Archive for August 2009

Which way do you pay abroad?

August 28, 2009

The traveller’s cheque…oft forgotten but not gone..  It seems as though all the new financial products these days are putting the traveller’s cheque in the background.  Indeed, it is even referred to as “traditional” (a kind way of saying “old-fashioned”).  But believe it or not, this form of travel money is still widely available – and widely accepted.

In fact, some countries prefer these to regular credit cards when it comes to paying.  They are certainly safer than carrying out great wads of cash – if a cheque goes missing, it can be replaced with ease.  The exchange rate on a traveller’s cheque will be just as competitive as on other holiday money products, usually it will be around the same as on cash offered by any provider.  However…

When you go to exchange these abroad, you may find that the local bank might add rates and fees on top of the exchange – meaning you’re worse off.  So, the debate continues… which is the cheapest and easiest way to pay on holiday?  Cash, traveller’s cheque or prepaid FX card?

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University-time is Round the Corner

August 27, 2009

Students!!  Not long until the new term starts!  For those starting university this autumn, you’re probably getting everything sorted – halls or flat, equipment, books, computer…there is much to get done!  Most important for your studies will be money.  It is an age-old cliche, the student who can only afford a can of beans per day and scrapes the rent together each month.  Unfortunately, for many people this is still a reality during their university years.  Even the SLC student loan sometimes just doesn’t cover the expenses – at least we can relax knowing that no repayments are required until our annual income is at least £15,000 a year!

You may have considered a student credit card, and this is certainly worth considering for emergency situations.  It probably isn’t recommended for everyday costs as you could end up in more debt.  A student account is offered at most banks, but shop around before choosing one – their features and benefits vary.

One thing is essential: making a budget before term begins.  The last thing you want is to be out of money when things like field trips, clubs or nights out are on the cards.  Worse – what happens if you don’t have any money to eat or pay the rent?  Sitting down and working out income versus outgoings is not just wise, it could also save unecessary pain down the line.

Is now the time for place in the sun?

August 25, 2009

According to property ‘experts’, it is time for Britons to start considering the overseas property market once again.  Since around 2007, interest from British investors in the market was slowing to an almost standstill – thanks mainly to the weaker-than-ever pound.  But since the sterling has [slowly] begun to recover against the Euro and the US dollar, ever more Brits are returning to the overseas game.

Best are properties in Spain and the region, in the main coastal areas, according to property analysts.  For sound investment, it is best to stick to holiday/second homes rather than speculative investments.  There have been reports of houses exchanging hands at vast discounts – over 70 per cent was one claim. 

It certainly sounds as though it is time to head for the sun once more!  Before pouring capital into the overseas market however, it is best to

– gain independent financial advice

– seek a decent overseas mortgage broker

That way, you are in a stronger position with your cash.

“Fragile” return to Growth on the cards for UK

August 24, 2009

London stock markets are reacting to the latest positive economic data from the UK.  This morning the FTSE 100 gained over 1 per cent after markets in Asia also showed strong gains.

Business confidence is up with IT the strongest sector, followed by finance and finally property.  It is believed that the British economy will grow in the third quarter after a much smaller decline in the second.  Later today, a report by the Institute of Chartered Accountants fro England & Wales is expected to show the recovery for Britain.  However, chief executive Michael Izza warns that while they are confident of a recovery, it will not be plain sailing.  “…the recovery is very fragile,” he said. 

Last week, US Federal Reserve chief Ben Bernanke gave a positive talk on the state of the economy there.  All in all, it seems as though a gradual return to growth is on the cards for most developed nations.

Recession or not?

August 20, 2009

Now here’s the latest bit of (too positive?) news:

the Bank of England has released forecast figures which would indicate that the UK is out of the recession.

Surely not?! 

According to the figures, GDP grew (albeit by a tiny percentage) and will continue to sustain this growth until next year.  But – hold on a second – isn’t the budget deficit so bad that economists, currency exchange markets and analysts generally shaking their heads in misery?  How can the country therefore be heading out of the worst and into more stable times?

For a sensible viewpoint, perhaps it is fair to say that there are signs that recovery here.  But it is best to look at the picture from a much larger perspective including all data, opinions, sentiment, consumer spending and so on.  Things looking so good now?  Oh and lest we forget unemployment…

Sterling up on “sticky” inflation figures

August 19, 2009

Wednesday on the currency exchange market, and things are looking interesting as ever.  The sterling rose this morning against the US dollar, to around $1.65, on news that inflation in Britain remained at 1.8 per cent for July.  It had been expected that it would fall to around 1.6 per cent. 

The Monetary Policy Committee will release minutes from its latest meeting later today, and so far the Bank has indicated that it believes inflation will remain below target until at least mid 2011.  It expects inflation to fall to below 1 per cent by September. 

Does that mean that today’s numbers are merely temporary?

Prepaid Cards to be Adopted for Schoolkids

August 18, 2009

Seems like Prepaid cards are finally hitting the mainstream and being noticed!  An exclusive school in the UK has decided to test out a scheme whereby all students use prepaid cards in order to pay during termtime.  Parents hold the primary card and their children are issued with a secondary card.  The primary card is loaded with funds which can then be accessed by the child. 

The idea behind the scheme is because in the past, children would arrive for term time with cash or cheques which needed to last for everything from small purchases to school trips.  They were difficult to monitor and school administration found it tricky to manage the system.  Now, children can pay for everything with ‘plastic’ and parents and teachers can keep tabs on where and how the money is being spent.

If a child comes into difficulty and needs funds, parents can transfer this within minutes – great for added safety.  The scheme is being tested out by the school before being adopted officially.  It is believed that if successful, other schools will follow and it may even reach the state sector. 

Kids may feel that they are being too closely watched by parents, who can view transactions online and control how much (or little!) money is being spent.  But the safety aspect of the system is very well supported.  For instance, it card carries chip and PIN technology and acceptance is extrememly wide as it is issued by MasterCard.  But as it is not a debit or credit card it does not allow for credit or going overdrawn.  A student stuck without money can call parents who can choose to load new funds on to the card quickly.

The new way to pay!  And it might be coming your way…