? 19 Jul 2019 12:00 AM (5 years ago)

If your credit file’s looking a bit worse for wear, you may be tempted to apply for a ‘credit building’ credit card. You might’ve seen an advert urging you to get one, as it’ll work a charm on that beaten up credit score of yours. Sound familiar?

Look, we get it. Once you’ve paid off your debt – or nearing the finish line – it’s normal that you’d want to restore your credit file to its former glory.

Sadly, it’s these good intentions that the providers of these cards are banking on (pardon the pun). Before you sign up, make sure you know all the facts…

What are credit cards for bad credit?

Credit cards for bad credit are sometimes called ‘credit-builders’. They tend to have lower spending limits and higher interest rates than other credit cards.

You might assume that the fact a firm is willing to offer you a credit card means that the risk is manageable for you. Applying for credit can be nerve-wracking, so it can be comforting to think at least these guys might say yes to your application.

But here’s the rub; credit cards that are targeted at people with poor credit ratings often have very high interest rates, sometimes as high as 70% APR.

Providers of credit-building credit cards know this isn’t a great deal in the long-term. That’s why these cards are packaged as medicinal wonders for a mortally wounded credit file.

As tempting as it may be, it’s strongly recommended that you think carefully before going down this road. In fact, many people who’ve had one of these cards feel it actually made their financial situation worse.

But I need one of these cards to help make ends meet!

If you’re struggling to cover living costs, and you’re wondering if one of these cards could help you stay on track, please be cautious.

If day-to-day expenses are becoming difficult to manage, this is often a telltale sign of a deeper problem, such as unmanageable debt or living beyond your means. Getting free debt advice would be a better option.

Shut up, MoneyAware. I need to improve my credit score and that’s the end of it!

Okay, okay, we hear you. You’re determined to improve your credit score, and we’re right there cheering you on. But trust us on this one; there are better ways to do it than saddling yourself with a truckload of interest.

For instance, you could:

1. Pay back any credit you’ve borrowed. No, really. Every time you make a payment on debts you already owe, this gets logged on your credit file. Creditors will see that you’re making an effort to pay off your debt, which’ll go in your favour for future credit applications.
2. Get on the electoral roll. Creditors can compare the information about you on the electoral roll to your application to make sure it’s accurate. The added security can really boost your chances when applying for credit.
3. Check your credit report to make sure it’s correct. Mistakes happen. it’s possible that there’s an incorrect note or an old debt that needs updating on your file. It costs nothing to check your credit file and it only takes a few minutes. Remember, there are three credit reference agencies – Credit Karma, Equifax and Experian – so make sure you pay each of them a visit.
4. Check you’re not linked to someone with a poor credit score. You can ask the credit reference agencies to ‘disassociate’ you from this person so that their actions no longer affect you. If you have joint debts with that person that still need paying off, you won’t be able to break this connection until the debt is settled.

I keep applying for credit but I’m getting nowhere! What can I do?

One of the most damaging actions a person can take when applying for credit is to apply for several products in quick succession. This behaviour sends up great big Elmo-red flags to lenders that for whatever reason, you’re desperate for credit, and may struggle to pay it back.

This super not-fun financial dance is what’s known as the ‘rejection spiral’, and you don’t win any pretty trophies for participating.

If you want to apply for a credit card, carry out a ‘soft search’ first. Several websites have an eligibility calculator that can tell you your credit rating, and how likely it is that your application will go through without any quibbling.

Ugh, I already have one of these cards…

First off, don’t feel bad. You know there’s no judgment here. Let’s be honest, those adverts and sales teams you may have seen promoting these cards in the shopping centre make them sound fabulous!

Here are some quick tips to make sure the card actually boosts your credit rating, rather than bruise it:

• Always try and pay the balance off in full each month. By doing this, you shouldn’t get charged that truckload of interest we talked about earlier: you don’t need to pay interest to improve your credit rating
• When you take out the card, say ‘nah’ to automatic credit limit increases. That way you can keep control over the credit limit
• Stick to your credit card limit. If you exceed your limit, further charges and interest start creeping up. This could make it harder to get further credit in future
• Make sure you pay on time each month. Obviously, this does wonders for your credit rating. It also helps you keep any promotional offer that you’ve received with the card
• Always try to make more than the minimum payment each month. If you can’t afford to pay more than the minimum, let the lender know as they may be able to help you out
• NEVER withdraw cash on a credit card. Your lender might see this as a sign that you’re struggling financially. This could make them reluctant to increase your limit or reduce your interest rate down the line
• Check your credit report using a soft search every few months, to see if your card use is improving your rating

Have you taken out a subprime credit card? Are you struggling with high interest or paying it off? Let us know in the comments.

The post ‘Credit-building’ credit cards: are they a bad idea? first appeared on StepChange MoneyAware.