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March 22, 2021

Assetz Exchange: My Review of This P2P Property Investment Platform

Nick Making Money, Saving Money, Investing reviews, property, crowdfunding 14 Comments

Today I’m looking at P2P property investment platform Assetz Exchange (launched in January 2019)..

As I have noted before on Pounds and Sense, I am something of an enthusiast for property investment (and specifically property crowdfunding). Among other things, I like the fact that you can make money from both rental income and capital growth. And investing in property can be a good way of spreading the risk when you have equity-based investments.

Of course, investing in property directly is costly and carries all the risk inherent in putting all your eggs in one basket. A major attraction of P2P property crowdfunding investment is that you can get started with much less money and build a diversified portfolio to help mitigate the risks.

In addition, if you invest this way you don’t have to deal with the day-to-day hassles of being a landlord, from finding tenants to repairing broken boilers. This is taken care of by the platform itself and/or their management company. You just have to sit back and – all being well – wait for the rental income and (hopefully) capital gains to materialize.

That said, there have been a few reversals in the P2P property sector over the last few months (see this recent post, for example). So I am now more concerned than ever to ensure that any investments I make in this category control risk as effectively as possible.

What Is Assetz Exchange?

As mentioned above, Assetz Exchange is a licensed P2P property investment platform. It is owned by well-known P2P lending platform Assetz Capital, but run quite separately from them. If you already have an account with Assetz Capital, you will have to register separately with Assetz Exchange.

Assetz Exchange aims to offer net yields to investors of between 5.2 and 7.2% per year. These are generally paid by institutional tenants through multi-year leases. All properties are unleveraged, providing additional security (and stability) for investors.

Assetz Exchange has some similarities with Property Partner, but they differ in some important ways. For one thing, many of the properties are rented out to charities (e.g. NACRO) or housing associations. These organizations generally sign longer contracts than private individuals. They don’t have voids (periods when the property is untenanted and producing no income). Neither are there any maintenance costs, as the organizations take responsibility for this themselves. And finally, these organizations are directly funded by the government, giving them a secure income stream.

Another area of specialism is show homes. Working with a national housebuilder, Avant Homes, Assetz Exchange purchases fully furnished show homes from multiple sites around the country. These are then leased back to the developer for fixed periods of up to five years to be used to help sell other plots. This eliminates potential void periods and avoids any maintenance costs. At the end of the leases, investors will be able to vote on whether to lease the houses to tenants or sell them to home-buyers on the open market.

Assetz Exchange also offers investors the chance to get involved with a new generation of modular eco-homes. This is already a popular approach to house-building in Europe and the United States. Assetz Exchange fund the acquisition and conversion of land into serviced plots, allowing buyers to then order a house to be built on that plot to their own specification. These modular-built eco-homes are sustainable and low energy. They are also typically quick to complete and have a lower impact on the environment.

Assetz Exchange do also buy and let some standard properties as well, offering investors the chance to further diversify their portfolios.

Signing Up

Before you can invest through Assetz Exchange, you will of course have to sign up on the platform. This is pretty straightforward. You just visit the Assetz Exchange website, read the information there, and click on Register in the top-right-hand corner.

You will then be required to enter your contact details and confirm which of four categories of investor you fall into. The options are as follows:

High Net Worth Investor – This includes individuals who have an annual income of £100,000 or more or net assets of £250,000 or more.

Self-certified Sophisticated Investor – This includes individuals who have made more than one peer-to-peer investment in the last two years or who meet certain other criteria relating to investment experience. This is the category I selected myself.

Investment Professional – Including corporate investors and SIPP or SSAS professional service providers.

Everyday Investor – This category is for investors who don’t fit into any of the categories above. They can still invest via Assetz Exchange but must pledge not to invest more than 10 per cent of their portfolio in P2P loans.

You will also be required to answer some multiple-choice questions to confirm that you understand the nature of investments that can be made on the platform. I found some of these questions quite challenging, and was pleased to get them all right first time. I would therefore recommend reading the information on the Assetz Exchange website (including the Help pages) carefully before proceeding to register. If you do make any mistakes, however, feedback is provided, and you can take the test again until you achieve a 100% correct score.

Once you have done all this, you will be able to fund your account. This must be done by bank transfer, as Assetz Exchange do not allow debit card payments. You will then be able to browse the range of currently available property investments:

Investing

Once you are registered on the platform and signed in, click on Exchange in the menu at the top of the screen and all current projects will be displayed. Here are a couple that are showing at the time of writing…

Clicking on any of these will open a page devoted to the investment concerned. Here you can read all about it, view reports and site plans, and so on. One very important area is the Order Book (see example below).

All buying and selling on the platform is conducted via an exchange (otherwise known as the Order Book) which works similarly to the secondary market on Property Partner.

So if you want to buy shares in a particular project, you can do so by accepting the best price currently available on the exchange. In the example above, there are £4,895 of shares available at zero discount (i.e. the original offer price).

If you want to get your shares at a lower price than this, you can make a bid. In the example, an investor has put in a bid for £75 at a 1.04% discount and another investor (or maybe the same one) has put in a bid for £154 at a 2.08% discount.

Conversely, if you wish to sell some or all of your shares at any time, you can accept the best bid (or bids) on the Order Book currently, or place an offer and wait to see if this is matched.

It does take a little bit of getting your head around at first, but it’s actually a simple and straightforward process. One thing to note is that if there is nothing showing on the right-hand-side of the Order Book (under Offers) you won’t be able to buy shares in that project there and then – though you can of course place a bid if you wish and see if a seller wants to match it.

In any event, if you want to buy, just click on the green Buy button (either on the Exchange page or the details page) and complete the short online form. You will need to indicate how much you want to invest, whether this should be from your General or IFISA account (see below), and whether the amount should include the FCC or not (see What Are The Charges? below).

You will also need to indicate whether you want to buy at the current best price (selected by default) or you want to try for a better price (in which case your bid will be added to the left-hand column in the Order Book).

The IFISA Option

As mentioned above, if you wish you can invest with Assetz Exchange via an IFISA (Innovative Finance ISA). As discussed in this recent post, this type of ISA for P2P investing gives you the same tax advantages as a cash or stocks and shares ISA. You don’t have to pay any tax on the money you make, whether this takes the form of dividends, income or capital gains.

Everyone has a generous annual ISA allowance of £20,000 in the current 2020/21 tax year (and next year as well). This can be divided any way you like among the three types of ISA. So if you open an Assetz Exchange IFISA, you can still have cash and stocks and shares ISAs with other providers as well, so long as you don’t invest more than £20,000 in total. You can also only invest money in one of each type of ISA in any one financial year.

Choosing the IFISA option on Assetz Exchange is very easy. You can do it when first registering on the site or later. The only extra thing you have to do is enter your National Insurance number.

If you have maxed out your ISA allowance – or have already invested in another IFISA in the current tax year – you can still invest via your default ‘Regular’ account. You can invest any amount this way, but of course any profits you make will potentially be taxable.

What Are The Fees?

Assetz Exchange do not charge any monthly fees to investors (this is in contrast to Property Partner, who made the unpopular decision to impose an Assets Under Management charge and monthly fee, greatly impacting small investors on the platform especially). The company does have to make money somehow, of course, and they do this from three sources:

Arrangement fee

When a property is first purchased, Assetz Exchange charge an arrangement fee which is included in the Fixed Costs & Contingency (FCC). When parts of the property are sold on the Exchange, this fee is added to the purchase price of the buyer (see above) and so is recovered by the seller. The size of this fee is included in the loan conditions.

Monitoring fee

Assetz Exchange charge a percentage of the gross rent received for the property. The percentage is stated in the loan conditions of the property.

Property disposal fee

A fee of 2% of the gross sales proceeds is charged if investors vote to sell and the property is physically sold.

What Are The Safeguards?

Like most other property crowdfunding platforms, all investments in any project on Assetz Exchange are held in a Special Purpose Vehicle (SPV) for the project concerned. This gives investors in the project some protection if the main company were to go into administration.

A contingency balance is held within each SPV which acts in a similar manner to a provision fund, covering unexpected short-term cash-flow disruptions. It is topped up from receipts and no distributions are made to investors if it falls below a certain level.

SPVs also benefit from indemnity insurance which covers non-payments from tenants. This in theory also covers disruption to cash-flow, but it does not cover voids (periods where the property does not have a paying tenant). For reasons mentioned above, voids should not be an issue with most of the properties listed on the platform.

In common with most other P2P investment platforms, Assetz Exchange does not fall within the remit of the Financial Services Compensation Scheme (FSCS), which covers customers with UK financial services firms up to £85,000 if the institution in question were to go bust.

Pros and Cons

Here is my list of pros and cons for Assetz Exchange.

Pros

1. Fast, easy sign-up.

2. Well-designed, intuitive website.

3. Low minimum investment (as little as £1 per project!) – this makes building a diversified portfolio straightforward.

4. Assetz Exchange take care of all the work involved in buying and managing properties. You just choose which ones to invest in.

5. Option to access money any time by selling on the secondary market (though this does depend on another investor being willing to buy your shares at a price you find acceptable).

6. Relatively low-risk investment options (though of course there are no guarantees)

7. Customer support (in my experience anyway) is fast, friendly and helpful.

8. Charges are reasonable. There is no charge for selling investments.

9. Potential to make money through both capital appreciation and rental income.

10. Rental income is paid into your account every month. You can either withdraw or reinvest it.

11. No monthly fees and only transaction-based charges to pay.

12. Opportunity to invest in socially beneficial developments such as sheltered housing

13. Tax-free IFISA option to which any investment on the platform can be added

14. Investors can vote for their favoured exit option (e.g. selling up) when the time comes

Cons

1. Can’t invest using a debit card

2. No auto-invest option currently available

3. Not as many opportunities as some P2P platforms (although the number is increasing steadily)

Closing Thoughts

I was impressed enough with Assetz Exchange to invest a small amount (£100) of my own money initially and will report back on PAS about how my portfolio fares. Here is how it’s looking at the time of writing, roughly a month after I opened my account. As you can see, my initial investment has grown by £3.87 from a combination of income received and capital growth. For a month that’s not bad at all – if it carries on growing at that rate I’ll be delighted! – but of course it is much too soon to draw any firm conclusions from this.

I particularly like the fact that with the low minimum investment on Assetz Exchange, even if you’re starting very cautiously (as I am) it’s easy to build a diversified portfolio. I like the relative simplicity of investing on the website and the fact that you can exit an investment any time via the exchange (though that does depend on willing buyers being available at a price that is acceptable to you). It is also good that there are no charges associated with selling on the exchange.

You can, of course, withdraw uninvested funds from your Assetz Exchange account at any time.

Obviously there are risks in any form of investing and it is important to do your own ‘due diligence’ before proceeding. You should also bear in mind that this type of investment is not covered by the Financial Services Compensation Scheme, which covers savers with UK banks and other financial institutions up to £85,000. On the other hand, the potential returns are significantly better than the fractions of a percent typically on offer from savings institutions right now, while the risks appear to be at the lower end of the spectrum, with many of the properties on long-term leases with corporate/institutional tenants.

To be very clear, nobody should put all their spare cash into Assetz Exchange (or any other investment platform for that matter) but in my opinion there is definitely a case for including AE within a diversified portfolio.

As mentioned above, I shall be reporting back on how my Assetz Exchange investments perform on PAS in future. In the mean time, if you have any comments or questions about this post, or Assetz Exchange more generally, please do leave them below as usual.

UPDATE JANUARY 2025 – Assetz Exchange have now rebranded as Housemartin. They continue to operate as described above, but going forward will focus entirely on supported housing projects, as these have proven the most reliable and hassle-free (not to mention the social/community benefits). For more info, see my new blog post P2P Property Investment Platform Assetz Exchange Rebrands as Housemartin.

Disclaimer: I am not a registered financial adviser and nothing in this post should be construed as personal financial advice. You should always perform your own ‘due diligence’ before making any investment and speak to a qualified professional adviser if in any doubt how best to proceed. All investments carry a risk of loss.

Please note also that this review uses my affiliate links. If you click through and make an investment or perform some other qualifying transaction, I may receive a commission for introducing you. This will not affect any charges you pay or the product/service you receive.

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March 7, 2021

My Coronavirus Crisis Experience: March 2021 Update

Nick Saving Money, Investing, Everything Else events, reviews 6 Comments

Here is my latest monthly Coronavirus Crisis Update. Regular readers will know I’ve been posting these updates since the first lockdown started a year ago now (you can read my February 2021 update here if you like).

I plan to continue these updates until we are clearly over the pandemic and something resembling normal life has resumed. Obviously, I very much hope that will be sooner rather than later.

As ever, I will begin by discussing financial matters and then life more generally over the last few weeks.

Financial

I’ll begin as usual with my Nutmeg stocks and shares ISA, as I know many of you like to hear what is happening with this.

As the screenshot below shows, since last month’s update my main portfolio has been through some ups and downs. It is currently valued at £19,155. Last month it stood at £19,008, so it is at least up a little (£147) overall.

As you may recall, three months ago I put £1,000 into a second Nutmeg pot to try out Nutmeg’s new Smart Alpha option. The value of this pot rose as high as £1,040 in mid-February, though it currently stands at a more modest £1,007. Here is a screen capture showing performance to date, though obviously it is much too early to draw any conclusions from this.

You can see my in-depth Nutmeg review here (including a special offer at the end for PAS readers).

I mentioned last time that my first investment with P2P property investment platform Property Partner reached its five-year anniversary, at which point investors can vote to sell their shares or continue for another five years. Along with just under half of the other investors, I voted to sell my shares.

The shares of everyone who wanted to sell were duly put up for sale on the platform. Unfortunately, though, there were few buyers, so with a substantial number of shares unsold, the property has been put up for sale on the open market. That means there will be a period of several months – possibly longer – before a buyer is found, and there is no guarantee that the independent valuation price will be achieved.

That is obviously disappointing, though as I only have a very small amount invested in this property (about £50) I’m not going to lose any sleep over it. In my view Property Partner didn’t make much effort to market these shares to investors. I suspect the same may be the case with at least some of the other properties coming up to their five-year anniversaries. It may be that Property Partner are happy to get some of the smaller houses and apartments off their books, especially the city-based ones for which demand has fallen as a result of the pandemic. Currently I have another small investment going through the five-year process. I voted to sell my shares in this too, but suspect the outcome will be the same.

As I have noted before on PAS, shares in many properties on Property Partner are currently available on the secondary market at a discount to the independent valuation price Based on my experiences to date, however, I would advise caution about regarding this as a buying opportunity. If properties that are relisted attract little interest from existing PP investors, they will have to be sold on the open market. In that case you are likely to have a long wait until you see any return on your investment, and there is no guarantee of an overall profit even then. I shan’t therefore be investing on the Property Partner secondary market for the foreseeable future.

That wasn’t the only disappointing financial news last month. Property crowdfunding investment platform The House Crowd unexpectedly announced that it was going into administration. I still have some investments with THC, though thankfully not as many as I did two or three years ago.

Apart from one small loan – which I accepted some time ago had gone south – my remaining investments are in traditionally crowdfunded properties, all of which are currently up for sale. The money is therefore secured by bricks and mortar, so I expect to get at least some of it back (and have of course been receiving dividend payments from rent received). As with other property crowdfunding platforms, each THC property is owned and managed by a separate Special Purpose Vehicle (SPV), which gives it legal protection from claims against THC by creditors. How this will pan out in practice remains to be seen, but I note that the administrators have said that their appointment is ‘not expected to have a material impact on investors.’

So I am being philosophical about this and awaiting further developments. These have undoubtedly been tough times for property investors, and regular readers will know that I also recently lost money with another property crowdfunding platform called Crowdlords. Overall, when you allow for my successful property investments and rental income, I am more or less breaking even, but even so (as I have said on the blog before) I am a lot more cautious about this type of investment nowadays.

Personal

February was another long, cold month, but at least there are signs of better times ahead now. The vaccine roll-out continues to go well and case numbers are dropping rapidly, giving us all hope for a return to something approximating normal life in the weeks and months ahead.

And, of course, we are heading into the spring now, with longer, brighter days and – eventually – the prospect of some warmer ones!

One thing that always lifts my spirit at this time of year – and especially in the current circumstances – is the arrival of spring flowers. In my garden I have crocuses and snowdrops out at the moment, and it won’t be long until the daffodils are in bloom. Here’s a photo of a flower bed in my front garden…

I had my first Covid jab in February, at the Whitemore Lakes mass vaccination centre near Lichfield. It was run by a team of NHS staff, military and volunteers. Everyone was friendly and efficient. The only slight blip came when I was checking in. I happened to notice that the clerk had put ‘female’ on my form, doubtless due to my lockdown hair. She was embarrassed when I pointed this out, but of course I couldn’t just say nothing. I shall be very pleased when we are allowed to visit hairdressers again!

I received the Oxford-Astra Zeneca vaccine. After I had a bad reaction to my last flu jab (fever and nausea) I was prepared for something similar with this, but thankfully that didn’t happen. Apart from very slight soreness in my arm the next day, I had no side-effects at all. I hope I am just as lucky with my second jab, which I have already booked for May.

Also on a medical theme. I had my latest trip to the eye clinic at Queens Hospital Burton last week. Regular readers will know that last autumn I was diagnosed with a perforated retina in my left eye. My first laser treatment was only partly successful, so Iast time I received a (more powerful) top-up treatment. This visit was to check if it had been successful, and I was pleased and relieved to hear that it had. So once again I need to express my thanks and gratitude to all the staff there, and especially to Mr Brent, the consultant who performed my final laser treatment and gave me the good news this time. I have been told that if something like this happens once it increases the chances of it happening again, so I have to be on the lookout for any potentially worrying changes to my eyesight in future. But that aside I am lucky that this problem was detected early before anything more drastic (e.g. a detached retina) occurred – so big thanks to my optician at Vision Express Lichfield as well!

As I write this update, the schools are just about to reopen to all students. I am delighted about that, as I know that it has been a tough time for many children. While some schools have been very good about running online classes, these can never be a complete substitute for face-to-face teaching. I also know from speaking to friends that some schools have been less supportive, simply sending pupils written lessons or assignments to complete on their own. That is obviously less than ideal for younger children especially.

I do think it is regrettable that the government has advised that secondary school children should wear masks in classrooms. The same applies to the mandatory twice-weekly testing. In my view these measures will achieve little apart from traumatizing young people and making it harder for them to learn. I understand these measures have been introduced partly to placate the teaching unions and some worried parents, but hope they will be swiftly withdrawn when (as I fully expect) there is no big ‘spike’ in virus cases following the return. Okay, I’ll get off my soapbox now!

As always, I hope you are staying safe and sane during these challenging times. If you have any comments or questions, please do post them below.

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January 7, 2021

Grow Your Money Every Week With Plum!

Nick Saving Money reviews, sponsored post 7 Comments

Updated 1 Feb 2021

British people generally are not very good at saving.

A third of us have under £600, and 1 in 10 have no savings at all (source: https://www.finder.com/uk/saving-statistics). Having so little money put away makes people especially vulnerable in the event of a sudden change in their circumstances such as redundancy or divorce.

So today I thought I’d bring to your attention a money-management app called Plum that aims to help with this problem.. Plum is designed to help you set money aside painlessly for any purpose – from holidays to major purchases or simply for a ‘rainy day’ fund.

Plum is one of a growing range of apps that make use of so-called Open Banking. This allows third-party apps to access your financial information (read only) – so long as you provide the necessary authorization, of course – and perform certain transactions on your behalf, if you choose to set up a direct debit.

Open Banking is now becoming well established in the UK, and safeguards are in place to ensure that your security isn’t compromised. Even so, this is something you need to be aware of – and comfortable with – before signing up with Plum or similar apps.

In this post I am looking at features available on the Plum Free (or Basic) account and the paid-for Plum Plus and Plum Pro Accounts. The Plum Free account is – of course – free of all charges. Plum Plus costs £1 a month (the first month is free) and Plum Pro costs £2.99 a month (again, the first month is free if upgrading from a Plum Free account). Plum Plus and Plum Pro offer a wider range of features and higher interest rates in interest-bearing ‘Pockets’ (further discussed below).

The screen capture below from the Plum website shows the features available with each type of account.

You can read more about the three account types if you wish on the Plum website.

How It Works

Plum is available as an iOS and Android app. It uses Open Banking in combination with a direct debit authorized by you to manage and grow your money for you in an intelligent way.

Every few days, Plum’s algorithm calculates what you can afford to stash away based on your spending habits. It then transfers that money automatically from your current account to your Plum account. In this way you put money aside regularly while barely being aware of it – so it builds up, and in due course you can spend it on things that really matter to you.

You can change the amounts the app takes at any time, and also pause the service if you wish. This means you don’t have to worry about Plum pushing you into the red. You always stay in control and can change the ‘mood’ at any time if you want to be more ambitious or cautious with your saving (see picture below).

Plum currently works with most major UK banks. The full list from the website is as follows:

Barclays
Danske Bank
First Direct
Halifax
HSBC
Lloyds
M&S
Monzo
Nationwide
Natwest
Revolut
RBS
Santander
Bank of Scotland
Starling
Tesco
TSB
Ulster Bank

Currently business accounts and joint accounts are not supported by Plum. They also do not support Channel Island bank branches.

How to Get Started

Start by downloading the app free of charge from Google Play or the Apple iStore (see links here).

Once you’ve downloaded the app and signed up, you can begin a dialogue with the Plum chatbot to help you set up your account. You will, of course, have to connect the app to your bank, so you will need to have your current account details to hand. Once it’s all set up, turn notifications on. This will allow the app to alert you when it wants to start setting money aside for you.

There is an option to speak to a real person if you need to. You can also increase or decrease the amount to stash away, set up ‘Pockets’ for specific purposes (see below), and even pause any transactions completely if you wish.

Do You Get Interest?

With the default ‘Primary Pocket’ on your Plum account the answer is no. The app is free and helps you set money aside painlessly, but Plum doesn’t pay interest on this.

Even Plum Free accounts can, however set up a secondary interest-paying Pocket. This facility is provided by Investec Bank and takes the form of an easy-access account paying 0.20% for all users

Plum Plus users can also set up one easy-access Pocket paying 0.40% interest. And Plum Pro users can have up to 10 such Pockets for different purposes, all paying 0.40% interest.

What Exactly Are Pockets?

Pockets let you set money aside with a specific goal and amount, e.g. to buy a car, save for a trip, or put down a deposit on a house. You can think of them as ‘pots’ or even jam-jars!

As money accumulates in each Pocket, the app will show your percentage progress towards achieving that goal.

All Pockets (except the default Primary Pocket) can be interest-bearing as well, as explained above. The interest paid will contribute towards achieving your goal/s.

Where Do Plum Keep Your Money (And Is It Safe?)

The app puts money away in your Plum account, which is the safeguarded account created when you sign up.

Your Plum funds in your Primary Pocket are held as e-Money by PayrNet (a subsidiary of Railsbank), Plum’s e-Money provider. Your funds are safeguarded with a UK Bank chosen by PayrNet. Your money is safeguarded because e-money cannot be lent out (this is also why it doesn’t earn interest). That same safeguarding also prevents any of Plum’s or PayrNet’s creditors from claiming your money in the event that either business should go bankrupt. Both Plum and PayrNet are regulated by the Financial Conduct Authority (the UK’s financial watchdog). Plum also boasts 256-bit TLS encryption to ensure your data is kept safe.

Money saved with Plum in interest Pockets is held on Trust with a UK Bank (Investec). A Trust is a legal mechanism that means Plum can look after your money but legally it never stops belonging to you. This means that if anything were to happen to Plum then the bank would return your money to you directly. Should something happen to the bank itself, you would be protected up to £85,000 under the Financial Services Compensation Scheme (FSCS).

How Easy Is It to Withdraw?

Transfers from non-interest Pockets back to your Primary Pocket are usually instantaneous. it is different with transfers from interest-bearing Pockets:

• When requesting an interest Pocket withdrawal before 15:00 UK time on business days, it will be completed the same day.

• When requesting after 15:00 UK time on business days or during weekends, it will be completed the next business day.

Note that withdrawals from interest and non-interest Pockets go back to your Primary Pocket initially. Withdrawals to your bank account will always be from your Primary Pocket. Such withdrawals are processed the same day (typically in around 30 mins) and will appear on your bank statement under your full name.

Other Benefits

As well as making it easier to put money aside, Plum can help you keep track of your income and expenditure. You can set it to provide daily or weekly balance updates, and it will also automatically track your transactions by category, week and month. Plum will let you know all of this without having to wade through bank statements.

In addition, Plum has AI (artificial intelligence) built in, so if it notices you are being overcharged on a bill or for a financial product, it lets you know. It will also suggest cheaper solutions for you and – if you wish – help you switch over in just a few clicks.

Plum also offers a variety of optional automated features. These include

Round Ups – Get Plum to round up your past week transactions to the nearest £1 and transfer the spare change.

52-Week Challenge – Starting with £1 in the first week, £2 in the second week and increasing up to £52 in the final week of the challenge, Plum can help you set aside £1,378 in a year. This feature is only available through Plum Pro.

Rainy Days – Once activated, Plum squirrels away extra cash automatically each day it rains where you live. This feature is also only available through Plum Pro.

Pay Days – The best time to set money aside is when you get paid, so tell Plum an amount and it’ll move this automatically for you on payday.

Plum Reviews

Plum has an average rating of 4.5 stars (‘Excellent’) from over 1200 reviewers on the independent Trust Pilot website. Just over three-quarters (76%) gave it the maximum five stars, with many mentioning the great customer service and how the app had helped them to save more. Of those who gave Plum three stars or less, the main issues mentioned were delays or problems in withdrawing. To be fair, the Plum team generally respond to such comments on the Trust Pilot website explaining how the app works and offering additional help where issues have arisen.

Final Thoughts

If you want to set more money aside but need a little help and encouragement to do so, Plum is well worth a look.

I like the way it stashes money away automatically, so in all probability you won’t even notice it. You can set it to take as much or as little as you like, and you can also make one-off additional payments if you are feeling particularly flush. You can also withdraw some or all of your money back to your bank account at any time.

Pockets are a great feature, allowing you to set aside money for specific purposes. And, as mentioned above, by using an interest-bearing Pocket, you can get interest as well (0.20% with a Plum Free account and up to 0.40% with a Plum Plus or Pro account). Obviously that’s not a fortune, but in the current low-interest rate environment it is still very competitive (and a lot better than nothing!).

In my view Plum is likely to work best for people with a regular monthly (or weekly) income. If you receive income more irregularly – e.g. you’re self-employed – it might not work quite as well. Even so, Plum say that their algorithm can detect patterns in your income and expenditure and adjust your transfer amounts accordingly.

In any event, there’s no reason not to try Plum yourself to see if it can help you set aside more. Just click through this link for more information and to sign up.

As always, if you have any comments or questions about this post, please do leave them below.

Note: This is a fully revised and extended version of my original Plum review from last year.

Disclosure: I am an affiliate for Plum so if you click through any link in this article and sign up, I will receive a modest referral fee for introducing you. This will not affect the service or benefits you receive in any way. Please note also that I am not a registered financial adviser and nothing in this post should be construed as personal financial advice.

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December 23, 2020

My Top 20 Posts of 2020

Nick Making Money, Saving Money, Investing events 8 Comments

As is customary for bloggers at this time of year, here are the top twenty posts on Pounds and Sense in 2020, based on comments, page-views and social media shares. They are in no particular order. I have excluded any posts that are no longer relevant.

I hope you will enjoy revisiting these posts, or seeing them for the first time if you are new to PAS. Don’t forget, you can always subscribe using the box on the right to be notified of new posts as soon as they appear.

All posts in the list below should open in a new tab/window when you click on the link concerned.

1. Ten Reasons Over-50s May Need an Independent Financial Adviser

2. How to Make Money From Your Old Tech

3. Save Money on Your Mortgage With Dashly

4. Twenty Ways to Make Extra Money From Home During Lockdown

5. Nutmeg Review: My Experiences With This Robo-Adviser Investment Platform

6. Why I Switched my Santander 123 Account to 123 Lite

7. How to Make Money From Affiliate Marketing

8. How to Get a Better Night’s Sleep

9. Should You Use Equity Release to Unlock the Value of Your Home?

10. What Are the Best Video Calling Tools for Older People?

11. Why I am (Still) Not a Fan of Premium Bonds

12. Get a Free Share Worth Up to £100 with Trading 212

13. Managing Your Finances and Tackling Debt – A Q & A With MoneyNerd

14. Booking a Holiday With Airbnb

15. Ten Things I Have Learned About Self-Employment Over 30 Years

16. Kuflink: My Review of This P2P Property Investment Platform

17. Looking After Your Mental Health in the Coronavirus Crisis

18. How Over-75s Can Claim Pension Credit to Keep Their Free TV Licence

19. Can You Still Make Money from Matched Betting?

20. Surviving the Covid Winter

I’ll be taking a break from blogging over the festive period (though I’ll still be around on Twitter and Facebook). I’ll therefore close by wishing you a happy, Covid-free Christmas, and for all of us a far better new year 🙂

If you have any comments or questions, of course, feel free to leave them below as usual.

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December 11, 2020

Managing Your Finances and Tackling Debt – a Q & A with MoneyNerd

Nick Making Money, Saving Money, Investing reviews, interviews 6 Comments

Today I have a Q and A for you with my fellow money bloggers at MoneyNerd.

MoneyNerd is a UK personal finance blog that aims to help people learn to manage their finances and tackle debt. I asked a number of questions about personal finance and debt, and added my own thoughts as well. Our answers are also being shared separately on the MoneyNerd blog. I hope you find them interesting and informative.

What’s your number 1 financial tip?

MN: It’s hard to give advice that would apply for everyone, because everyone’s finances are different. But I would suggest ‘write it down’, as a fairly universal and important financial tip. Start with your financial goals, then write down the steps you’ll take to get there according to your budget. A lot of people have good financial intentions, but without having clear goals on paper, it’s easy to get led astray.

PAS: Agreed. I would also say, keep on top of your money. Know what’s going in and what’s going out every month, and budget accordingly. Always be on the lookout for ways you can maximize your income and minimize your expenditure. And try to put some money aside for the proverbial rainy day. Everyone should really have at least three months’ worth of income set aside in case of emergencies. Sorry, that’s at least three tips, I know!

What do you think are the main causes people find themselves in financial difficulty?

MN: I think financial difficulties are mainly caused by unforeseen life-events, such as bereavement, unemployment, and relationship breakdowns. These kinds of bumps-in-the-road can severely throw people off course, particularly if their financial situation was fragile in the first place. Unfortunately, all three of these examples have sky-rocketed due to the pandemic, and many people in the UK will be facing financial difficulties over the coming year.

PAS: Not much I can add to that. Although sometimes failing to monitor your income and expenditure closely enough can lead to debts mounting up before you realise it.

What personal finance tools do you currently use to track and manage your money?

MN: I’m quite old-school and still use spreadsheets for a lot of money-related things! There are some good apps out there though – Money Dashboard is a particularly good one.

PAS: I am the same and use spreadsheets a lot. I started with Microsoft Excel, but these days mainly use Google Sheets. As regards personal finance tools, I like Snoop [referral link], a relatively new app that helps you keep track of your finances and suggests easy ways you can make savings.

Any tips for people coming to financial management later in their lives?

MN: It might be a little harder to undo old habits and reinstate new ones if you’re approaching financial management from an older perspective. So start by setting simple goals, and work at them consistently. It’s probably worth taking a little time to assess what’s important to you right now, too: what range of outgoings does your money need to cover in later life that you didn’t need to consider before?

PAS: I am 64 and have friends in their seventies and eighties, so I have seen the sorts of problems older people can face. In particular, so many aspects of our personal finances are dealt with online now, from banking to applying for state benefits. The pandemic has probably accelerated this trend.

Many older people struggle with the technology and it’s often not as intuitive as it should be, especially for those whose eyesight isn’t as good as it once was. So I would say to any older people, try not to get left behind by technology, and ask younger friends and relatives for help when needed. Last year a group of us clubbed together and bought a friend (a retired builder) a Chromebook for his 80th birthday. He had never engaged with computers or the internet before and I must admit I was expecting him to struggle at first. However, he took to it like a duck to water, and was soon ordering tools and components online from a local builders merchant. So even old dogs can definitely learn new tricks!

2021 is going to be tough for many. Do you have any advice on how to keep things under control?

MN: I’d start with the obvious – plan as much as possible, in order to save as much as possible. This is so that when those ‘bumps-in-the-road’ come along, you have some kind of safety net, however small. Unfortunately, however, I imagine a lot of people will do everything right this year and still fall into difficulty. As and when that happens I would say be proactive in reaching out and seeking help. There are plenty of free services and helplines to reach out to, before matters spiral.

PAS: Yes, definitely. As I said earlier, everyone should have a financial safety net to tide them over when life throws you a curveball.

In my earlier career I worked as a debt counsellor at a citizens advice bureau, so I know that there is lots of help out there if you ask for it. And friends and family can be a good source of practical and emotional support too. Just don’t bury your head in the sand and pretend to everyone that nothing is wrong.

What would be your top tip for someone who is worried about a debt (or debts) they can’t repay?

MN: I have two tips: the first is don’t panic, the second is be proactive. If you can’t afford the repayments for a loan or credit card, contact the company and explain your situation. If you’re struggling to meet the repayment amounts, you may also need to look at whether a debt solution is appropriate for you. Having unaffordable debt can be a scary place in which to find yourself, but by taking action you can dissipate some of that anxiety by feeling you are doing something about the problem.

PAS: Yep. It’s worth bearing in mind also that if you have a debt you can’t repay, it’s not just your problem, it’s a problem for whomever you owe the money to as well. It is therefore in their best interests to work with you to find a method for paying down the debt.

What are some good ways of boosting your income?

MN: Ask yourself: do I own anything I could rent? A parking spot, a vehicle, a garden shed, even a room in your house if you own it. Then ask yourself: do I own anything I could sell? Old clothes, a bicycle, old furniture, anything in storage. Then finally, ask yourself what you could do with your spare time: dog-walking, Uber-driving, delivering takeaways/parcels, painting and decorating,completing online surveys, match betting, free-lancing, etc. I have a whole blog post which goes into this very topic in more detail: Making Money – Tips and Tricks.

PAS: Lots of great ideas there. Like MoneyNerd, I also have a section of my blog devoted to ideas for boosting your income. I like online surveys, with Prolific Academic (a website needing people to take part in academic research) a particular favourite. And I do matched betting as well, though not as much as I used to, as I’ve been restricted (or gubbed as we say in MB’ing) by many of the leading bookmakers!

What is the best way you can help a friend or family member who has debt problems?

MN: Honestly, I don’t think there’s a one-size fits all here. Everyone and everyone’s debt problems are different. But that seems like a cop-out! So I think showing genuine, non-judgemental support, and ensuring they have all the right resources (StepChange, CitizensAdvice, etc.) to hand are two good places to start.

PAS: I agree with this. But based on personal experience with a friend a few years ago, I would also advise thinking hard before lending them money, as this seldom solves the problem and may simply exacerbate it. With my friend, who lived alone, I found that acting as a lender to him changed the nature of our friendship, and not for the better. I also felt that by constantly bailing him out, I was allowing him to avoid addressing his money management issues. Eventually we had a difficult telephone conversation when he asked me to lend him money again and I refused. He took it better than I expected and our friendship actually returned to something more normal after that. He got his finances under better control, although I did on a couple of occasions afterwards send him supermarket vouchers to ensure he had enough to get food. I didn’t expect to be repaid for these, obviously!

If you had a sudden, unexpected windfall of £5,000, what would you do with it?

MN: Firstly I’d pay off any loans or outstanding credit card debts. Then I’d take my family out for a nice meal, and put what’s left-over into a tax-free ISA.

PAS: Paying off debts would be my first priority as well, though I am fortunate not to have any at the moment. I would put most of the rest in my Nutmeg stocks and shares ISA, and some in my Kuflink property loan investment account (from which I have had good results over the last three years) to provide a bit of diversification. Going out for a nice meal with family and friends sounds good too, although as I live in a Tier 3 area I might have to wait a while for that!

What was your best-ever financial decision, and what was your worst?!

MN: My best financial decision was investing in a tech based stocks and shares ISA which has done really well over the last 5 years, although don’t know if I’d recommend the same investing approach in the current economic climate.

On the other hand my worst financial decision was living in London for 10 years where rent and cost of living is exorbitant.

PAS: My best financial decision was probably paying off the mortgage when I had a windfall a few years ago. At a stroke one large item of monthly expenditure was gone, giving me greater financial flexibility as well as saving me a lot in future interest payments.

My worst decision was investing too much in property crowdfunding a few years ago when it was still new and exciting. I had money to invest at the time and liked the idea of owning stakes in a portfolio of properties across the UK. Some of my investments worked out but others didn’t, and I am currently sitting on a number I can’t access because the properties in question can’t be sold for one reason or another. The money is still there in bricks and mortar but I have no idea when or how I will be able to access it. That said, I do still believe in the property crowdfunding concept, but I do it a lot more selectively now.

About MoneyNerd

MoneyNerd.co.uk is a personal finance blog that was set up with one aim in mind: to help people learn how to manage their finances and tackle debt. The blog includes a variety of straight-talking articles that cover personal finance topics from credit card guides to mental well-being tips. These can help you understand exactly how financial products work, as well as what your rights are when dealing with debt. We want to offer authentic and truthful information that can help you deal with your situation, whatever that may be.

Many thanks again to MoneyNerd for their insights. Please do check out the MoneyNerd site for much more information about tackling debt and getting your finances under control.

As always, if you have any comments or questions about this post, please do leave them below.

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November 24, 2020

Nutmeg Launches ‘Smart Alpha’ Portfolios Powered by J.P. Morgan Asset Management

Nick Saving Money, Investing reviews 6 Comments

Updated 16 November 2023.

Regular readers of PAS will know that I am a fan of the Nutmeg robo-adviser investment platform, and have a good portion of my own money in a Nutmeg stocks and shares ISA. You can read my in-depth review of Nutmeg here.

I was interested to hear that Nutmeg had launched a new investment style for their ISA, Lifetime ISA, Junior ISA, SIPP (personal pension) and general investment account customers. Previously such customers had a choice of three options: Fixed Allocation, Fully Managed and Socially Responsible.

All Nutmeg portfolios are managed by human experts, but the Fixed Allocation ones are altered annually, whereas the others are managed more actively. The Socially Responsible portfolio aims to optimize your investments according to various environmental, social and governance (ESG) factors. So it focuses on companies with a good track record and proactive strategy in such areas as water use, pollution, greenhouse gas emissions, proportion of female board members, and so on. Currently my own stocks and shares ISA is in the Fully Managed category (which was the only option available when I originally invested with Nutmeg).

Whilst all three of these investment styles remain available, a new one was launched in 2020…

Smart Alpha Portfolios

Nutmeg’s Smart Alpha portfolio range is powered by J.P. Morgan Asset Management. It includes five risk-rated portfolios, each holding between 10 and 14 passive and active exchange traded funds (ETFs). They are run by J.P. Morgan’s multi-asset solutions team, giving Nutmeg clients access to the investment giant’s experience and expertise. Writing on the Nutmeg blog, their Chief Investment Officer James McManus explained the benefits of this approach as follows:

The name recognises the intelligent way these portfolios are designed with the potential to achieve alpha (returns above the market) for our clients in three ways.

Firstly: The use of J.P. Morgan Asset Management’s multi-asset specialists, a team with a 50-year history of investing for institutions and professionals worldwide. These specialists inform Smart Alpha portfolios’ long-term (strategic) asset allocation.

Secondly, Smart Alpha portfolios have the ability to be flexible around this long-term asset allocation, allowing us to manage risk and capture opportunities at different stages of the market cycle.

Thirdly: Nutmeg and J.P. Morgan Asset Management have added to these capabilities a means to make smart security selections within active exchange traded funds (ETFs). These smart selections are made based on the insights of J.P. Morgan Asset Management’s research analysts with the aim being to capture returns in excess of the market benchmark (alpha).

How do these smart selections seek to gain alpha? The active ETFs we use allow us to move overweight in certain positions that J.P. Morgan Asset Management’s analysts expect to perform well and underweight in those positions they expect to perform poorly. This gives us the ability to move above and below market benchmark positions, delivering greater potential returns with similar risk to the overall market.

As well as allowing Nutmeg investors to tap into the expertise of J.P. Morgan Asset Management, these portfolios are ESG integrated, meaning that (as mentioned above) environmental, social and corporate governance considerations are factored into every research and investment decision. These portfolios are therefore suitable for the growing number of investors for whom ethical considerations are particularly important.

The terms and conditions for the new Smart Alpha portfolios are copied below, alongside the other portfolio types.

The above is correct as at 16 November 2023, but may have changed subsequently. Please note also that Nutmeg has also recently introduced a new ‘thematic’ investment style. More information about this can be found about this in my full Nutmeg review and on the Nutmeg website. Remember that all investing carries a risk of loss.

My Thoughts

This is undoubtedly an interesting move by Nutmeg and gives investors the opportunity to benefit from having their portfolio actively managed by a leading investment house at no extra cost. If you are a Nutmeg investor already, you can start by investing as little as £500 to test the water. You can either use ‘new money’ from your bank account or another ISA, or you can transfer money from another pot within your Nutmeg ISA account.

Personally I am very happy with the way my Nutmeg ISA has performed during this tumultuous year and don’t want to rock the boat too much. On the other hand, I am curious to see how the new Smart Alpha portfolios perform in comparison. So I have created a new £1,000 pot within my ISA and have selected Smart Alpha as the investment style. The risk level is 4/5, which roughly corresponds with the 9/10 risk level in my Fully Managed portfolio.

I will of course report back on Pounds and Sense about how my investments perform. Obviously, if my Smart Alpha pot seems to be doing significantly better than my Fully Managed one, I will switch some or all of the latter to Smart Alpha as well. It is one of the attractions of Nutmeg that you can have multiple pots within a single ISA with different investment styles and risk levels attached to them.

Capital at risk. Tax treatment depends on your individual circumstances and may change in the future.

In Conclusion

I am obviously a fan of Nutmeg and – as stated above – have a significant proportion of my investments with them.

Of course, I am not a qualified financial adviser and everyone should do their own ‘due diligence’ (and/or take professional advice) before deciding to invest. In addition, you shouldn’t consider investing with Nutmeg (or anyone else) unless you have paid off any interest-charging debts and have at least three months of easily-accessible savings in case of emergencies.

Based on my personal experiences with Nutmeg, though, I am happy to recommend them. They provide a simple, easy-to-understand investment platform, the customer service is excellent, and certainly in my case the results to date have exceeded my expectations.

If you have any comments or questions about this post or Nutmeg in general, please do leave them below.

PLEASE NOTE: As with all investing, your capital is at risk. Tax treatment depends on your individual circumstances and may be subject to change in the future. The value of your portfolio with Nutmeg can go down as well as up and you may get back less than you invest.

Note also that I am not a qualified independent financial adviser and nothing in this review should be construed as personal financial advice. You should always do your own ‘due diligence’ before investing and take professional advice if in any way uncertain how best to proceed. All investing carries a risk of loss.

Please note also that this review includes affiliate links. If you click through and make an investment or perform some other qualifying transaction, I may receive a commission for introducing you. This will not affect in any way the terms you are offered or any fees you may be charged.

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November 9, 2020

How Universal Credit Claimants Can Get Free Energy-Saving Home Improvements via the Government’s Energy Company Obligation Scheme

Nick Saving Money property, sponsored post, benefits, events 6 Comments

The number of people applying for Universal Credit has surged to record levels as a result of the Coronavirus pandemic and the numbers are set to rise further with the ongoing economic uncertainty.

In addition to a loss of income, households could also be facing a rise in energy-bills due to more time spent at home and cold weather approaching. Many will be coming to grips with the benefits system for the first time and starting to understand the rules, regulations and complexities around making a claim.

However, there is a little known silver lining for these claimants. Anyone who has claimed Universal Credit successfully will also be eligible for home improvements under the Government’s Energy Company Obligation (ECO) scheme.

This current scheme, called ECO3, targets people that have high energy costs comparative to household income. The scheme has a list of ‘qualifying benefits’ for eligibility. Universal Credit is on that list.

Plus, there are no savings or income-tests for the qualifying benefit part of the application, so if you receive any benefit on the list below (excluding Child Benefit, as that has an income cap), it’s likely you’ll be eligible.

According to Ofgem (who administer the ECO scheme), claimants will still be eligible for a period of 18 months following the date of the letter for the Universal Credit award (page 44 of the Ofgem ECO3 guidance has full details).

So if, say, you were awarded your Universal Credit in April but you got a job last week and came off Universal Credit today (for example), you still have a significant period of time (a year and a half) to apply for and install the measure, as you would still be classed as eligible even when you return to work. While you can wait to apply, it’s advisable to apply sooner rather than later, as funding rules can change at any time.

Even if you have returned to work or are planning to return to work, you will still be eligible, providing you have had at least one award for Universal Credit.

And it isn’t just Universal Credit recipients who are eligible for grants. Also on the ‘qualifying benefits’ list are the following:

Armed Forces Independence Payment
Attendance Allowance
Carer’s Allowance
Child Benefit*
Child Tax Credit
Constant Attendance Allowance
Disability Living Allowance
Income Support
Pension Credit (Guarantee)
Employment and Support Allowance (income-related)
Jobseeker’s Allowance (Income-based)
Income Support
Industrial Injuries Disablement Benefit
Mobility Supplement
Personal Independence Payment
Severe Disablement Allowance
Universal Credit
War Pension Mobility Supplement
Working tax credit

* Note: If Child Benefit is the only qualifying benefit you receive, you will also need to meet additional income rules detailed here.

You will still be eligible if you return to work as you can claim for a period of 18 months after claiming benefits.

What Grants Are Available?

There are a range of energy-efficiency measures that can be installed under the Energy Company Obligation (ECO) scheme, including boiler upgrades, home insulation and heating upgrades. The Scheme is funded by the major energy companies and if you claim benefits, you are entitled to this funding.

Table: Measures Available Under the Energy Company Obligation Scheme

Measure	Homeowners	Private Tenants	Housing Association Tenants	Landlords	Council Tenants
Air Source Heat Pump (ASHP)	✅	✅	✅	❌ Landlords ✅ Private tenants can apply	❌
Boiler Upgrade or Repair	✅	❌	❌	❌	❌
Cavity Wall Insulation	✅	✅	✅	❌ Landlords ✅ Private tenants can apply	❌
Electric Heating Upgrade	✅	✅	✅	❌ Landlords ✅ Private tenants can apply	❌
First Time Central Heating (FTCH)	✅	✅	✅	❌ Landlords ✅ Private tenants can apply	❌
Internal Wall Insulation	✅	✅	✅	❌ Landlords ✅ Private tenants can apply	❌
Underfloor Insulation	✅	✅	✅	❌ Landlords ✅ Private tenants can apply	❌

How Much Could You Get?

The amount of funding available depends on a range of factors, including property type, your existing heating, wall type and potential energy savings from proposed work.

The first step in working out what you could get is to check your eligibility online. There’s a quick form on the Energy Saving Genie website where you can enter your details to see if you are eligible.

If you meet the criteria, you can choose to apply and once your application has been submitted, it will be passed to a Registered Installer.

The Registered Installer will arrange a free survey of your property. You can choose to proceed ASAP with a survey taking place following strict health and safety guidelines or you can choose to wait until after Covid-19.

Once the survey has taken place, the surveyor will report back to the Registered Installer, who will talk you through the grants that are available towards energy-efficiency measures at your property.

The grant is paid directly to the installer and they are awarded on lifetime savings (LTS) scores. Currently electric heated properties and larger properties tend to receive the most funding. But even if your home isn’t large or heated by electricity, it is worth applying as you could still receive a significant grant towards home improvements.

So if you are one of the many million new Universal Credit claimants due to Covid-19, you can start the process of applying for a home improvement grant that will knock £££s of your energy bills for years to come, well after the pandemic has passed.

Check your eligibility here!

Disclosure; This is an adapted reblog of an original post by Energy Saving Genie. It is also a sponsored post. If you click through and end up taking advantage of this government scheme, I will receive a fee for introducing you. This will not affect any products or services you may receive or the value of any grants you may be awarded.

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October 30, 2020

Save Money on Your Mortgage with Dashly

Nick Saving Money reviews, property, sponsored post 4 Comments

For many of us, our mortgage is our biggest monthly outgoing. So it’s important to keep a close eye on it and check regularly whether you could save money by switching to another provider.

That’s exactly what a new online service called Dashly aims to do. They evaluate your current mortgage deal against the whole market, taking into account your specific personal circumstances as well. If they find a better deal for you they let you know and – if you choose to proceed – assist you with the switching process.

How Does Dashly Work?

Dashly is available as a desktop site, with mobile apps for iOS and Android coming soon.

You start by registering and entering some details about your current mortgage and your personal circumstances. The latter is important, as things such as your income, employment type, credit score and age can all affect the deals you could be eligible for. This process takes 10-15 minutes. Dashly then compares your mortgage against an average of 10,000 products to find the best deal for you.

If they find a better deal than your present one, they send you a notification. You can then evaluate this and decide whether you want to switch. If you do, the team at Dashly will assist you with the switching process.

In addition, Dashly will continue monitoring your mortgage every month. If they find you could save money by switching again, they’ll let you know. It’s worth noting that the equity you have in your property changes on a monthly basis due to ever-changing house values and your decreasing mortgage balance. As your LTV (loan-to-value ratio) decreases, your mortgage may qualify for better, cheaper deals. Again, Dashly checks this on your behalf.

You receive a detailed personal report from Dashly about your mortgage every month. In addition, your dashboard will show you all the key facts at any time, from the changing value of your property to the amount of equity in it, any current deals that would save you money to your next payment date. It’s all there on one easy-to-read web page.

How Much Could You Save?

The savings can be substantial. Dashly say that on average their users save £2,620 (see footnote).

Of course, in practice savings will depend on a number of things, including the balance outstanding on your mortgage, the competitiveness of your current deal, the term left to run, and the effect of any early repayment penalties. Dashly takes all of these things into account in determining whether you could save money by switching to a new lender (and by how much).

Are There Any Costs?

Using Dashly is free. There are no hidden charges and Dashly say they will never hit you with advertisements or email campaigns to try to make money from you. They get paid out of mortgage provider fees, and are authorized and regulated by the Financial Conduct Authority.

Dashly are also founding members of Finance For Good, a charity run by social impact fintechs who put consumers first. They say that their security rivals that of the world’s leading banks.

In Conclusion

If you have a mortgage, in these uncertain times it’s more important than ever to ensure that you aren’t paying over the odds for it.

Dashly offers a free service that not only checks whether you are getting the best deal currently but also continues monitoring your situation month by month and recommends switching again if a new and better deal arises.

By using Dashly you could painlessly save hundreds or even thousands of pounds on the cost of your mortgage. There is never any obligation to switch or any fee to pay for the service. So you really have nothing to lose and everything to gain by registering for an account today.

Footnote: Your individual savings may vary and will depend on personal circumstances. £2,620 per year is the average amount based on research Dashly has conducted on the mortgage market. Find out more at www.dashly.com/reference-index .

Disclosure: This is a sponsored post on behalf of Dashly. If you sign up and make use of the service, I may receive a referral fee for introducing you. This will not affect in any way the service you receive or the deals you are offered.

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October 27, 2020

Protect Your Loved Ones with Bespoke Life Insurance

Nick Saving Money, Everything Else property, sponsored post, insurance 4 Comments

Life insurance isn’t the most exciting of subjects, but in these uncertain times it’s something we all need to think about.

Not everyone requires life insurance. If you are single with no dependants and/or on a very low income, it may not be necessary or appropriate for you. But if you have a partner, children or other relatives who depend on your income, you probably should have life insurance to help provide for them in the event of your death.

What Is Life Insurance?

Life insurance is a type of insurance policy that protects your loved ones financially if you die. It can help minimize the financial impact that your death could have on your family and provide peace of mind for you and them.

Most life insurance policies are designed to pay a cash sum to your loved ones if you die while covered by the policy. This can help them cope with everyday money worries such as mortgage payments, household bills and childcare costs. It may also cover funeral costs. You can take out life insurance under joint or single names, and you can pay your premiums monthly or annually.

There are two main types of life insurance: term life insurance and whole of life insurance.

Term life insurance policies run for a fixed period such as 10, 20 or 25 years. These types of policy only pay out if you die during the term of the policy. A whole-of-life policy, on the other hand, pays out no matter when you die (as long as you keep up with your premium payments, of course).

There are three different types of term life insurance. With decreasing term insurance, the amount payable on death reduces over time. This type of policy is often taken out in conjunction with a mortgage as the payout reduces over time in line with the amount needed to clear the outstanding debt.

You can also get increasing term insurance, where the payout rises each year (typically to take account of inflation) and level term insurance, where it remains the same throughout. Not surprisingly, level term and (especially) increasing term policies are more expensive than decreasing term.

What Doesn’t It Cover?

Life insurance normally pays out only on death. If you become unable to work due to an accident or illness, you won’t generally be covered.

Some life insurance policies will pay out if you receive a terminal diagnosis. This is by no means always the case, though, so it’s important to check the wording of your policy carefully.

Most life insurance policies also have some exclusions, e.g. they might not pay out if you die from alcohol or drug abuse. In addition, if you take part in risky sports, you may have to pay a higher premium. If you have a serious health problem when you take out a policy, any cause of death related to that illness may be excluded.

For the above reasons, you may also want to consider taking out critical illness cover. This covers you if you get one of the medical conditions or injuries specified in the policy. Some examples of critical illnesses that might be covered include heart attack, stroke, cancer, and chronic, life-limiting conditions such as multiple sclerosis and MND. Most policies will also consider permanent disabilities as a result of injury or illness. These policies only pay out once and then the policy ends. Some policies will make a smaller payment for less severe conditions, or if one of your children contracts one of the specified conditions. Health conditions you knew you had before you took out the insurance won’t generally be covered.

What Does It Cost?

Life insurance can be surprisingly good value. Premiums start at just a few pounds a month. Prices vary a lot, however, so it’s important to shop around and take advice as appropriate.

A variety of factors may affect the price you are quoted. They include the following:

your age
your health
your weight
your occupation
your lifestyle
whether you smoke
your medical history
your family’s medical history
the length of the policy
the amount of money you want to cover
whether you want decreasing, level or increasing term cover

Other things being equal, the younger and healthier you are, the cheaper your policy is likely to be. But as the list above indicates, many other factors can affect the price you are quoted. In addition, women are typically charged a little less than men, as on average they live a few years longer.

The Bespoke Option

As you can see, while life insurance is a simple concept, in practice there are many variations. It is therefore important to establish what is the most appropriate option for you and your family, and shop around to get the best price for this.

A company that can help with both these things is Bespoke Financial. They are independent insurance and mortgage brokers, and will take the time to establish your exact requirements and design a ‘bespoke’ package to suit you and your family’s needs. Their trained advisers will visit you in your home (with all necessary Covid precautions) or you can speak on the phone to them. They can arrange all types of life insurance, critical illness cover, cover for long-term illness or disability, and so on.

To get an initial personalized quote, click through to the Life Insurance page of their website and answer six quick questions. You can then discuss this with an adviser to ensure you will be getting exactly the right type and level of cover for your needs.

And as an added bonus for readers of my blog, you can get a free will just by asking for a quotation. You can’t say fairer than that, now can you?

As always, if you have any comments or questions on this post, please do leave them below.

Disclosure: This is a sponsored post on behalf of Bespoke Financial. If you click through one of the links and end up making a purchase, i will receive a commission for introducing you. This will not affect in any way the product or service you receive.

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How to save money on foreign currency transfers before or after retirement

September 11, 2020

How to Save Money on Foreign Currency Transfers Before and After Retirement

Nick Saving Money property, travel, sponsored post, pensions, retirement 0 Comments

A great number of people today need to transfer currencies, or receive transfers from abroad, for many different reasons. As globalization extends, this need has become more frequent as geographical borders become less relevant.

For example, our parents couldn’t even dream about services like eBay or Alibaba, where you can buy anything and have it delivered from a dozen countries away. And the whole thing might be cheaper than buying it in your local store!

But here is where the matter of foreign currency transfers becomes important. Paying for something abroad or getting money sent to you might not be cheap. That’s because not only do you have to pay bank fees for the transaction, you also lose money on currency exchange, which is often a mandatory step in cross-border transfers.

Luckily, today there are alternative money transfer services that allow you to cut these costs. You’ll need to look into them if you require regular foreign currency exchange (FX or forex) services.

Why You Might Need to Make Foreign Currency Transfers

One reason you might need to make a large money transfer abroad is real estate. Buying property is an important part of the retirement planning process and many Britons choose to retire abroad. For example, the latest data indicates that there are about 466,000 British pensioners living in the EU. There are even more among the 5.5 million Brits living worldwide.

Even if you don’t plan on moving or buying a vacation home on some tropical beach, you might consider investing. Investing in real estate is one of the less risky methods for growing your fortune. Of course, the coronavirus crisis has heavily affected this industry. But there are still some very promising prospects for the residential housing market.

Also, today you’ll need to make international payments when booking your holiday accommodation. So, if you plan to travel at all, you’ll need to look for cheap money transfer solutions.

Anyone involved in international business also needs to make and/or accept international payments. This also includes the simple process of buying goods through one of the many e-commerce platforms.

In addition to those reasons, if you are an expat or a traveller, you’ll need to exchange money regularly. The same goes for dealing with transfers like inheritance or even accepting dividend payments from your investments.

All in all, living in the modern world makes you exposed to foreign currency exchange and transfers in many ways. Therefore, the knowledge of how to save money on these transactions is sure to be useful.

How Much Do Foreign Currency Transfers Cost in a Bank?

The cost of an international bank wire transfer is a very complicated issue. First of all, you need to understand that banks will advertise, and sometimes even show you, only the transfer fee. In the UK those range from £8 to about £40. That doesn’t seem too bad, especially for large transfers, right?

However, the truth is that banks are deceiving customers most of the time. If they were fully transparent, you would understand that what truly matters is the FX rate margin. That’s the amount that the bank charges per currency conversion on top of the mid-market exchange rate.

Simply put, high FX margins are why you lose so much money on currency conversions. Different banks use different margins and that’s why they offer different exchange rates. But if you compare the options offered by top UK banks, you’ll see that they are all very close.

Therefore, you don’t have much of a choice.

Also, there might be additional fees involved in a cross-border money transfer. The recipient bank might charge its own fees. If there are any intermediary ‘stops’ along the way, more fees will come.

All things considered, the real cost of an international money transfer can go up to 3-10% of the transfer amount. This cost will be higher for exotic currencies and transfers to remote locations. It will go down a bit for large transfers because banks might offer better terms to VIP clients.

However, the total will always be quite high.

Leading Money Transfer Service Alternatives From the UK

With bank transfer costs so high, a necessity for an alternative emerged. The solution came in the form of FX brokers and money-transfer companies. These businesses offer services similar to banks, but they have much lower overhead costs. Therefore, they are able to keep both the margins and fees very low.

In fact, many companies charge no transfer fees at all for the majority of transactions. However, they use different margins that often depend on the transfer size. Thus, you should always compare foreign currency transfers before choosing a service. This won’t be difficult as all top companies in the industry offer free quotes. They also have transparent pricing schemes.

On average, a transfer with one of these companies will cost you 1-3% of the total. Industry leaders even offer options that allow you to cut costs below 1% for large transfers.

The most notable UK-based FX companies today are TransferWise and WorldFirst. There are other notable businesses as well. However, they cannot compete with these two giants that have multi-million funding.

TransferWise

TransferWise launched not even a decade ago and it has already become a major disruptor in the banking industry. It took over the FX money transfer industry rather fast as well. The main selling point of this company was offering not merely cheap transfers but also a fixed margin scheme.

This means that TransferWise managed to offer its customers consistency and a chance to save a great deal of money. Because of the fixed margins, its services were the most affordable in the industry. The company is now valued at over $3.5 billion and it’s expanded to many countries, including the US.

WorldFirst

WorldFirst is another veteran in the FX transfer industry. This company built a solid reputation for its reliability and trustworthiness. Launched back in 2004 literally from a basement, WorldFirst became one of the industry leaders within a few years.

In 2019 this fintech business was purchased by Ant Financial of the Alibaba Group. This allowed WorldFirst to launch a major change in pricing. It had already been one of the top companies, but it could not compete with TransferWise in affordability. However, the new pricing scheme with fixed margins that go below 0.55% makes WorldFirst a cheaper alternative even to TransferWise. At the moment, there is no cheaper option for foreign currency transfers in the UK. Also, WorldFirst has a very wide reach due to its association with Alibaba, though it’s not yet available in the US.

In Conclusion: Do Your Research for Saving Money on Foreign Currency Transfers

FX money transfer companies today offer great opportunities for money saving. However, do not forget that the lowest cost doesn’t necessarily mean the best offer. These companies have a number of requirements and additional services that you should research. For example, some have a minimum transfer limit. Others offer FX hedging tools that will be essential for reducing risks for businesses and investors.

Thus, be sure to compare all options you have available and research them thoroughly. Watch out for scammers, and choose only those businesses that have a good standing in the industry.

This is a sponsored post.

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