Articles

Ten little known personal finance tips

19.12.2013

Here are 10 financial things everybody should know – but which too many of us don’t.

General tips

1. How much of your ISA allowance have you used?

In 2013-14 the full allowance is £11,520.  If you make occasional payments or regular monthly contributions of less than £960 into investments, you could be leaving some of your allowance unused.  Find out, and use it before the end of the tax year if you can.

2. How much is your jewellery worth?

Soaring gold and diamond prices over recent years could mean your bling is worth a lot more than you paid for it.  If so, your contents insurance may no longer be adequate to replace the items if stolen, so get a fresh value.

3. Price comparison sites aren’t always the cheapest way to buy financial products

“They don’t always have the best deal with each provider, and take a cut of the sale, adding to the cost”, says discount broker Clubfinance.  Always compare prices with a direct quote.

4. What factors affect your credit rating?

A poor credit score makes it difficult or even impossible to get a competitive mortgage, loan or credit card.  Find out yours for a £2 fee from credit reference agencies Equifax, Experian or Callcredit.

5. You can earn tax-free cash by renting out a spare room

Most of us have spare rooms, but most don’t realise they can earn up to £4,250 per year tax-free by taking in a lodger. Whether you want to of course is another matter….

Tips for our retired clients

6. Where are all your pensions?

It’s easy to lose track of old company pensions, especially if you have worked for several employers.  The Pensions Tracing Service can help you track them down:  www.pensiontracingservice.com or telephone 0800 122 3170.

Tips for our working clients

7. Keep track of your annual mileage

Your motor insurer wants to know how many miles you drive each year when you buy cover, as the more miles you do, the more likely you are to have an accident.  If you have seriously underestimated your mileage it could invalidate your policy if you make a claim.  The easiest way to find out is to compare the mileage on your MOT certificates.

8. Find out when you can claim your state pension

Most people expect to qualify at age 65, but that is steadily rising and younger people might have to wait until they are 68 or even older. 

9. Make sure you know what your employee benefits package includes

A good workplace benefits package can be worth 20-40% of your basic salary, and include valuable insurance.  If you don’t know what you’ve got, you may end up buying cover you don’t need.

10. How long would your savings last if you could not work?

Ideally, you would have a six-month cushion, but for the average Briton it’s just 19 days (source: Legal & General).  That’s not necessarily a problem as long as you have something else in place to kick in when you run out of cash.  To arrange that, you need to know how much you have.

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I feel I can phone at any time with requests for help! Mrs G - Coventry

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Adrian Smith

Chartered Financial Planner
Chartered Wealth Manager
CFP-CM

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