Sarah Pennells is a personal finance journalist and the face behind SavvyWoman.co.uk. We think she does a great job at explaining financial subjects in a very clear and accessible manner. You can find her column below where she writes about the latest financial news, and helps you get more from your money.
Stolen phone? Beware the big bill
Last week a teacher became the latest customer to hit the headlines for having been billed by their mobile phone provider for thousands of pounds after their phone has been stolen.
Osian Rhys Edwards, from Wales, has been told to pay £10,000 by Vodafone. His phone was stolen in Spain but, although he says he called Vodafone to tell them what’s happened, the phone company says it doesn’t have a record of the call.
It appears that the thieves used his phone to repeatedly dial a premium rate number which is why the bill was so high. I’ve seen several similar cases where criminals have set up their own premium rate number specifically so they can steal phones or SIM cards to generate money from the premium rate calls.
I’ve been reporting on stories like these for over ten years and – shockingly in my opinion – the mobile phone networks don’t seem to think it’s their problem when their customers are faced with bills of thousands of pounds. Osian Rhys Edwards’ bill was originally £15,000, but Vodafone has reduced it to £10,000.
Last year, the government said that a bill capping scheme should be in place by this spring. It would be similar to the one you have if your credit or debit card is stolen, which means you only have to pay the first £50 unless you’ve been grossly negligent. But there’s no sign of it yet.
So, here are my tips so you don’t get stung:
- If your phone is stolen, report it to the police and your mobile phone network provider as soon as you can. Ask for the name of the call handler at the phone company and make a note of exactly when you called.
- It’s worth contacting the phone company even if you’re not sure your phone has been stolen. They can block your phone and unblock it if it turns up.
- Mobile phone insurance usually only covers the cost of replacing the handset, but check whether there’s any cover to pay the cost of calls that have been made before you’ve reported your handset as stolen.
- Complain to the Communication Services Ombudsman (and tell your MP) if you aren’t happy with how your complaint has been dealt with .
Bank of England payments shutdown
We’re used to the high street banks having mobile or online banking glitches from time to time, but on Monday the Bank of England’s ‘real time payments system’ stopped working for a few hours.
That meant – among other things, that the CHAPS payment system, used by the banks and businesses to make payments to each other, and by solicitors to transfer money from house buyers to house sellers – was offline as well.
CHAPS makes over £277 billion worth of payments every day, and on Monday – by the time it was back up and running – over 140,000 payments had been processed.
The Bank of England apologised for the technical fault and has said it will carry out a full investigation. It also said that all payments had been made by eight o’clock on Monday evening.
Luckily, Monday isn’t generally a busy day for property completions. If his had happened on the last Friday of the month, which is the busiest day for house moving, it would have been rather a different story!
Junior ISAs grow up
Junior ISAs – the tax-free savings or investment accounts for children – will be three years old on November 1st. Although many parents are aware of them, there’s still some confusion about how they work and what you can pay into them . Here’s what you need to know:
- Junior ISAs are similar to adult ISAs in that interest on junior cash ISAs is paid tax free and there’s no tax to pay on stocks and shares ISAs when you cash it in.
- Children can have one cash and one stocks and shares junior ISA and the money can be transferred to another provider to get a better interest rate or return.
- Money is locked away in a junior ISA until your child is 18, but they can choose what they do with it from the age of 16.
- Friends and family can pay up to £4,000 into a junior ISA in the current tax year. This limit changes every year.
Energy meter mix up
This week I was doing some filming with the BBC’s Rip Off Britain programme, and I met up with a rather fed up homeowner called Janet. Janet had been sent letters by her another energy supplier (as well as her own) for the last three years. Despite numerous phone calls, letters and emails by Janet and her family, the letters kept coming. They only stopped last month.
Janet’s case was an extreme one, but there’s no doubt that these mix ups do happen and they can be difficult to sort out. You can be billed by the wrong energy supplier when you’ve been transferred by mistake, or you may be billed too much because your bills are based on someone else’s meter.
Here are my tips to end meter mix up misery:
- Check your bill to see if the meter number on the bill matches your meter number.
- If you think you’re getting billed for your neighbour’s energy (this happened to a friend of mine!), ring your energy supplier, but follow it up with an email or letter if they don’t sort it out quickly.
- If you have been transferred wrongly, you should be told within 20 days of you contacting the company (either the one you’ve been transferred to or your old supplier) that you’re being transferred back.
- Contact Citizens Advice consumer line on 03454 04 05 06 (the number’s on the back of your energy bill) if you can’t get your complaint taken seriously.
- If you’re still not getting anywhere, complain to the Energy Ombudsman. It’s free to do.
It’s less than six months until most people with a pension will be able to take money straight out of it, as long as they’re aged 55 or over. Under the old rules, which were loosened a bit in the Budget in March and will be relaxed further next April, many people had to buy an ‘annuity’, which converted a pension fund into a monthly income for life.
The problem is that there’s a lot of confusion about these rules and – unfortunately – scammers and rogue advisers are taking advantage of this. They’re offering free ‘pension reviews’ or telling people that they should ‘act now’ and take money from their pension.
SAVVY TIP: Although I think the principle behind giving people more control over their own pension money is a good one, taking lots of money from your pension may be the worst thing to do. For a start, only 25% of anything you take out is tax free – you have to pay tax on the rest, and secondly, if you take out a lot of money now, will you have enough left in your pension to live on when you’re older?
Don’t fall for the scams – make sure you:
- Don’t take advice from someone who cold calls you. I’m afraid that cold calling is often used by fraudsters or scammers.
- Don’t feel pressured into making a decision quickly or because of an incentive. It’s far too important a decision to be rushed!
- Don’t get dazzled by the fact you can take money from your pension. Think about what you’ll do with the money once you’ve taken it out and – crucially – what you’re giving up.