Monthly Archives: March 2013

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Overview of George Osborne’s Budget 2013

The Chancellor of the Exchequer George Osborne recently released his 2013 budget which detailed his plan for the coming year 2013-14.  The new budget sees benefits for some groups and drawbacks for others – an overview is provided here:

For public sector workers, excluding the armed forces, once again pay scales will be restricted and pay rises will fall beneath inflation by 1%.  For many workers in the sector, this has been going on for 5 years.

Groups interested in climate change may be disheartened to hear of the new plans to harvest gas from new sources recently found. This is part of an initiative to help the public by obtaining more fuel and increasing energy investment.

There will also be some amendments to housing benefit, as the building of social houses will take longer, therefore no improvements have been made to waiting times. Although with right-to-buy schemes, the length of time required to have occupied the home before being able to purchase the property has been reduced to 3 years. This will hopefully help tenants who want to buy their home.

In a measure to establish more income from tax evaders, steps will be taken to deter businesses from purchasing companies at a loss to reduce tax. This has the potential to generate approximately £4.8 billion over the course of 5 years.

On another note the budget does have some positive aspects for drivers with the expected fuel duty rise cancelled. This is a welcome decision for many drivers who found the rising fuel costs to become a burden.

Those seeking to purchase a home will benefit from the help-to-buy scheme which will enable them to receive 20% of the value of their property as long as they have 5% that they can put down as a deposit first. Homeowners will also benefit as property prices are set to rise.

Beer duty has seen a reduction by 1p in an attempt to boost British pubs. In contrast to this wine, spirits and cider have all seen a rise in duty tax with wine now costing 10 pence more, spirits 38 pence more and cider 2 pence more.

Options When it Comes to Debt Management

People who want to clear the debt that they have accumulated have a number of different options. Each set of circumstances is individual and the method you use to reduce your debt will depend on how much money you owe and the income that you have available.

For some people, it can be as simple as learning to budget more strictly and following the mantra of spending less than you earn. If you find that you are just falling short of your payments each month, look at where you can make some savings on regular expenses, such as utility bills, grocery bills and consider switching your mortgage if you can find a better deal with another provider.

It may be that you have more serious debts to contend with and that budgeting alone won’t be enough to clear them. In the UK debt help comes in a variety of forms, depending on the level of debt you are faced with. There are many different debt management companies and financial charities that you can contact for an initial consultation.

Common debt solutions include:

Debt management plan

This is where you agree a monthly repayment for all your creditors, but it goes to the debt management company which then redistributes it on your behalf. A debt management plan can help in terms of administration for multiple debts and the debt management company may be able to negotiate a lower interest rate for you.

Debt consolidation loan

An alternative to a debt management plan is to take out a new loan to cover your existing unsecured debts. You then have one single payment to make each month, and debt consolidation loans usually have a lower rate of interest than credit or store card bills. You need to be strong-willed enough not to be tempted to start spending on credit cards, etc, until your debt consolidation loan is paid off, otherwise you could end up back in the same position you started in.

IVA

In the UK, people with debts greater than £10,000 owing to three or more creditors can enter into an Individual Voluntary Arrangement (IVA) which is a legal agreement drawn up between the person owing money and their creditors and passed by the court. Creditors aren’t obliged to agree to this, but usually do as it strengthens their chances of recuperating their money. When people seek bankruptcy advice, they will often be informed about taking out an IVA instead. IVAs can be a better option than declaring bankruptcy as your assets will not be put at risk.

These are just some of the options available to someone in debt, but before going ahead with any of the debt management solutions offered by third parties, you should seek independent financial advice.

Struggling With Monthly Expenses? Could a Payday Loan Help?

For people struggling with short-term cash flow, a payday loan can be a real life saver. All manner of bills and expenses need paying every single month, and if you don’t have available funds it can quickly send you into a financial panic.

How to apply for a payday loan

Fortunately, applying for a payday loan is a quick and painless process. There are a vast number of legitimate payday loan lenders on the internet today, who offer cash in your bank account in only a few hours.

The best part about the application process is that you don’t need to give your life history in order to get approved. The majority of lenders don’t do a credit check, and don’t care if your financial history is less than perfect.

All they are concerned with is whether or not you meet their simple criteria. Basically, you have to be 18 years of age or older, have a recognised bank account, and have some form of regular income that can be proved.

If you tick these 3 boxes, then you should have no problem at all getting approved for a payday loan.

The downside of payday loans

While payday loans are a great way to get yourself out of short-term financial hardship, they can quickly turn into a nightmare.

This is especially true if you fail to pay back the money on time. When this happens, you will be subject to a number of “late payment” fees, which can quickly leave you with a huge amount of debt and a compromised credit score.

Also, you may have a higher interest rate added to the loan, which will add even more money to the total amount payable.

With this in mind, you should only ever apply for a payday loan if you are certain that you can meet the payment deadline with no problems. If there is any doubt in your mind then you should seek out alternative forms of lending.

Getting payday loans every month

Some people get stuck in the habit of applying to payday lenders every month to help with their monthly expenses. Ultimately, this is not what payday loans were designed for, so if you find yourself in this situation you need to find a way out.

Take an honest look at your monthly expenses and see what costs you can cut out. For example, do you really need that premium cable television package?

Once you start to cut costs, then it will become easier to meet your essential expenses without the need for constant payday loans.