Child Trust Fund Changes - Published:27/10/07
If, like me you have a child born after 1 September 2002 you will no doubt have heard of the Child Trust financeEssentially, all babies born after this date have been sent a voucher by the government value £250 (£500 for near to the ground income families) to be saved or invested on their behalf into a dedicated "youngster Trust Fund" (CTF) account What's more, the administration has promised to top up accounts by a further £250 (£500 for low profits families) when the brood turn sevenThe aim of the scheme is to get us parents thinking about the long-term, financial prospect of our little terrors and, as the CTF financial records can be topped up by family and associates with up to £1,200 each year, it is hoped that a healthy shell egg will have been created by the time the youngster turns 18, when the account is closed by the way, the money will be clever to retain its tax-free status as the government has promised that CTF accounts will be able to revolve into cash ISAs)Of course, the scheme isn't without its evils and, perhaps surprisingly, take-up has been one of them Although you'd believe being sent a £250 voucher for your child by the government would have parents clamouring to disburse it into an explanation before their child starts solids, for some this has been far from the caseAnd although after a year idle vouchers are automatically invested on behalf of the child by the government, parents don't get to decide this account - and the youngster will have missed out on 12 months' interestThe financial Secretary, Kitty Ussher has now published the second annual Child Trust Fund statistical account, which shows that three-quarters of parents have vigorously opened their child's CTF, but only a quarter of financial records have had additional money paid into them This seems to have prompted the administration into announcing the following three initiatives to promote parental appointment with the scheme, in particular "harder to reach" groupsThe first plan is aimed at helping less financially confident parents to understand what the CTF scheme is all about, and to do this, "voluntary and division organisations" are being trained to give face-to-face supportThe second involves sending reminder letters to parents that have failed to open their child's explanation after eight months of receiving the voucher (this was it seems that trialled this day and resulted in parental opened accounts increasing by 8 percentage points)lastly, HM Revenue and Customs (HMRC) will consult with CTF account providers to see if it would be possible for parents to open financial records to open financial records without having to send in the coupon, in an attempt to make the process easierIt's obviously hoped that these initiatives will help with the take up of the scheme, and encourage parents to take an interest and top up their child's account And I believe the reminder correspondence is a very good idea, as anyone who's had a child will be acquainted with how the first few months fly by in a flash, in which time it would be easy to forget all about a coupon languishing in a drawerThe CTF scheme is, in my opinion, without cause complicated and badly explained, and although the government appears to be addressing this problem by targeting less monetarily confident parents, I know very monetarily astute couples who have had no idea where to put their child's voucherThe Child Trust finance website itself can complicate -- rather than simplify -- the system with jargon And although even it states that a shares-based CTF can be a distant more lucrative choice than a simple savings account, judgment a good comparison table of stakeholder/shares based financial records can be very difficultWhat is perhaps most irritating is that, although the government has stated that fees for stakeholder crop must be capped at 15%, many providers have in use that percentage as the shape to use This means that should you choose a allegedly cheap tracker CTF you can find your child is charged the full yearly charge of 15% -- when a similar, non-CTF tracker can be found charging now 04%Personally, although I appreciate the government's sentiments I would similar to to see an repair of the whole scheme and general simplification of what's available to children and their parentsIn the meantime, put on't allow your child's £250 go to waste If you're struggling to decide where to open a CTF, you can get plenty of help on the topic by reading articles on the subject from sites such as the trick'sMore: 10 Things to be acquainted with about Child Trust Funds| Make the most of your Child Trust Fund | economy for Children Centre© Copyright 1998-2007, The assorted Fool Limited All rights reserved This material is for personal employ onlyPlace of Reg: England & Wales Company Reg No: 3736872 storage bin Reg No: 735 7818 01.
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We Should Spend More On Our Credit Cards - Published:10/09/07
That is at least what we are led to believe My view is a small different - I don't think we use our credit cards enough Let me clarify that horrendously reckless statement with the aid of some particulars and figures from the latest APACS spending figures releaseHere in the UK, 314m people have credit cards Of those that have credit cards, we have an average 24 cards each The average money owing outstanding on each card is £718, or just over £1,700 for each cardholderTo put that in perspective, £1,700 is equivalent to what we currently use on our cards in just over five months Or, put another way, on average we take just over five months to disburse off our credit card amount overdueHmmm, that's not too good, especially considering it's reckoned that half of us disburse off our credit card balances in full each month This means the rest of us are taking almost a year to pay off their debtsThis is where the news gets a small brighter The total amount we owe on our credit cards has been falling steadily for two existence nowSince 2005 our total credit card money owing has fallen from £575b to £535b, a drop of some 7% Our spending on credit cards has remained roughly the same, but we've been paying back more Now whether this is down to good financial habits, or has been forced upon us by banks cutting back on credit limits is hard to speak But it's good news nonethelessLooking back a little further, we can see that payable £385b on our credit cards at the end of 2000 Why is this date significant Well, this is when Egg introduced the first 0% balance move card So credit card balances have only full-grown by about 5% a year since that tip Given that you'd expect credit card spending to at least grow in line with inflation, it looks similar to we'd haven't been as out of manage with our credit cards as you might believePersonally I find it hard to believe we'd had 0% equilibrium transfers for less than seven existence Incidentally, this year is the tenth anniversary of the first cash back credit card coalition & Leicester) and the eleventh of the first loyalty credit card (Goldfish)Unlike credit card spending, debit certificate purchases have been growing like topsy We exhausted £79b on debit cards in 2000 This year, we're on track to use £220b This means we use over 80% more on debit cards than we do on our credit cardsmoney withdrawals has been growing quite quickly too In 2000 we withdrew £113b This year, no hesitation partly due to there being 3 money machines for each person, we'll draw out £180b So our cash spending exceeds our credit card spending by 50%Three reasons coil to mind Firstly, debit card and cash expenditure doesn't let you take pleasure in the interest-free period you get with credit card purchases (typically around 56 days) Secondly, you won't be able to earn free cash by by a cashback card Last of all, for purchases between £100 and £30,000, we don't get the defense of part 75 of the Consumer Credit Act, which means the credit card company is jointly liable should there be a difficulty with what we've boughtSo next time you pay with something by cash or withdrawal card, stop and think if you'd be improved off using your credit card instead, provided of course you disburse off the additional debt before it costs you any interest© Copyright 1998-2007, The assorted Fool Limited All rights reserved This material is for personal employ onlyPlace of Reg: England & Wales Company Reg No: 3736872 storage bin Reg No: 735 7818 01 Registered place of work: 30 Great Pulteney.
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Banking on your mobile - Published:27/10/06
Egg, in partnership with O2, is launching next generation movable internet banking on October 1stO2 will provide i-mode, a overhaul originating from Japan that offers a content-rich, far above the ground speed experience similar to being online, and currently has 55 million users worldwideEgg will be the first UK bank to employ i-mode to provide its customers with internet banking on their movable phones, a overhaul already used by one million people in JapanAndy Thompson, manager of propositions at Egg, said: "Our Egg Money research reveals that customers do not be acquainted with at any given time what they have available to use and over half are eager to embrace mobile internet banking as a method of supervision their money"Our service on i-mode is the start of a rebellion in how customers interact with their finances, as long as them with immediate, convenient and fast access to their money wherever they are"From October 1st customers will be able to access information, account balances, and deal details from their Egg card, Egg Money and Egg Savings accounts All transactions will be covered by Egg's online assuranceAccording to Ofcom's communications market account 2005, there are 61 million mobile phone users in the UK alone, and as technology becomes more stylish, phones are being used for entertainment and personal organisation as well as communicationIf the feedback Egg receives from customers testing the i-mode overhaul is positive, other banks may feel force to expand their services in the mobile phone domainMoneyExpert Limited is authorised and regulated by the monetary Services Authority (FSA Registration No 301654) The Financial Services power does not regulate some forms of mortgage agreement, credit cards, personal loans,.
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