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.
New 15 car plate
Thinking of buying a new car? If so, I bet you’ll do some research into the type of car you want before you buy. But it’s also a good idea to research how you’ll pay for it. A survey by a bank shows that just over half of those who bought a car using a car loan or another form of credit shopped around for the best interest rate. Although most people use their savings to pay for their new car, almost 20% use some form of credit with one in four of those opting for a finance deal provided by the car dealer. So, what are the different car finance options and what should you watch out for?
- Personal contract plan (PCP) – here you put down a deposit and make monthly payments for a fixed time (normally up to three years). At the end of the term you can make an extra payment and keep the car or hand it back. The car could be repossessed if you can’t keep up the payments.
- Hire purchase – the similarity with a PCP is that you pay for the car over a period of up to five years, but unlike a PCP there’s no large payment at the end of it. That means your monthly payments are generally higher. The car could be repossessed if you can’t keep up the payments.
- Personal loan – your loan isn’t secured against the car so it can’t be repossessed if you can’t keep up the payments. Personal loan rates are very competitive at the moment (you can get loans charging less than 4% if you have a very good credit score, depending on how much you want to borrow). But if you can’t get the best rates, a personal loan could be a more expensive option.
- Credit card – if you can get a 0% deal on card purchases and you can pay it off in time, or you can get a 0% on balance transfers credit card and transfer the balance, it’s a good option. But, if you end up paying interest it could be very costly. However, you will get valuable consumer protection if you pay for the car on your card.
SAVVY TIP: If you pay the deposit using your credit card and the rest by cash or personal loan, for example, you get the same consumer protection as you would if you paid the full price by credit card.
Illegal private parking tickets
Millions of parking tickets issued for private car parks could be illegal, according to the motoring charity the RAC Foundation. Many people don’t realise that a parking ticket issued in England or Wales when you’ve parked on private land or in private car park aren’t legal penalties. Instead, they’re effectively an ‘invoice’ for a breach of contract. The amount on the parking ticket is the sum that the company believes it’s entitled to claim for you parking when you shouldn’t have done so. But the RAC Foundation says that the amounts charged on tickets can be far higher than any costs incurred by private car parks. It wants to see cases tested in the courts.
SAVVY TIP: If you get a ticket because you parked on the street or a council-run car park, the rules are different and in that case the ticket is a penalty notice.
Married couples’ tax allowance
Some married couples will be £4 a week better off just because they’re married. That’s almost enough for a fish and chip supper (but only for one of you!). Who gets it? Well, if you’re married or in a civil partnership and one of you pays tax at the basic rate and the other doesn’t earn anything or earns less than the personal allowance (which will be £10,600 from April 6th), you’ll be able to register for the married couples’ tax allowance.
The tax allowance will be worth up to £4.08 a week and the first payment will be made in April 2016. You can register now by going to the gov.uk website.
SAVVY TIP: You can’t claim this tax allowance if one of you is a higher rate taxpayer and couples who live together but who aren’t married are also excluded.
Transferring a child trust fund
If you have money for your children in a child trust fund, you’ll soon be able to transfer it into a junior ISA. Up until now, money in a child trust fund couldn’t be transferred to a junior ISA. But from April 6th the rules will change and parents will be able to transfer money from child trust funds into junior ISAs.
Children born between September 2002 and January 2011 were able to take out a child trust fund, but they were abolished in 2011. Junior ISAs were introduced to replace them after they were abolished and, in some cases, these have offered a higher interest rate or a better return.
Both child trust funds and junior ISAs are tax efficient savings or investment accounts where the money that’s paid into them is tied up until the child reaches 18.
Logging off …permanently
Apologies for the fact this is a bit depressing, but have you made arrangements for your online accounts after you’ve died? No? I’m not surprised as it’s probably not something most of us think about.
Research shows that three quarters of us haven’t made any plans. But it could be quite difficult (and in some cases, virtually impossible) for your relatives to get access to your accounts after you’ve died if you haven’t made plans in advance. The survey also found that over three quarters of people have had some problems sorting out a relative’s account after their death.
There’s no universal approach by companies either: some social media accounts let friends and family set up a memorial page, some email providers automatically close accounts after they’ve been inactive for a certain length of time, and others let family members close email accounts but don’t let them access any of the emails.
SAVVY TIP: In most cases, if you’re trying to get access to the account of a relative who’s died, you’ll need to provide a copy of the death certificate and evidence of your own identity.