Money To The Masses Putting you in control Wed, 16 Apr 2014 05:50:09 +0000 en-GB hourly 1 Tenants to get more protection under new plans Wed, 16 Apr 2014 05:50:09 +0000 Tenants to get more protection from compulsory redress scheme

Millions of tenants and leaseholders will get better protection from unscrupulous landlords under plans announced by the Government on 15th April 2014

What are the new plans that have been announced?

  • All letting and property management agents will be required to join an approved redress scheme later this year
  • There are 3 approved redress schemes – The Property Ombudsman, Ombudsman Service Property & The Property Redress Scheme
  • A new voluntary code of practice will set standards for the management of property in the private sector
  • A new help to rent guide that will give tenants a better understanding of what to expect from their rental deal
  • Introduction of a model tenancy agreement which landlords can use for longer tenancies, providing extra security for families
  • Guidance for local councils on how to tackle rogue landlords and protect tenants from illegal eviction
  • An ongoing review to consider what other improvements can be made to the conditions in the private rental sections and tackle bad landlords

What service does a redress service provide?

  • All 3 schemes offer independent investigation of complaints about hidden fees and poor service
  • Where complaints are upheld a tenant or leaseholder could receive compensation

What is the current situation regards membership of a redress scheme

  • Membership of a redress scheme is currently voluntary
  • Around 60% of letting agents are currently members of a redress scheme
  • The balance ( approx. 3,000) will be encouraged to join a redress scheme ahead of the legal requirement

For more tenant information read this article – Renting a property – a guide to your rights and responsibilities

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I’ve separated from my wife, is it true that she’ll still get my pension if I die? Tue, 15 Apr 2014 06:15:40 +0000 ex-wife pensionReader Question:

I have a works pension which I put into a private pension. I have been separated from my wife but not divorced. With my new pension company I signed a form stating after my death any money in it should be divided between my son and my partner but I have been told my wife may still be able to claim the money. Could you please let me know how I stand?

Mark’s Response: 

Good question!

Okay- with a personal pension the pension doesn’t form part of your estate to be given out according to your will, but instead the pension company trustees (people who work for your pension company and take decisions like this) decide where the money should go.

Because of this the person who said your wife might still have a claim does have a point, in theory maybe she does as the trustees could, in theory, give the money to whoever the choose. However in practise the pension trustees will take into account the fact you have been separated for so long when deciding, and much more importantly they will take into account the ‘Death Benefit Nomination Form’ it sounds like you’ve completed. Although they’re not 100% bound by this form there would have to be very strong reasons for them not to follow it (i.e. it was totally out of date and wasn’t aligned to your will at all). In this case it sounds like you’ve done the right thing with the form and so should be covered.

I hope that helps

Mark Sekree

This article was written by Mark Sekree, Partner of 3-S Financial Management, Fellow of the Personal Finance Society and creator of EZ ISA.

The material in any email, the Money to the Masses website, associated pages / channels / accounts and any other correspondence are for general information only and do not constitute investment, tax, legal or other form of advice. You should not rely on this information to make (or refrain from making) any decisions. Always obtain independent, professional advice for your own particular situation. See full Terms & Conditions and Privacy Policy.


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How to choose a good investment fund – 5 key statistics Mon, 14 Apr 2014 07:30:18 +0000 Growing investment

How to choose an investment fund

The standard risk warning that you will see on all financial literature is that ”past performance is not indicative of future returns’. But are there more reliable measures to use when choosing a unit trust or investment trust?.

While there are various fund ratings systems out there which aim to rank a fund manager’s performance they are seldom objective. Yet, there are a number of readily available objective fund statistics ( is one source) which can give you an insight into a manager’s performance as well as the amount of risk they are taking with your savings. Below I list five of the most important and how to use them:

  • Alpha- In simple terms alpha is a figure which measures a manager’s apparent skill at picking the right investment opportunities. So a fund with a positive alpha shows that the manager is obviously doing something right as he’s generating returns ahead of what you would expect, given the returns of the wider market. The higher the alpha figure the better. A positive alpha of 1% means the fund has outperformed its benchmark by 1%. Similarly, a negative alpha of -1% would indicate an underperformance of 1%.
  • Beta – Beta measures a fund’s sensitivity to the general market in which it operates. The market always has a beta of 1 by definition. So if a fund also has a beta of 1 that would mean that if the market rose by 5% then so should the fund. If the fund has a beta of -1 then as the market rises so the fund falls. A well-managed index fund will have a beta of exactly 1. Funds that outperform the market when it does well but do even worse when the market is going down will have a beta above 1.
  • Volatility (standard deviation) – The standard deviation shows how widely a fund’s return varies from its benchmark over a given period. A fund whose annual return hasn’t differed much from its long-term average return will have a low standard deviation and has therefore displayed a lower volatility of returns. If a fund has an average annual return of 10% but a volatility of 15%, this means that the range of returns has varied from -5% to +25%. High volatility obviously could give rise to higher returns but also higher losses. So compare a fund’s volatility to other similar funds within its sector and make sure you are happy with the level of volatility as this is indicative of the level of investment risk you are taking. Also have a look at the fund’s sharpe ratio.
  • Sharpe ratio – The sharpe ratio indicates how much excess return the manager has produced for the increase in volatility, as a result of holding riskier assets. Remember, volatility is not in itself a bad thing as long as the excess risk is rewarded by improved returns. The higher the sharpe ratio the better.
  • R-Squared -gives a measure of how much of a fund’s movements can be attributed to a movement in the fund’s benchmark. A high R- squared figure (0.85-1) would suggest that the fund’s performance patterns have been in line with the fund’s chosen index. A low R- squared (under 0.7) suggests the opposite. R-squared also sheds light on whether the benchmark against which the fund is set against is actually relevant. A low R-squared would suggest the benchmark and therefore the Beta measure, explained above, is irrelevant. But if a fund has a Beta less than 1 and an R-Squared close to 1 this would suggest that it is offering high risk-adjusted returns, which is a good thing. This is because the fund is capturing the returns of the general market (the R-squared bit) but is less sensitive to market movements up or down (the BETA part).
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19 key things to do when searching for your next home Mon, 14 Apr 2014 06:12:53 +0000 checklist

Key things to do when searching for your next home

When starting to look for a new home it can be a daunting task trying to decide which is the right property for you and your family.

Here are some top tips that will make your house hunting go a bit smoother

Start with the property portals

  • Property portals such as Rightmove and Zoopla have made finding the right property a whole lot easier
  • Use the filter facility to focus on the right house type and area narrowing down your search
  • You can normally save searches so that you can for instance have different searches for different areas making the whole process more organised
  • If you have been regularly checking the portals then set the filter to ‘last 7 days’ which will then deliver results showing only houses recently on the market or recently reduced
  • Make use of the property price data held on most property portals as this will give you an idea of the recent sale prices and estimated current property values in the area where you are looking

 Engage with estate agents and start viewing properties

  • Don’t be one of those that loves searching the property portals and estate agency websites but never views any properties, get out viewing and see what you are actually going to get for your money
  • Start talking to estate agents about properties and the area in which you are interested, estate agents will have an extensive knowledge of both the area and properties to help in your search
  • When viewing properties make sure you also check out the area fully and do this at various times of the day and at weekends to get a good feel for whether you would want to live there
  • Read this article for more tips when out viewing – 41 things to check and ask when viewing a property

Keep notes on all properties viewed

  • When viewing a number of properties it can be a bit confusing, so keep notes about what you liked and did not like about each property together with the marketing price
  • Also make notes about any work that may need doing so that you can compare prices of different properties in different states of repair
  • Arrange further viewings, if there are things that you feel you missed first time around, so that you have all the information required to make a sound judgement on each property
  • Make sure you are fully briefed about how long the property has been on the market and the seller’s position i.e. have they found a property, this could help you when negotiating a purchase price

Get your finances in order

  • It’s important when you are seriously looking to buy a property that you start to sort out your finances early on
  • Talk to an independent mortgage adviser about how much you could borrow and the costs involved so you that you can make an offer on a property with the confidence that you can raise the necessary finance
  • When you finally find the right property make sure you research available mortgages fully together with their associated costs before deciding on the right mortgage for you
  • Read this important article about changes in the mortgage market  - New rules for 2014 mean that a third of borrowers won’t be accepted come April

Making an offer

  • Once you have decided on which property or properties you are interested it’s time to make an offer
  • If you have kept notes on each property you will be able to justify any offer by making reference to the work required or the sale price of similar properties in the area
  • When making an offer emphasise you current position, i.e. property sold, mortgage arranged in principle, to support your offer

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Best of the Sunday papers’ PROPERTY sections 13th April 2014 Sun, 13 Apr 2014 07:49:18 +0000 The Independent

Picture gallery: celebrity homes

Hot homes along Jubilee line

The Feeling frontman leads tour of his Hackney pub conversion

The Telegraph

Mango House: a £5,400 home built in six weeks

Gorgeous Georgian properties for sale

Sandbanks locals aren’t enjoying the large party houses

The Sunday Times (subscription)

Are you living in a bubble?

Stand out from the crowd

Rise and shine

The Mail on Sunday

Three smart steps that can ease pain of mortgage fees

Confidence in the housing market hits three year high

Sutton revealed as easiest place to sell a home

The Observer

Let’s move to Downe, Biggin Hill and the London Downs

10 things to consider before rushing into the property market

The House Upside Down – in pictures


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Best of the Sunday papers’ MONEY sections 13th April 2014 Sun, 13 Apr 2014 07:24:05 +0000 The Independent

Overdrafts can be ‘as costly as payday loans’

15 million people are falling behind on bills

Row goes on over deferred student loans

The Telegraph

How cost of retirement income doubled in 40 years

Three routes to ‘Isa millionaire’

Pension ‘freedoms’ denied to savers with work guarantees

The Sunday Times (subscription)

Anger grows over annuity refunds

Time to give your portfolio a spring clean

‘Stealth tax’ parking fines reach £255m

The Mail on Sunday

How to cut your income tax bill by investing

Ten classic cars that have soared in value in the last five years

Five favourite best buy cash Isas for 2014

The Observer

Small energy suppliers offering cheapest deals

Craiglist scam has cost me £450 in holiday money

PayPal shake-up protects buyers of ‘intangibles’

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Remortgage calculator – find out if you should remortgage & how to get the best deal Fri, 11 Apr 2014 05:59:47 +0000 remortgage calculator“Should I fix my mortgage?”, “Is now the best time to remortgage?”, “Do you know of a good remortgage calculator?”- these are among the most common mortgage related questions I’m asked by you guys. So to help you the following article aims to:

  • help you see whether remortgaging is worth considering for you
  • the possible interest rate you might get upon remortgaging
  • tell you the 5 things to check when looking for the best remortgage deal
  • and help you secure the best mortgage deal for you

First step – the rate rise check using the remortgage calculator

At the bottom of this article there is a mortgage calculator. It can be used as a remortgage calculator and help shed some light on the remortgage / fixing conundrum.


First, enter your current mortgage details into the remortgage calculator

  • Mortgage amount – enter the original amount you borrowed into the remortgage calculator (i.e £240,000)
  • Repayment years – enter the original term of your mortgage when you took it out (30 years)
  • Annual Interest – enter the current interest rate you are paying (3%)

 Look at the Monthly Payment section

  • Focus on the option (repayment or interest only) which matches your current deal. If you’ve completed the above step correctly then this should match your current mortgage payments in reality.

What if interest rates rise?

Now you can test to see what your monthly mortgage payments would become when interest rates rise.

  • Look at my article – ‘Latest Interest Rate predictions’ which informs you when the market currently thinks that interest rates will rise and by how much. Try recreating this and other scenarios using the remortgage calculator.

Second Step – Get a feel for the remortgage deals out there for you

  • Go to the following Mortgage comparison tool – it is the only completely unbiased source of mortgage deals I trust.
  • Then tick the options relevant to you – (it will take seconds)
  • You will then be presented with a table of the best remortgage deals sorted by the total payable over the term of the mortgage.
  • Now alter the repayment term if you see fit and note the impact on the repayments.
  • Note down the details of a number of the deals (with varying fixed term periods) paying attention to the rate it reverts to after the initial fixed period ends as well as fees.

Third step – Test a rate rise scenario on the remortgage deals

Scroll down to the remortgage calculator again below and:

  • Enter the Mortgage amount – now use the actual amount you have remaining on your mortgage (i.e. £205,000)
  • Repayment years – enter the remaining term of your mortgage or the different term you explored in the second step above (the longer the term the lower your monthly repayment but ultimately the more interest you will pay in total).
  • Now test the impact of a rate rise once the fixed period comes to an end. Yes you could remortgage again at that point but there is no guarantee of the rate you will receive. When testing the rate be sure to enter the rate your potential remortgage deal will revert into the “Annual interest rate” box below

 Fourth Step – 5 things to check when looking for the best remortgage deal


1. Make sure you check the small print on your current deal

It’s no good arranging a remortgage if it will cost you money to get out of your current deal. Many deals have exit penalties that continue long after the fixed or discounted period, so check your paperwork or ring your lender to make sure you avoid any charges.

2. Check all the fees

There will be fees payable when you remortgage – booking fee, arrangement fee, survey fee and legal costs. Make sure you get a complete picture of these costs so that you can make the proper judgment on whether a particular deal is best for you .

3. Make sure you know what will happen after the deal period expires

You will probably be attracted by a special offer, either a discounted or fixed deal, that will save you money. However, make sure you check what happens when this introductory deal finishes as things may change dramatically. All lenders will provide you details on how the interest rate will be calculated after the special offer ends and make sure that this will still be affordable.

4. Check whether you can make overpayments

There may be times in the future when you want to pay a lump sum off your mortgage to help reduce the term. You need to check your proposed new mortgage deal to make sure overpayment is allowed and if so whether there is any annual limit.

5. Is your mortgage portable?

What happens if you want to move house in the next few years and can you move your mortgage deal on to a new property? Some lenders do not permit this type of transfer or if they do they will charge a fee for the service.

Fifth Step – Secure the best deal for you

Now you should have a feel for your remortgage options and whether it seems worth exploring further. The key things to remember are that when researching the remortgage deals out there they are only indicative. It doesn’t take into account:

  • Your full circumstances
  • Your credit history
  • Your earnings
  • Affordability measures & other underwriting from a new lender
  • Your existing deal

To sum up, just because a lender may quote for a mortgage does not mean that they will actually lend to you!

So I suggest that you now seek the help of a independent qualified mortgage adviser who can not only recommend the best deal based on your circumstances but also knows the underwriting process of each mortgage lender inside and out – and therefore the one most likely to offer you the best deal.

If you don’t know a mortgage adviser whose opinion you trust, then an award winning mortgage adviser and contributor to MoneytotheMasses, is happy to help with a FREE no obligation chat, just click here.

Remortgage calculator


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First-time buyer quiz – Test yourself Wed, 09 Apr 2014 05:35:05 +0000 mortgage quizIf you are looking to get on the property ladder it can feel like a bit of a minefield. So in partnership with the Money Advice Service we bring you a fun quiz to test your knowledge of the house buying process and your mortgage options. So have a go and see how clued up you are.

How to get the best first-time buyer mortgage for you

If you are considering getting on the housing ladder then make sure you speak to an independent mortgage adviser who can source the best deal for you based on your personal circumstances.

If you don’t know a mortgage adviser whose opinion you trust, then an award winning mortgage adviser and contributor to MoneytotheMasses, is happy to help with a FREE no obligation chat, just click here.

First-time buyer quiz

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New bailiff laws to crackdown on aggressive tactics Tue, 08 Apr 2014 08:10:43 +0000 New bailiff lawsNew bailiff laws will crackdown on aggressive tactics

New sweeping changes to the way bailiffs can enforce debt repayments came into force on 6th April 2014 in England & Wales.

Why have the new bailiff laws been implemented?

  • The current laws relating to bailiffs are unclear and confusing
  • The confusion can result in bailiffs and enforcement officers misrepresenting their legal authority
  • There is also anecdotal evidence of bailiffs using excessive force to recover goods
  • Regulation of bailiffs is fragmented with some elements of the industry being tightly regulated while others are informally regulated through trade associations
  • There are currently no training standards

What is being implemented in the new bailiff laws?

  • Landlords will be banned from using bailiffs to seize property for residential rent debts without applying to a court first
  • Mandatory training and certification for bailiffs will be implemented
  • Ensure that vulnerable people are treated differently and given assistance
  • Introduction of clearer rules detailing when a bailiff can enter a property and what goods they can take
  • Restrictions will be applied on when bailiffs can sell goods
  • The new bailiff laws will require bailiffs to inform the court on the likely means of entry, the amount of force required before a warrant will be granted for forced entry
  • Require bailiffs to give seven days notice before taking possessions, unless they have specific permission from a court
  • Introduce fixed fees to end the ability for bailiffs to add excessive charges to the amount debtors have to pay
  • Stop bailiffs entering homes where only children are present
  • Bailiffs will only be able to attend premises between the hours of 6am and 9pm


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Best Savings Accounts Mon, 07 Apr 2014 09:30:21 +0000 best savings accountsThe table below is a roundup of the current best savings account rates available at the moment.

Finding the best savings account

Before you scroll down to the best savings account table here’s a checklist to find the right account for you:

1. Interest rate – many accounts offer a high initial rate but this reduces after a period of time, typically 6 months or 1 year, often referred to as a ‘teaser rate’. The initial higher interest  rate may look a good deal but you need to make sure that the base interest rate (after the offer period ends) remains competitive. Also watch out for tiered interest rates where the bank vary the amount of interest they pay based on how much is in your account. Some sneaky institutions will even reduce your interest rate if you go above a certain amount.

2. Fixed rate or variable  - some savings accounts offer a fixed interest rate for a period of time others offer rates that are variable and could be changed at any time. Fixed rate accounts normally require you to tie up your money for a period of time, the longer the time period the higher the rate. If you need to get access to your money in this ‘tie-in’ period then a penalty will be applied normally a reduction or loss of  the interest already earned.

3. Minimum and maximum investment limits – all savings accounts will have a minimum and maximum investment amount. Most accounts can be opened for a little as £1 but accounts offering the best rates often have a minimum amount of £5,000 or even £10,000.

4. Access to your savings - not all savings accounts provide instant access to your money and you may need to give 60 days or even 120 days notice prior to making a withdrawal. Although some accounts appear to be instant access you may be limited to a certain number of withdrawals in a year, so read all the terms & conditions carefully. In some instances, if you fall foul of the terms and conditions you could actually get back less money than you originally put in.

5. Managing your account - once your savings account is open you will need to keep an eye on your cash and maybe withdraw money or add to your savings from time to time. Most savings accounts offer a variety of ways to manage your money – online, branch, telephone – but some offer an ‘in branch’ only  service which can be very inconvenient. Check that you are happy with how you can manage the account.

6. Protection - one of the main reasons for putting your cash in a savings account, rather than investing in the stock market, is security. Check whether the deposits with the bank or building society in question are covered under the Financial Services Compensation Scheme (FSCS). If they are then 100% of the first £85,000 you have in a savings account (£170,000 on a jointly held account) is protected. I highlight the FSCS cover in the table below.

7. Compatibility with your other accounts – You need to be aware that the aforementioned FSCS limit is per banking licence and many banking brands share the same licence. Check here before opening an account to see which brands shares licences and make sure that all your savings, if over £85,000 in total, are protected.

Best Savings Accounts


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