Steve A Smith asked:




Many of the Britons who are renting property could be putting themselves under financial pressure, a study has revealed.

According to new research by AA Legal Services, half of those renting a home do not have a written tenancy agreement from their landlord before moving into a property, despite this being a legal requirement. With a significant number of consumers are being priced out of the home-owning market, the company reported that a quarter of these people “being forced to rent”. However, with more tenants revealed to be concerned about the size of their bedrooms rather than how they would be able to reclaim their deposit, it was suggested that many Britons could be leaving themselves open to unnecessary financial pressure upon signing a rent agreement.

Commenting on the figures, James Molloy, head of AA Legal Services, said: “These findings demonstrate how poorly people protect themselves when moving into a rented home. It is vital that you agree your tenancy agreement and check everything, including inventory and utility meter readings, before you accept the keys to your rented home. Yet thousands of people are just not doing so and are putting themselves and their home at risk.”

The study also revealed that more than half (55 per cent) of consumers do not take electricity, gas or water meter readings before moving into a property. As a result, the financial services firm claimed that this could lead to them facing “unexpected bills”, which in turn may see them develop problems meeting other demands on their spending such as credit cards, overdrafts and tenant loans. In addition, a “shocking” 59 per cent of renters are unaware as to their notice period, a move AA suggested could leave people in “the lurch with unbudgeted months of rent to pay”. Findings from the financial services firm also indicated that 55 per cent of respondents do not take the time to make sure that their rental payments are clearly set out and agreed upon, which may see them paying more money than they should each month.

Meanwhile, the financial services firm reported that just over one in five (22 per cent) claim that they have taken steps to ensure their finances will be able to cope with the demands that moving into a rented house or flat can bring. As a result, Mr Molloy advised those consumers who are concerned about a property they wish to rent to seek out advice from a solicitor or some other “reputable organisation”.

Should people renting a home find that they are coming under surging financial pressure, for whatever reason, the taking out a personal loan could help them relieve such stress by merging numerous demands on spending into a single low-rate loan. Speaking earlier this month, Moneyfacts analyst Lisa Taylor reported that borrowers need to take the time to make sure that they are getting a competitive rate of interest on a personal loan, as a number of lenders have increased their rates over the last nine months. She stated that choosing the “wrong” loan could see consumers paying double the amount of interest then is necessary.

Caroline

Mark Dawson asked:




A complacent attitude towards their finances could see many Britons struggle with money as they get older, new figures highlight.

In research released by Defaqto, a number of consumers are “sleepwalking” into financial hardship as they are saving an inadequate amount of cash into pension schemes. And as a result of a shortfall of deposits into savings accounts, they may face pressures on their ability to service demands on their spending in later life, for example on utility bills, secured loans and mortgage costs.

The study also revealed that there are more people who are saving up for their next foreign holiday than those putting cash away for retirement. Meanwhile, money management difficulties could be even more pronounced for the one in three consumers who are not making any pension contributions at all.

Commenting on the findings, Matt Ward, principal consultant of pensions and wealth management for Defaqto, said: “Our research showed that many people are sleepwalking into retirement. While the majority are planning to retire from full-time work at or around normal retirement age, many people realise that their income in retirement may meet their needs”.

“For this reason, some 50 per cent of those currently working expect to either continue doing some work in retirement or to defer their retirement to make their savings last as long as possible. Relying on part-time work could be really dangerous, partly because the jobs might not be there when they are needed and partly because people may not be able, or indeed inclined, to work when it actually comes to it.”

Mr Ward added that consumers need to start thinking about their financial future “now”. By putting as much money as possible into pension accounts when they are able to do so, they will be able to provide themselves with “the greatest degree of comfort” for when they get older.

Additionally, the financial research company revealed that people are looking for greater assurances about the money they are saving for later life, with consumers wanting more guarantees concerning how much they will be due to take out upon giving up work. Meanwhile, a larger number of Britons are seeking “more incentives” to begin saving for retirement. About a third of respondents believe that everyone should be made to put money towards a pension scheme, while there was also support for the idea that employers should have to provide retirement accounts for their staff.

For those concerned their present financial situation does not give them enough opportunity to put money into pension schemes, taking out a debt consolidation loan could be an advisable option. In doing so, borrowers will be able to merge existing debts owed on loans, overdrafts and credit cards into a single monthly repayment. Such a move could be welcomed by some 1.5 million people over the age of 55, as research from Scottish Widows showed that such consumers will have to work beyond retirement age due to a shortfall in the money saved into pension schemes. The study also indicated that some 41 per cent of this age group view their current financial situation as being “tight” as they do not have sufficient disposable income at the end of each month to allow them to begin saving.

Milton

Abbi Rouse asked:




Although it is still five months away, Britons are being warned that failing to plan their spending over the Christmas period could impact upon their personal financial situation.

In research carried out by Britannia, just under half of the adult population (47 per cent) are said to not be saving money specifically for the festive season, despite predictions among the public that it will set them back by an average of

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Abbi Rouse asked:


flation and a lack of credit has forced many Britons into a difficult economic situation, according to Legal & General.

The financial services firm has announced that the number of people who are now living beyond their means has increased significantly in the last six months, with residents in the north found to be particularly hard struck. Research carried out by the group indicated that in this area, the number of people whose outgoings are higher than their monthly income has ballooned by 82 per cent, with 281,000 consumers in the region found to be in this situation. East Anglia and the north-west have also seen their income shrink in the face of increasing costs, with 51 per cent and 47 per cent increases in the number of people living beyond their means recorded in each of these areas respectively.

For consumers who are finding that their salary is insufficient to cover their bills, applying for a payday loan may be useful to replace missing income. On the other hand, for consumers who find this to be a regular issue, a loan for consolidation purposes may be of benefit.

Indeed, it seems that across the country the number of people with money left over after bill payments is contracting. Research from Legal & General has indicated that only 57 per cent of the population has money to put away at the end of each month, meaning that an additional 1.2 million consumers have found their income insufficient in supporting their household in the last six months.

Again, the north was found to be the worst affected region, with a 17 per cent decrease in the number of people with surplus income logged in this area. However, the firm also pointed out that even Londoners are feeling a pinch, with a seven per cent fall recorded in the capital.

Commenting on the figures, Jonathan Latham, director of wealth customer marketing at Legal & General, said: “As inflation takes its toll, the need for investing becomes even greater as digging into reserves looks inevitable for an increasing number, with nearly 5.3 million people now being forced to spend more than they earn. The harsh reality of today means the end of the ‘spend now pay later’ culture. We would urge customers to review their finances and carefully look at their spending and savings habits. With some careful budgeting it is possible to keep on saving, even a small amount. If you are having financial problems, it is important that you take action and speak to a debt adviser.”

For those who have found themselves struggling to keep up with spending commitments, taking out a debt consolidation loan may be an effective way of getting finances back on track. By spreading out payments in this way, people may find that they can avoid the risks of defaulting on commitments. Opting for this type of loan might be of particular interest to those people who are considering selling their property to avoid repossession after the Motley Fool warned that many buy and rent back schemes come with clauses that could put consumers in a vulnerable position.



Jessie

Abbi Rouse asked:


More Britons are expecting to be financially active over the coming months, a new study shows.

In the 25th Financial Activity Survey carried out by GfK NOP and commissioned for JGFR, it was indicated that some 25.3 million people expect that they will take part in at least two types of monetary moves, in areas ranging from repaying loans and other debts to investing into saving schemes. Such a figure represents a rise from the 23.7 million recorded last quarter, although this is down from 26.6 million which was noted in March last year. Meanwhile, 10.5 million people questioned expect that they will only carry out one form of fiscal activity in the weeks ahead. Just under a fifth (19 per cent) of such consumers expect that this will take the form of paying back debts.

The overall FAB activity index has risen by just over two points during the last three months to stand at 88.3, with the borrowing activity index also posting growth from the previous quarter to 68.3. Meanwhile, the debt repayment index was indicated as having increased since January. In addition, one in ten people are looking to borrow through some form of unsecured borrowing, such as personal loans or credit cards. However, this figure is indicated as representing a slight fall from the study carried out at the same time last year.

Overall, the most popular monetary activity is making a cash deposit. Almost two-thirds (63 per cent) of people are looking to either save or invest money.

John Gilbert, managing partner at JGFR, said: “The combination of very weak consumer confidence and financial wellbeing are reflected in the continuing depressed savings, investment and borrowing intentions. This will intensify the difficulties of financial businesses generating revenue growth, particularly when one of the few bright spots is in mortgage demand where supply is being withdrawn. There is a growing possibility of a liquidity squeeze on consumers with many people cast adrift in unchartered waters and becoming forced asset sellers.”

However, demand for credit to finance the purchasing of a car has witnessed growth in recent months. Now standing at 70, this figure shows a rise from the low recorded in December, although it is down by eight points from March 2007.

In addition, the study also showed that those living in the south-west of England and Wales are set to be the most financially-active, with such consumers accounting for 79 and 78 per cent of people from the respective regions. On the other hand, less than two-thirds (64 per cent) of Britons resident in the Yorkshire and Humberside area of the country are set to take some form of action in regards to managing their money.

Whether looking to fund a major purchase such as a home or car or simply supplement their spending, taking out a personal loan might prove to be of assistance. Doing so may see borrowers be able to finance their buying quickly and effectively, leaving them with an affordable rate of repayments to make. Furthermore loans could assist those aiming on increasing the amount of disposable income they have each month to invest into saving schemes. Getting a loan may also help those concerned about meeting the cost of utility bills. Recently Tim Wolfenden, head of home services for uSwitch, suggested that despite the most recent round of energy price hikes, costs are set to increase even further later on in the year.



Cecil

Abbi Rouse asked:


A significant number of Britons are worried about the country’s economic prospects, new research shows.

In the Cracking the Credit Crunch: Recession Veterans vs Recession Virgins study by Fool, it was revealed that 17 per cent of people believe Britain is already in a state of recession. Recession veterans were indicated as being those who have experienced economic difficulties during the past 40 years, with recession virgins yet to face the impact of a slump in the monetary markets. Findings from the personal finance publication also indicated that one in five respondents admit being filled with fear at the smallest hint of an economic downturn.

The drop was attributed to the continuing impact of the credit crunch, which was seen the availability of cheap loans and other types of borrowing diminish. Consequently, just under three-quarters (74 per cent) of Britons claim that they are to change their spending habits to help protect them against a financial slump.

Following an economic downturn it may be possible that significant numbers of consumers develop problems in meeting demands on their finances. Such areas could include home loans, store cards and mortgage repayments.

An estimated 41 per cent of recession veterans claim that recent difficulties in the financial markets have already had a negative effect on their own money management. One in three of people yet to experience a slump are reported to be “clueless” about the predicted difficulties that they may face. In addition, a third of recession virgins believe they are in a fiscal situation where they are forced to go into the red. Furthermore, 33 per cent of Britons state that they are unable to afford saving money.

Commenting on the research, David Kuo, head of personal finance for Fool, said: “The term credit crunch has become a part of our everyday vocabulary over the past eight months but it’s instructive to see how people feel about a looming recession. In an economic downturn there will be opportunities and threats and we can take steps to maximise the first and minimise the second. And simple measures such as reining in spending will ensure that we have a pot of spare money tucked away to see us through a slump.”

Mr Kuo reported that those who have cash to spare may be able to manage various financial commitments such as making mortgage repayments or investing money into a savings account. “It won’t make the credit crunch go away but it will make life more bearable until it does,” he added.

Research from Fool also indicated that 31 per cent of people think that a recession will last for at least two years. Some five per cent of respondents meanwhile claim it will carry on for an indefinite period of time.

For those consumers who are concerned about their ability to manage money as 2008 progresses taking out a low-cost loan now could be advisable. By applying for a UK loan it is possible that borrowers can meet numerous demands on their spending at once, leaving them with a single low-cost repayment to make. This may be particularly helpful to those experiencing difficulties in paying their mortgage. A recent study by the Council of Mortgage Lenders revealed that 27,100 homes were repossessed during the course of 2007.



Victoria

Abbi Rouse asked:


More people could be due to come under financial pressure over Christmas, a new study suggests.

In research conducted by CreditExpert, 76 per cent of Britons state that they are set to either spend the same amount of money on gifts this year as they did in 2006 or increase their expenditure. The news comes as 29 per cent of those surveyed claim that their present financial situation is tighter than it was last year. And as the credit reference agency claims that the impact of the recent series of interest rate rises and the credit crunch has put more strain on consumers’ monetary situations, more people could well be due for a “huge financial fork-out this Christmas”.

The study also showed that eight per cent of respondents believe that their borrowing, whether through credit cards, overdrafts or a personal loan, will increase in the weeks leading up to the Christmas period. Meanwhile, about half (47 per cent) of those surveyed think that there is a social pressure for them to buy expensive gifts.

Jim Hodgkins, managing director for CreditExpert, said: “During the festive season, most of us spend more than normal so it’s especially important to monitor our finances and make sure our Christmas doesn’t turn into a financial nightmare.”

He advised that while buying gifts is a “big part” of the festive period, consumers would be wise to avoid overspending as otherwise they could develop problems managing debts accrued via loans and credit cards. “It’s vital we budget and take a step back to ensure all our outgoings are necessary so we don’t end up being unable to make the repayments come January – a bad credit rating can make the difference between being offered credit or not, so make sure you keep on top of your credit history and ensure you can pay back any debts before you go into the red,” Mr Hodgkins asserted.

Overall, the study showed that people in the north feel that they are under the most pressure to splash out on expensive gifts for their loved ones, which consequently could impact upon their ability to make payments on personal loans and other types of borrowing. In turn, CreditExpert pointed out that those from the northern areas struggle more with money than anywhere else in the country, as the levels of consumers in the north-west and north-east who have got into debt after overspending during Christmas accounts for 37 and 31 per cent respectively. This compares to the 22 per cent of residents from the south-east of England who admitted getting into debt last Christmas. Meanwhile, people in the 35 to 44-year-old age bracket are the most likely to have gone into the red as a result of exceeding spending plans over the festive season.

For those concerned about their ability to fund their spending in the run-up to Christmas, taking out a cheap loan could well be an advisable option, as in doing so borrowers may be able to make a number of purchases at a low rate of interest or pay off other debts that they may have built up. Last month, Neil Munroe, external affairs director at Equifax, reported that having a positive credit report can help consumers access a loan at a competitive rate of interest.



Stephanie

Mark Dawson asked:


Britain’s financial optimism has plummeted, according to a recent set of figures.

GfK NOP’s latest consumer confidence index revealed a drop of five points with regard to the country’s outlook on the current monetary climate to stand at -24. Such a figure is the lowest recorded since November 1992. Furthermore the current overall level of economic optimism was shown to be down by 18 points from the same period this time last year, with decreases noted across all five of the firm’s measures which make up the index.

GfK NOP’s index tracking the nation’s thoughts about the state of their finances was shown to have fallen by four points to stand at -8 – the lowest level recorded for more than 11 years. In addition, consumer predictions about their personal finance situation over the next 12 months have fallen by four points to stand at zero. Meanwhile, the index judging whether consumers think it is a good time to make major purchases dropped by three points to stand at -24. Such a figure is the lowest recorded since November 1990 and represents a fall of 30 points from last year.

Furthermore, the index charting the public’s thoughts on the general economic state of Britain over the past year has dropped to -53, with predictions about how it will fare during the next12 months falling six points to stand at -38.

With consumers having such major financial concerns, it may be the case that significant numbers of Britons are struggling to manage the various demands on their spending. Such areas could well include utility bills, loan and mortgage repayments, transport costs and credit cards.

Commenting on the research, Rachael Joy, a member of GfK NOP’s consumer confidence team, said: “Consumer confidence is at its lowest since level since November 1992. This month’s drop has been mainly driven by dropping confidence in the general economy over the last 12 months. With the news dominated by stories of recession, the credit crunch, housing market falls and future petrol and food price increases, it will take more than a quarter point reduction in interest rates to alleviate the current gloomy mood of the UK consumer.”

However Britons are not entirely negative when it comes to thoughts about how they will manage their money. In fact, many appear to be taking steps to prepare for later life, as the firm’s savings index – which judges whether people think that now is a good time to set cash aside for the future – increased. Up by three points from last month’s figures to stand at +28, the index is now at the same level as it was in April 2007.

Consumers who have grave concerns about their ability to manage their finances as 2008 progresses might wish to consider taking out a consolidation loan. In selecting this type of loan, borrowers could find that they are able to allay various monetary fears and merge constraints on their spending into affordable monthly repayments. A debt consolidation loan might be of particular assistance to the former young urban professionals of the 1980s. Research carried out by LV= indicated that 45 per cent of the yuppies of two decades ago – who are now in their late 40s and early 50s – claim to be struggling to live within their means.



Tonya