Saturday, 15 November 2014
Saturday, 1 November 2014
Word of the Day: Provision
provision
prəˈvɪʒ(ə)n/
noun
- 1.the action of providing or supplying something for use."new contracts for the provision of services"
synonyms: supplying, supply, providing, purveying, delivery, furnishing, equipping,giving,
donation, allocation, distribution, presentation
"the President condemned the provision of weapons to guerrillas" - 2.an amount or thing supplied or provided."changing levels of transport provision"synonyms: facilities, services, amenities, resource(s), equipment, arrangements,solutions;
verb
- 1.supply with food, drink, or equipment, especially for a journey."civilian contractors were responsible for provisioning these armies"
- 2.set aside an amount in an organization's accounts for a known liability."financial institutions have to provision against loan losses"
Saturday, 25 October 2014
When is it ok to use my savings to clear debt?
Is it OK for me to stop saving and pay off my debt?
That is a question that I see being asked quite a lot around forums and blogs about money. So to clarify the situation, the answer, here at the Smart Wallet HQ is an unequivocal and absolute YES. Get rid of any savings and pay off your debts. Go. Do it now, I'll wait until you return.
I can say this with certainty, because you stand to save more by doing this. Stop right there, first I'm told that saving is the key to good finances, and now that I have some savings you want me to stop saving and use it? Yes. Debts cost more than savings, clear it off and your finances are better off.
Lets get some things cleared. A credit is a positive addition to your net worth, like when my business pays me at the end of the month. I now have a net credit worthiness of say £2000, which means that I am now worth £2000 more than I was, 24 hours earlier.
A debt is the opposite of credit, in fact it is negative credit. If I have a debt of £1000, I am now worth £1000 less, because sooner or later, I will have to pay that money back. It is easy to calculate your net worth this way. Just add up all of your positive credits (house, car, laptop, jewelry) and then subtract all of your negative credits (credit card balances, loans, mortgages). Your OK when the sum is positive, but when it is not, then you need to start rethinking your finances.
The problem compounds because of, well... compound interest. Your £1000 negative credit can easily spiral to several times that. (Assuming a 35% APR on a credit card balance of £1000, after 1 month it will be £1029, after 2 months £1159, and after 12 months £1411).
And to add to our woes, the credit lenders are like casinos, the house always win. The debt interest rate will always beat any savings rate they provide. So if you borrow £1000, and put it into a savings account - you will lose. The savings will be paltry, compared to what you have to pay back in interest.
Ok, lets crunch some numbers. Lets assume you have a debt of £10000, with a modest 15% APR. This could be a car on finance or a personal unsecured loan. And lets say you have savings of £5000 earning 5% interest (yeah, right - that's not very easy to get, most banks pay you peanuts on your savings).
So your net worth is £5000 (without calculating for next months salary), and assuming no extra income/outgoings, your net worth is going to be as shown in the table below.
As you can see it is a fools game. You cannot win. Your savings will never outweigh your debts. And your net worth is spiraling further and further into the negative.
Now assuming that you use your savings to pay off the debt, here is another simulation:
Thirdly, look out for the small print. Common sense would dictate, that a lender would be happy to accept early repayment, as they are getting their money back and can use it elsewhere. But no, despite the fancy 3 piece suit your banker wears, he only does it to hide his dorsal fins and other shark like traits. There are a whole host of fees and penalties that a lender can charge you for early repayment. And in some cases, this might be the same as the interest they expect you to incur over the loan term, so you might be better off in that scenario, saving your money and slugging off the repayments as expected. Some mortgages, do allow a small percentage of penalty free over payment per year - if you can do that, do it.
Finally, don't forget to keep an accessible liquid emergency cash fund. Life can throw anything at you at anytime, from a burst drainage pipe to a broken boiler. It makes sense to pay off expensive loans/debts and should you need emergency cash, you can reborrow on a credit card and pay off the card within 30 days - but if getting a credit card is difficult or the rates are horrendous or you need the cash for longer than the 30 days interest free period, an emergency cash fund is important. For example, a cheap mortgage might mean you can use all your savings to overpay, but keep £1000 for emergencies. Or you might choose to spend all your savings overpaying the mortgage, knowing that you have a few thousand £ limit on a credit card. But should you have a 35% APR credit card loan, throw all your savings at that, and you can always reborrow from the card later should you need to. This will vary based on your circumstances, so will require some thought on your part.
That concludes my thoughts on debts vs savings. I hope that this piece encourages you to think about where your money will make the most impact (paying off debts), and hopefully it saves you some money in the long run too. Adios.
That is a question that I see being asked quite a lot around forums and blogs about money. So to clarify the situation, the answer, here at the Smart Wallet HQ is an unequivocal and absolute YES. Get rid of any savings and pay off your debts. Go. Do it now, I'll wait until you return.
I can say this with certainty, because you stand to save more by doing this. Stop right there, first I'm told that saving is the key to good finances, and now that I have some savings you want me to stop saving and use it? Yes. Debts cost more than savings, clear it off and your finances are better off.
Lets get some things cleared. A credit is a positive addition to your net worth, like when my business pays me at the end of the month. I now have a net credit worthiness of say £2000, which means that I am now worth £2000 more than I was, 24 hours earlier.
A debt is the opposite of credit, in fact it is negative credit. If I have a debt of £1000, I am now worth £1000 less, because sooner or later, I will have to pay that money back. It is easy to calculate your net worth this way. Just add up all of your positive credits (house, car, laptop, jewelry) and then subtract all of your negative credits (credit card balances, loans, mortgages). Your OK when the sum is positive, but when it is not, then you need to start rethinking your finances.
And to add to our woes, the credit lenders are like casinos, the house always win. The debt interest rate will always beat any savings rate they provide. So if you borrow £1000, and put it into a savings account - you will lose. The savings will be paltry, compared to what you have to pay back in interest.
Ok, lets crunch some numbers. Lets assume you have a debt of £10000, with a modest 15% APR. This could be a car on finance or a personal unsecured loan. And lets say you have savings of £5000 earning 5% interest (yeah, right - that's not very easy to get, most banks pay you peanuts on your savings).
So your net worth is £5000 (without calculating for next months salary), and assuming no extra income/outgoings, your net worth is going to be as shown in the table below.
 |
| The only winning move is not to play. |
| -ve Credits | +ve Credits | Total | |
|---|---|---|---|
| Current Month | -10,000 | +5,000 | -5,000 |
| Month 2 | -10,125 | +5,020 | -5,105 |
| Month 3 | -10,251 | +5,041 | -5,210 |
| Month 4 | -10,379 | +5,062 | -5,317 |
As you can see it is a fools game. You cannot win. Your savings will never outweigh your debts. And your net worth is spiraling further and further into the negative.
Now assuming that you use your savings to pay off the debt, here is another simulation:
| -ve Credits | +ve Credits | Total | |
|---|---|---|---|
| Current Month | -10,000 | +5,000 | -5,000 |
| Month 2 | -5,062 | +0 | -5,062 |
| Month 3 | -5,125 | +0 | -5,125 |
| Month 4 | -5,189 | +0 | -5,189 |
There is some light at the end of the tunnel, your net worth is a lot better in this scenario than in the previous one. Just after 4 months, your £128 better off than if you left your money in savings.
So, there you have it. While my theoretical simulations above may not represent your current financial circumstances accurately, it should give you a base for doing your own napkin calculations (if your inclined that way, I would recommend a good free spreadsheet, like google docs). Your always guaranteed to save more for your future self by paying down debts now.
There are specific cases, like my pre-2012 student loan, that incurs 0.0145% interest, which is beaten by my 0.018% savings in my emergency fund.
There are certain factors to take into account, the first and foremost is to pay off the most expensive debt first. This will be payday loans (why you have those is beyond me!), store cards (again, why?!), credit cards (a bit better, but still shop around for good deals, and money making schemes), as opposed to the mortgage, or a student load or a cheap personal loan - which provide 'cheaper' interest rates.
Consideration should also be given to a consolidation of loans. This will generally require speaking to someone face to face or over the phone, but it might help to reduce your costs and repayments (and credit score) by having to make a single repayment instead of 3 or more per month. You might also be able to use credit cards to your advantage, by shifting the balances of several cards to a long 0% deal. Sometimes, just asking politely, you might get a reduction of the rates on your debts too.
There are specific cases, like my pre-2012 student loan, that incurs 0.0145% interest, which is beaten by my 0.018% savings in my emergency fund.
There are certain factors to take into account, the first and foremost is to pay off the most expensive debt first. This will be payday loans (why you have those is beyond me!), store cards (again, why?!), credit cards (a bit better, but still shop around for good deals, and money making schemes), as opposed to the mortgage, or a student load or a cheap personal loan - which provide 'cheaper' interest rates.
Consideration should also be given to a consolidation of loans. This will generally require speaking to someone face to face or over the phone, but it might help to reduce your costs and repayments (and credit score) by having to make a single repayment instead of 3 or more per month. You might also be able to use credit cards to your advantage, by shifting the balances of several cards to a long 0% deal. Sometimes, just asking politely, you might get a reduction of the rates on your debts too.
Thirdly, look out for the small print. Common sense would dictate, that a lender would be happy to accept early repayment, as they are getting their money back and can use it elsewhere. But no, despite the fancy 3 piece suit your banker wears, he only does it to hide his dorsal fins and other shark like traits. There are a whole host of fees and penalties that a lender can charge you for early repayment. And in some cases, this might be the same as the interest they expect you to incur over the loan term, so you might be better off in that scenario, saving your money and slugging off the repayments as expected. Some mortgages, do allow a small percentage of penalty free over payment per year - if you can do that, do it.Finally, don't forget to keep an accessible liquid emergency cash fund. Life can throw anything at you at anytime, from a burst drainage pipe to a broken boiler. It makes sense to pay off expensive loans/debts and should you need emergency cash, you can reborrow on a credit card and pay off the card within 30 days - but if getting a credit card is difficult or the rates are horrendous or you need the cash for longer than the 30 days interest free period, an emergency cash fund is important. For example, a cheap mortgage might mean you can use all your savings to overpay, but keep £1000 for emergencies. Or you might choose to spend all your savings overpaying the mortgage, knowing that you have a few thousand £ limit on a credit card. But should you have a 35% APR credit card loan, throw all your savings at that, and you can always reborrow from the card later should you need to. This will vary based on your circumstances, so will require some thought on your part.
That concludes my thoughts on debts vs savings. I hope that this piece encourages you to think about where your money will make the most impact (paying off debts), and hopefully it saves you some money in the long run too. Adios.
Wednesday, 1 October 2014
Word of the Day: Acquiescence
acquiescence
ˌakwɪˈɛsns/
noun
- the reluctant acceptance of something without protest."in silent acquiescence, she rose to her feet"
- synonyms: permit, consent to, agree to, allow, assent to, give one's consent to,accept, concur with, give one's assent to, give one's blessing to, say yes to, give the nod to, give one's approval to;
- antonyms: forbid, refusal
Tuesday, 9 September 2014
Smart Wallet Tip: The Happiness Formula Edition
“Annual income twenty pounds,
annual expenditure nineteen nineteen six,
result happiness.
Annual income twenty pounds,
annual expenditure twenty pounds ought and six,
result misery.”
– Wilkins Micawber (David Copperfield, by Charles Dickens)
Outdated literature? Not at all. You will find much happiness when you learn to live within your means. And we can do this by reducing our wants. What pushes a typical £30000 p/a income over the brink? A few extra evenings out or even a new car or some nice new designer handbags, a new laptop, tablet or a smartphone. Moments and experiences that we care not to remember shortly afterwards, items that lose their appeal after the initial wow, they soon need replacing with newer shinier items to wow us again momentarily. (This is the essence of consumerism).
The solution is not to do insurance fraud and register your car to some rural farmyard out of the city to save yourself a few bucks, claim fraudulent benefits or to lie to the taxman and earn cash on the side - immorality and sin money (and the tax-man) will eventually catch up with you. Cut your expenditure, cut the crap in your life and feel the burden lift off your shoulders. Give your credit card, your bank account and your wallet and ultimately yourself, a little room to breath.
Living within your means, is not a very appealing concept. I mean, personal finance and investment is about eventually rolling around in flashy clothes and fast cars, right? Expensive watches, sunglasses and convertible cars are what we expect, yet all we face are overdue bills and desirable items that we spent days scoping out and shopping for, but which no longer mean anything to us.
But in the long term, non of that matters if you spend more than you earn, ultimately you will have to cough up the money and still be in the red.
But, penny pinching is only for the tight-fisted and really poor. Why would a middle-class citizen or even a upper-class consider it? The rich want to keep their money so do the poor. The same rules apply. Earn £10 and spend £11, misery. Earn £10,000 and spend £10,001, result in.... misery.
After years of ultra top secret research in a urban high tech lifestyle, I can now reveal to you my ultra top secret formula for happiness:
annual expenditure nineteen nineteen six,
result happiness.
Annual income twenty pounds,
annual expenditure twenty pounds ought and six,
result misery.”
– Wilkins Micawber (David Copperfield, by Charles Dickens)
Outdated literature? Not at all. You will find much happiness when you learn to live within your means. And we can do this by reducing our wants. What pushes a typical £30000 p/a income over the brink? A few extra evenings out or even a new car or some nice new designer handbags, a new laptop, tablet or a smartphone. Moments and experiences that we care not to remember shortly afterwards, items that lose their appeal after the initial wow, they soon need replacing with newer shinier items to wow us again momentarily. (This is the essence of consumerism).
The solution is not to do insurance fraud and register your car to some rural farmyard out of the city to save yourself a few bucks, claim fraudulent benefits or to lie to the taxman and earn cash on the side - immorality and sin money (and the tax-man) will eventually catch up with you. Cut your expenditure, cut the crap in your life and feel the burden lift off your shoulders. Give your credit card, your bank account and your wallet and ultimately yourself, a little room to breath.
Living within your means, is not a very appealing concept. I mean, personal finance and investment is about eventually rolling around in flashy clothes and fast cars, right? Expensive watches, sunglasses and convertible cars are what we expect, yet all we face are overdue bills and desirable items that we spent days scoping out and shopping for, but which no longer mean anything to us.
But in the long term, non of that matters if you spend more than you earn, ultimately you will have to cough up the money and still be in the red.
But, penny pinching is only for the tight-fisted and really poor. Why would a middle-class citizen or even a upper-class consider it? The rich want to keep their money so do the poor. The same rules apply. Earn £10 and spend £11, misery. Earn £10,000 and spend £10,001, result in.... misery.
After years of ultra top secret research in a urban high tech lifestyle, I can now reveal to you my ultra top secret formula for happiness:
Expenditure > Income = Misery
Expenditure < Income = HappinessStop being miserable.
Friday, 15 August 2014
I like big butts and I cannot lie!
First of all an apology to all of those who came here looking for something saucy. Today's musings are about water butts.
 |
| which butt are you here for? |
What are they?
A water butt is a container that connects to your drainage downpipe (from the roof of your house/building) and collects the rainwater.
Why would I want one?
Because for a cheap initial outlay, over the course of its lifetime, a water butt will save you loads on your water bill costs.
How do they work?
A water butt comes with plenty of parts, the things to look out for in your kit are the following:
- the drum (it would be a pretty useless kit without anything to hold the water)
- the stand (not necessary, but it lets the drum sit higher off the ground, allowing you to use the tap to take water out of the drum - you can frugally make a stand out of bricks or any other durable material)
- the tap - this lets you take water out of the drum into watering cans or buckets)
- the diverter - this is a simple hose that connects your downpipe to the drum
- water butt link kit (not necessary, unless you want to connect multiple drums to act as a giant storage unit)
As it rains, the roof of your building acts as a giant collector and all the rain that it collects, come down through your downpipes and collect into the water butt. Once it is full, any excess rainwater, continues to drain as normal.
But I hear you scream, "tap water is dirt cheap! How frugal can you get?".
Hold your horses. I pay 97p for a cubic meter of water from severn trent on my current tariff. That sounds cheap. 1000 litres of water for 97p ~= £0.001p a litre (rounded for easier calculations). Still cheap. Flushing the toilet uses 15 litres of water, and costs 1.5p, flushing twice a day for a whole year costs costs £11 a year. For a family of 5 - that's £55 a year of good clean water, flushed down the toilet per year - which has a high energy requirement to produce and pump around the country, so it is not only wasteful of precious water, but also burns precious fossil fuels to produce.
That was the napkin calculation for a 15 litre toilet flush. Shall I get started with that lazy soak in the bath that uses 120 litres of water, or the 300 litre car wash or the watering can fiesta some of us have in our gardens during summer? ... I will spare you the details. But let it be known that I do believe with all my heart and soul, that we are a wasteful society and it is in our nature to spend the resources that we have in abundance. Not for once thinking about the bruises and scars we are leaving behind on the surface of the earth, in our mindless exploitation of it.
For all intents and purposes, we can use tap water for pretty much anything and everything, but do we need to? For drinking and hygiene - yes (although it is perfectly safe to boil water to clean it to drink). But watering a garden patch, flushing the loo or washing a car does not need clean, expensive tap water, with fluoride added to it, does it?
And in those situation why would you use expensive water? For £20~50 you can get water butts of all sizes and shapes. Not only is it good for the environment (and generally speaking, this is one situation where the bigger the butt, the better it is for the environment) as it saves water and energy, it is good for your finances. depending on your water usage, a water butt will pay for itself within the year. So what are you waiting for, get your butt to the store and get a water butt!
Monday, 4 August 2014
Musings on tyres
Oh how fickle the heart is, it wants what it wants. I have said it before and I will say it again. Owning a car is expensive. Owning a luxury car is even more so.
The underlying costs of owning a car is what really mounts up; insurance, road-tax, MOT, repairs, and fuel - are all part of the on-going drainage on the wallet. But here at the smart wallet HQ, even in the face of defeat, we will save a few quid.
Todays topic of discussion is tyres. Cars get a lot of wear and tear, especially if your job role see's you travelling up and down the country, and meeting clients and discussing projects - a mans got to make his money somehow. Of all the parts on a car, the part that gets the most wear are the tyres. They are on the ground all of the time and are subject to contact with mud, water, tar, metalworks, pot-holes, stones, grit, sand, rubbish, heat, cold, ice, snow - you name it, the tyre comes into contact with it.
I have recently discovered a split in the sidewall of one my rear tyre. The tyre itself is still in great condition, with loads of tread left on it. I am a little unsure of how the tyre split, as it looks very unnatural. There are 2 distinct cut marks on the tyre, almost like a stabbing from some sharp metallic object.
The damage is by no means extensive, it is just superficial and on the surface. The cuts are barely more than a mm deep. But it is alas, enough to warrant an MOT failure, or so I am told.
So, I will now need a new tyre. But no, to ensure even performance, and wear and tear, I will need to replace BOTH rear tyres. (you can image, the new tyre has more grip than the other, and then if you apply the brakes harshly - one side of the car will brake faster than the other, leading to swerving or spinning of the car - not a situation you want to find yourself in).
So, what are my options? Well, my first port of call to the Lexus showroom in Birmingham, 2 recommended manufacturer tyres - £155 each, plus fitting, plus geometry and tracking of all 4 tyres - total cost was just shy of £600. No thank you.
Part worn, again you cannot be sure of the safety of part worn tyres. I mean, they are all not bad and will not kill you, but there is a small risk in putting on part worn tyres, also as they are part worn, they will wear out faster, lead to MOT failures or problems faster than new tyres. It is in my opinion, not much financial economy to be gained using taking this route.
I then proceeded to call a few local tyre fitters, having experience with them in the past, I was a little wary. The tracking and geometry of performance cars is very subtle and should ideally be taken care of by a professional, who has enough reference material to look up exact angles, weights and variances to set the position and angle of the tyres correctly. A lot of small garages, use a string and hammer to measure and set tyres straight - which isn't accurate and may not be best for your car. Again, there were savings to be made here - I could get 'like new' tyres for £50 each, fitted - but again, there is no financial economy or reassurances on doing a shoddy job on car tyres - the only point of contact that I have to the ground at any speed.
Then I turned to a hybrid approach. My plan is to buy tyres online, at low markup. This is possible as a lot of online only companies have very little in the costs of storage (small warehouse or even no warehouse - stock is bought in, as and when ordered), employee costs (very minimal administrative tasks), and very little running costs (web hosting, no large office or building costs). Some reputable ones that I have found are listed below:
http://www.tyres-pneus-online.co.uk/
http://www.blackcircles.com/
http://www.tyresonthedrive.com/ (who will fit and balance tyres for you on your driveway, you will still need to go to a garage for the tracking)
http://www.tyreleader.co.uk/
http://www.oponeo.co.uk/
http://lovetyres.com/
http://www.mytyres.co.uk/
http://www.camskill.co.uk/ (Whom I have used in the past, with plenty of success)
Most will do price matches too, so you are able to research your tyres across all of these sites (read reviews and performance metrics), and find the cheapest and get them all to price match each other, to see if you can save a little money. Plus also search online (google: websitename voucher) to see if there are any current discounts for the site in question.
Well, with delivery of 2 goodyear performance efficientgrip tyres 245/45/R17 at £220, fitting at £10 (local garage, I then got Lexus to do the tracking at a one off cost of £99 - a total cost of £329 for what would have cost £600 initially. I also sold my old tyres through gumtree, as a set (clearly stating the issue with the defective tyre) for £60. (so total cost of £269)
Not a bad result, but it still stings that I had to shell out unnecessarily in the first place.
The underlying costs of owning a car is what really mounts up; insurance, road-tax, MOT, repairs, and fuel - are all part of the on-going drainage on the wallet. But here at the smart wallet HQ, even in the face of defeat, we will save a few quid.
Todays topic of discussion is tyres. Cars get a lot of wear and tear, especially if your job role see's you travelling up and down the country, and meeting clients and discussing projects - a mans got to make his money somehow. Of all the parts on a car, the part that gets the most wear are the tyres. They are on the ground all of the time and are subject to contact with mud, water, tar, metalworks, pot-holes, stones, grit, sand, rubbish, heat, cold, ice, snow - you name it, the tyre comes into contact with it.
I have recently discovered a split in the sidewall of one my rear tyre. The tyre itself is still in great condition, with loads of tread left on it. I am a little unsure of how the tyre split, as it looks very unnatural. There are 2 distinct cut marks on the tyre, almost like a stabbing from some sharp metallic object.The damage is by no means extensive, it is just superficial and on the surface. The cuts are barely more than a mm deep. But it is alas, enough to warrant an MOT failure, or so I am told.
So, I will now need a new tyre. But no, to ensure even performance, and wear and tear, I will need to replace BOTH rear tyres. (you can image, the new tyre has more grip than the other, and then if you apply the brakes harshly - one side of the car will brake faster than the other, leading to swerving or spinning of the car - not a situation you want to find yourself in).
So, what are my options? Well, my first port of call to the Lexus showroom in Birmingham, 2 recommended manufacturer tyres - £155 each, plus fitting, plus geometry and tracking of all 4 tyres - total cost was just shy of £600. No thank you.
Part worn, again you cannot be sure of the safety of part worn tyres. I mean, they are all not bad and will not kill you, but there is a small risk in putting on part worn tyres, also as they are part worn, they will wear out faster, lead to MOT failures or problems faster than new tyres. It is in my opinion, not much financial economy to be gained using taking this route.
I then proceeded to call a few local tyre fitters, having experience with them in the past, I was a little wary. The tracking and geometry of performance cars is very subtle and should ideally be taken care of by a professional, who has enough reference material to look up exact angles, weights and variances to set the position and angle of the tyres correctly. A lot of small garages, use a string and hammer to measure and set tyres straight - which isn't accurate and may not be best for your car. Again, there were savings to be made here - I could get 'like new' tyres for £50 each, fitted - but again, there is no financial economy or reassurances on doing a shoddy job on car tyres - the only point of contact that I have to the ground at any speed.
Then I turned to a hybrid approach. My plan is to buy tyres online, at low markup. This is possible as a lot of online only companies have very little in the costs of storage (small warehouse or even no warehouse - stock is bought in, as and when ordered), employee costs (very minimal administrative tasks), and very little running costs (web hosting, no large office or building costs). Some reputable ones that I have found are listed below:
http://www.tyres-pneus-online.co.uk/
http://www.blackcircles.com/
http://www.tyresonthedrive.com/ (who will fit and balance tyres for you on your driveway, you will still need to go to a garage for the tracking)
http://www.tyreleader.co.uk/
http://www.oponeo.co.uk/
http://lovetyres.com/
http://www.mytyres.co.uk/
http://www.camskill.co.uk/ (Whom I have used in the past, with plenty of success)
Most will do price matches too, so you are able to research your tyres across all of these sites (read reviews and performance metrics), and find the cheapest and get them all to price match each other, to see if you can save a little money. Plus also search online (google: websitename voucher) to see if there are any current discounts for the site in question.
Well, with delivery of 2 goodyear performance efficientgrip tyres 245/45/R17 at £220, fitting at £10 (local garage, I then got Lexus to do the tracking at a one off cost of £99 - a total cost of £329 for what would have cost £600 initially. I also sold my old tyres through gumtree, as a set (clearly stating the issue with the defective tyre) for £60. (so total cost of £269)
Not a bad result, but it still stings that I had to shell out unnecessarily in the first place.
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Before we start, if you have been rejected for a credit application recently (credit card, bank account, insurance, mobile phone contract etc) - stop applying for more. You need to take a step back and figure out why you have been rejected. Further applications, could have a spiraling negative effect on your credit report. So follow these steps improve your rating.
Step 1 - Access and check your report
Obviously, being a Smart-Wallet reader, you will itemise the date in your calendar/diary and cancel the free trial at no cost to you - thereby earning some cashback and effectively getting paid to check your credit history. Noddle, also offers a free credit report, which is largely the same as equifax/experian, so you can use that too.
Step 2 - You need to start somewhere
Start with a basic credit card, even if its the one offered by your bank account provider (although, I would recommend either capital one or aqua - as they provide 0.5% cashback), and use it lightly for your necessary expenses, spend a few quid on it monthly and then have a direct debit clear up that expenditure. Over the next few months, your credit report will have activity, and it will show you to be a responsible borrower.
Step 3 - Too much credit is bad
Step 4 - Get errors amended
Step 5 - Stability
Step 6 - Register to vote
Step 7 - Space and time
Step 8 - Time and money
Rule of thumb for credit cards is to use them as a debit card. Use them for benefits (cashback/voucher/etc), then pay off with a direct debit set to clear the whole bill at the end of the month. Do not spend money you do not have. £5 late now, could be all the difference to that loan application 3 years later.
Step 9 - One for all, all for one.
Step 10 - Check, then recheck