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.
What’s your data worth?
How much do you think someone should pay for your email address? Or your browsing history? A new survey finds that people think their email address is worth around £980, when in fact it could be sold for as little as 5p!
Many people don’t realise how cheaply companies trade data for or when their details might be sold. While the cost of buying your data could be cheap, for some companies, it’s valuable stuff.
SAVVY TIP: If you’re on a website or service that you have to register for, make sure you check exactly what information you’re handing over and who it can be sold to or shared with. Companies should ask for your explicit permission if they are going to share something like your email address or other details with other companies.
Tax credit renewal deadline
If you get tax credits, you have until July 31st to renew your claim. The amount of tax credit you receive is normally based on information you’ve given about the previous tax year’s income. So, if your circumstances have changed – for example – you’re earning more or less, your tax credits will need to be adjusted.
Here’s my handy guide on what you need to do:
- Make sure you have received a renewal pack. You should have been sent yours in the post before the end of June. If you didn’t get one, you should call the tax credit helpline on 0345 300 3900.
- If your renewal pack has the words ‘reply now’ you need to renew your tax credits. You can do this online at gov.uk/manage-your-tax-credits, by phone on the number I mentioned above or by post.
- If your renewal pack has the words ‘check now’, you just need to check that the details are correct. If they are, you don’t have to do anything and your tax credits will be paid for another year at the same level you’re currently receiving them.
- If you don’t renew your tax credits when your details have changed your tax credit payments will stop. You will be sent a summary statement and if you don’t send back your renewal pack within 30 days of getting this statement, you won’t get any tax credits in the future.
Unarranged overdraft? You could be paying a fortune in charges!
If you go into the red without asking your bank’s permission – watch out! The fees and charges could add up to a large chunk of money each month. In fact, according to consumer group Which?, an unauthorised overdraft could cost more than a payday loan.
The amount payday lenders can charge has been capped at 0.8% interest a day, which works out at £24 if you borrow £100 for a month. But, if you pick the wrong bank and go overdrawn by £100, you could pay as much as £90 in fees and charges. The competition watchdog is due to recommend next month whether these charges should be capped further.
SAVVY TIP: Some current accounts have an interest-free buffer, which can be from £10 to £200. Banks should offer to text you when you’re about to go overdrawn or near your agreed overdraft limit, so sign up for this service if you haven’t already. And, if your bank has expensive unauthorised overdraft charges, consider switching to one that doesn’t.
Getting the best rate on your savings
Savings rates are pretty rubbish (not a technical term!) and they’re likely to go even lower in the future. If you want to get the most interest on your savings, you need to keep a sharp eye on the rate and be prepared to move your money, if necessary. Bear in mind:
- The best interest rate may be from a current account, rather than a savings account. You can get up to 5% for a limited period on certain amounts (typically a few thousand pounds), or 3% if you’re prepared to pay £5 a month for your account and have between £3,000 and £20,000. You normally have to pay in a minimum amount each month and set up a couple of direct debits.
- Some banks paying the highest interest rates on fixed rate savings accounts are not covered by the UK’s savings compensation scheme. Instead, under EU rules, they have to give the same amount of cover (€100,000 – in the UK it’s £75,000), but the system and timescale for claiming may be different. It’s worth bearing in mind especially if you’re thinking of going for an account that locks your money away for more than two years (by which time we may be out of the EU).
- Peer-to-peer lending pays more than savings accounts – sometimes a lot more – but it can be much riskier as well. Your money isn’t covered by the UK savings compensation scheme and, if you’re offered a much higher interest rate, it’s because you’re taking on a lot more risk. You may not get back the money you’ve lent out.
Ban cold calls offering credit
A leading debt advice charity, StepChange, says there should be a ban on companies cold calling people and offering them credit or debt management services that they have to pay for. Its research found that over half of all adults have had one of these cold calls and one in eight are being called more than once a day.
It’s not just debt advice companies and loan brokers that are calling people. Claims management companies often call or text people out of the blue. Here are my tips for stopping unwanted calls:
- If you’re called out of the blue, hang up! Don’t listen to what they have to say.
- Reduce the chances of getting unwanted calls by signing up to the Telephone Preference Service (TPS). It’s not foolproof and you may still get some calls, but you should get a lot less.
- Register your mobile number as well (you can do this by texting your email address to 85095 – a special TPS number). It won’t work for texts, just calls.
- If you get unwanted calls after you’ve registered with TPS the company is committing an offence. Cold callers shouldn’t withhold their number either as this has been illegal since May 16th. Complain to TPS if you continue to get calls – even if the number has been (illegally) withheld.