Expert Savings Advice

So many car warranties have ‘hide and seek’ clauses hidden somewhere within the small print that consumers often feel like they’re playing children’s games just to get their broken down vehicle seen to. Two of the main culprits are the ‘wear and tear’ and the ‘betterment’ clauses. Each of these is designed to give the company a way out of paying claims and the main two hidden clauses consumers should always look for before signing on the dotted line.

If a company can get out of paying for mechanical or electrical component due to normal wear and tear which comes with age they will certainly do so. Most companies do have a wear and tear clause and may pay a portion of the repair based on a sliding scale related to the relative age of the part. Warrantywise also has such a clause written into plans, but you are given the opportunity to opt out by deselecting the tick box. And, this brings us to the matter of excess.

Most companies do have excess written into their warranties and you have this option with Warrantywise as well. The difference is that most car warranty companies don’t reduce their premiums when you have excess written into the plan but Warrantywise does reduce the cost of your payments based on the excess chosen. It is their belief that if you are paying excess your premium should reflect that extra money you are paying for a warranty – plain and simple.

Another clause a warranty company will get you on almost every time is ‘betterment.’ Look for this term very, very carefully in the small print because many warranties will not pay for parts if they feel the part increases the value or betters the vehicle in any way. Warrantywise does not use this as an excuse for denying claims. You will find this on warranties at Warrantywise but you are also allowed to deselect this option as well.

Many people feel that their vehicles are new enough to forego this option so they don’t choose it, and of course, that decision rests with you. In the end, you will never need to play children’s games to see where you could be led astray. If you are going to play hide and seek, play it with your children, not your warranty company. You have a right to a fair warranty claim settlement and Warrantywise will not play games.

Why should you worry about keeping your carpets clean? The most obvious reason is so they don’t look dirty but there are several reasons you should clean your carpets regularly. Your carpet is a major investment for your home. If it’s not kept clean then your carpet won’t last very long and all the hard earned money you’ve invested in it will certainly be wasted but you may not realize there are serious health reasons for keeping your carpet clean.

You may not realize that everything on your carpet doesn’t just stay on your carpet. Regular traffic and general use spread all the dirt and pollutants that reside in your carpet throughout the air. All that dust that is just lying there is also invading your home and your family’s lungs. Even when you can’t see the dirt and grime with the naked eye it’s still there, and it remains a potential health risk. Your carpet needs regular and thorough cleaning. You can’t afford to ignore it or pretend that it doesn’t exist.

If anyone in your household has health issues it is vital that your carpets are professionally cleaned regularly. Dirt, dust, and dander can trigger symptoms for allergy and asthma sufferers. You can’t afford to not have them professionally cleaned. Allergies can lead to illnesses such as bronchitis and a bad asthma attack could be life threatening. This is actually a life and death matter in some cases.

Virtually all carpet manufacturers maintain that your carpets should be cleaned professionally every 12-18 months in order to keep them looking their best. If you have children, pets or more traffic logically your carpet will need to be professionally cleaned far more often. If you plan to keep your carpets looking beautiful with their color and fibers completely intact getting your carpet professionally cleaned is part and parcel with regular home maintenance.

If your carpet already has stains and odors you may wish to get your carpet professionally cleaned by carpet cleaners in Leeds. The longer any stains or odors are allowed to remain the more firmly they become set in. Eventually your only choice will be to replace your carpet which will mean spending more time and resources than regular cleaning would require. In this case as in most cases an ounce of prevention is worth a pound of cure.

It’s far better to invest your time and money in preserving the resources you currently have, than having to go out and replace your carpet. Your time and money could be better spent in investing your time and money into adding value to your home. It’s far better to be bettering your position with your investments than to be losing ground.

Protect your health, protect your family, and protect your investment in your home. Take a step in the right direction and don’t waste any time. Once you can see the dirt and the wear and tear it’s already too late. Have your carpet professionally cleaned. You’ll be glad you did.

When considering how the new Pension legislation will affect our company I have been put in charge of reviewing the various options regarding setting up a suitable pension plan. This task seemed fairly straight forward but the one thing that surprises me is the lack of information on the subject, when I would have expected a large amount of advertising and so on from the government.

From my research it seems clear that our firm will have to start paying into a pension plan in January 2013 for all members aged over 22 and earning more the £7,464 per year. We understand that all members will have to be ‘automatically enrolled’ into a pension plan and then if they don’t want to pay in then that means we don’t have to pay in as the employer. If they do pay in then eventually they will have to pay in 4% of their earnings and as employer we’d pay in 3%, there would be a further tax relief payment of 1% from the government.

Then if someone has opted out of the scheme then we have to opt them back into the pension plan every 3 months.

If I have any of this information incorrect then I’d be interested to know how.

The debt management plan is important because many of us become trapped in the vicious cycle of taking on more debt in order to cover the debt repayments we already have.

The reason that the debt management plan is such a popular solution to complicated debt repayments is because it allows us to bring our expenditure and income back into line without any further borrowing. While this is an attractive proposition, it is not actually suitable for everybody. Could a Debt Management Plan be the right plan of action for you?

Take a glance at the main characteristics of a debt management plan and find out.

• The debt management plan is for debtors who are unable to afford all of the full monthly payments on their debts.
• A debt management plan does not write off your debts. Instead it allows the debtor to make a reduced monthly payment at an agreed rate until the debt is cleared.
• Your debts will be listed in full and in order of priority, starting with outstanding debts which could result in the loss of a home, an essential utility or item such as a car for commuting to work, then the maximum amount of expendable monthly finances that you can dedicate to the debt is also calculated.
• This maximum payment is divided among your creditors each month.
• Debtors can cancel their debt management plan at any point because it is not legally binding.
• If you arrange your debt management plan with a third party, you may still be contacted by your creditors but are not obligated to increase your payments to them.
• Once agreed debtors make just one monthly debt repayment which is divided among their creditors which makes your debt easier to manage.

A young couple living in their shed in Hampshire have been ordered to move out by their local authority.

While the garden shed is usually employed to store shovels, rakes and lawnmowers, one NHS worker and her partner used their garden shed as a place to live.

Victoria Campbell, 20, and her 26-year-old boyfriend, senior care assistant Bill Warden, had lived in her parents’ outbuilding whilst saving money which they intended to use for a deposit on a real house. That plan, however, has been scuppered by their local authority which has told them that they must leave the shed.

The council’s planning committee claimed the structure was “not appropriate for primary living accommodation” and “created an undesirable precedent, which would make it difficult to refuse similar further applications”.

The garden shed had no running water and just one oil radiator to supply heating. Electricity was sourced from the main house and the 15ft by 15ft building contained one fold out bed which the couple shared.

Miss Campbell will now seek legal advice from consultants in order to obtain temporary permission to stay in the shed.
The UK’s Shed of the Year 2011 is owned by Somerset resident Jon Earl, who allows local music groups to record their songs in the building.

Whilst it is a growing trend to work and earn a living out of a renovated garden shed, it seems that the opportunities to create living environment within them without sufficient planning permission might not be so straightforward.

We recently had a presentation at work about managing personal finances and it was suggested that we try to look for the cheapest way of insuring everything and search for the cheapest utilities provider at that moment for gas and electricity. Furthermore the speaker went on to say that it was possible to make savings on virtually all household expenditure and illustrated this by doing a life insurance comparison right there in front of us. Armed with this information I have decided that hence forth I will make time to save money wherever it can be done. Unless I have compared prices I will not commit to buying from anyone, until I have used every opportunity to find out if I could’ve bought the same thing elsewhere for less money. I have access to the internet at home and I intend to make it pay for itself so that I can enjoy the benefits.

Spending money on new phones every one to two years can be difficult so in this post we look at ways to save money when you need to replace your mobile phone. You can save money by going for a sim only deal where you get the sim data card but no handset. There are times we find a phone we really love and do not want to replace. There are also cases where we are unhappy with our internet provider but just bought a new phone a few months ago. No matter your situation there are options out there for you. One option is choosing a sim only deal from one of the mobile service providers. These deals allow you to purchase a SIM card without having to purchase a new phone.

A SIM card is the “data” source of your phone. It is what stores your data such as the contact list, games, and pictures. It is also the item that will tell the phone which provider tower to use in order to connect your call or internet access. The SIM card is what talks with the service provider to tell them when you’ve made a phone call, how long that call was, and to whom it was made. In this way the phone company is able to charge you appropriately for the phone usage.

Given what the SIM card can do it makes sense that if you switch to a new provider and want to keep the phone you have that you would need to switch out the SIM card. Most of the newer phones will allow you to remove the SIM card. Some mobile phone products do not; however, if you have a smartphone or one with 4G technology chances are you can replace the SIM card.

Now that you understand what the SIM card does and that it can be replaced rather than purchasing a whole new phone, we can look at what SIM only deals means.

Sim only deals are offers where you buy just the SIM card and phone minutes from a service provider. You can view a wide range of sim only contracts at the www.simsonlydeals.co.uk/ website.So for the future bear in mind that you have the option of purchasing a SIM card rather than an entire phone which will save you a considerable amount of money. These deals can be pay as you go or a monthly contract. There are a wide variety of contracts and plans available on both the pay monthly options as well as the pay as you go plans. Pay as you go gives greater control but the data or call charges are quite a lot higher.

New research carried out by a leading online price comparison site shows that 1 in 5 British parents think they will get themselves into debt by spending more than they can really afford on family days out this summer.

This data is a reflection of the difficult financial climate we are experiencing, where households are struggling with increasing bills for energy and food and keeping children entertained is also becoming more expensive.

As an example, a day at Alton Towers for a family of four could easily cost in excess of £300 when food and travel costs are added to the ticket price. And that’s before you factor in the cost of interest if credit is used to pay for the trip.

More than 75% of parents surveyed said they expect to get into debt this summer, with credit cards and overdrafts serving as the main sources of additional cash. In theory, parents can borrow on credit cards or overdrafts without paying interest, thereby avoiding debt problems, but only if they are treating these as short-term solutions. It’s also vital to shop around for the products that best serve your needs and have the least interest or charges associated with them.

If your credit history prevents you from getting a credit card or overdraft with 0% interest, there are other ways you can save money as a parent during the summer holidays. Nearly 2 in every 5 parents intend to cut costs by visiting local attractions where entry is free, and 14% will make use of vouchers and coupons to get the best possible deals available.

Booking in advance can also often result in a saving, and simple things like taking a picnic on a trip to the zoo rather than buying food on the site can help ensure your budget will stretch further. Travel costs can also be reduced by using public transport and taking advantage of the savings available for families.

Your net worth equals what you own minus what you owe. It is commonly referred to as the difference between your total assets and your total liabilities.

Heres a simple illustration:

Home Value = $350,000   Mortgage balance = $150,000
Investments = 100,000     Credit cards = 20,000
Auto = 45,000                  Auto loans = 30,000
Savings = 15,000             Bank loan = 4,000
You Own = $510,000        You Owe = $204,000

Therefore, your net worth would be $306,000.

There are two ways to increase your net worth. You can own more things or you can reduce your debt obligation. This article will focus on reducing your debt first because it is the fastest way to generate more money and, then, buy (own) more things.

In our example, you have $204,000 of debt. If youre like most people, you pay less attention to the mortgage and car loan balances because you consider them to be rather normal (necessary) to your way of life.

The credit card companies are probably charging somewhere between 12 to 18 percent (forget those slick, short-lived introductory teasers) and the bank loan is probably around 6 percent.

Now, before we go further let me ask you a question. Which is faster? Create $204,000 (in other words, own more) … or reduce $204,000 of debt? In both instances, the result is the same because your net worth will have increased by the same amount.

To create $204,000 in 15 years, you would have to invest $6,956.69 each year for 15 years and receive a guaranteed 8 percent rate of return. Where can you find a guaranteed rate of return this high in todays marketplace? No where!

To reduce $204,000 of debt in 13.5 years, it takes only $100 extra each month. Now, lets make sure you understand what I just said.

To increase your net worth by $204,000 you must invest almost $7,000 each year for 15 years. You hope and pray youll receive no less than 8 percent average every year.

Or… you can come up with only $100 each month to reduce 100% of your debt (to include your mortgage) in only 13.5 years — guaranteed! Hard to believe isnt it?

Go ahead and check it out yourself. First, use a compound interest table to compute the investment requirement. Then, print this
debt reduction chart. Youll need an Adobe Reader, which is probably already installed on your computer. Otherwise, go to adobe.com for a free download version.

In every instance, it is faster and more reliable to eliminate your liabilities than to increase your assets. Why? Because the interest you pay on your debt is excessively higher than the guaranteed interest you can earn.

By following the debt chart and adding an additional $100 each month to the minimum payment requirement, you can dramatically compound the effect of your payments and expedite the complete elimination of all your debt.

Its a lot easier to come up with $100 extra each month than it is to find $6,956.69 each and every year for the next 15 years.

I have already written about the financial necessity of saving a portion of any income payment that you receive. This means that a percentage of every single source of income is set aside, marked, or tracked as money that you cannot spend. This task isnt optional if you want to have some basic financial stability or start growing some serious wealth. Saving is the first step and it is the easiest, simplest, but the most emotionally difficult step. I know that starting to save money is emotionally painful because spending money is easy and pleasurable, while saving money feels difficult and challenging. But like any behavior, it becomes easier and natural the more you do it.

As a review, the billionaire John Templeton started out working during the Great Depression but he saved 50% of his income. This guy was serious! OK, you may have a lot of fixed expenses that you just cant cancel immediately, but at least enroll in financial nursery school by saving 1% from all the income that you receive. Or start with only $3 a month and then ratchet up your savings rate continually until you are at least over 10%; or if you are ambitious get it over 30%. (If you are trying to find the loophole, this savings is your after-tax income that you can spend dont count your 401K or medical savings accounts or any other qualified money that you dont have full/immediate access to spending).

The remainder of this article is about what to do with that savings. Economics is the study of allocating scarce resources. Personal economics are similar, but I think that it is better described as: The allocation of your income that you cant spend. If you dont spend this money, and maybe have it setting aside in savings account, what do you do with it? Do you pay down on a credit card, save it for a car, donate it to a worthy cause, or purchase a bank certificate of deposit? How do you go about deciding?

Well, I have given this some thought and have reached a few conclusions. It is my view that your monthly savings needs to be divided among four mandatory categories. By this, I mean that among the zillions of things you can do with savings, it is my view that four of them are absolutely mandatory. For example, if you earn a paycheck (and after all of the taxing authorities take their share) of $1,000 that you can deposit into your checking account and youve chosen a personal savings percentage rate of 8%, then you move $80 ($1,000 X .08) into a separate savings account. Now, you will take this $80 and divide it up into at least the four mandatory categories I am going to discuss, along with any other categories that you value. In this way youll have the whole $80 assigned to specific financial duties to meet your financial goals.

Here are the four categories in priority order:

1. The Vault this is your wealth account. Money gets deposited into this account and it never leaves, like a one-way valve. The Vault is invested and the principal is never spent. It will grow into the largest part of your net worth, generating nearly all of your investment income. If you dont start creating wealth penny-by-penny, youll never have any.

2. Soft Savings a delayed spending account. This money is marked for things that you want to buy, but cant afford to purchase with normal pocket money. For example, a house, car, boat, vacation, college fund for kids, planned medical care, clothing, jewelry, etc. But this also includes maintenance to your home, like a roof, new appliances, new siding, paint, landscaping, remodeling, etc.

3. Paydown Debt Balances making extra principal payments on your credit cards, car loans, and your mortgage. By chipping away at these expenses you will eventually eliminate them all, and then have more money available for other categories. Personal debt is the opposite of financial freedom and dramatically makes it more difficult to reach your financial goals. If you doubt this, look at the interest charges you pay each month and imagine if that money had been invested instead.

4. Financial Education books, magazines, newsletters, seminars, software, investment memberships. Also, hiring professional financial advisors, tax accountants, estate attorneys, etc. (Avoid free advice a buddy, your cousin, or a friends neighbor buy the best, most expensive professional advice you can afford).

As I mentioned before, you can put your savings into places that are only limited by your creativity. But it is my view that these four areas are so important that they need to be continually fed money in a systematic manner.

If you are missing the first account, The Vault, youll never have the money to start investing so youll never receive any investment income. This is pretty much the goal of all personal finance, to help you generate the most investment income. That is why this is the most important of the four categories, to get your money earning money so that you dont have to. (I do not consider any retirement accounts or qualified accounts to be Vault money. This is because you do not have direct control to invest the money or receive any investment income until the government decides that you can).

If you are missing the second account, Soft Savings, you either cant buy what you want, or you have to increase your personal debt. This is moving in the opposite direction of financial freedom you are reducing the amount of money that you can spend each month by the amount of the debt payment, and you are reducing your net worth by the principal and interest that youll be charged. Another symptom of a lack of Soft Savings is disrepair to your car, home, and health because you dont have the money for upkeep. Everything physical needs to be maintained, from your teeth to your vacuum, and it costs money to do so. This depreciates the financial assets that you own, and puts at risk the most important quality of life your health.

If you are missing the third account, Paydown Debt Balances, you are simply going to be the patsy in the financial game of life. People that are building their wealth collect lots of little interest payments from the people that are destroying their wealth by making lots of little interest payments money is transferred every month from one group of people to the other. Which group do you want to be in? Well, your Vault can automatically put you into the group of wealth-builders and your Paydown Debt account starts to extract you from the group of wealth-destroyers. The Paydown Debt account puts you on track to permanently extinguish all of your personal debt. The sooner a personal debt is paid off, the more rapidly you can take all of this money and put it into the other categories.

If you are missing the fourth account, Financial Education, you wont know how to captain your Vault, and you may run it straight into the rocks. Only you will manage your money in a manner that will be to your maximum benefit. So it is best if you pay to learn how to handle money and learn where to put it. But not everyone has an interest in these subjects, and that is fine. For them, instead of personally managing your money, you are going to personally manage your financial advisors. Youll be spending money and time to hire and manage the advisors to attend to financial details.

By allocating your savings into these four categories you are addressing the four most important elements of financial management. Youll be making certain that: Your investment income will always increase by adding to your Vault; youll have money available for extra expenses with your Soft Savings; your net worth will always be increasing with a Paydown Debt account; and youll intelligently learn how to lower your investment risk, raise your investment returns, and lower your tax liability with your Financial Education account. The only source of money to build these critical financial functions to increase your income, net worth, and stability is your savings you simply have to do it.

I recommend you fund these accounts simultaneously do not focus only on debt or only on education because I have seen how it is financially detrimental to do so. For example, lets say that you really want to paydown your debt so you dont contribute anything to The Vault. I have found that if you dont have any investments, your investing skills will be under developed. You will not know how to invest once your debts have been paid off, youll have no investment income to manage, you wont be looking for investing opportunities because that is something you cant afford right now, etc. And as a result, it will be harder to get into the investing game later, youll have more to learn in a shorter amount of time, and may just avoid it altogether and put Vault money into a low paying account.

How much do you allocate among the four categories? Anything more that zero! It is up to you, and your financial situation will fluctuate and be different from others. Just to get some starting percentages, below is my allocation. It is not a recommendation for anyone, it is just what works for me right now.

My current savings rate = 20% of all after-tax income.

(This does not include 401K, medical savings accounts, or other deferred/qualified withholding). This means that 20% of all cash income that hits my checking account each month is set aside into these categories:

1. The Vault receives 50% of total savings each month.
2. Soft Savings receives 20% of savings each month.
3. Paydown Debt receives 20% of savings each month.
4. Financial Education receives 5% of savings each month.
5. And that leaves 5% for other categories each month.

You may receive continual, ongoing income, in addition to some rare, one-time inflows of money. The percentages detailed above are how I allocate regular income savings. But if there is any one-time inflow of money (garage sale, bonus, extra project), then I take 90% of the proceeds and split it among the four accounts, and the other 10% is just spent. You can create your own money rules for different types of income; you can tell by my allocation percentages that my primary focus is to build up the balance of the Vault.

The amount of money that you can save from every source of income is your key to a brighter financial future. Contrarily, a risky and dimmer financial future awaits those that refuse to systematically save money. So be sure that you take the steps necessary to set savings aside and then simultaneously divide it among the four mandatory accounts by consistently allocating money to them. You dont have a financial foundation without these four accounts, but with them, you can build as high as your ambition takes you.