For­got­ten di­rect deb­its can be a fi­nan­cial drain

Daily Express - - YOUR MONEY - By Har­vey Jones

BRITONS are be­ing urged to watch out for “zom­bie bills” such as un­wanted sub­scrip­tions and con­tracts or risk wast­ing hun­dreds of pounds a year.

Too many of us are throw­ing money away on for­got­ten di­rect deb­its, stand­ing or­ders, sub­scrip­tions, do­na­tions and mem­ber­ships by fail­ing to pay at­ten­tion to what is com­ing out of our ac­count.

Fi­nan­cial ex­perts are urg­ing Britons to re­view their bank and credit card state­ments in the run-up to Christ­mas to root out un­wanted pay­ments lurk­ing in their fi­nances.

This fol­lows a new cam­paign by Cit­i­zens Ad­vice, which found that nine out of 10 peo­ple who tried to get out of an un­wanted ser­vice were ini­tially re­fused. RE­VIEW OUT­GO­INGS Peo­ple fear they are throw­ing most money away on un­used sub­scrip­tions for satel­lite TV, mo­bile phone con­tracts, Net­flix, gym mem­ber­ship and Ama­zon Prime mem­ber­ship.

De­spite the cost, al­most half ad­mit to not re­view­ing their di­rect deb­its and stand­ing or­ders in the last 12 months, ac­cord­ing to re­search from com­par­i­son site GoCom­pare.com.

It found that peo­ple are pay­ing £28.30 a month on av­er­age for things they do not want or use, or al­most £340 a year, with many pay­ing be­tween £480 and £600.

GoCom­pare head of con­sumer af­fairs Ge­orgie Frost said au­to­mated pay­ments can be a dou­ble-edged sword: “They can save you money and en­sure you al­ways pay on time, but you could end up with a load of zom­bie bills leech­ing your cash with­out re­al­is­ing it.”

If you see a pay­ment on your state­ment you do not recog­nise, con­tact your bank or credit card provider im­me­di­ately. She said: “They should be able to clar­ify who the pay­ment is made to.”

Your bank is legally obliged to stop any di­rect debit or stand­ing or­der im­me­di­ately on re­quest, but re­mem­ber to keep check­ing fu­ture state­ments to en­sure no fur­ther money is com­ing out of your ac­count. You should also watch out for changes to terms and con­di­tions, in­clud­ing new fees, er­rors and fraud­u­lent pay­ments, Frost added. PLAY IT COOL Many com­pa­nies of­fer one-month free tri­als then au­to­mat­i­cally roll you onto a paid sub­scrip­tion, but He­len Dewd­ney, con­sumer rights blog­ger at The Com­plain­ing Cow, said check your can­cel­la­tion rights be­fore sign­ing up. Then make a note to re­view your de­ci­sion be­fore the first pay­ment comes out of your ac­count. “You are also en­ti­tled to a 14-day cool­ing off pe­riod when you can can­cel with­out penalty,” she said.

Dewd­ney added that the Con­sumer Rights Act 2015 gives you pro­tec­tion from un­fair con­tracts: “For ex­am­ple, if a com­pany says that you must give six months’ no­tice to can­cel a sub­scrip­tion, that would be un­fair. If you want to can­cel, do so quickly and in writ­ing, so that you have ev­i­dence.” TRAPS AND TRICKS The founder of on­line com­plaints ser­vice Re­solver.co.uk James Walker said com­pa­nies make huge prof­its from sub­scrip­tion traps: “They work on the ba­sis that most of us are not very good at re­mem­ber­ing when we have signed up to free deals and when they ex­pire, so we con­tinue to be charged for ser­vices we have for­got­ten about.”

The costli­est traps in­clude sam­ple goods, of­ten cos­met­ics or health sup­ple­ments. He added: “You sign up for a free sam­ple, but if you don’t can­cel in time, other goods ar­rive, of­ten with huge price tags.”

To com­pound the prob­lem, many busi­nesses are based abroad and deal­ing with them can be tricky. “If the busi­ness is not based in the UK, think twice. Your rights are not as strong in other places around the world.”

Al­ways read the small print be­fore sign­ing up, he added: “We know it is a pain, but do you need 18 pages of text for a free trial? That is a warn­ing in it­self.”

Walker said you should also check the com­pany’s con­tact de­tails: “If a busi­ness makes it hard for you to speak to a per­son di­rectly, be wary.”

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