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Wednesday, June 25, 2008
Dope, Dollars & Deficits
DO DEFICITS MATTER? Right around the time that English missionaries produced the first Bible in Chinese, the British Empire found... ... itself with a trickier kind of translation problem.Exporting the English language to China – and a little Protestant godliness besides – was proving much easier than exporting British-made goods.Imports from abroad, in contrast, just kept on growing as the industrial revolution steamed ahead at home, sucking in the new consumer favorites – tobacco, sugar, coffee, calicoes, porcelain and silk.By the early 19th century, of course, Britain owned the plantations of the West Indies and the factories of Bengal. So those deficits didn't even exist, let alone matter. But "the British were spectacularly unsuccessful in finding trade goods that the Chinese wanted or needed," as Jonathan Spence, professor of history at Yale, noted in his Reith Lectures for the BBC earlier this week. Thus "there was the problem of trade imbalances." And stuck for consumer items to ship back across the oceans, London's merchants were forced to pay in cash.For the British, money meant gold, just as it did until the last gasp of the Gold Standard one hundred years later. But the Chinese wanted silver.(They never did get round to using gold, in fact. And while Britain recovered early from the Great Depression by abandoning gold for credit-money in 1931, one theory holds that China side-stepped it entirely by sticking to its silver standard...)Translating English pounds into Chinese yuan in the 1830s meant selling gold for silver, and that meant dealing on Europe's precious metals market. Paying a commission to the bullion dealers of Paris or Prussia – as well as shipping it all back and forth – only added further to the transaction costs of running up that yawning trade gap.What to do? A little of the British Empire's raw cotton found a market in China, but it wasn't nearly enough to close the trade gap. Gold bullion continued to flow out of London, aggravating the "bullionist" school of economists and policy-makers. They feared a shortage of coin in the domestic British economy, plus a fall in the Pound Sterling's international value...as well as giving work to foreign laborers, and paying profits to their foreign masters...while leaving the London exchequer impoverished should it ever need to fund a military defense of the home front.And so "it was this melancholy failure of the balance of trade that led to the under girding of the opium business in China," explains Prof. Spence. Opium grown in India "started to be sold to the Chinese by British traders, and later by American traders, because the West simply could not find enough products to attract the Chinese in a sort of barter exchange at the time."Widespread dope-smoking and the social breakdown it can invite rarely chimes with government policy – not domestically, at least. Opium had long been banned by imperial decree from Nanjing. But after ten years of trying to fend off Britain's drug dealers without damaging the inflows of silver, the Qin authorities finally cracked and made a stand, seizing 20,000 chests of the drug – some 1,200 tonnes – landed in Guangzhou.London responded first with a gun-boat, and then the all-out Opium War of 1839. It ended three years later with the Treaty of Nanjing. Britain's military might won the island of Hong Kong, plus reduced trade tariffs, freedom from Chinese law for its ex-pats, as well as "most-favored nation" status.
Saturday, June 21, 2008
Advantages of Forex
Although the Forex market is by far the largest and most
liquid in the world, day traders have up to now focused
on seeking profits in mainly stock and futures markets.
This is mainly due to the restrictive nature of
bank-offered Forex trading services.
Unlike others, NorthFinance offers both online and
traditional phone Forex trading services to all
investors, with minimum account opening values starting
at 100 USD.
There are many advantages to trading spot Forex as
opposed to trading stocks and futures.
In the peoples mind there is this opinion that brokerage
firms and analysis’s can change the flow of the
currency. But in reality, FOREX is an independent
international foreign exchange market which can be
influenced by many factors but NOT by the wants(wills)
of traders and brokerage firms.
Because of its diversity you are able to trade FOREX 5
days a week, 24 hours a day. US, Europe and Asia the
major trading sessions enable you to trade on your own
schedule and make a quick respond to breaking news from
all continents of the world no matter where you are
located.
Complied benefits from both high leverage and potential
profits from both rising and falling market, Forex is
very interesting for speculators from every point of
view.
For example, with $10,000 cash in a standard account
that allows 1:100 leverage (1%), you can control up to
$1,000,000 in notional value.
NorthFinance charges NO commissions or fees, simply take
all your profits with you. Commission-free trading is
one of the most attractive features of NF. The dealing
spreads are as low as 2 pips(for EUR/USD). Providing a
more comfortable environment when trading. Versatility
all around
The overall volume of FOREX market is $2 trillion.
Almost all the amount of the volume involves trading of
the major currency pairs, NorthFinance clients enjoy
tight spreads on these pairs.
NorthFinance clients have the ability to trade in both
directions, compared to other equity markets where it is
more difficult to make certain trades. This gives an
advantage to all our clients.
It is simple to open an account, you can do it on-line
within 10 minutes. With multiple means of
funding/withdrawing you can start trading within one
hour. Access your trading account from anywhere in the
world. Our company serves clients, from over 150
countries and with a large network of world wide located
offices and representatives it makes contact us easy.
Trader Y opened an account of USD 50'000.
He buys EUR/USD 500'000 @ 1.3500 at the market and
places a stop loss order at 1.3460.
This point shows that his maximum risk is USD 2'000 and
his margin utilization is 10%, well above the minimum.
During the trading day the Forex market fluctuates and
initially moves down to 1.3480.
At this point trader Y has an unrealized loss of USD
1'000 and his margin utilization has fallen to 98%
reflecting the effect of the downward move on his margin
capacity.
Later the price moves back up to 1.3600 and trader Y
decides to take profit.
He sells at 1.3600 making a USD 5'000 profit which
represents a 10% return on his account value.
Note that trader Y took only a risk of USD 2'000 and
made a return of USD 5'000 this equates to a risk/reward
ratio of 2.5. A high risk reward ratio is what every
trader should be aiming for.
Please note that the example above is arandom case and
in no way is meant to illustrate that the potential for
profit is always greater than the potential for loss in
foreign exchange trading.
liquid in the world, day traders have up to now focused
on seeking profits in mainly stock and futures markets.
This is mainly due to the restrictive nature of
bank-offered Forex trading services.
Unlike others, NorthFinance offers both online and
traditional phone Forex trading services to all
investors, with minimum account opening values starting
at 100 USD.
There are many advantages to trading spot Forex as
opposed to trading stocks and futures.
In the peoples mind there is this opinion that brokerage
firms and analysis’s can change the flow of the
currency. But in reality, FOREX is an independent
international foreign exchange market which can be
influenced by many factors but NOT by the wants(wills)
of traders and brokerage firms.
Because of its diversity you are able to trade FOREX 5
days a week, 24 hours a day. US, Europe and Asia the
major trading sessions enable you to trade on your own
schedule and make a quick respond to breaking news from
all continents of the world no matter where you are
located.
Complied benefits from both high leverage and potential
profits from both rising and falling market, Forex is
very interesting for speculators from every point of
view.
For example, with $10,000 cash in a standard account
that allows 1:100 leverage (1%), you can control up to
$1,000,000 in notional value.
NorthFinance charges NO commissions or fees, simply take
all your profits with you. Commission-free trading is
one of the most attractive features of NF. The dealing
spreads are as low as 2 pips(for EUR/USD). Providing a
more comfortable environment when trading. Versatility
all around
The overall volume of FOREX market is $2 trillion.
Almost all the amount of the volume involves trading of
the major currency pairs, NorthFinance clients enjoy
tight spreads on these pairs.
NorthFinance clients have the ability to trade in both
directions, compared to other equity markets where it is
more difficult to make certain trades. This gives an
advantage to all our clients.
It is simple to open an account, you can do it on-line
within 10 minutes. With multiple means of
funding/withdrawing you can start trading within one
hour. Access your trading account from anywhere in the
world. Our company serves clients, from over 150
countries and with a large network of world wide located
offices and representatives it makes contact us easy.
Trader Y opened an account of USD 50'000.
He buys EUR/USD 500'000 @ 1.3500 at the market and
places a stop loss order at 1.3460.
This point shows that his maximum risk is USD 2'000 and
his margin utilization is 10%, well above the minimum.
During the trading day the Forex market fluctuates and
initially moves down to 1.3480.
At this point trader Y has an unrealized loss of USD
1'000 and his margin utilization has fallen to 98%
reflecting the effect of the downward move on his margin
capacity.
Later the price moves back up to 1.3600 and trader Y
decides to take profit.
He sells at 1.3600 making a USD 5'000 profit which
represents a 10% return on his account value.
Note that trader Y took only a risk of USD 2'000 and
made a return of USD 5'000 this equates to a risk/reward
ratio of 2.5. A high risk reward ratio is what every
trader should be aiming for.
Please note that the example above is arandom case and
in no way is meant to illustrate that the potential for
profit is always greater than the potential for loss in
foreign exchange trading.
Why Trade Forex
Take control of your own finances.Beat the returns from mutual funds, hedge funds or managed funds.
Start-up costs are low when compared with day trading stocks or futures.
Forex is the world’s largest market. No one can corner the market.
With a trading volume of around $1.9 trillion dollars a day, no single entity can control the market for an extended period of time.
You can make money when the market is going up or down.
Forex markets trade 24hours a day. There is no waiting for the opening bell.
Technical analysis works very well and the market trends well.
Forex offers up to 100:1 leverage but it is wise avoid very high leverage if you can afford it. Stocks offer 1:1 or 2:1.Futures offers 15:1 leverage
The forex market is the most liquid in the world. Traders can almost always open or close a position at a fair price.
You can make big money working only a few hours a day or week on your computer.
You can trade from anywhere in the world where there is an internet connection.
You can gain experience without risking your own money by using a free demo account.
When trading stocks, there are over 40,000 stocks to choose from. In forex, you can choose one or two currency pairs and focus your analysis.
Start-up costs are low when compared with day trading stocks or futures.
Forex is the world’s largest market. No one can corner the market.
With a trading volume of around $1.9 trillion dollars a day, no single entity can control the market for an extended period of time.
You can make money when the market is going up or down.
Forex markets trade 24hours a day. There is no waiting for the opening bell.
Technical analysis works very well and the market trends well.
Forex offers up to 100:1 leverage but it is wise avoid very high leverage if you can afford it. Stocks offer 1:1 or 2:1.Futures offers 15:1 leverage
The forex market is the most liquid in the world. Traders can almost always open or close a position at a fair price.
You can make big money working only a few hours a day or week on your computer.
You can trade from anywhere in the world where there is an internet connection.
You can gain experience without risking your own money by using a free demo account.
When trading stocks, there are over 40,000 stocks to choose from. In forex, you can choose one or two currency pairs and focus your analysis.
Forex for Beginners
Forex is an international market that buys and sells currencies of the world; the mechanisms of the marketplace are very similar to that of other markets such as the stock market. The purpose is to buy low and sell high to maximize profits. There are various Forex strategy and Forex options to utilize, some investors find researching past trends and fluctuations helpful. By reading trends appreciating and depreciating patterns can be recognized. There are steps new trades can take in order to ensure their introduction to the marketplace is straightforward as well as rewarding. On joining this global trading arena it is necessary to maintain constant analysis while recognizing the value of time. There are numerous Forex strategy and Forex options to choose from, being familiar with these working makes Forex for beginners comprehensible.
Wednesday, June 4, 2008
10 Tips for Online Forex Traders
Without a doubt, trading is more than a few quick tips for success. You need experience, fortitude, capital and, above all, a solid trading system. However, for beginners and those who are perhaps losing their focus amid significant drawdowns, keeping things simple can introduce much-needed focus into your trading. To that end, here are 10 tips for trading e-forex that can help you get a handle on these exciting markets.
For small accounts especially ($25,000 and under), trade with the trend. Many beginners look for trades in any direction. While forex trading easily permits bi-directional trading, trading in the direction of the trend improves your odds over the long run.
Have two accounts. One real account and the other a demo account. Learning doesn't stop when trading real dollars begins. Keep the demo account and use it to test alternative trades, alternative stops, etc. For example, you can shadow your real trades with identical ones in your demo account, but widen your stops in the demo in an effort to see if you're being too conservative.
Stop looking for leading indicators. There aren't any. While some firms make a lot of money selling software that predicts the future, the reality is that if those products really worked, they wouldn't be giving the secret away.
Examine daily charts, four-hour charts and one-hour charts to time your trades. While trading at 30- and 15-minute time increments is doable, it takes a great deal of dexterity.
Don't trade the time frame. Trade the pattern. Reversal patterns, hesitation patterns and breakout patterns appear often. Learn to look for the pattern in any time frame.
If you're properly funded, trading two lots is safer than trading one. Trading three lots is safer than two. Trading is a synthesis of emotions, technical analysis and money management. One lot makes it difficult to weigh these elements in deciding to enter or exit. Two lots is easier and, providing you have the capital, three lots is optimal.
Extreme trading can be the most conservative trading. Trading at the extremes ? when prices touch or break or bounce off trend, support or resistance lines ? increases the odds that you have chosen the correct direction.
Scan the Big Five - the dollar/yen, euro/dollar, Swiss franc/dollar, euro/yen and pound/dollar ? before you decide to take a position in any one of them. There might be something obvious you're missing.
Follow the Upside Down Rule. If you can turn a chart upside down and it looks the same, stay away.
Don't count profits in your first 20 trades. Keep track of the percentage of wins. Once you know you can pick direction, profits can be increased with multi-plot trading and variations in using your stops. In other words, now is the time to get serious about money management.
For small accounts especially ($25,000 and under), trade with the trend. Many beginners look for trades in any direction. While forex trading easily permits bi-directional trading, trading in the direction of the trend improves your odds over the long run.
Have two accounts. One real account and the other a demo account. Learning doesn't stop when trading real dollars begins. Keep the demo account and use it to test alternative trades, alternative stops, etc. For example, you can shadow your real trades with identical ones in your demo account, but widen your stops in the demo in an effort to see if you're being too conservative.
Stop looking for leading indicators. There aren't any. While some firms make a lot of money selling software that predicts the future, the reality is that if those products really worked, they wouldn't be giving the secret away.
Examine daily charts, four-hour charts and one-hour charts to time your trades. While trading at 30- and 15-minute time increments is doable, it takes a great deal of dexterity.
Don't trade the time frame. Trade the pattern. Reversal patterns, hesitation patterns and breakout patterns appear often. Learn to look for the pattern in any time frame.
If you're properly funded, trading two lots is safer than trading one. Trading three lots is safer than two. Trading is a synthesis of emotions, technical analysis and money management. One lot makes it difficult to weigh these elements in deciding to enter or exit. Two lots is easier and, providing you have the capital, three lots is optimal.
Extreme trading can be the most conservative trading. Trading at the extremes ? when prices touch or break or bounce off trend, support or resistance lines ? increases the odds that you have chosen the correct direction.
Scan the Big Five - the dollar/yen, euro/dollar, Swiss franc/dollar, euro/yen and pound/dollar ? before you decide to take a position in any one of them. There might be something obvious you're missing.
Follow the Upside Down Rule. If you can turn a chart upside down and it looks the same, stay away.
Don't count profits in your first 20 trades. Keep track of the percentage of wins. Once you know you can pick direction, profits can be increased with multi-plot trading and variations in using your stops. In other words, now is the time to get serious about money management.
Introduction to Foreign Exchange Markets
The forex market is a non-stop cash market where currencies of nations are traded, typically via brokers. Foreign currencies are constantly and simultaneously bought and sold across local and global markets, hence investments appreciate or depreciate in value based upon currency movements. Foreign exchange market conditions can change at any time in response to real-time events. The main enticements of currency dealing to private investors and attractions for short-term forex trading are:
24-hour trading, 5 days a week with access to global forex dealers
An enormous liquid market making it easy to trade most currencies
Volatile markets offering profit opportunities
Standard instruments for controlling risk exposure
The ability to profit in rising or falling markets
Leveraged trading with low margin requirements
Many options for zero commission trading Forex trading The investor's goal in forex trading is to profit from foreign currency movements. Forex trading is always done in currency pairs. When trading currencies, trade only when you expect the currency you are buying to increase in value relative to the currency you are selling. If the currency you are buying does increase in value, you must sell back the other currency in order to lock in a profit. An open trade (also called an open position) is a trade in which a trader has bought or sold a particular currency pair and has not yet sold or bought back the equivalent amount to close the position. Private investors can trade in forex directly or indirectly through:
The spot market
Forwards and futures
Options
Contracts for difference
Spread betting It is estimated that anywhere from 70% to 90% of the forex market is speculative. In other words, the person or institution that bought or sold the currency has no plan to actually take delivery of the currency in the end; rather, they were solely speculating on the movement of that particular currency. Exchange rate Currencies are traded in pairs and exchanged one against the other when traded, so the rate at which they are exchanged is called the exchange rate. The majority of the currencies are traded against the US dollar (USD). The four next-most traded currencies are the euro (EUR), the Japanese yen (JPY), the British pound sterling (GBP) and the Swiss franc (CHF). These five currencies make up the majority of the market and are called the major currencies or "the majors". Some sources also include the Australian dollar (AUD) within the group of major currencies. Margin Banks and/or online trading providers need collateral to ensure that the investor can pay in case of a loss. The collateral is called the margin and is also known as minimum security in forex markets. In practice, it is a deposit to the trader's account that is intended to cover any currency trading losses in the future. Margin enables private investors to trade in markets that have high minimum units of trading by allowing traders to hold a much larger position than their account value. Leveraged financing Leveraged financing is the use of credit, such as a trade purchased on a margin. It is very common in forex trading, and results in being able to control $100,000 for as little as $1,000. Risks Although Forex trading can lead to very profitable results, there are risks involved: exchange rate risks, interest rate risks, credit risks, and country risks. Approximately 80% of all currency transactions last a period of seven days or less, while more than 40% last fewer than two days. Given the extremely short lifespan of the typical trade, technical indicators heavily influence entry, exit and order placement decisions.
24-hour trading, 5 days a week with access to global forex dealers
An enormous liquid market making it easy to trade most currencies
Volatile markets offering profit opportunities
Standard instruments for controlling risk exposure
The ability to profit in rising or falling markets
Leveraged trading with low margin requirements
Many options for zero commission trading Forex trading The investor's goal in forex trading is to profit from foreign currency movements. Forex trading is always done in currency pairs. When trading currencies, trade only when you expect the currency you are buying to increase in value relative to the currency you are selling. If the currency you are buying does increase in value, you must sell back the other currency in order to lock in a profit. An open trade (also called an open position) is a trade in which a trader has bought or sold a particular currency pair and has not yet sold or bought back the equivalent amount to close the position. Private investors can trade in forex directly or indirectly through:
The spot market
Forwards and futures
Options
Contracts for difference
Spread betting It is estimated that anywhere from 70% to 90% of the forex market is speculative. In other words, the person or institution that bought or sold the currency has no plan to actually take delivery of the currency in the end; rather, they were solely speculating on the movement of that particular currency. Exchange rate Currencies are traded in pairs and exchanged one against the other when traded, so the rate at which they are exchanged is called the exchange rate. The majority of the currencies are traded against the US dollar (USD). The four next-most traded currencies are the euro (EUR), the Japanese yen (JPY), the British pound sterling (GBP) and the Swiss franc (CHF). These five currencies make up the majority of the market and are called the major currencies or "the majors". Some sources also include the Australian dollar (AUD) within the group of major currencies. Margin Banks and/or online trading providers need collateral to ensure that the investor can pay in case of a loss. The collateral is called the margin and is also known as minimum security in forex markets. In practice, it is a deposit to the trader's account that is intended to cover any currency trading losses in the future. Margin enables private investors to trade in markets that have high minimum units of trading by allowing traders to hold a much larger position than their account value. Leveraged financing Leveraged financing is the use of credit, such as a trade purchased on a margin. It is very common in forex trading, and results in being able to control $100,000 for as little as $1,000. Risks Although Forex trading can lead to very profitable results, there are risks involved: exchange rate risks, interest rate risks, credit risks, and country risks. Approximately 80% of all currency transactions last a period of seven days or less, while more than 40% last fewer than two days. Given the extremely short lifespan of the typical trade, technical indicators heavily influence entry, exit and order placement decisions.
Forex Articles
Forex articles about issues such as New York Stock Market and 1987 Stock Market Crash.
New York Stock Market
New York Stock Market (NYSE) is the largest stock exchange in the world by dollar volume.
New York Stock Market
1987 Stock Market Crash
1987 stock market crash happened on "Black Monday", October 19, 1987, when Dow Jones Industrial Average (DJIA) dropped by 508 points to 1739 (22.6%).
1987 Stock Market Crash
German Stock Market
German stock market has, alltogether, ten stock exchanges.
German Stock Market
Brazil Stock Market
Brazil stock market is centered around Sao Paulo Stock Exchange, the country's and Latin America's largest stock exchange.
Brazil Stock Market
Stock Market Results
One of the easiest tools to analyze stock market results is the Google Finance portal.
Stock Market Results
Currency Exchange Rate History
Currency exchange rate history resources include online forex databases and central bank websites.
Currency Exchange Rate History
Mazo Currency Exchange
There are currently no Mazo currency exchange locations available, and your better bet is to go to change currency at either Los Llanos de Aridane or Santa Cruz de la Palma.
Mazo Currency Exchange
Property Investment New Zealand
Property investment New Zealand has been increasing due to political stability, great weather, and good living standards pulling investment money and people to the area.
Property Investment New Zealand
New York Stock Market
New York Stock Market (NYSE) is the largest stock exchange in the world by dollar volume.
New York Stock Market
1987 Stock Market Crash
1987 stock market crash happened on "Black Monday", October 19, 1987, when Dow Jones Industrial Average (DJIA) dropped by 508 points to 1739 (22.6%).
1987 Stock Market Crash
German Stock Market
German stock market has, alltogether, ten stock exchanges.
German Stock Market
Brazil Stock Market
Brazil stock market is centered around Sao Paulo Stock Exchange, the country's and Latin America's largest stock exchange.
Brazil Stock Market
Stock Market Results
One of the easiest tools to analyze stock market results is the Google Finance portal.
Stock Market Results
Currency Exchange Rate History
Currency exchange rate history resources include online forex databases and central bank websites.
Currency Exchange Rate History
Mazo Currency Exchange
There are currently no Mazo currency exchange locations available, and your better bet is to go to change currency at either Los Llanos de Aridane or Santa Cruz de la Palma.
Mazo Currency Exchange
Property Investment New Zealand
Property investment New Zealand has been increasing due to political stability, great weather, and good living standards pulling investment money and people to the area.
Property Investment New Zealand
Euro Currency Exchange
Euro currency exchange rates can be found from resources such as Marketwatch for live rates, and ECB for historical rates.
Marketwatch - Euro Live Rateswww.marketwatch.com/tools/stockresearch/globalmarkets/
The Marketwatch live ticker is one of the best live tickers for EUR/USD rate and many other rates against the US dollar.
You can also see the historical progression of the rate against the US dollar at
marketwatch.com/tools/quotes/intchart.asp?symb=C_EUR&sid=127354
The live rates for Marketwatch are in fact produced by Global Forex Trading (www.gftforex.com), which is an online forex trading house.
European Central Bank - Historical EUR rateswww.ecb.int/stats/exchange/eurofxref/html/index.en.html
European Central Bank (ECB) is the central banking unit for the whole of European Union. It also acts as a data storekeeper for official rates of EUR against other currencies.
These historical rates can be accessed from the ECB website. There are also interactive charts to see how the currency has changed in value against a range of other currencies in the world.
Marketwatch - Euro Live Rateswww.marketwatch.com/tools/stockresearch/globalmarkets/
The Marketwatch live ticker is one of the best live tickers for EUR/USD rate and many other rates against the US dollar.
You can also see the historical progression of the rate against the US dollar at
marketwatch.com/tools/quotes/intchart.asp?symb=C_EUR&sid=127354
The live rates for Marketwatch are in fact produced by Global Forex Trading (www.gftforex.com), which is an online forex trading house.
European Central Bank - Historical EUR rateswww.ecb.int/stats/exchange/eurofxref/html/index.en.html
European Central Bank (ECB) is the central banking unit for the whole of European Union. It also acts as a data storekeeper for official rates of EUR against other currencies.
These historical rates can be accessed from the ECB website. There are also interactive charts to see how the currency has changed in value against a range of other currencies in the world.
Stock Market Timing System
Stock market timing system providers include TimingCube, StockMarketTiming.com, and EminiForecaster.
TimingCubewww.timingcube.com
According to the company who makes this system, their investment system combines trend following techniques to time market movements with momentum rankings to target the strongest U.S. and international markets.
They rely on a Trend Timing Model to detect major trend changes in the broad market and to issue Buy and Sell signals, on average three to five times per year.
In addition, their World Index Ranking points out the best markets and diversified index funds to be invested in, in 100% mechanical way.
StockMarketTiming.com
According to this website, their system combines mathematical models of technical analysis and a proprietary methodology to produce results that aim to beat the buy-and-hold strategy of investing.
Their system produces, on a yearly basis, about 20 to 25 signals (i.e., buy long, sell short, or hold cash) for each ETF (DIA, SPY, and QQQQ).
EminiForecasterwww.eminiforecaster.com
This company has a method of forecasting that calculates different cycles in the market and their computers use them to forecast the following week. These forecasts are best suited for swing trading and even daytrading.
TimingCubewww.timingcube.com
According to the company who makes this system, their investment system combines trend following techniques to time market movements with momentum rankings to target the strongest U.S. and international markets.
They rely on a Trend Timing Model to detect major trend changes in the broad market and to issue Buy and Sell signals, on average three to five times per year.
In addition, their World Index Ranking points out the best markets and diversified index funds to be invested in, in 100% mechanical way.
StockMarketTiming.com
According to this website, their system combines mathematical models of technical analysis and a proprietary methodology to produce results that aim to beat the buy-and-hold strategy of investing.
Their system produces, on a yearly basis, about 20 to 25 signals (i.e., buy long, sell short, or hold cash) for each ETF (DIA, SPY, and QQQQ).
EminiForecasterwww.eminiforecaster.com
This company has a method of forecasting that calculates different cycles in the market and their computers use them to forecast the following week. These forecasts are best suited for swing trading and even daytrading.
Forex Trading Systems and Solutions
Once you’ve covered the basics of foreign exchange operations, you might also want to know the ways currency trading is done, through brokerages, forex trading systems, and with different currency trading systems.
The tools and services you’ll need for you own forex trading or operations will depend on your particular approach to forex.
In fact, many corporations do not want to take any risks with forex fluctuations and will hedge their positions. Others, traders and speculators, seek to profit from the fluctuation with their systems and views.
From this site, you’ll find information on resources that will help you understand better the complex world of investments for forex markets and currency trading.
The tools and services you’ll need for you own forex trading or operations will depend on your particular approach to forex.
In fact, many corporations do not want to take any risks with forex fluctuations and will hedge their positions. Others, traders and speculators, seek to profit from the fluctuation with their systems and views.
From this site, you’ll find information on resources that will help you understand better the complex world of investments for forex markets and currency trading.
Ways to Learn About Forex Markets
There are many ways you can learn about forex markets. If you’re a business student, many universities have classes in foreign exchange operations and macroeconomic mechanisms that affect currency fluctuations.
Outside of the formal education field, you can learn about forex and currency trading from traders, salespeople, and analysts. Moreover, you can learn foreign exchange operations from educators through specifically arranged seminars, courses, and mentoring.
And don’t leave out forex magazines and books for background information and latest news to keep you ahead of the curve.
Outside of the formal education field, you can learn about forex and currency trading from traders, salespeople, and analysts. Moreover, you can learn foreign exchange operations from educators through specifically arranged seminars, courses, and mentoring.
And don’t leave out forex magazines and books for background information and latest news to keep you ahead of the curve.
Forex ?
Forex market is the biggest financial market in the world. Moreover, currency trading is one of the fastest growing forms of investing.
Here’s how to find information and resources to deepen your knowledge about the fast and exciting world of foreign exchange and how to use it for trading purposes.
Internet has changed the way people view forex markets. No longer are the best currency analyst reports unavailable to the public, live real-time data too expensive for common investors, or capital requirements too high.
In fact, many companies have introduced mini forex accounts, with starting capital requirements for selected accounts in some brokerages under $1000. These smaller accounts have made currency trading available to everyone, increasing the need to be educated on forex and currency trading.
Here’s how to find information and resources to deepen your knowledge about the fast and exciting world of foreign exchange and how to use it for trading purposes.
Internet has changed the way people view forex markets. No longer are the best currency analyst reports unavailable to the public, live real-time data too expensive for common investors, or capital requirements too high.
In fact, many companies have introduced mini forex accounts, with starting capital requirements for selected accounts in some brokerages under $1000. These smaller accounts have made currency trading available to everyone, increasing the need to be educated on forex and currency trading.
Travel Insurance
It's surprising how few people take out travel insurance, or pay attention to what is covered by their travel insurance policy. Given the cost of travelling, hotels and tours and the likelihood that you will be delayed or injured or have belongings or important documents stolen or lost, a good travel insurance policy is an easy way to minimise the disruption and distress caused by such events. Anyone who has ever had an airline lose their suitcase was probably shocked to learn the paltry amounts the airlines are, by law, obliged to reimburse travellers for their lost goods. Similarly, air or rail delays may mean you miss an important connection, and even if the delay was no fault of your own you may still find yourself paying for a whole new ticket. If the worst happened and you were to fall ill or be injured, medical costs in foreign countries - the United States is one example - could be crippling without insurance to cover medical expenses and repatriation. Travel insurance policies come in many term lengths, ranging from the specific length of your trip, to one-month coverage for an extended holiday, to several months' coverage for travellers such as backpackers, all the way up to annual coverage for the most frequent travellers. Different policies will cover varying amounts of loss and expense and have different exceptions and deductibles. Not all travel insurance policies are appropriate for all forms of travel, however. An annual policy may be too much coverage for a couple going to the Costa del Sol for two weeks each year; similarly, a cheap policy from an online travel agent may not cover longer periods of travel or certain activities, such as skiing or scuba diving. There are many types of travel insurance policy and many travel insurance providers, but only Moneynet.co.uk can direct you to the best travel insurance deals around. As a financial data comparison site, Moneynet.co.uk helps you sort through the deals to find the package that best suits your travel needs.
What should your travel insurance cover?Probably the most important coverage you need to arrange is for medical expenses. However, countries in the European Economic Area - which includes EC countries as well as Norway, Liechtenstein and Iceland - provide reciprocal health services. You need to take a completed E111 form (available at the Post Office) with you when you travel. The E111 does not, however, provide repatriation coverage. Travellers should check the Department of Health website (http://www.doh.gov.uk/) for more details, as during 2005 the UK will be adopting the European Health Insurance Card (EHIC) in place of the E111 form. Some other countries have different forms of reciprocal health services, but you will need to check with the DoH before travelling to establish what medical services you will be entitled to under the agreement. If in doubt, travellers are advised to take out travel insurance to be safe. Travel insurance policies will have clauses dealing with existing medical conditions, and many will not cover any illness related to existing conditions. Heart patients, people with HIV and those suffering from other illnesses may have difficulty finding coverage; the elderly may have difficulty as well, even without existing medical conditions. Check with a specialist company like Saga for the best deals for older travellers. Many people will want to make sure their travel insurance covers them for sporting accidents, such as for skiing. Winter sports cover is usually available at extra cost, as is cover for specialised activities such as scuba diving. If you plan to partake of any so-called extreme sports, however, your policy is less likely to cover them, so always check before taking part in an activity. You may need to speak to a specialist provider such as Activesure.co.uk or look at 'extreme activity' policies from companies like Endsleigh. It's also important to ensure your policy covers your length of trip. An annual policy, though covering various trips throughout the year, will likely not cover individual trips of more than 31 days. If you're buying a single-trip policy, or travel frequently on small or local airlines, be sure your travel insurance provides adequate cover in case of delays, cancellations and lost baggage. Even having to pay the cost of staying in a hotel an extra night can be expensive; paying for entirely new flights after a delay and missed connection can be prohibitive.
Who should I buy my travel insurance from?Contrary to what many people are told by their travel agent, it is not required by law to carry travel insurance. However, it is highly recommended. If you are holidaying on a package deal, your agent or operator will probably try to sell you their own travel insurance for the trip; although convenient, this is one of the most expensive coverage options and travellers are advised to arrange travel insurance separately instead of paying up to twice as much through a travel agent. Since January 2005, it is especially important to avoid the travel agents when buying travel cover; from that date, the insurance industry falls under the regulation of the Financial Services Authority, giving that body the ability to investigate and take action on behalf of consumers. Tour operators and travel agents, however, are not subject to this regulation, so if you have a complaint about travel insurance purchased from a travel agent, the FSA and the Financial Ombudsman Service will not be able to intervene on your behalf. Luckily consumers have a great many options when it comes to purchasing travel insurance - from the big financial service providers to high street providers. Insurance companies and banks offering different types of travel cover include Churchill, Columbus Direct, Direct Line, Go Sure, Kingfisher, Norwich Union, the Royal Bank of Scotland, AXA, Lloyds TSB, Egg, Abbey, Halifax, Nationwide, Britannia and NatWest - to name only a few. Check with your other insurance providers to see if they offer travel cover - many companies such as the AA, Auto Direct or BUPA, which focus on other types of insurance, offer travel insurance policies as well. If you'd like to buy your travel insurance while you go about your daily errands, consider the various policies offered by such high street names as Tesco, Marks & Spencer or the Post Office.
What do I need to know about making claims?First of all, don't be one of the nearly 50% of people surveyed by the Association of British Insurers who would be willing to submit a fraudulent travel insurance claim - this only leads to higher premiums for everyone. Inflating your claim makes the process of getting the payout harder for everyone else, and it could also be a criminal offence leading to prosecution. The first step with any travel insurance claim is to ensure that the policy you hold covers you for the particular loss. For goods, there will likely be maximum amounts for each item, and loss may not be covered. As for medical claims, check what your coverage is for emergencies, longer-term care and medications, and again be sure to declare any pre-existing medical conditions when you buy the policy. Find out if your insurer expects to be told of every activity you plan to take part in on holiday. It may seem silly to let them know about a little hiking, golfing or sailing, but insurance companies need little excuse to wriggle out of paying, so don't make it easier for them to do so. Take your policy with you when you travel - or a copy of it - and list details of any very expensive item (camera, jewellery, etc.) you plan to take as well. Ensure your valuables, passport and extra cash are locked in the hotel safe as much as possible. If and when something is stolen, if you plan to claim for it, report it to the police immediately. Many companies will not pay out without a police report. For medical claims, make sure you keep all the paperwork, receipts and forms involved in your hospital. Again, take a copy of your policy with you on holiday and familiarise yourself with the steps they require you to take when making a medical claim.
What should your travel insurance cover?Probably the most important coverage you need to arrange is for medical expenses. However, countries in the European Economic Area - which includes EC countries as well as Norway, Liechtenstein and Iceland - provide reciprocal health services. You need to take a completed E111 form (available at the Post Office) with you when you travel. The E111 does not, however, provide repatriation coverage. Travellers should check the Department of Health website (http://www.doh.gov.uk/) for more details, as during 2005 the UK will be adopting the European Health Insurance Card (EHIC) in place of the E111 form. Some other countries have different forms of reciprocal health services, but you will need to check with the DoH before travelling to establish what medical services you will be entitled to under the agreement. If in doubt, travellers are advised to take out travel insurance to be safe. Travel insurance policies will have clauses dealing with existing medical conditions, and many will not cover any illness related to existing conditions. Heart patients, people with HIV and those suffering from other illnesses may have difficulty finding coverage; the elderly may have difficulty as well, even without existing medical conditions. Check with a specialist company like Saga for the best deals for older travellers. Many people will want to make sure their travel insurance covers them for sporting accidents, such as for skiing. Winter sports cover is usually available at extra cost, as is cover for specialised activities such as scuba diving. If you plan to partake of any so-called extreme sports, however, your policy is less likely to cover them, so always check before taking part in an activity. You may need to speak to a specialist provider such as Activesure.co.uk or look at 'extreme activity' policies from companies like Endsleigh. It's also important to ensure your policy covers your length of trip. An annual policy, though covering various trips throughout the year, will likely not cover individual trips of more than 31 days. If you're buying a single-trip policy, or travel frequently on small or local airlines, be sure your travel insurance provides adequate cover in case of delays, cancellations and lost baggage. Even having to pay the cost of staying in a hotel an extra night can be expensive; paying for entirely new flights after a delay and missed connection can be prohibitive.
Who should I buy my travel insurance from?Contrary to what many people are told by their travel agent, it is not required by law to carry travel insurance. However, it is highly recommended. If you are holidaying on a package deal, your agent or operator will probably try to sell you their own travel insurance for the trip; although convenient, this is one of the most expensive coverage options and travellers are advised to arrange travel insurance separately instead of paying up to twice as much through a travel agent. Since January 2005, it is especially important to avoid the travel agents when buying travel cover; from that date, the insurance industry falls under the regulation of the Financial Services Authority, giving that body the ability to investigate and take action on behalf of consumers. Tour operators and travel agents, however, are not subject to this regulation, so if you have a complaint about travel insurance purchased from a travel agent, the FSA and the Financial Ombudsman Service will not be able to intervene on your behalf. Luckily consumers have a great many options when it comes to purchasing travel insurance - from the big financial service providers to high street providers. Insurance companies and banks offering different types of travel cover include Churchill, Columbus Direct, Direct Line, Go Sure, Kingfisher, Norwich Union, the Royal Bank of Scotland, AXA, Lloyds TSB, Egg, Abbey, Halifax, Nationwide, Britannia and NatWest - to name only a few. Check with your other insurance providers to see if they offer travel cover - many companies such as the AA, Auto Direct or BUPA, which focus on other types of insurance, offer travel insurance policies as well. If you'd like to buy your travel insurance while you go about your daily errands, consider the various policies offered by such high street names as Tesco, Marks & Spencer or the Post Office.
What do I need to know about making claims?First of all, don't be one of the nearly 50% of people surveyed by the Association of British Insurers who would be willing to submit a fraudulent travel insurance claim - this only leads to higher premiums for everyone. Inflating your claim makes the process of getting the payout harder for everyone else, and it could also be a criminal offence leading to prosecution. The first step with any travel insurance claim is to ensure that the policy you hold covers you for the particular loss. For goods, there will likely be maximum amounts for each item, and loss may not be covered. As for medical claims, check what your coverage is for emergencies, longer-term care and medications, and again be sure to declare any pre-existing medical conditions when you buy the policy. Find out if your insurer expects to be told of every activity you plan to take part in on holiday. It may seem silly to let them know about a little hiking, golfing or sailing, but insurance companies need little excuse to wriggle out of paying, so don't make it easier for them to do so. Take your policy with you when you travel - or a copy of it - and list details of any very expensive item (camera, jewellery, etc.) you plan to take as well. Ensure your valuables, passport and extra cash are locked in the hotel safe as much as possible. If and when something is stolen, if you plan to claim for it, report it to the police immediately. Many companies will not pay out without a police report. For medical claims, make sure you keep all the paperwork, receipts and forms involved in your hospital. Again, take a copy of your policy with you on holiday and familiarise yourself with the steps they require you to take when making a medical claim.
Motor Insurance
Arranging motor insurance is vital for every motorist - not only because you are legally obliged to do so, but because accidents can and do happen every day on UK roads. Being in an accident not only puts you at risk of paying for your own vehicle repairs, but you may have to pay for another driver's repairs as well. Being legally obliged to carry motor insurance doesn't make you equally obliged to pay too much for it, but many people could secure a better deal on their insurance by shopping around, and some studies suggest that many of us do not bother to do so and pay too much based on a low initial premium. As the UK's premier financial data comparison site, Moneynet.co.uk can direct you to the best insurance providers and policies to meet your needs. Though many insurers claim to have the cheapest deals going, Moneynet.co.uk makes it easy to see which deals best suit you and your vehicle.
What kinds of motor insurance are there?Comprehensive insurance Comprehensive car insurance covers any damage to your vehicle - it is, in effect, an all-risk policy. The only exclusions to the policy will be those you agree on with your insurer, and which may or may not be items like breakdown coverage, medical or legal fees. Comprehensive coverage is popular because it not only covers damage caused by accidents, but also by more minor events like scratches or damage by other motorists when your vehicle is parked. There will be some exceptions to what the policy will cover, such as regular wear and tear. It's important to check a policy carefully for a full list of exclusions before you sign the contract. Despite its convenience, comprehensive insurance coverage is not the best option for everyone. For example, if you drive a second-hand car that is not worth very much money, and if you are in a higher-premiums category (ie. if you are young), you may pay out more in comprehensive insurance than your car is worth. Third party insurance Third-party-only car insurance is the minimum level of insurance permitted under the Road Traffic Act, and covers only your liability to other drivers - it does not cover damage to you or your vehicle. Some policies may also cover your legal fees in case of litigation following an accident. For slightly more than the third-party-only option, you can cover yourself for third party, fire and theft, which will also pay out if your car is stolen or destroyed in a fire. Specialty insurance Specialty vehicles such as sports and kit cars, classic cars, 4x4 vehicles, motorcycles and other less common vehicles may command much higher premiums than regular cars. If you find you are being quoted more than you expected to pay for a new sports car, for example, you may wish to check a specialty insurer such as Adrian Flux for a quote. Similarly, motorcyclists and caravan enthusiasts should check dealers such as Swinton, and classic car owners may find a more appropriate quote from classic car specialists Lancaster.
What does vehicle insurance cost?There are likely as many possible quotes for car insurance as there are vehicles on the road. However, certain factors will ensure you pay more to insure your vehicle - some of which can be avoided, and some that cannot. Two factors which are entirely out of your control are your age and gender. Young drivers are statistically at a much higher risk of having an accident than those who have been driving for longer - the combination of inexperience and youthful impetuousness leads to more accidents, and more insurance claims. Being added to a parent's insurance policy is the best way to keep young drivers' insurance down, but if they have their own car then they will need to buy - and likely pay much more - for their own policy. Young drivers can keep costs down by sticking to third-party-only insurance, buying an inexpensive and/or second-hand car, and keeping a driving record clean of speeding and other violations. You may also find better quotes from specialist providers such as 4 Young Drivers. Older drivers, on the other hand, are generally given preferential rates due to their experience and extra caution on the roads. Specialist insurers such as Senior Car Insurance or Saga may offer the best rates. Having an extra X chromosome may seem an unfair way to keep vehicle insurance costs low but statistically, women take fewer risks than men, are more cautious and drive more slowly, resulting in less expensive insurance claims. As a result they are generally offered lower premiums and are catered to by a large number of specialist insurers such as Diamond, Girl Motor, Diva Female Car Insurance and Women on Wheels. As with other types of insurance, the cost of your premiums will also be highly dependent on whether you have made claims in the past. However, in the case of vehicle insurance, you may have had to make a claim even though the loss or damage was not your fault. Some insurers, such as Bell, aim not to penalise drivers for such claims. Many factors that can affect the cost of your vehicle insurance are well within your control, however. A more expensive car with modifications will cost more to insure, as will one that is parked on the street instead of in secured parking. Paying attention to security within your car, via the use of alarms, immobilisers or steering locks, will help keep premiums lower. Using your car to commute will increase your premiums, as will having a job in certain 'higher-risk' industries such as entertainment or the media. You also have some control over the cost of vehicle insurance premiums even if you don't drive a car. Motorcyclists can keep costs down by keeping the size of their bike down; a smaller, less powerful bike is unable to accelerate as quickly as a large one, and cannot reach the same speeds overall, so is deemed safer. Drivers of 4x4s can, oddly, keep insurance costs down by not going off-road, and it is extremely important for owners of these vehicles to check their coverage to see if they are covered off the public highways before they venture into the woods. Finally, no matter what you drive, one simple way to keep your premium costs down is to keep your speed down. Not only are you less likely to have an accident, a speed conviction can double or even treble your insurance premium. Not all insurance providers will necessarily charge more for a convicted speeder, though, so it pays to shop around.
What kinds of motor insurance are there?Comprehensive insurance Comprehensive car insurance covers any damage to your vehicle - it is, in effect, an all-risk policy. The only exclusions to the policy will be those you agree on with your insurer, and which may or may not be items like breakdown coverage, medical or legal fees. Comprehensive coverage is popular because it not only covers damage caused by accidents, but also by more minor events like scratches or damage by other motorists when your vehicle is parked. There will be some exceptions to what the policy will cover, such as regular wear and tear. It's important to check a policy carefully for a full list of exclusions before you sign the contract. Despite its convenience, comprehensive insurance coverage is not the best option for everyone. For example, if you drive a second-hand car that is not worth very much money, and if you are in a higher-premiums category (ie. if you are young), you may pay out more in comprehensive insurance than your car is worth. Third party insurance Third-party-only car insurance is the minimum level of insurance permitted under the Road Traffic Act, and covers only your liability to other drivers - it does not cover damage to you or your vehicle. Some policies may also cover your legal fees in case of litigation following an accident. For slightly more than the third-party-only option, you can cover yourself for third party, fire and theft, which will also pay out if your car is stolen or destroyed in a fire. Specialty insurance Specialty vehicles such as sports and kit cars, classic cars, 4x4 vehicles, motorcycles and other less common vehicles may command much higher premiums than regular cars. If you find you are being quoted more than you expected to pay for a new sports car, for example, you may wish to check a specialty insurer such as Adrian Flux for a quote. Similarly, motorcyclists and caravan enthusiasts should check dealers such as Swinton, and classic car owners may find a more appropriate quote from classic car specialists Lancaster.
What does vehicle insurance cost?There are likely as many possible quotes for car insurance as there are vehicles on the road. However, certain factors will ensure you pay more to insure your vehicle - some of which can be avoided, and some that cannot. Two factors which are entirely out of your control are your age and gender. Young drivers are statistically at a much higher risk of having an accident than those who have been driving for longer - the combination of inexperience and youthful impetuousness leads to more accidents, and more insurance claims. Being added to a parent's insurance policy is the best way to keep young drivers' insurance down, but if they have their own car then they will need to buy - and likely pay much more - for their own policy. Young drivers can keep costs down by sticking to third-party-only insurance, buying an inexpensive and/or second-hand car, and keeping a driving record clean of speeding and other violations. You may also find better quotes from specialist providers such as 4 Young Drivers. Older drivers, on the other hand, are generally given preferential rates due to their experience and extra caution on the roads. Specialist insurers such as Senior Car Insurance or Saga may offer the best rates. Having an extra X chromosome may seem an unfair way to keep vehicle insurance costs low but statistically, women take fewer risks than men, are more cautious and drive more slowly, resulting in less expensive insurance claims. As a result they are generally offered lower premiums and are catered to by a large number of specialist insurers such as Diamond, Girl Motor, Diva Female Car Insurance and Women on Wheels. As with other types of insurance, the cost of your premiums will also be highly dependent on whether you have made claims in the past. However, in the case of vehicle insurance, you may have had to make a claim even though the loss or damage was not your fault. Some insurers, such as Bell, aim not to penalise drivers for such claims. Many factors that can affect the cost of your vehicle insurance are well within your control, however. A more expensive car with modifications will cost more to insure, as will one that is parked on the street instead of in secured parking. Paying attention to security within your car, via the use of alarms, immobilisers or steering locks, will help keep premiums lower. Using your car to commute will increase your premiums, as will having a job in certain 'higher-risk' industries such as entertainment or the media. You also have some control over the cost of vehicle insurance premiums even if you don't drive a car. Motorcyclists can keep costs down by keeping the size of their bike down; a smaller, less powerful bike is unable to accelerate as quickly as a large one, and cannot reach the same speeds overall, so is deemed safer. Drivers of 4x4s can, oddly, keep insurance costs down by not going off-road, and it is extremely important for owners of these vehicles to check their coverage to see if they are covered off the public highways before they venture into the woods. Finally, no matter what you drive, one simple way to keep your premium costs down is to keep your speed down. Not only are you less likely to have an accident, a speed conviction can double or even treble your insurance premium. Not all insurance providers will necessarily charge more for a convicted speeder, though, so it pays to shop around.
Home insurance - building and contents
Considering how important our homes and possessions are to us, it's surprising that more people don't put more consideration into their building and contents insurance. Could you afford to replace your home if it burned down? Insuring your home is so important that most mortgage providers won't grant a mortgage without buildings insurance; however, it's worth shopping around for policies, as your mortgage provider may not be the best insurance provider. Buildings insurance will usually cover both the structure and the permanent fixtures such as plumbing, baths, toilets, doors and cupboards. You will need to check your policy to see if it also covers what are considered 'outbuildings' such as garages, garden sheds and the like. The policy may cover for damage from a number of causes, which may include fire, landslide, flood, falling trees, vehicles, earthquakes or lightning. Equally important should be insuring your home's contents, which are your possessions - your appliances, electronic goods, furniture and clothing. A surprising one in four households doesn't carry contents insurance, though - many of them renters - leaving them liable for loss or damage due to burglary, smoke, fire or flood and water. Some contents insurance policies may also cover you for legal liability - the loss you would suffer if someone injured themselves in your home due to your negligence or lack of upkeep of the property, and sued you for damages. Building and contents insurance policies may be sold together, but it's worth investigating the cost of separate policies to ensure you're getting the best price for your coverage.
What does home insurance cost?With both buildings and contents insurance you will have a choice between basing the cost of your premiums on the number of bedrooms in your house - a convenient, but potentially costly method - and working out the exact value of rebuilding your home and replacing its contents on the sum-insured method, which may be more accurate but is also more complicated and time-consuming. Both methods carry the risk of over-insuring yourself and paying higher premiums; the sum-insured method also carries the risk of underestimating the value of your home and belongings, and therefore running the risk of being unable to replace everything should it be lost. If you underestimate the value of your belongings in order to save money on premiums you will lose out on any claim, so be as accurate as possible when estimating replacement values. It's important to work out the amount of buildings insurance you require based on what it will actually cost to rebuild your home, and not simply on the resale value, as these two figures may differ widely and you may be able to rebuild your home for much less than it would cost to buy in a strong real estate market. It is recommended that homeowners contact a chartered surveyor to assess the correct insurance replacement cost of a home. Premiums on building insurance policies will vary widely from house to house, so don't expect to get the same deal as your neighbour. Your postcode will be one of the first factors to determine your premiums, as some high-crime areas may be at greater risk of burglary. Buildings insurance may also be index-linked, which means premiums will rise in line with the Retail Price Index (RPI). The style of your house will also be a consideration. Do you have a thatched roof, or similar uncommon construction? Insurance companies will often charge more for unusual features. Listed buildings will also be more costly. Lastly, as with all insurance policies, your previous claims history will also be taken into account. Your postcode will also be a factor for your contents insurance, but the cost of premiums will vary even more widely due to your individual contents and how much they are worth. In addition, you will need to check whether you have indemnity cover or new-for-old cover. New-for-old insurance is likely to cost more, but it ensures that you are given the amount it costs to replace an item with a new one if it cannot be repaired. Indemnity cover takes into account the age of the item and wear and tear, and only gives a fraction of the new replacement cost. You will also pay more for your insurance premiums if you wish to cover certain items which will not be kept in your home at all times, such as jewellery or a laptop computer. Homeowners generally insure the contents of their homes with theft or disaster damage in mind. However, you're probably more likely to damage or destroy an expensive item by accident, so accidental damage cover is a wise idea - it covers you for items that may be dropped and broken, scratched or otherwise damaged.
ExclusionsIt is crucial to check the fine print of your building and contents insurance policies to see what is and is not covered, or you may suffer a nasty and expensive shock. The most common buildings insurance exclusions relate to damage from ordinary ageing and wear and tear; damage caused by your own neglect of the property, or by your pets; or damage you intentionally cause to the property. Most insurance polices will also have limits on what you can claim for individual items, and for the total value of your contents, but you may be able to negotiate more coverage for higher premiums. Homeowners who travel a great deal need to ensure that their home insurance policies cover them for extended periods away from the property. Many policies will not cover theft or damage if the property is left vacant for 30 days or more, but again, for higher premiums you may be able to arrange special cover.
Who offers home building and contents insurance?There are a great many home insurance providers, so establish first what sort of coverage and policy you want before shopping around for quotes. Providers include esure, the Post Office, More Than, Lloyds TSB, Saga, Norwich Union, Zurich and the AA.
What does home insurance cost?With both buildings and contents insurance you will have a choice between basing the cost of your premiums on the number of bedrooms in your house - a convenient, but potentially costly method - and working out the exact value of rebuilding your home and replacing its contents on the sum-insured method, which may be more accurate but is also more complicated and time-consuming. Both methods carry the risk of over-insuring yourself and paying higher premiums; the sum-insured method also carries the risk of underestimating the value of your home and belongings, and therefore running the risk of being unable to replace everything should it be lost. If you underestimate the value of your belongings in order to save money on premiums you will lose out on any claim, so be as accurate as possible when estimating replacement values. It's important to work out the amount of buildings insurance you require based on what it will actually cost to rebuild your home, and not simply on the resale value, as these two figures may differ widely and you may be able to rebuild your home for much less than it would cost to buy in a strong real estate market. It is recommended that homeowners contact a chartered surveyor to assess the correct insurance replacement cost of a home. Premiums on building insurance policies will vary widely from house to house, so don't expect to get the same deal as your neighbour. Your postcode will be one of the first factors to determine your premiums, as some high-crime areas may be at greater risk of burglary. Buildings insurance may also be index-linked, which means premiums will rise in line with the Retail Price Index (RPI). The style of your house will also be a consideration. Do you have a thatched roof, or similar uncommon construction? Insurance companies will often charge more for unusual features. Listed buildings will also be more costly. Lastly, as with all insurance policies, your previous claims history will also be taken into account. Your postcode will also be a factor for your contents insurance, but the cost of premiums will vary even more widely due to your individual contents and how much they are worth. In addition, you will need to check whether you have indemnity cover or new-for-old cover. New-for-old insurance is likely to cost more, but it ensures that you are given the amount it costs to replace an item with a new one if it cannot be repaired. Indemnity cover takes into account the age of the item and wear and tear, and only gives a fraction of the new replacement cost. You will also pay more for your insurance premiums if you wish to cover certain items which will not be kept in your home at all times, such as jewellery or a laptop computer. Homeowners generally insure the contents of their homes with theft or disaster damage in mind. However, you're probably more likely to damage or destroy an expensive item by accident, so accidental damage cover is a wise idea - it covers you for items that may be dropped and broken, scratched or otherwise damaged.
ExclusionsIt is crucial to check the fine print of your building and contents insurance policies to see what is and is not covered, or you may suffer a nasty and expensive shock. The most common buildings insurance exclusions relate to damage from ordinary ageing and wear and tear; damage caused by your own neglect of the property, or by your pets; or damage you intentionally cause to the property. Most insurance polices will also have limits on what you can claim for individual items, and for the total value of your contents, but you may be able to negotiate more coverage for higher premiums. Homeowners who travel a great deal need to ensure that their home insurance policies cover them for extended periods away from the property. Many policies will not cover theft or damage if the property is left vacant for 30 days or more, but again, for higher premiums you may be able to arrange special cover.
Who offers home building and contents insurance?There are a great many home insurance providers, so establish first what sort of coverage and policy you want before shopping around for quotes. Providers include esure, the Post Office, More Than, Lloyds TSB, Saga, Norwich Union, Zurich and the AA.
Insurance Guide
Introduction
Have you got it covered? These days, you probably have. Insurance is now available for nearly anything, covering the most important - and probably the most expensive - possessions in your and your family's lives: your home and its contents, your vehicle and your holiday. Just as with life and health insurance, arranging cover for your expensive and/or treasured possessions provides peace of mind should the worst happen - theft or fire loss in your home, an accident that destroys your car, or a loss of luggage or difficulty abroad which has the potential to ruin your dream holiday. And while insurance can never replace the loss of a family heirloom, it can help to ensure you are not bankrupted replacing a necessity. Depending on what you're insuring, policies and premiums will differ greatly - some will be short-term and cover only emergencies, while others like motor or house and contents insurance will be more long-term in nature and will likely adapt to your changing circumstances during the term of your policy. There is no shortage of companies wanting to sell you insurance - insurance companies and brokers now have to compete with banks, supermarkets and travel agents to sell you a policy, and the wide variety on offer can be confusing. How much coverage do you need? And how do you know that you're getting the policy you need at the best possible price? As a financial data comparison site, Moneynet.co.uk can direct you to the best insurance deals to meet your needs. The Internet makes it easy to shop around for low premiums, but you need to ensure that your choice of home, car or travel insurance really suits you, your belongings and circumstances.
Have you got it covered? These days, you probably have. Insurance is now available for nearly anything, covering the most important - and probably the most expensive - possessions in your and your family's lives: your home and its contents, your vehicle and your holiday. Just as with life and health insurance, arranging cover for your expensive and/or treasured possessions provides peace of mind should the worst happen - theft or fire loss in your home, an accident that destroys your car, or a loss of luggage or difficulty abroad which has the potential to ruin your dream holiday. And while insurance can never replace the loss of a family heirloom, it can help to ensure you are not bankrupted replacing a necessity. Depending on what you're insuring, policies and premiums will differ greatly - some will be short-term and cover only emergencies, while others like motor or house and contents insurance will be more long-term in nature and will likely adapt to your changing circumstances during the term of your policy. There is no shortage of companies wanting to sell you insurance - insurance companies and brokers now have to compete with banks, supermarkets and travel agents to sell you a policy, and the wide variety on offer can be confusing. How much coverage do you need? And how do you know that you're getting the policy you need at the best possible price? As a financial data comparison site, Moneynet.co.uk can direct you to the best insurance deals to meet your needs. The Internet makes it easy to shop around for low premiums, but you need to ensure that your choice of home, car or travel insurance really suits you, your belongings and circumstances.
Student Finance Guide
According to data from National Statistics and The Times Higher Education Supplement, students now make up around 4% of the total UK population, making them a significant market. The UK population is also aging, as a result of a decline in fertility rates and the mortality rate (people are living longer and healthier). According to money education charity Credit Action, the vast majority of students are going to end up in debt, whilst according to 2004 Natwest Student Money Matters, graduates will now leave university with debts of almost £13,000.
These are significant figures, but with a little financial planning, they can be put into context.
If you (or your child) are about to start university, here are a few factors to bear in mind before departure:
Assume you will accumulate a certain amount of debt over your period of study, but don’t unduly worry about it.
If you can, take a gap year or some time out to earn money before going to university and where possible obtain a job that may have some relevance to your course
It helps if you take on a part time job at university, though this isn’t meant to distract from the studying. There are a number of employers who provide jobs for students, including universities. Many universities have schemes where students can volunteer (and get paid) as ambassadors, lab assistants, campus helpers and mentors: a part-time job doesn’t have to be off-campus
If you have to borrow , make sure you always establish the cheapest forms of credit available such as interest free overdrafts and student loans. However, remember to check your contracts when you graduate, it doesn’t take long for the Student Loans Company or your bank to start claiming back what was free money at university.
Don’t take out a credit card, you’re a student remember? That iPod and summer ball dress can wait! Keep it simple with a current account, savings accounts and your student loans. If you really find yourself considering taking out a credit card, seek advice before doing so and ensure you know when you can pay it back. As a student, credit cards should always be your last resort.
Budget if you can, and if nothing else avoid paying for everything on plastic (especially credit cards), you’ll keep better track of your spending by using cash and checking your balance regularly. Check your current account over the internet with online banking
Don’t just budget on the essential – rent, food, bills and books. The costs of those coffees between lectures will mount up, not to mention text (mobile phone) costs, printing, transport prices, gym subscriptions and membership fees to student clubs and societies
Do your financial homework online with moneynet, have you got the best current account and savings account?
Shop around for your insurance; moneynet can help you here too. Students are frequent victims of crime, not just with theft between students, but the anonymity of campus life means that wallets, laptops and mobile phones are easy to steal and if they’re not insured, you will lose the value of the stolen item and may have to pay for any damage incurred
Student grants, in the mainstream, were phased out many years ago, but there may be grants, hardship funds and bursaries available to specific courses and individuals. Do your homework in advance and don’t make assumptions.
Know what you want from your course and time in higher education, your finances and studies will benefit from a sense of purpose. There is nothing worse than graduating from university with debt and a minimal idea of where to move next, especially when those debts are being claimed back.
Invisible savings
OK, so there’s nothing like re-discovering a ten-pound note in your pocket, which you’d forgotten about, but below are a few tips which could contribute to finding a few extra quid each year at university.
Insurance: check out the different insurance options on moneynet to get your best quote. Household, motor and travel insurance will be likely considerations at some point during your course and you will find quotes vary considerably, so look at the different choices available.
Exploit your student card where possible and always investigate whether a company offers a student rate or student discount
Bulk buy and divide the cost between your flatmates
If you have to have a mobile phone, are you sure you have the best deal?
Do you pay the bills in your household? A quick search on moneynet will reveal whether you are with the cheapest supplier for you domestic bills, though remember to check with your landlord before changing suppliers
Savings
Stretch your student loans and birthday / Christmas cash gifts out as long as possible. Open up a savings account that would you give you reasonable access to your funds, whilst providing a higher rate of interest than you may get in a current account. If you have saved significant funds, which you believe you won’t need access to in the intermediate term, consider low risk options such as ISAs. Certain ISAs will also allow immediate access to funds and still give high rates of interest, so review the different options.
Dos and don’ts of student finance
Don’t lend money to other students, you may not get it back
Don’t borrow money from other students, if you have to borrow then you can’t afford it
Don’t give anyone else access to your PIN number, you will not be covered for missing funds
Be careful when putting your name on the gas, electricity or phone bill in a shared house. Draw up an agreement and if you doubt anyone’s commitment to pay then don’t share the bills. Standing orders are useful in a shared house, as financial contributions go automatically and directly to the bill-payer and they provide a form of commitment from all parties concerned
Look beyond freshers’ week when it comes to spending your student loan
There will always be students with more money than you, be philosophical about this and don’t try to keep up with unrealistic spending habits. If you have to borrow money for ‘good times’, remember it is your name on the credit card, your name on the overdraft and your credit record. Financial mistakes made when you’re a student may come back to haunt you in graduation
These are significant figures, but with a little financial planning, they can be put into context.
If you (or your child) are about to start university, here are a few factors to bear in mind before departure:
Assume you will accumulate a certain amount of debt over your period of study, but don’t unduly worry about it.
If you can, take a gap year or some time out to earn money before going to university and where possible obtain a job that may have some relevance to your course
It helps if you take on a part time job at university, though this isn’t meant to distract from the studying. There are a number of employers who provide jobs for students, including universities. Many universities have schemes where students can volunteer (and get paid) as ambassadors, lab assistants, campus helpers and mentors: a part-time job doesn’t have to be off-campus
If you have to borrow , make sure you always establish the cheapest forms of credit available such as interest free overdrafts and student loans. However, remember to check your contracts when you graduate, it doesn’t take long for the Student Loans Company or your bank to start claiming back what was free money at university.
Don’t take out a credit card, you’re a student remember? That iPod and summer ball dress can wait! Keep it simple with a current account, savings accounts and your student loans. If you really find yourself considering taking out a credit card, seek advice before doing so and ensure you know when you can pay it back. As a student, credit cards should always be your last resort.
Budget if you can, and if nothing else avoid paying for everything on plastic (especially credit cards), you’ll keep better track of your spending by using cash and checking your balance regularly. Check your current account over the internet with online banking
Don’t just budget on the essential – rent, food, bills and books. The costs of those coffees between lectures will mount up, not to mention text (mobile phone) costs, printing, transport prices, gym subscriptions and membership fees to student clubs and societies
Do your financial homework online with moneynet, have you got the best current account and savings account?
Shop around for your insurance; moneynet can help you here too. Students are frequent victims of crime, not just with theft between students, but the anonymity of campus life means that wallets, laptops and mobile phones are easy to steal and if they’re not insured, you will lose the value of the stolen item and may have to pay for any damage incurred
Student grants, in the mainstream, were phased out many years ago, but there may be grants, hardship funds and bursaries available to specific courses and individuals. Do your homework in advance and don’t make assumptions.
Know what you want from your course and time in higher education, your finances and studies will benefit from a sense of purpose. There is nothing worse than graduating from university with debt and a minimal idea of where to move next, especially when those debts are being claimed back.
Invisible savings
OK, so there’s nothing like re-discovering a ten-pound note in your pocket, which you’d forgotten about, but below are a few tips which could contribute to finding a few extra quid each year at university.
Insurance: check out the different insurance options on moneynet to get your best quote. Household, motor and travel insurance will be likely considerations at some point during your course and you will find quotes vary considerably, so look at the different choices available.
Exploit your student card where possible and always investigate whether a company offers a student rate or student discount
Bulk buy and divide the cost between your flatmates
If you have to have a mobile phone, are you sure you have the best deal?
Do you pay the bills in your household? A quick search on moneynet will reveal whether you are with the cheapest supplier for you domestic bills, though remember to check with your landlord before changing suppliers
Savings
Stretch your student loans and birthday / Christmas cash gifts out as long as possible. Open up a savings account that would you give you reasonable access to your funds, whilst providing a higher rate of interest than you may get in a current account. If you have saved significant funds, which you believe you won’t need access to in the intermediate term, consider low risk options such as ISAs. Certain ISAs will also allow immediate access to funds and still give high rates of interest, so review the different options.
Dos and don’ts of student finance
Don’t lend money to other students, you may not get it back
Don’t borrow money from other students, if you have to borrow then you can’t afford it
Don’t give anyone else access to your PIN number, you will not be covered for missing funds
Be careful when putting your name on the gas, electricity or phone bill in a shared house. Draw up an agreement and if you doubt anyone’s commitment to pay then don’t share the bills. Standing orders are useful in a shared house, as financial contributions go automatically and directly to the bill-payer and they provide a form of commitment from all parties concerned
Look beyond freshers’ week when it comes to spending your student loan
There will always be students with more money than you, be philosophical about this and don’t try to keep up with unrealistic spending habits. If you have to borrow money for ‘good times’, remember it is your name on the credit card, your name on the overdraft and your credit record. Financial mistakes made when you’re a student may come back to haunt you in graduation
Family Finance Guide
Whilst you might not be able to buy love, you can at least protect it with a little financial planning. If you and your partner are contemplating moving in together and merging your finances or even getting married or starting a family, here are few suggestions to keep the love alive over the years! Decide on your financial priorities, such as:
Would an emergency fund be helpful?
Do you need to protect either your own or your partner’s income in the event of illness? At least considering cover of joint expenses?
Do either of you want to consider life insurance, as security for the other?
How much borrowing will you need to do to buy a home?
If you have children, how much planning do you want to do? Is private education an option, do you want to start saving for university fees?
Are you already saving for a pension? Do you want to incorporate your partner in your pension plans? If you’re not already saving for a pension, when do you intend to start doing this?
Will you be saving for short-term family events – such as birthdays, holidays or Christmas?
If you are likely to have surplus funds, are you likely to invest these? If so, will you invest in medium or long term options?
Available resources for parents:
Child Benefit:
Child Benefit is paid for a child or young person who is:
under 16 years old or
16, 17 or 18 years old and at school or college studying fulltime
16 or 17 years old and has left school recently and has registered for work or training with one of the following:
Careers Service, or Connexions Service
Ministry of Defence
Department for Employment and Learning (in Northern Ireland)
An education and library board (in Northern Ireland)
The young person must be actively seeking work or training place and have not yet started work, or training for which a training allowance is paid.
Free dental care & free prescriptions to all mothers-to-be and new mothers (within first year of birth)
Statutory Maternity Pay (SMP)
According to the Department for Work and Pensions:
SMP provides the mother with financial assistance to take time off at and around the birth
SMP is paid by the employer, up to a maximum of 26 weeks
SMP is regarded as earnings and the employer will deduct tax and National Insurance accordingly
Child Tax Credits All families with children can claim Child Tax Credits if their income is less than £58,000 (up to £66,000 if the child is less than a year old). You can still claim this benefit even if you are not the biological parent, but you must be the main person who is responsible for the child. More information about credits and benefits: Tax credit enquiries: 0845 3003900 (UK Tax Credits enquiries) 0845 6032000 (Northern Ireland Tax Credits enquiries) Child benefit enquiries: 0845 302 1444 0845 603 2000 (Northern Ireland)
Available resources for children:
Child Trust Funds (CTFs) Child Trust Funds are long-term tax-free savings and investment accounts into which the Government will pay ‘endowments’ when a child is born. A further payment of an undisclosed amount will also be paid at the age of seven. This means that each child born on or after 1st September 2002 will receive an initial lump sum payment of (currently £250 or £500 for poorer families) from the government. This will be sent in the form of a voucher which can then be used to open a CTF account with the investment provider of the child’s guardian’s choice. Parents will be able to pay up to £1,200 a year into the fund, until the child reaches 18 when the account will cease to be a Child Trust Fund account, and will usually be transferred into an easy access account. Preferential tax treatment will then cease, and any further growth in the fund after this time will be subject to normal tax legislation. Savings in a Child Trust Fund account will develop into an asset which can then be used by the child, and no-one else, when they reach the age of age of 18 (not before) to help cover some of the large expenses encountered at this time of a person’s life, and is intended to contribute towards university fees, first mortgage, etc.
Education Maintenance Allowance (EMA) An EMA is a weekly payment of £10, £20 or £30, depending on the household income and is paid directly into the student’s bank account. The money is intended to help with the day-to-day costs generated by staying on at school or college, such as travel, books and equipment etc. Additionally, £100 bonuses available for students who remain committed to their course and get good marks. A student can get an EMA if:
Their household has an income of £30,000 or less and
Their course involves at least 12 hours of guided learning per week Courses eligible for EMAs include school sixth forms, sixth-form colleges or further education colleges and encompasses ‘A’ levels, GCSEs, GNVQs, NVQs or other vocational qualifications. More information can be found at: For more information about the Education Maintenance Allowance, call the Inland Revenue on 0845 300 3900. If you have any suggestions on how family finances could be improved, please feel welcome to email: info@moneynet.co.uk
Would an emergency fund be helpful?
Do you need to protect either your own or your partner’s income in the event of illness? At least considering cover of joint expenses?
Do either of you want to consider life insurance, as security for the other?
How much borrowing will you need to do to buy a home?
If you have children, how much planning do you want to do? Is private education an option, do you want to start saving for university fees?
Are you already saving for a pension? Do you want to incorporate your partner in your pension plans? If you’re not already saving for a pension, when do you intend to start doing this?
Will you be saving for short-term family events – such as birthdays, holidays or Christmas?
If you are likely to have surplus funds, are you likely to invest these? If so, will you invest in medium or long term options?
Available resources for parents:
Child Benefit:
Child Benefit is paid for a child or young person who is:
under 16 years old or
16, 17 or 18 years old and at school or college studying fulltime
16 or 17 years old and has left school recently and has registered for work or training with one of the following:
Careers Service, or Connexions Service
Ministry of Defence
Department for Employment and Learning (in Northern Ireland)
An education and library board (in Northern Ireland)
The young person must be actively seeking work or training place and have not yet started work, or training for which a training allowance is paid.
Free dental care & free prescriptions to all mothers-to-be and new mothers (within first year of birth)
Statutory Maternity Pay (SMP)
According to the Department for Work and Pensions:
SMP provides the mother with financial assistance to take time off at and around the birth
SMP is paid by the employer, up to a maximum of 26 weeks
SMP is regarded as earnings and the employer will deduct tax and National Insurance accordingly
Child Tax Credits All families with children can claim Child Tax Credits if their income is less than £58,000 (up to £66,000 if the child is less than a year old). You can still claim this benefit even if you are not the biological parent, but you must be the main person who is responsible for the child. More information about credits and benefits: Tax credit enquiries: 0845 3003900 (UK Tax Credits enquiries) 0845 6032000 (Northern Ireland Tax Credits enquiries) Child benefit enquiries: 0845 302 1444 0845 603 2000 (Northern Ireland)
Available resources for children:
Child Trust Funds (CTFs) Child Trust Funds are long-term tax-free savings and investment accounts into which the Government will pay ‘endowments’ when a child is born. A further payment of an undisclosed amount will also be paid at the age of seven. This means that each child born on or after 1st September 2002 will receive an initial lump sum payment of (currently £250 or £500 for poorer families) from the government. This will be sent in the form of a voucher which can then be used to open a CTF account with the investment provider of the child’s guardian’s choice. Parents will be able to pay up to £1,200 a year into the fund, until the child reaches 18 when the account will cease to be a Child Trust Fund account, and will usually be transferred into an easy access account. Preferential tax treatment will then cease, and any further growth in the fund after this time will be subject to normal tax legislation. Savings in a Child Trust Fund account will develop into an asset which can then be used by the child, and no-one else, when they reach the age of age of 18 (not before) to help cover some of the large expenses encountered at this time of a person’s life, and is intended to contribute towards university fees, first mortgage, etc.
Education Maintenance Allowance (EMA) An EMA is a weekly payment of £10, £20 or £30, depending on the household income and is paid directly into the student’s bank account. The money is intended to help with the day-to-day costs generated by staying on at school or college, such as travel, books and equipment etc. Additionally, £100 bonuses available for students who remain committed to their course and get good marks. A student can get an EMA if:
Their household has an income of £30,000 or less and
Their course involves at least 12 hours of guided learning per week Courses eligible for EMAs include school sixth forms, sixth-form colleges or further education colleges and encompasses ‘A’ levels, GCSEs, GNVQs, NVQs or other vocational qualifications. More information can be found at: For more information about the Education Maintenance Allowance, call the Inland Revenue on 0845 300 3900. If you have any suggestions on how family finances could be improved, please feel welcome to email: info@moneynet.co.uk
What is ethical investing?
Ethical investing is just like any other type of investing, be it in funds, shares, bank accounts or otherwise, except that the company that invests the money for the consumer undertakes not to use that money to fund certain activities or behaviour that are believed to be harmful to the environment, to people or to animals and wildlife. This may mean, for example, that a fund management company will not purchase shares in arms companies or firms that develop harmful pesticides, or that a bank will not lend money to or otherwise facilitate business for such companies. Financial companies that practice ethical investment may not focus on such negative criteria, but positive criteria instead, meaning they will seek out businesses that benefit the environment or the community. The range in policies is sometimes labelled by colour: a 'light green' company will avoid businesses whose actions or products are harmful to the environment, while a 'dark green' company will actively seek out enviro-friendly or community-based businesses to invest in. An increasingly common term for ethical investing is 'socially responsible investing', or SRI. SRI focuses on the positive rather than the negative, and instead of blacklisting entire industries, it prefers to pick the company within the industry that is doing the most to improve its business practices, and give that company encouragement in the form of investment. This positive reinforcement is seen as more likely to improve business practices overall. It's important to remember that even though you may not directly invest your money - ie by buying shares - you may be indirectly investing it via a mortgage, pension or savings account, and by investing ethically you can have a say in what sort of activities your money supports. It is also important to know that the term 'ethical' is largely self-awarded - there is no standard to which companies must conform before they can label themselves ethical. Organisations such as EIRIS, the Ethical Investment Research Service, provide information into companies' ethical behaviour for independent investors, fund managers and charities alike.
Ethical Investing Guide
Introduction
Do you want to get rich, but not at the expense of the poor? You're not alone. Ethical investors in the UK are growing in number each year along with public awareness of pollution, fair trade, child labour, arms sales and similar contentious issues. Ethical investing has gone from being a 'fringe' activity - previously seen as the practice of tree-huggers and sandal-wearers - to a going concern that offers clear-conscience alternatives for the full range of financial products including mortgages, bank accounts, utilities, investments and pensions. Now, more than ever, it's easy being green. But just because a product is deemed 'ethical' doesn't mean it is necessarily a wise financial choice. Given the relatively small number of companies engaged in ethical activities, there are a restricted number of stocks that funds can be invested in - a situation that often caused poor performance in the past. These days, however, UK ethical funds perform on a par with regular funds, according to Standard and Poor's. This is a far cry from 1984 when Friends Provident's Stewardship Fund had to carry a 'wealth warning' so that investors knew the rewards of ethical investment might not have stretched far beyond a clear conscience. It is important to get advice from an independent financial advisor to help you make the right choice of ethical investment for both your financial goals and your ethical ideals.
Do you want to get rich, but not at the expense of the poor? You're not alone. Ethical investors in the UK are growing in number each year along with public awareness of pollution, fair trade, child labour, arms sales and similar contentious issues. Ethical investing has gone from being a 'fringe' activity - previously seen as the practice of tree-huggers and sandal-wearers - to a going concern that offers clear-conscience alternatives for the full range of financial products including mortgages, bank accounts, utilities, investments and pensions. Now, more than ever, it's easy being green. But just because a product is deemed 'ethical' doesn't mean it is necessarily a wise financial choice. Given the relatively small number of companies engaged in ethical activities, there are a restricted number of stocks that funds can be invested in - a situation that often caused poor performance in the past. These days, however, UK ethical funds perform on a par with regular funds, according to Standard and Poor's. This is a far cry from 1984 when Friends Provident's Stewardship Fund had to carry a 'wealth warning' so that investors knew the rewards of ethical investment might not have stretched far beyond a clear conscience. It is important to get advice from an independent financial advisor to help you make the right choice of ethical investment for both your financial goals and your ethical ideals.
Life assurance: policy types
Term life assurance is the simplest form of policy, offering basic cover for a set number of years, usually at low cost. A term policy requires a regular premium payment and pays out a lump sum on the policyholder's death. If the policy expires and the holder is still alive, no payment is made; the policy pays out only if you expire before it does. The cost of the assurance premiums will vary from person to person depending on factors such as age, health and occupation, but for all policies it is crucial to ensure you keep up the monthly premium payments to keep cover in place. Term assurance policies may also offer the option to pay an extra premium and receive a payout in the event the policyholder is diagnosed with a critical or terminal illness. Critical illness cover can include debilitating but not necessarily fatal conditions such as heart attack or stroke, cancer, multiple sclerosis, loss of limbs, etc., and the cover pays a lump sum on diagnosis - not for treatment of the condition, as you would expect with a health insurance policy. As with any coverage, it is important to be sure exactly which conditions the policy covers, and which it doesn't. A policy will be very specific as to the illnesses it will pay out for; critical illness policies can also range from basic coverage, which will include just the main critical illnesses such as cancer, to comprehensive policies that cover a more extensive range of conditions. Full disclosure of any and all existing medical conditions and history is vital when arranging critical illness cover. Failure to disclose could result in denial of payment when an illness is diagnosed - just when that payment is needed most. Policyholders wishing to provide for their families in the event of their death can choose Level Term assurance, which pays a lump sum if the holder dies during the term of the policy. The payout amount is guaranteed and remains the same throughout the policy; you only need to choose how much you wish the amount to be, and the length of the policy term. There is no payout, however, should the policyholder outlive the term of the policy. Decreasing Term assurance sees the amount to be paid out decreasing over the term of the policy. Most often used to cover mortgages, this type of term life assurance has the payout sum reducing over time just as the amount owing on the mortgage reduces. Some mortgage providers will not release mortgage funds without the debtor securing some form of life assurance, guaranteeing repayment should the worst happen. Whole-of-life assurance removes some of the guesswork from life assurance by guaranteeing a payout of a lump sum when the policyholder dies, at whatever time that may be. As long as the premiums are maintained, the cover is assured. However, because a payout is virtually guaranteed, this assurance is generally more expensive than basic term assurance and is generally more likely to be used in Estate Planning as a tool to meet Inheritance Tax liabilities. Endowment life assurance policies are essentially savings schemes that have life assurance attached; they are most often carried with mortgages and pay out any accumulated returns at the end of the policy term, or if the policyholder dies before the end of term, a payout sum plus any returns so far. Generally endowments are taken out with decreasing term assurance, where the payout sum decreases throughout the term of the policy to cover the remaining mortgage debt, but the endowment investment is hoped to make up the difference and even perhaps surpass it. However, this happy outcome requires the cooperation of the investment markets - the performance of which is not, of course, guaranteed. With Convertible Term assurance, you may convert a term policy to whole-of-life or endowment assurance at the end of the term of the policy, without necessarily having to provide new medical details. Family income benefit provides a slightly different payout; the benefit upon your death is provided to your family in regular payments rather than in a lump sum, giving them a regular income over a selected period of time. The term is chosen at the outset of the policy, and this type of policy would usually be taken to replace a lost salary or to provide an income for a particular purpose, such as children's education expenses. With Family Income Benefit, you decide the term ahead of time, perhaps to match your expected income-earning years. So if you die with five years to go on the term of the policy, it pays out the benefit to your dependent for the next five years. If you die with only six months to go to the end of the term, your family will only receive six months' worth of benefit.
life insurance guide
Introduction
What will happen to your loved ones after you die? Will they be able to support themselves? Can your spouse manage the mortgage payments and ensure your children are able to attend university? Arranging life assurance cover is the best way to ensure your family is taken care of in the event of your death, giving both you and them peace of mind. Many of us are superstitious about planning for after our death, believing it to be a morbid topic and one that might even hasten the inevitable. But knowing you have a comprehensive life assurance programme in place will provide peace of mind for both you and your loved ones. Life assurance, put simply, is a policy provided by an insurance company that pays your family either a lump sum or a series of smaller sums in the event of your death. Policies vary widely; some may guarantee a payout, others expire after a certain period of time. Some have premiums and payouts set in stone, while others offer more flexibility. There are many factors to consider when choosing a life assurance policy. What sort of cover do you need? How much cover should you arrange? Do you need basic life assurance or more extensive critical illness cover, and what about tax? As a financial data comparison site, Moneynet.co.uk can direct you to the best life assurance deals to meet your needs. The internet makes it easy to shop around to find the best deals, but you need to ensure that a deal really suits you and your family.
What will happen to your loved ones after you die? Will they be able to support themselves? Can your spouse manage the mortgage payments and ensure your children are able to attend university? Arranging life assurance cover is the best way to ensure your family is taken care of in the event of your death, giving both you and them peace of mind. Many of us are superstitious about planning for after our death, believing it to be a morbid topic and one that might even hasten the inevitable. But knowing you have a comprehensive life assurance programme in place will provide peace of mind for both you and your loved ones. Life assurance, put simply, is a policy provided by an insurance company that pays your family either a lump sum or a series of smaller sums in the event of your death. Policies vary widely; some may guarantee a payout, others expire after a certain period of time. Some have premiums and payouts set in stone, while others offer more flexibility. There are many factors to consider when choosing a life assurance policy. What sort of cover do you need? How much cover should you arrange? Do you need basic life assurance or more extensive critical illness cover, and what about tax? As a financial data comparison site, Moneynet.co.uk can direct you to the best life assurance deals to meet your needs. The internet makes it easy to shop around to find the best deals, but you need to ensure that a deal really suits you and your family.
What is best for me - A personal loan or mortgage?
The more you borrow, the lower the rate of interest. And at the top end of the borrowing scale, personal loans are competing with mortgages, which usually have a lower interest rate. While personal loans typically have rates between around 6 per cent and 18 per cent, it's possible to find a fixed rate mortgage at 5 per cent.
personal loan searchpersonal loan best buyspersonal loan guide If you're borrowing £15,000 for some major work on the house, it's worth thinking very carefully whether it would be cheaper to get a mortgage than a personal loan. Mortgage lenders are more than ready to extend existing mortgages or to tempt customers over from other lenders, particularly when increases in property prices have left many people with large amounts of equity in their home. You can arrange an extended mortgage over a period similar to a personal loan, and the repayments, like loans, are structured to pay off the debt at a fixed time. But beware. Borrowers always have to be aware of the risk of losing their home if they can't keep up with the bigger monthly repayments.
personal loan searchpersonal loan best buyspersonal loan guide If you're borrowing £15,000 for some major work on the house, it's worth thinking very carefully whether it would be cheaper to get a mortgage than a personal loan. Mortgage lenders are more than ready to extend existing mortgages or to tempt customers over from other lenders, particularly when increases in property prices have left many people with large amounts of equity in their home. You can arrange an extended mortgage over a period similar to a personal loan, and the repayments, like loans, are structured to pay off the debt at a fixed time. But beware. Borrowers always have to be aware of the risk of losing their home if they can't keep up with the bigger monthly repayments.
What are the pitfalls in arranging a personal loan?
Banks and building societies and other lending institutions are keen to compete for our business because there is big money to be made from personal loans. When we borrow money, be it on a mortgage or credit card or bank overdraft, the lender makes profit from the interest charged. The interest rate applied is known as the Annual Percentage Rate (APR), and your first consideration when arranging a loan is to compare the APRs of different products as a means of determining how competitive they really are.If it's presented as a monthly rate of interest, look for the annual equivalent, which will allow you to compare it with other lenders. There's a wide variation in the rates available - and there's nothing to be gained by paying any more than is necessary. So don't think that just because your own bank or other lender says it has a special offer for customers this is going to be the best available.There's nothing to stop you going elsewhere - and there's every reason to shop around as widely as possible. When you're looking at interest rates, it's also important to consider any other factors that might be making them cheaper. For instance, a 'secured' loan might have a lower interest rate but it will represent a much higher risk, because if you default on repayments you could lose your home. It is not unusual for lenders to offer different APRs depending on the method of application e.g. applications by telephone may receive a higher APR than those done online, so it's well worth shopping around for the best deal.If you are looking for a low cost loan, comparing the APR is always a good place to start. Lenders do quote interest rates in different ways, and it's worth familiarising yourself with these before you start.If your loan is a truly flexible product then you may also be able to withdraw funds from the account on a rolling basis, providing you stay within your credit limit. Lenders also offer repayment holidays or payment breaks, allowing you to take a break from your monthly repayments either at the start of the loan (known as 'deferred repayment') or at an agreed point during the term. Interest will continue to accrue on the outstanding balance and this may result in increased monthly payments so your debt is still repaid over the term agreed at the outset.
Secured or unsecured: Which kind of loan is best for me?
Secured or unsecured are the two options available to most people, although by far and away most people arrange their personal loans on an unsecured basis.Secured loans are - as the name suggests - arranged on the assumption that the borrower is going to put up some kind of surety to the lender. Generally this is the borrower's property. This means that the lender has the right to take ownership of the asset if you fail to make the repayments that are due under your loan agreement. While most of us would baulk at the prospect of putting our homes on the line, there are advantages to taking out a secured loan. For example, the lender's risk of default is reduced, which usually means a lower interest rate or perhaps a longer repayment period. One of the key differences between secured and unsecured loans is that it is usually possible to borrow far more by going down the secured route. Lenders will consider much higher sums if they know they have a security over your property and it is possible to arrange up to £100,000 - but you'll typically need to put the deeds to your home on the table. The amount borrowed is repaid monthly over an agreed term agreed at the outset, which will usually range between three years and twenty five years. You may be charged a penalty if you repay your loan earlier than agreed, and you should check each lender's individual policy.But the key issue here is that, when you see that bleak warning notice 'Your home is at risk if you fail to keep up with repayments', it really does mean that. Consider therefore the risk of losing the asset, were you to fall into arrears with the required repayments, against the advantage of paying slightly lower regular payments.It will probably come as no surprise to learn that around 90 per cent of all loans arranged fall into the unsecured category.
Put simply, you do not have to put up any surety for the loan, and the lender trusts in you and your ability to repay the debt.The rates of interest charged are normally higher or the maximum loan terms are significantly shorter than those available for secured loans, but even so, five years - or 60 months - is usually long enough to cater for most borrower's needs. And if you are able to arrange a loan at less than 6 per cent, then you can see why levels of personal borrowing are today higher than at any time previously - even during the consumer boom of the late Eighties.Most people will prefer to take out a fixed interest rate, which effectively means it will stay the same throughout the term of the loan, regardless of any changes in the bank base rate.In much the same way as arranging a fixed rate mortgage allows you to determine your monthly repayments, allowing you to budget accurately, so does the fixed rate personal loan.But go for a variable interest rate, and you will find your repayments will rise and fall in line with any changes to the bank base rate. Although lowest APR is one factor that contributes to a 'cheap' loan, you should always pay attention to the small print as any additional costs will be found there. Remember also that if your credit rating is not as good as it might be, lenders will see you as a higher risk and may not offer you the lowest APR on their personal loan products. That said, do not be too thrown if you have to pay a slightly higher APR. The difference between one or two per cent on repayments spread over three years is very little in the overall scheme of things.Some lenders do apply an early settlement charge (also known as a redemption penalty) if the debt is repaid in full before the agreed end date. This can be up to 2 months interest so it pays to check this out before you commit. If you think you'll clear the debt before the end of the term then your best bet will probably be a loan with no early settlement costs, even if the APR is slightly higher. Whatever you decide, you'll need to do your sums before you sign on the dotted line.
Put simply, you do not have to put up any surety for the loan, and the lender trusts in you and your ability to repay the debt.The rates of interest charged are normally higher or the maximum loan terms are significantly shorter than those available for secured loans, but even so, five years - or 60 months - is usually long enough to cater for most borrower's needs. And if you are able to arrange a loan at less than 6 per cent, then you can see why levels of personal borrowing are today higher than at any time previously - even during the consumer boom of the late Eighties.Most people will prefer to take out a fixed interest rate, which effectively means it will stay the same throughout the term of the loan, regardless of any changes in the bank base rate.In much the same way as arranging a fixed rate mortgage allows you to determine your monthly repayments, allowing you to budget accurately, so does the fixed rate personal loan.But go for a variable interest rate, and you will find your repayments will rise and fall in line with any changes to the bank base rate. Although lowest APR is one factor that contributes to a 'cheap' loan, you should always pay attention to the small print as any additional costs will be found there. Remember also that if your credit rating is not as good as it might be, lenders will see you as a higher risk and may not offer you the lowest APR on their personal loan products. That said, do not be too thrown if you have to pay a slightly higher APR. The difference between one or two per cent on repayments spread over three years is very little in the overall scheme of things.Some lenders do apply an early settlement charge (also known as a redemption penalty) if the debt is repaid in full before the agreed end date. This can be up to 2 months interest so it pays to check this out before you commit. If you think you'll clear the debt before the end of the term then your best bet will probably be a loan with no early settlement costs, even if the APR is slightly higher. Whatever you decide, you'll need to do your sums before you sign on the dotted line.
How much should I borrow and over how long?
Most people typically clear their loans on a regular monthly basis, taking from anywhere between one and five years.For sums of between £1,000 and £25,000, the personal loan is these days typically the first port of call for millions of people needing a bit extra - many borrowers will use their loans to consolidate other, more expensive debts such as outstanding credit card balances and bank overdrafts - but of course millions use them for major purchases such as motor cars.As a general rule of thumb, the more you borrow, the cheaper the rates of interest. So if you want say, £1,000, you could be looking at rates as high as 20 per cent - the lenders say this is because of the relatively high administration costs involved in arranging loans. Sums of this size are often better put on a low cost credit card, or run as a bank overdraft. But for the bigger sums, many will opt for a personal loan. Borrow £25,000, spread over say a five year period, and you could be looking at rates of under six per cent.
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personal loan searchpersonal loan best buyspersonal loan guide With the Bank of England base rate still at historic lows, this represents very cheap borrowing.Another consideration is whether or not to take out insurance - known as payment protection insurance - which covers your loan repayments in the event of your not being able to work through accident, sickness or unemployment.But this kind of cover can significantly drive up the cost of the loan repayments, and there are often many clauses in the small print which can trip you up. If you are self-employed, or on short term working contracts for example, you may find that the terms and conditions of the loan are not appropriate for your circumstances.
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personal loan searchpersonal loan best buyspersonal loan guide With the Bank of England base rate still at historic lows, this represents very cheap borrowing.Another consideration is whether or not to take out insurance - known as payment protection insurance - which covers your loan repayments in the event of your not being able to work through accident, sickness or unemployment.But this kind of cover can significantly drive up the cost of the loan repayments, and there are often many clauses in the small print which can trip you up. If you are self-employed, or on short term working contracts for example, you may find that the terms and conditions of the loan are not appropriate for your circumstances.
Personal Loan Guide
Introduction - More choice than ever before
TIME was when we had little choice if we needed to arrange a loan. The first port of call was typically the High Street bank, or local building or friendly society. We would then have to rely upon the benevolence of the manager - and of course a decent credit record showing that we were a good risk when it came to repaying money borrowed.The amounts we could borrow were restricted, and even up to just a decade or so ago, going cap in hand for sums above £10,000 was virtually unheard of. Today however the situation is radically different. As a nation we collectively owe in the region of one trillion pounds - yes, one trillion - comprised for the most part of mortgage, credit/store cards and personal loans.One of the reasons for this massive uplift in debt is the easy availability of money. Whereas we used to be limited to the High Street when wanting to borrow significant sums to buy a car, say, or maybe to help finance other major projects, in 2005 there are endless avenues open to us.
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personal loan searchpersonal loan best buyspersonal loan guide Along with the High Street lenders - some of whom offer the most competitive rates available in today's fiercely competitive market - we can now log onto the Internet to source a personal loan, or pick up the telephone to arrange an in-principle loan via a finance company in a matter of minutes.As a financial data comparison site, Moneynet.co.uk can point you in the right direction for the best deals to meet your needs. There is a bewildering choice, and not all of them will be right for you. For example, some loans impose hefty penalties should you want to pay them off earlier than the agreed borrowing period. The golden rule is always to read the small print before signing for a loan.
TIME was when we had little choice if we needed to arrange a loan. The first port of call was typically the High Street bank, or local building or friendly society. We would then have to rely upon the benevolence of the manager - and of course a decent credit record showing that we were a good risk when it came to repaying money borrowed.The amounts we could borrow were restricted, and even up to just a decade or so ago, going cap in hand for sums above £10,000 was virtually unheard of. Today however the situation is radically different. As a nation we collectively owe in the region of one trillion pounds - yes, one trillion - comprised for the most part of mortgage, credit/store cards and personal loans.One of the reasons for this massive uplift in debt is the easy availability of money. Whereas we used to be limited to the High Street when wanting to borrow significant sums to buy a car, say, or maybe to help finance other major projects, in 2005 there are endless avenues open to us.
more...
personal loan searchpersonal loan best buyspersonal loan guide Along with the High Street lenders - some of whom offer the most competitive rates available in today's fiercely competitive market - we can now log onto the Internet to source a personal loan, or pick up the telephone to arrange an in-principle loan via a finance company in a matter of minutes.As a financial data comparison site, Moneynet.co.uk can point you in the right direction for the best deals to meet your needs. There is a bewildering choice, and not all of them will be right for you. For example, some loans impose hefty penalties should you want to pay them off earlier than the agreed borrowing period. The golden rule is always to read the small print before signing for a loan.
Re-mortgaging - Is it really worth it and what are the catches?
The re-mortgage market in the UK is big business for most lenders. Mortgage lenders have become increasingly aggressive with their marketing tactics over recent years as they try to hold onto or increase their market share at the expense of their competitors. In some ways this has worked to the advantage of the consumer but it also means that most lenders will now offer more attractive deals to new borrowers than they will offer to their existing customers. Before the early 80's most people arranged their mortgage with one lender and then stuck with that mortgage throughout its life. Mortgages were generally provided by Building Societies and the borrower was expected to go cap in hand to their Building Society who would lend if a savings account had been held for a sufficient period of time and if the lender had not used up their quota of funds for that period. In other words the lender had the 'upper hand' and the borrower was at their mercy. This all started to change in the mid eighties as the role of the Buildings Societies became less restricted and a new Building Societies Act took effect which allowed the Building Societies to compete head to head with Banks and Insurance Companies in all areas of financial services. As the Banks and Insurance Companies saw their territory being invaded by this new breed of Building Society so they too fought back and started encroaching on the Building Societies territory, most significantly, by entering the mortgage market. In addition Building Societies were released from the constraints that they had been under with regard to raising funds and were now allowed to raise money on the Wholesale Money Markets. All of these changes combined to make one very big difference to the market - there was now no shortage of mortgage money for the financial institutions to lend and a big fight was on to attract the customer. As with any product greater competition is generally good for the buyer resulting in lower prices. So, let's now look at the situation in today's market. There are currently a little over 100 different mortgage lenders active in the UK market today. These range from the traditional Building Societies to Banks, Insurance Companies and the centralised lenders. As long as the applicant is credit worthy and the property to be mortgaged is good security there is no shortage of potential lenders. As I mentioned earlier, each of these lenders is anxious to maintain or increase their market share and this has resulted in an ever increasing array of new, innovative and competitive products being marketed. Unfortunately, in all of this most lenders seem to have forgotten their existing customer base and most of their marketing activities are directed towards attracting new borrowers rather than looking after their existing customers. The result of this has been to create a two-tier market. Most lenders will offer one set of products to new borrowers and another, less attractive, range of products to their existing customers (this is a generalisation and there are a few lenders who will offer existing customers access to the same products as new customers).
Choosing the most suitable interest rate structure
The first question that most people ask when considering a new mortgage is 'What type of interest rate structure is best for me? - Should I take a fixed rate, a capped rate, a discounted rate, a stepped rate, a standard variable rate or a cashback deal?' Indeed this all important question is one that needs very careful consideration. So let's look at each of these options in turn and attempt to simplify the choices available.
Fixed RatesFixed rate mortgages are available on a variety of terms and for most periods. At one end of the scale there are some very short term deals fixed for say 6 months, and at the other end of the scale there are offers that will fix the rate for the entire term of the mortgage. So should you opt for a fixed rate and if so what are the catches to watch out for? The decision you make here will normally depend on two factors. The first is what you feel will happen to interest rates over the coming months/years and secondly your approach to risk. Let me explain in more detail - If you feel that interest rates are likely to fall then it is unlikely that you will want to tie yourself in to a fixed rate for any period, particularly if you feel that the normal variable rate is likely to fall below the fixed rate. You will probably feel more inclined to take a discounted rate in these circumstances as you can then benefit from any fall in interest rates with a reduction in your mortgage repayments. The second consideration that will influence your decision is your attitude to risk. If you like to budget with certainty then you will probably want to fix your repayments for a reasonable length of time. Equally important is the amount of leeway you have with your budget and whether you can afford to meet any increase in repayments. If you are a first time buyer and have borrowed to your maximum limit then it is probably sensible to fix your repayments at a level which you can comfortably afford. If there is little 'slack' in your budget then you must consider 'can I really afford to take a chance on interest rates rising?' So, if you decide to opt for a fixed rate what are the catches and what points should you particularly watch out for? First let's look at the disadvantages of taking a fixed rate. Clearly the most obvious disadvantage is if interest rates fall - in this case you could find yourself paying more than you would have had to with a variable or discounted rate. If you have opted for a long term fixed rate then this decision could cost you dearly over the period of the fixed rate. You will also find that, with most fixed rates, you will be charged a penalty (called a redemption penalty) if you wish to change your mortgage or pay it off completely or in part in the first few years. With most fixed rate mortgages this penalty will certainly last for the term of the fixed rate and it is quite common for these penalties to extend beyond the fixed rate term, thereby tying you into that mortgage for a number of years after the fixed rate has finished. These redemption penalties are usually imposed at a level that would make it uneconomic to change the mortgage or transfer to another lender whilst the penalty is in place. There many lenders who offer fixed rates without redemption penalties or with penalties that only last during the fixed rate period. These products are certainly worth considering although you will usually find that, as a result of this, the rate offered is not the most competitive in the market. However, you do then have additional alternatives if interest rates work against you and you could be free to negotiate an alternative rate with the lender or, if the worst comes to the worst, move to a different lender.
Capped RatesA capped rate will give you the best of both worlds between a fixed rate and a variable rate. The cap is basically a ceiling on the interest rate above which it will not rise. On the other hand, if the normal variable rate falls below the capped rate then the variable rate will be charged. So, you have a guaranteed maximum rate with the benefit of a reduction in interest rate if this happens - sounds too good to be true? Well there are some catches - first you will usually find that the cap is set at a higher rate than the best fixed rates for a similar period. So, for example, if a capped rate is offered for 5 years capped at 8% you may find the best five year fixed rate is being offered at 7%. Secondly, you also need to watch out for redemption penalties as with fixed rates. The third point to watch out for is that sometimes these products are sold as 'cap and collar' products. This basically means that, as well as a ceiling on the interest rate above which it cannot rise there is also a collar on the rate which is a level below which the rate cannot fall. For example a product may be sold with a cap of 8% and a collar of 5% for 5 years. This means that within that 5 year period the interest rate is guaranteed not to rise above 8% but it will also not fall below 5% within that time either. This means that if the normal variable rate falls below the collared rate you will be paying 'over the odds'.
Fixed RatesFixed rate mortgages are available on a variety of terms and for most periods. At one end of the scale there are some very short term deals fixed for say 6 months, and at the other end of the scale there are offers that will fix the rate for the entire term of the mortgage. So should you opt for a fixed rate and if so what are the catches to watch out for? The decision you make here will normally depend on two factors. The first is what you feel will happen to interest rates over the coming months/years and secondly your approach to risk. Let me explain in more detail - If you feel that interest rates are likely to fall then it is unlikely that you will want to tie yourself in to a fixed rate for any period, particularly if you feel that the normal variable rate is likely to fall below the fixed rate. You will probably feel more inclined to take a discounted rate in these circumstances as you can then benefit from any fall in interest rates with a reduction in your mortgage repayments. The second consideration that will influence your decision is your attitude to risk. If you like to budget with certainty then you will probably want to fix your repayments for a reasonable length of time. Equally important is the amount of leeway you have with your budget and whether you can afford to meet any increase in repayments. If you are a first time buyer and have borrowed to your maximum limit then it is probably sensible to fix your repayments at a level which you can comfortably afford. If there is little 'slack' in your budget then you must consider 'can I really afford to take a chance on interest rates rising?' So, if you decide to opt for a fixed rate what are the catches and what points should you particularly watch out for? First let's look at the disadvantages of taking a fixed rate. Clearly the most obvious disadvantage is if interest rates fall - in this case you could find yourself paying more than you would have had to with a variable or discounted rate. If you have opted for a long term fixed rate then this decision could cost you dearly over the period of the fixed rate. You will also find that, with most fixed rates, you will be charged a penalty (called a redemption penalty) if you wish to change your mortgage or pay it off completely or in part in the first few years. With most fixed rate mortgages this penalty will certainly last for the term of the fixed rate and it is quite common for these penalties to extend beyond the fixed rate term, thereby tying you into that mortgage for a number of years after the fixed rate has finished. These redemption penalties are usually imposed at a level that would make it uneconomic to change the mortgage or transfer to another lender whilst the penalty is in place. There many lenders who offer fixed rates without redemption penalties or with penalties that only last during the fixed rate period. These products are certainly worth considering although you will usually find that, as a result of this, the rate offered is not the most competitive in the market. However, you do then have additional alternatives if interest rates work against you and you could be free to negotiate an alternative rate with the lender or, if the worst comes to the worst, move to a different lender.
Capped RatesA capped rate will give you the best of both worlds between a fixed rate and a variable rate. The cap is basically a ceiling on the interest rate above which it will not rise. On the other hand, if the normal variable rate falls below the capped rate then the variable rate will be charged. So, you have a guaranteed maximum rate with the benefit of a reduction in interest rate if this happens - sounds too good to be true? Well there are some catches - first you will usually find that the cap is set at a higher rate than the best fixed rates for a similar period. So, for example, if a capped rate is offered for 5 years capped at 8% you may find the best five year fixed rate is being offered at 7%. Secondly, you also need to watch out for redemption penalties as with fixed rates. The third point to watch out for is that sometimes these products are sold as 'cap and collar' products. This basically means that, as well as a ceiling on the interest rate above which it cannot rise there is also a collar on the rate which is a level below which the rate cannot fall. For example a product may be sold with a cap of 8% and a collar of 5% for 5 years. This means that within that 5 year period the interest rate is guaranteed not to rise above 8% but it will also not fall below 5% within that time either. This means that if the normal variable rate falls below the collared rate you will be paying 'over the odds'.
Mortgage guide
Introduction
The mortgage market is a competitive one and there are some great deals to be had and some huge savings to be made simply by shopping around and choosing the right deal. However, for the uninitiated, there are also many pitfalls to look out for and, with thousands of products, making the right choice can be a nightmare. The Moneynet Internet site (www.moneynet.co.uk) is a service aimed at the consumer that makes the mortgage finding process easier. Moneynet, launched in 1997, was the first company to publish mortgage information in an inter-active way and to make that information available to the consumer - previously this type of information has been made available to brokers and financial advisers only. The aim of this guide is to assist with other areas of the decision making process and I hope that you will be able to use this publication together with the Internet site to source the best product for your requirements and circumstances. One important point to note is that Moneynet is an independent company and we have no interest in promoting one product or lender over another. We simply provide an information service which is funded, primarily, by the sale of advertising space. Our web site contains details of over 100 lenders products and covers well over 95% of the market. Follow this guide through step by step and I hope that we can unravel some of the mysteries of the mortgage market for you. I also hope that this will lead to substantial savings for you over the years. Whilst every effort has been made to ensure that the facts in this guide are correct, no liability is accepted for any errors contained herein or for any loss resulting from actions taken as a result of the book. The information published in this guide is not intended as advice under the Financial Services and Markets Act and where individual advice is required it should be sought from a properly FSA authorised adviser. Links to such advisers are available on the web site.
The mortgage market is a competitive one and there are some great deals to be had and some huge savings to be made simply by shopping around and choosing the right deal. However, for the uninitiated, there are also many pitfalls to look out for and, with thousands of products, making the right choice can be a nightmare. The Moneynet Internet site (www.moneynet.co.uk) is a service aimed at the consumer that makes the mortgage finding process easier. Moneynet, launched in 1997, was the first company to publish mortgage information in an inter-active way and to make that information available to the consumer - previously this type of information has been made available to brokers and financial advisers only. The aim of this guide is to assist with other areas of the decision making process and I hope that you will be able to use this publication together with the Internet site to source the best product for your requirements and circumstances. One important point to note is that Moneynet is an independent company and we have no interest in promoting one product or lender over another. We simply provide an information service which is funded, primarily, by the sale of advertising space. Our web site contains details of over 100 lenders products and covers well over 95% of the market. Follow this guide through step by step and I hope that we can unravel some of the mysteries of the mortgage market for you. I also hope that this will lead to substantial savings for you over the years. Whilst every effort has been made to ensure that the facts in this guide are correct, no liability is accepted for any errors contained herein or for any loss resulting from actions taken as a result of the book. The information published in this guide is not intended as advice under the Financial Services and Markets Act and where individual advice is required it should be sought from a properly FSA authorised adviser. Links to such advisers are available on the web site.
What type of card should I go for, Standard, Gold…or Platinum
While carrying a Gold or Platinum card once conferred a certain prestige, these days there is very little difference between them although some credit card companies will insist on charging a fee for a Gold card, for example. Sometimes this kind of plastic does come with more bells and whistles - you might get better benefits like travel cover, for example, but the reality is that most adults with sound credit histories on modest incomes can apply for Gold or Platinum cards and they will not be aware of any difference to plainer plastic in their purses and wallets. Don't forget that the credit card companies don't just make their money on unpaid balances. Depending on how or where you use your card, you may be hit with unexpected charges, so it's important to read all the terms and conditions of the card before you agree to use it. The good news is that, as of March 2004, credit card issuers have had to summarise their interest charges and features in what's known as an "honesty" box, making their terms easier for the average consumer to understand. Check the conditions carefully, making reference to how you will be using the card.How are the monthly payments allocated to the total owing? You might hope that a monthly payment towards an outstanding balance would go towards the oldest charge first, or the highest-interest-rate balance first, but that is likely not the case. For example, if you have a credit card with a balance transfer at 0% and new purchases at 16.9%, the monthly payment will likely go towards the balance transfer first, ensuring that your interest rises more quickly. Be sure you understand the small print regarding your payment allocation - known as the "payment hierarchy" - before you agree to the terms and conditions.
Credit Cards - Balance Payment
Always pay off balance in full every month You use your credit card for everyday purchases, from groceries to petrol to household goods, and you never carry a balance over to the next month. In your case, the interest rate is irrelevant, as you'll never suffer the consequences of it. To avoid paying any charges at all, choose a card with no annual fee; however, you may prefer a card with a small annual fee that offers bonuses on the amount spent, such as travel rewards or cash back on purchases. As a regular spender, you'll be able to realise these bonuses more quickly.You need to ensure first that the card you choose has an interest-free period, and that you always pay before that period is up. Some cards offer up to 59 days interest-free, and you can ensure you are always on time with your payment by setting up a direct debit with your bank for the full amount each month.If you ever plan to use a credit card for big-ticket items as well, such as holidays or large purchases, and not paying off the full balance immediately, it may be worth getting another credit card with lower interest charges and using it only for that purpose. Usually pay off balance in full each month You use your credit card regularly, for everyday purchases as well as the odd luxury item, and though you try to pay it off in full each month you don't necessarily mind carrying the odd balance over. In your case, the interest rate isn't irrelevant - you need to ensure that you don't pay heavily for not paying off in full each month. To keep charges down, choose a card with no annual fee, and a low standard rate of interest. You may also be interested in cards with cash back or travel rewards schemes, but these cards will not necessarily have the lowest interest rates. Check the rate of rewards on each scheme to determine whether they are worth it for you; for example, if your average monthly spending rewards you with a basic domestic air ticket three years from now, you would probably save that much money by simply choosing a no-bonus low-interest credit card instead. Rarely or never clear balance each month You're the credit card companies' dream client, the one they make their money from, so you need to ensure they make as little as possible. Shop around for the lowest interest rate you can find. In your case, a low introductory rate may not be a wise choice, unless you are prepared to switch cards again after the introductory period is over and the rate usually switches to a much higher one. Look for a low standard rate and no annual fee.If you choose a low introductory rate - sometimes as low as 0% - that rate will revert to a standard level when the introductory period is over, so you'll need to look for a new card after six months or so depending on the offer. If you are already carrying a large balance, many cards now offer a low (sometimes 0%) rate on balance transfers as well as a low introductory rate, reverting to a standard rate after a certain time period and/or on any new purchases made on the card. If you have a balance you want to pay off, you may consider shifting it to a separate card with a low balance transfer rate, and making new purchases on a separate card. If you are trying to clear a balance, it's important to note that unless you are paying no interest at all, that balance will continue to rise even if you don't make new purchases. It will also take much longer to clear if you are paying only the minimum amount each month, as most or all of that payment will go towards interest charges. Paying a larger amount than the minimum each month will ensure that your debt is paid off more quickly.
An Introduction to Credit cards
WILL that be paper, or plastic? These days, our answer to that question is most likely to be plastic, as an increasing number of us rely on credit cards for our spending needs.Whether it's to spread the cost of an expensive purchase over several months, or to gain points towards a reward item, UK consumers are using credit cards more than ever - and owing close to £180 billion as a result. With the relatively easy availability of credit today, more can get in on the act - from greater numbers of companies offering Visa, MasterCard or store cards, to more people being approved for cards, including students and even those with shaky credit ratings. A credit card is a simple way of obtaining a credit rating and, used wisely, can help provide flexibility in spending and even bonuses like cash back offers or travel credits. However, they can also be an easy way to get into serious debt, when used improperly.Many people are lured into applying for certain credit cards with the promise of low - sometimes ridiculously low - interest rates, but depending on your personal circumstances and financial situation, there may be more important factors to consider.
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