» Go back to school with your fi­nances Your Money

If you are a par­ent feel­ing the pinch or just need a re­fresh, VICKY SHAW has money lessons that will help you make the grade

Gloucestershire Echo - - NEWS -

SUM­MER is over – and fam­ily fi­nances are likely suf­fer­ing dents from the hol­i­days, as well as chil­dren’s back-to-school costs.

Par­ents across the UK have col­lec­tively spent nearly £1.2 bil­lion send­ing their chil­dren back to class, ac­cord­ing to a re­port from Min­tel – mak­ing it the third big­gest re­tail spend­ing event af­ter Christ­mas and Black Fri­day.

But now the kids are back in the class­room, there are some ways you can help im­prove your fi­nances – whether it’s sort­ing your pen­sion, sav­ing for a rainy day, even get­ting a new mort­gage or deal­ing with debts.

“Par­ents who have done ev­ery­thing they can to pre­pare their chil­dren for the new school term may feel that they have ne­glected their own fi­nan­cial well­be­ing,” says Rachel Springall, fi­nance ex­pert at Money­facts.co.uk. “If this is the case, there are steps par­ents can take to rein in their fi­nances and get back above board.”

You don’t have to be a par­ent to ben­e­fit from get­ting into ‘back to school’ mode with your fi­nances ei­ther – these tips could be use­ful for any­one.

Plug the pen­sion gap

“IT’S vi­tal that con­sumers seek ad­vice to en­sure they have a com­fort­able pot ready for their re­tire­ment, as it will only get harder to plug the gap as they get older,” says Rachel. De­pend­ing on in­di­vid­ual cir­cum­stances, she says some­one could po­ten­tially build up £30,000 just by sav­ing an ex­tra £100 per month over 25 years. But even this ex­tra amount may run out more quickly than ex­pected. “While this sounds a lot, it may not last long, or could be just a one-year salary for some,” she adds.

Re-mort­gage to re­duce your monthly re­pay­ments SOME bor­row­ers may be sit­ting on their mort­gage lender’s stan­dard vari­able rate (SVR) af­ter an ini­tial deal has come to an end. But big sav­ings could be made by switch­ing to a new deal. Ac­cord­ing to Money­facts.co.uk, in early Septem­ber, the av­er­age SVR stood at 4.89% – but the av­er­age two-year fixed rate mort­gage on the mar­ket had a lower rate of 2.47%. “Bor­row­ers may also be con­cerned about eco­nomic un­cer­tain­ties and are look­ing to fix for longer,” says Rachel. “Thank­fully, there have been sig­nif­i­cant cuts to deals in the five-year fixed mar­ket, as well as more deals sur­fac­ing for even longer terms, such as 10-year and 15-year fixed deals.

“All in all, bor­row­ers have plenty of choice, but seek­ing in­de­pen­dent fi­nan­cial ad­vice may be wise to nav­i­gate the mort­gage mine­field.”

Shift credit card debts to an in­ter­est-free card

CREDIT cards can be costly – but there are still plenty of in­ter­est-free deals avail­able. It’s im­por­tant to bear in mind any fees for trans­fer­ring your bal­ance to an in­ter­est-free card though, as well as whether you can clear your debt be­fore the in­ter­est-free pe­riod ends and charges start to ap­ply.

Rachel high­lights a 29-month in­ter­est-free deal which has been of­fered on bal­ance trans­fers from MBNA, for a fee of 2.75%.

Al­ter­na­tively, Natwest has been of­fer­ing a 23-month 0% in­ter­est bal­ance trans­fer deal with­out a fee.

Con­sider a low-cost loan to con­sol­i­date debts

RACHEL says some lenders have been of­fer­ing per­sonal loan rates as low as 2.9% to bor­row £10,000 over five years, in­clud­ing John Lewis Fi­nance. Per­sonal loan rates have be­come cheaper in re­cent years. Five years ago, the low­est rate for the equiv­a­lent amount and term was 4.1% from Sains­bury’s Bank, Money­facts says.

Switch cur­rent ac­counts for some ‘free’ cash TRA­DI­TION­ALLY over the sum­mer, free cash of­fers for peo­ple switch­ing their cur­rent ac­count tend to dry up, Rachel says, but this year there’s been bet­ter news for switch­ers.

For ex­am­ple, Royal Bank of Scot­land re­cently an­nounced it would give £150 to con­sumers who switched. Other ex­am­ples of cash­back perks in­clude First Di­rect, which has been of­fer­ing £50, while new cus­tomers who switch to M&S Bank can get up to £180 in gift vouch­ers when they switch and stay.

Build a sav­ings fund

AS WELL as sav­ing small amounts of­ten your­self, you may also be able to get ex­tra help to save, which could be par­tic­u­larly help­ful if your bud­get is very tight.

The Gov­ern­ment Help to Save scheme aims to help el­i­gi­ble peo­ple on low in­comes to build up a rainy day fund. More in­for­ma­tion is avail­able at gov.uk/get-help-sav­ingslow-in­come.

You may be able to get ex­tra help to save, which could aid tight bud­gets Rachel Spring­hall of Money­facts.co.uk

Fol­low our top tips to help you tackle your money is­sues

You can learn to save

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