Easy Everyday Cost-Cutting Tactics

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No matter how much you cut costs, there will obviously always be plenty of things that you need to buy. There are also times when it is worth spending more for better-quality, and times when you just want to treat yourself because you can afford it and feel you deserve it.

There is nothing wrong with any of these expenses, but it’s nice to keep their total cost down as far as possible. In particular, it’s nice when you can get exactly what you need (or what you were paying for anyway), but pay noticeably less than you were expecting to.

Cashback Websites

Some time ago now, “affiliate schemes” started to catch on among online retailers. Through these schemes, if another website (the affiliate) sends customers their way and those customers make a purchase, the affiliate gets a cut of the money. The idea is simply to gain more customers.

Cashback websites take advantage of these schemes, splitting their commission with you or even giving it all to you and relying on ad revenue. That way, you get to save money while shopping with major online retailers, just by using the cashback website’s affiliate link instead of heading directly to the store you want to buy from. Savings on most day-to-day purchases will be pennies or a couple of pounds (which can still mount up over time), but on big things like car insurance and broadband contracts the savings can be big.

Switching Suppliers

Regularly switching suppliers of energy, phone/broadband, insurance and so on has become one of the most oft-quoted pieces of money-saving advice. There is extremely good reason for this, because savings can be massive. For example, it recently emerged that a very large percentage of customers are overpaying for energy, mainly by around £160-£235 a year, simply through failing to switch.

In particular, make sure you don’t switch once and then become complacent, pleased with yourself for finding the best deal. Prices often go up as soon as a contract runs out, and even if the cost is going to stay the same markets are constantly changing and the best deals are almost inevitably those for new customers. As a rule, you should start looking for a new provider as soon as the contract with your old one runs out if you want to be sure you are getting the best deal. There are a couple of considerations to make besides price, however. Make sure you are being quoted for a like-for-like service, or the quotes may simply not be comparable. It could also be worth checking out independent reviews to make sure the company won’t provide substandard service.

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The Best Things to Buy Second Hand

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Buying second hand is one of the most well-known tactics to get things for less. The trade-off, of course, is that second hand items have already been used so they will have amassed some wear and tear and have a shorter service life left to them. However, there are certain things which are not particularly susceptible to this problem, and buying these things second hand can be a great way to save money with few if any drawbacks.

Books

Books will generally remain eminently readable even if they become dog-eared and floppy. Most second hand books, however, are in very good condition. They are widely available from charity shops, specialist bookshops, and online for extremely low prices – often a fraction of the original cover price. Unless you want to snap up a new release as soon as it comes out, you will almost certainly be better off buying second hand.

If you like to experiment with new books, you could try buying very cheap ones from a charity shop and then returning them for someone else to read when you are done. That way, you are saving money, reducing clutter in your home, and passing on the opportunity to other book-lovers.

DVDs, CDs and Computer Games

These disc-based goods hold up to their second hand status almost as well as books. Generally, a disc will have to be quite badly scratched before it develops problems. Unless the previous owner was careless, it is probably almost pristine as simply being played does not really put any wear and tear on a disc. These items rarely offer any real disadvantage when bought second hand. Most retailers inspect second hand discs before sale, and will happily accept a return if there is a problem.

CDs are particularly interesting. In the age of the digital download, they have been an oft-neglected medium for some time. For this reason, second hand CDs are often sold at bargain bucket prices. This means that buying a CD and then digitising the tracks (a simple process using software that comes with new computers as standard) can actually be cheaper than downloading.

Cars

Cars depreciate quickly. This fact is the bane of many car owners, but it can be a blessing when it comes to buying a second hand car. Buying cars that have previously been owned is already a popular process, but even if you want the newest model it can still be worth looking at second hand models. Even cars that are just a few months old with very low mileage will sometimes appear on the market, and will generally offer a noticeable discount while in reality being little different from a brand new car.

There are sometimes advantages of buying a new car over a good second hand one. These are usually not so much anything to do with the car itself, but rather retailer promotions like attractive finance deals, long warranties, or free servicing. Sometimes, similar deals can be available on second hand cars if bought from a dealer rather than privately.

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Tips for Better Bulk Buying

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It is no secret that it is usually cheaper to buy things in bulk, but this approach also has its downsides. For example, many people are put off by concerns about using everything up before it expires, or by the challenges of finding enough storage space for large amounts of food. However, there are a number of things you can do to help ensure that bulk buying works out well.

Focus on Non-Perishable Goods

The simplest way to avoid the issue of use by dates is to focus on non-perishable goods, or goods that will take a long time to actually go off even if the date slips by. Tins are good and oft-cited examples, tough bear in mind that these are also heavy and tend to fill up kitchen cupboards quite quickly. Teabags are another good example. They are lightweight, aren’t  very prone to spoiling, and can be bought much more cheaply in bulk. They can also be fairly easy to store, especially as large packs tend to be flexible.

Also, bear in mind that bulk buying doesn’t exclusively apply to food items but to any kind of item that tends to get used up in the home. For example, toilet tissue and kitchen rolls can both sometimes be bought cheaply in bulk. Large quantities of both these items often turn up on deal websites like Groupon.

Share and Cooperate

Another way to get around the problem of expiry dates is to cooperate with a friend when buying perishable goods. Supposing you come across something that is a lot cheaper through a “buy one get one free” offer, or simply buying a pack twice the size. However, that product will only last a week before it expires, and you will just not get through that much in a week. If you have a friend who uses the same product, you could arrange to split the purchase between you.

The arrangement is simple. One of you actually buys the product, then the other pays back a portion of the price and gets some of the product. This way, you both get a better deal and neither of you is stuck with more than you could use before it goes off.

Extra Storage Space

Sometimes it might be easier than you think to create extra storage space especially for buying food in bulk. If you intend to buy a lot of food, it may be worth simply expanding the area you search for opportunities. Some food will keep quite happily without being in your kitchen, so why not keep it elsewhere?

This might be as simple as using a wardrobe in the spare room or a corner of your attic or cellar for food storage. Alternatively, if you have a shed or a garage that is connected to mains electricity you could try putting a small freezer in there. This will allow you to buy a lot of food that is suitable for home freezing when you want to take advantage of offers or reductions.

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Your Money-Saving Rights While Renting

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There are a lot of things that can be done to reduce your living costs, but when you are a tenant in a rented property you may be unsure which of these fall within your rights. While some things pertaining to the property most certainly require the permission of your landlord, there are nonetheless a great many things you can do to bring down the cost of living in your property. These fall entirely within your rights as a tenant and do not require any approval at all.

Switch Energy Supplier

If you pay the bills yourself rather than through the landlord (for example if they are included in your rent), you are entirely within your right to switch the company that supplies your electricity and gas. In rare cases, tenancy agreements may include a clause saying you need the landlord’s permission to make the swap but, according to Ofgem the energy regulator, you should not be prevented unreasonably. A clause that prevents tenants from switching when they are responsible for paying bills could also potentially be viewed as an unfair agreement. The exception is where changing would require an alteration to the property, such as switching from a prepaid meter to a standard one.

Switching your energy supplier could potentially save a lot of money. The cheapest deals often come from smaller suppliers. Even if you aren’t familiar with their names, this isn’t necessarily a reason to hesitate. In customer satisfaction surveys, small companies tend to get much higher scores than the big ones.

Phone and Broadband

Similarly, if you are responsible for paying the bills for phone and broadband, you should be fully entitled to choose your own supplier. Usually, if a new line or reactivation of a line is required when you move into the property this should be within your rights even if it means a visit from an engineer in order to install it. However, check with your landlord if the property does not have any current phone sockets.

Once again, make use of comparison sites in order to get the best deal. Make sure you also look at other aspects of the package such as special offers or cashback in order to identify the best price. At the same time, make sure you choose a suitable package, as exceeding your download limit can quickly get very expensive.

Check Agency Fees Carefully

Agencies usually apply fees to a transaction, and these can be fairly heavy. Things like referencing fes are necessary and it is standard to include an administrative fee, but there have been occasional reports of some very questionable add-ons such as £60 for photocopying a document.

Fees should not only be reasonable, but also stated clearly up-front so you know what you are getting yourself into. If you feel an agency is failing to follow these principles and are hitting you with hidden fees, you can report them online to Shelter.

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Get the Most From a New Credit Card

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Taking out a new credit card requires careful decision-making. It is important to choose the right card, and find the best deal for which you are eligible and the most appropriate for your circumstances. However, by looking beyond the card itself, it is possible to get a little bit more out of applying for a card.

Rewards

Many credit cards come with rewards, gifts, and incentives. With rewards cards, you may be offered a cashback deal on money spent with the card, a free welcome gift such as a gift card for a major retailer, or reward points towards a retailer loyalty scheme. Even if you have found a card that seems perfect quite quickly and easily, it is worth seeing if another provider can offer similar terms along with a reward. That way, you still get a card that suits your needs, but you get something extra as well.

Cashback Sites

Even if the card that suits you best is not a reward card, it may be possible to get something extra from taking it out. You just have to go through a third party instead of directly to the provider. Cashback websites offer you cashback on online shopping and on certain other things like signing up for accounts with some websites. A number of credit card providers are also accessible through cashback sites. Basically, the cashback site gets a commission from the lender for bringing them your custom, and they then pass on cash to you. In the case of credit cards, you make your application for the card in exactly the same way as usual, except you first go through the cashback site. If your application is approved, you get paid money.

Striking a Balance

The only drawback to these rewards is that it is surprisingly easy to get drawn into a card that is less appropriate for your needs, and this can wipe out the benefits of the extras on offer and leave you worse off. It is easy to think that a monthly fee or a higher interest rate will still leave you in profit because of a cashback deal, only to find out the hard way that the two sums don’t match up in quite the way you thought. By either choosing a reward card or signing up for the same card through a cashback site it is likely you will be better off, but make sure to think carefully before switching to a card that is different from what you originally planned.

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Gender Opinion Difference on Tax

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In particular when there are hard economic times, who pays what and how much into the ‘system’ in terms of tax etc can be quite a controversial topic.  A new survey suggests there are even differences in opinions regarding tax between gender groups, let alone other more obvious groupings such as age and economic standing.  The survey, WalletHub’s ‘2014 Tax Fairness Survey’ had more than a thousand participants, and was designed to be representative of US groupings for gender, age and race.

Corporate taxes are in the spotlight currently as more US companies reincorporate abroad to earn profits without the necessity of having to pay US taxes.  They do so via the purchase of foreign companies or merger deals, one of the most recent attempts being the drug giant Pfizer’s over $100bn merger bid for its British rival AstraZeneca.  The government hope is to make the 35% that the US takes more competitive, as it is one of the highest rates charged by the developed world.  Directly in opposition to this – where surveyed almost two thirds want corporate tax to be higher – the percentage of women who want this are at 73% compared to 55% of men.

The main findings included that 80% of people thought the tax system was either ‘complex’ or ‘extremely complex’, though the gender differences for this were minimal (education level was the biggest variation factor, with the more educated finding the tax system more complex).  This reflects the rise in using free tax calculators online.

On the question of what matters most in a tax system, taxes for economic growth, to foster equality or to foster fairness, 61% believed fairness comes first.  Men were more likely than women to say tax equality comes first.  To enable a less complex and a fairer taxation system, many think less tax deductions are the way forward: 48% of men, compared to just 36% of women.

Overall less than a quarter of all those surveyed want a flat tax system opposed to the system most countries have of progressive taxation.  Proportionally 29% of men and only 20% of women.

Further research is to be conducted in order to analyse what these differences may mean in terms of gender differences, finances and society.

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Why Investors Should Reclaim PPI

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The PPI scandal refuses to go away, but that is simply because it is far from over. There are still thousands of claims being made and the scandal regularly finds fresh steam amidst discoveries such as this month’s revelation that some banks and credit providers were short-changing claimants.

If you are an investor in property, shares or any other source of revenue, then reclaiming PPI could be particularly important. Since the money that you are owed could be playing a role in your investments, you stand to gain not just the funds to which you are entitled but also the returns they could generate. Neglecting to make a claim, on the other hand, will lead you to miss out.

PPI refunds vary significantly from case to case, but the average is £2,750. Supposing you tend to invest your savings in a series of funds with returns averaging – to keep the maths simple – 10% annually. Taking the average £2,750 PPI claim as an example, reclaiming those funds and then putting them into your investment portfolio would, assuming the value of the funds rise in accordance with their average, boost your returns by £260 in the first year before charges and tax. If the investments in question are placed into an ISA, they will not even be eaten into by tax. Due to the compound nature of portfolio growth, returns in subsequent years if your portfolio maintains similar levels of performance will be noticeably larger year-on-year.

Of course, similar principles apply to other forms of investment such as stocks and shares, bonds and property.

Even if you investors do make a PPI claim later, they will still be missing out. Making one in a year’s time will still reclaim the original money, but will not get the returns that would have been earned over the course of that year. While missold PPI refunds are subject to interest, this is at best uncertain. It may or may not outpace the returns you would have received were the money to form part of your investment portfolio, and are certainly not an investment opportunity in themselves. In fact, taking the above example of investment funds, the majority of funds from major providers such as Vanguard have outperformed this interest rate on average over the past ten years. Furthermore, this interest is subject to tax, while many types of investment can be easily sheltered from this through the use of an ISA.

In short, investors who are owed PPI will mostly stand to gain more than their refund from making a claim as soon as possible.

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Millions must be given back to consumers from Energy suppliers

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The regulator Ofgem is investigating energy suppliers’ policies to check they are being adhered to, after discovering that approximately £204 million has been left over from customers after closing their business energy accounts and approximately £202 million has been found left over from old personal consumer accounts.

Ofgem has informed energy suppliers that they must “find ways to use this money to benefit consumers more generally”, and they need to be held accountable for what has happened with the money.

A senior partner leading the enforcement department of Ofgem, Sarah Harrison informed the Today programme on BBC Radio 4 “we’re using the opportunity to alert customers “, she continued “Make sure that you take with you what is owed to you when you change supplier”.

Director of Ofgem, Philip Cullum states “we want suppliers to show more responsibility”, CEO of Ofgem Andrew Wright also added, “when many people are struggling to make ends meet, it is vital that energy companies do the right thing and do all they can to return this money and restore consumer trust”.

Over 6 years money has been building up after people or businesses have either switched their suppliers or moved location. Possibly as many as 3.5 million personal and 300k business customers are affected.

Andrew Wright also went on to say, “we want to see decisive action by suppliers, individually and collectively, to address the issue”.

Angela knight, a spokesperson from Energy UK who represent the suppliers said, “we want to give the money back, of course we do”, and continued, “thousands of letters are sent out, people are telephoned, but if you don’t have contact details, how do you find them?”

Another energy supplier SSE stated that they have written off 4 times the amount of money  through bad debt compared to the amount of money that is credit and hasn’t been returned to customers and stated, “ although sometimes customers do disappear and cannot be traced, we always view any credit as theirs and no matter how much time passes, if they come forward and we can identify and outstanding credit, we will return it to them”. SSE also would like to reiterate that “we’re happy to work with anyone who has legitimate suggestions for how we can find customers more easily and efficiently.

Ofgem has however reached an agreement with the “big six” energy suppliers by issuing automatic refunds via direct debit when customers are in credit.

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Simple Tips for Prioritising Your Various Debt Repayments

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Nobody wants to be in debt, but sometimes we find ourselves in a position where we have got ourselves into a lot of debt. It might seem like they are pushing down on our shoulders and that there is no way of seeing the light of day, but there is a way to make things a bit easier. Here are some simple tips for prioritising debt repayments.

Compile a List of Your Debts

The first thing you need to do is make a list of all your debts. This will men gathering up all the paper work for all of your different debts and compiling it into a pile, list or some other way of being able to look at them all at the same time. You will want to see clearly what each debt entails so that you can get a good idea about what you financial position actually looks like.

Work Out Exactly How Much is Owing

With all of your debts, work out exactly how much is owing on each one. This includes looking at the interest, how much you are paying, and what sort of interest it is, so that you have an idea about the variable amounts with each one. What are the monthly payments, and what annual fees does the debt attract?

Order the Debts

Once you have your list, put it into order of which ones have the highest interest rates, penalties and fees. This will give you an idea about which ones you are treading water with, and which ones could possibly be paid off sooner rather than later. Having a good idea about where your financial position is really at, will help you to see the big picture, rather than looking at the forest from within the trees, as all you see is trees.

Consolidate?

Now that you have your list and can exactly what each debt entails, have a look to see which ones you can consolidate. Ask yourself, if there are any of those debts that could save you money if you consolidated them into the one loan? Consolidating can often be a good idea because rather than spending a lot of money paying off the interest and not getting forward, you might be able to just be paying one monthly repayment on a loan that covers all of them.

Work Out How Much More Than the Minimum Would Help You

Rather than continuing to pay the minimum monthly repayment and only ever paying off the interest, it might be a good idea to start paying a little bit more than the minimum each month. If you did pay more than the monthly minimum, how much would you be paying, and how much would it take for you to pay off before it started to be of help to you and your situation?

Author Bio

This article was contributed by Michael Craig on behalf of Dreamloans – a leading car-finance broker based in Adelaide, Australia.

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Larger cash withdrawals receive scrutiny from HSBC

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HSBC have faced a backlash from some customers who were denied the ability to withdraw large sums of their own money from their bank account without valid explanation and evidence on why they wanted to do this. HSBC stated that this was because of a change in policy but failed to tell this to their customers.

One customer going by the name of Peter went to withdraw £10,000 in cash from HSBC for travelling and to give some to his sons; he called HSBC a day prior to his withdrawal with everything seeming to go ahead as normal. However the following day he was called by his local branch which asked him for booking receipts for the trips he wanted to go on, which Peter did not have; they also asked him to make a bank payment to his sons rather than withdraw cash to pay them. The day after this Peter again called HSBC who then agreed that he could withdraw the full £10,000 following an examination of his account.

Another customer, Stephen Cotton also faced difficulty in withdrawing larger sums of cash, in this case from an instant access savings account. He tried to withdraw £7,000 to pay back his mother on a loan. Stephen Cotton told Money Box: “When we presented them with the withdrawal slip, they declined to give us the money because we could not provide them with a satisfactory explanation for what the money was for. They wanted a letter from the person involved.”

After receiving customer opinions on the matter, HSBC declared that they were going to change the policy: “We are immediately updating guidance to our customer facing staff to reiterate that it is not mandatory for customers to provide documentary evidence for large cash withdrawals, and on its own, failure to show evidence is not a reason to refuse a withdrawal.”

Clacton’s Conservative MP, Douglas Carswell stated that “All these regulations which have been imposed on banks allow enormous interpretation. It basically infantilises the customer. In a sense your money becomes pocket money and the bank becomes your parent.”

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