COVID-19 has affected almost every aspect of our lives, including our personal finances. Here are same personal expenses you can recoup:
1. SKY Sports and BT Sports
Sky Sports customers can now ‘pause’ their subscription & BT Sport customers can get two months’ credit (or donate it to the NHS).
2. Cancelled flights and package holidays.
If your flight or package holiday was cancelled, you are legally entitled to a refund. State your request clearly, in writing, to the firm concerned. If you still struggle to get your refund, you could try to claim through your card provider.
The company which took your money is responsible for issuing your refund.
Consider whether you 100% need a refund, or if you’d be happy with a voucher.
At the moment, many airlines are really struggling. This means of course that it’s safer to demand a refund rather than settle for a voucher in case the airline collapses before you can use it. But it’s also worth considering whether you’re in a position to show a bit of forbearance.
3. Refunds for train tickets
Advance, off-peak and anytime tickets are now fully refundable and you won’t need to pay any admin fee. You should also be able to get a partial refund on any part-used return tickets, again with no fee.
Season tickets. With these, you should be able to get a partial refund for the bit you haven’t used, so long as you have at least three days left on a seven-day ticket, or at least seven days left on a monthly or longer season ticket. Many firms have waived the usual £10 admin fee for this – although contrary to what was initially announced, some have said they will still charge it, so check.
If you’ve bought a Transport for London travelcard which is loaded onto your Oyster card, TfL has said it will waive its usual £5 admin charge if you request a refund as a result of being told to self-isolate.
4. MOT Extension
Drivers who have an MOT due from 30th March onwards will be granted a six-month extension because of the coronavirus pandemic, the Transport Secretary has announced.
So for example, if your vehicle’s MOT was due to expire on the 3rd May, it will now run out on 3rd November 2020. However, you will still have to keep your car in a roadworthy condition. Garages are remaining open for any repairs that might be needed.
5. Cancelled Events.
If you’ve bought a ticket for an event that has been cancelled, you should usually get a refund, though do first double-check the terms and conditions. Ticketmaster has confirmed that customers will be able to get a full refund if an event is cancelled due to coronavirus. However, it’s less certain if you’ll get booking and delivery fees refunded too, so check.
While you may be entitled to a refund, also consider that many firms – especially small independent businesses – will struggle as a result of coronavirus cancellations. So if you can afford it, it could be worth practising forbearance by waiving your right to a refund and accepting a voucher or credit note instead if you’re offered one.
6. Gym Memberships.
Most major chains are simply pausing all memberships for the whole time they’re closed – and will freeze monthly payments automatically.
If you’ve paid upfront for an annual membership, it will be extended by the number of days the venue was shut for once it reopens.
A few of the big gym chains have confirmed that any days paid for in March that could not be used due to closure will be refunded once they open up again.
It’s a good idea to contact your gym directly to find out what’s happening if you’ve not heard from them.
7. Cinema Memberships
Odeon and Cineworld have confirmed that they are pausing any memberships and freezing payments until they reopen.
What is an ISA? What makes it different from any other savings or investment vehicle? What are the different types of ISAs? How much can I save or invest in an ISA? Can I open an ISA for my child? I get asked these questions repeatedly. Well, here are the answers!
Let’s start with the definition of an ISA. An ISA is an Individual Savings Account which allows you to invest in cash, shares and unit trusts without having to pay any tax on the interest, dividends and capital gains that you may earn.
You get six different types of ISAs. They are as follows:
Cash ISA. This is also known as a basic ISA and is essentially a savings account. Any interest earned on a Cash ISA is tax free.
Stocks and Shares ISA. This is essentially an investment account in which you invest in stocks and shares. Any dividends or capital gains earned on a Stocks and Shares ISA is tax free.
Lifetime ISA. This ISA is only available for first-time buyers and / or the under 40s. If this applies to you, you are allowed to invest £4,000 per year in a Lifetime ISA for either a house deposit or for your retirement. In addition to any interest, dividends or capital gains being tax free, the government will also give you a 25% top up on the amount you have contributed in a Help to Buy ISA.
Innovative Finance ISA. This is a peer-to-peer lending account in which you can lend money to individuals or small businesses without paying tax on any interest earned.
Help to Buy ISA. This is a savings account for first-time buyers. You are allowed to save up to £3,400 in the first tax year and then £2,400 during each tax year thereafter. In addition to any interest being tax free, the government will also give you a 25% top up on the amount you have contributed in a Help to Buy ISA.
Junior ISA. This can be either a savings account or an investment account for under 18s. You are allowed to save up to £4,260 per tax year free of tax on the interest, dividends or capital gains.
The current tax year runs from the 6th April 2018 to the 5th April 2019. You can invest up to £20,000 in ISAs during this tax year.
You’re allowed to split this allowance any way you like across a Cash ISA, Stocks and Shares ISA, Lifetime ISA (maximum of £4,000) and an Innovative Finance ISA. For example, you could put £6,000 in a Cash ISA, £10,000 in a Stocks and Shares ISA and £4,000 in a Lifetime ISA in this tax year.
NOTE: You CANNOT contribute to a Cash ISA in the same tax year as contributing to a Help to Buy ISA.
The deadline for adding money in this tax year is midnight on the 5th April 2019.
If you already have an ISA and would like to transfer it to a better paying ISA, remember to do a transfer and not a withdrawal. If you withdraw your money it immediately loses its ISA status and investing it elsewhere will come out of your ISA allowance.
Any other questions? Pop them in the comments section and I’ll do my best to answer them.
Making New Year’s resolutions is not for everyone. In fact, research has shown that just less than half us make them. Having said that, research has also shown that we are 10 times more likely to achieve our goals if we actually set explicit New Year’s resolutions than if we set none at all. While I’m not necessarily a fan of New Year’s resolutions, I am most certainly a fan of goal-setting, regardless of the time of year. Why? Well, I believe that the only way to achieve those things that matter most to us in life is by setting and working towards meaningful goals.
Now setting meaningful goals is one thing, but making steady and consistent progress towards those goals is not always easy. In fact, in can be downright hard. It takes effort and perseverance. All too often we throw in the towel before our victory hour. But we’ve got to remember that effort and perseverance are always rewarded in the long-term.
These principles of goal-setting apply to every area of our lives including our personal finances. If you want financial freedom, it’s going to take effort and perseverance. There is no such thing as a ‘get rich quick’ scheme. It’s the steady and consistent progress towards a meaningful financial goal that will pay off in the long-term.
Don’t take a que sera sera approach to your finances or any other area of your life for that matter. No, you can fundamentally change the direction of your life by taking personal responsibility for your current reality and taking purposeful steps to changing it.
And don’t let the distance between your goal and your current reality paralyse you into a state of inaction. No-one ever goes straight from A -> Z in one step. Rather, they take one step from A -> B, then another step from B -> C, and then the next step from C -> D, and so it continues. And it’s rare that anyone has the whole route all figured out from the start. All you need is the next step to keep you going and pretty soon you’ll be able to look back and celebrate just how far you’ve come.
So at the start of this New Year, I want to encourage you to set yourself one to three stretch goals when it comes to your finances. Whether it’s learning to work to a budget, getting the best deal for your savings, getting out of debt, or starting a long-term investment strategy, set yourself some personal finance goals that will move you one, two or three steps towards financial freedom. And if you need some help setting financial goals, check out my blog post on goal-settinghere .
Whatever your next step looks like, now is the time to make a start. Nothing changes if nothing changes. Let 2018 be the year you make significant progress towards financial freedom.
At the time of writing this blog post, there are less than 7 weeks till Christmas, where has 2017 gone? To help you go gently on your finances over the festive season, I wanted to share a few Christmas money-saving tips with you. But first, here are two statistics that you might find shocking:
Research published by Triodos Bank revealed that adults in the UK receive £2.6billion worth of unwanted gifts at Christmas.
According to Unilver, 2 million Christmas dinners were wasted across the United Kingdom in 2016. This is the equivalent of:
263,000 turkeys; plus
5 million mince pies; plus
40,000 slices of Christmas pudding; plus
2 million Brussels sprouts; plus
9 million carrots; plus
3 million roast potatoes.
What do these statistics tell us? Well, in short, they tell us that we spend too much on food and gifts at Christmas time. There are very few people, if any, who willingly set out to waste money and yet, these statistics clearly show that that is exactly what we do. So what can we do to avoid falling into this trap? Here are a few ways:
Set yourself a Christmas budget. One that covers how much you can realistically afford to spend on gifts, groceries and gallivanting (entertainment). Start by asking yourself, “What can I afford to spend?” and plan a great Christmas around that.
Don’t borrow for Christmas, but if it’s unavoidable, find yourself a 0% credit card deal on new purchases. Just make sure you pay it off in full before the interest free period ends.
Agree to end obligatory giving. How many of us give out of obligation? This is not true generosity. It is much better to have a frank discussion with friends and family alike and agree to put an end to this practice. I am not saying to stop giving entirely as generosity is something I wholeheartedly applause and even subscribe to, but what I am saying is to give where it really counts.
Set up a Secret Santa. That way, everyone taking part only buys one gift and also receives one gift. You can even agree a spend cap with each other.
Remember that kids don’t measure gifts the same way adults do. What I mean by this is that, more often than not, it’s not the expensive gifts that capture a child’s heart, but the creative, entertaining and thoughtful ones. No matter what I buy my kids for Christmas, the one thing they are after year after year, is the small carton of glow-sticks that Santa brings them and makes them share. It works a treat every time.
Shop at online outlet stores to grab yourself a bargain. Lots of high street shops and high end shops now have online outlet stores. See https://www.moneysavingexpert.com/deals/outlets for a free guide of some of the better ones.
Cut your grocery bill by:
Making use of any items you already have in your pantry or your freezer. You’d be surprised how much you can save by doing this. Don’t believe me? Just add up the value of unused food items sitting in your pantry and freezer today.
Sticking to a meal plan. If you do, you won’t buy what you won’t need.
Don’t fall for the ‘buy 1 get 1 half price’ specials. Just buy what you know you’re going to use.
Shop a brand level down. Money Saving Expert, Martin Lewis, had a blind taste-test party for nurses at a hospital a couple of years ago with champagne, turkeys, etc. 62% of the time, the participants preferred the lower-brand goods or couldn’t tell the difference.
For more ways to cut the cost of Christmas, click here
My money tip this month is on the real key to financial freedom. It won’t be what you expect, it will be far simpler. It’s also free. But just because it’s simple and free, it doesn’t mean its necessarily easy. So, what is it?
The real key to achieving financial freedom is the ability to exercise self-discipline in our money management. In fact, without it, we can kiss financial freedom goodbye. Too many of us have the wrong perception about this great tool. We see it as something unpleasant and difficult to attain. Whereas in reality, self-discipline is actually our greatest ally!
You see, when it comes to money matters, self discipline is the ability to put off spending on impulse in order to achieve a greater financial reward or a greater financial goal further down the line. In other words, it’s about practising delaying gratification.
What does self-discipline mean in practice?
It means to make a decision in advance about how you are going to spend, save and invest your money in order to live the kind of life that you want. It’s the tool that will empower you to be able to:
buy your first home,
start your own business,
leave a dead-end job,
travel the world,
get out of debt,
pay for your children’s education, etc.
Self-discipline is the tool that turns hum-drum ineffective budgeting into that which transforms your financial future. Sure, there’s a bit of sacrifice involved. But nothing worth achieving ever comes without a price. As someone once wrote, “discipline is being able to plan your pain and your pleasure.” The pain being not buying that thing you want in the moment. And the pleasure of achieving your financial goals later on.
If financial freedom is something you want, it’s yours if, and only if, you can master the art of exercising self-discipline.
Today the Bank of England voted again to keep UK interest rates (i.e. the base rate) at the record low of 0.5%. While they have warned that it will rise if the economy keeps growing as forecast, no-one can predict exactly when this will be.
On the one hand, this is positive news for borrowers whose cost of debt is linked to the base rate, e.g. for those of us with tracker mortgages. On the other hand, when it comes to our savings, it will mean we have to get really smart with our money in order to see it grow, and I mean REALLY grow.
Here’s the crux of the matter: if your money is not growing by more than inflation, then it is not growing at all. In fact, you are losing money.
Currently, the best rate you can get on an instant-access cash ISA is about 1.06%. And, if you’re prepared to lock your money away for the next 5 years, you can get about 2.15%*. With inflation currently at 2.9% and forecast to go above 3% in October (that’s the CPI and not the RPI which is a lot higher), then these Cash ISA rates are pretty dismal. If this is all you are earning on your hard-earned cash, then your money is actually decreasing in value by at least 0.75% in real terms. So, what then are your options?
Thankfully there are options available to us, but like anything in life, there is always a trade-off. The trade-off is the first fundamental rule to making your money work for you and that is the relationship between risk and reward: the higher the risk, the higher the reward and the lower the risk, the lower the reward.
Keeping this relationship in mind, experts from around the world agree that equities are still one of the best ways (over the long-term) to grow your money with inflation beating returns. One only has to look at the FTSE 100’s performance over the last 12 months to agree that this makes sense…..it grew by about 15%. I would like to emphasise though, that equities are a long-term investment and should not be entered into blindly. Get yourself educated beforehand and don’t forget to use your ISA allowance first.
Secondly, experts also suggest that in times of low interest rates, bonds can be an attractive option. The two main options here are corporate bonds and gilts. Although with the country bailouts we’ve seen in recent years, one has to ask whether gilts are indeed as low risk as they used to be.
A third option which is gaining popularity is social lending or peer-to-peer (P2P) lending. So what is P2P lending? It is the lending or borrowing of money between individuals and ‘peers’ without the intervention of a traditional financial institution. A number of P2P lending platforms have been established to bring such lenders and borrowers together. The reason that this is becoming increasingly popular is because of the favourable rates on offer to both lenders and borrowers alike. Be aware, any savings via this option are not covered by the Financial Services Compensation Scheme.
The bottom line is this, don’t leave your savings to chance, not if you want to see them grow. It’s up to you to take control and be deliberate about growing your money.
In my attempts to keep this brief, I’ve only skimmed the tip of the iceberg. If you’d like to learn more, I’m running a once-off Investments 101 workshop on the 28th September 2017. For details get in touch with me on: liz@yourmoneyroadmap.com.
