Charges For Financial Products 'Increasing'

Britons are facing more fees than they did last year on
financial products and services such as personal loans,
secured loans, mortgages and credit cards, as well as on
savings and current accounts, according to the latest
research from online comparison service moneysupermarket
The website has found that across five financial products
British consumers now face a combined total of 112 fees, a
number that is slightly higher than the 110 faced at the
same time last year. The areas investigated were mortgages,
loans, savings, current accounts and credit cards, with the
findings of the research dubbed as "galling" by the
managing director of moneysupermarket, Stuart Glendinning.

"It is unbelievable that five financial products can be the
root of so much penalty pain. With so many default fees and
charges in place, even the most astute consumer can fall
foul. People deserve financial penalties to be transparent
and fair from the outset," Mr Glendinning said.

Mortgages were found to be the cause of most problems when
it came to fees and penalty charges, with a total of 51
different fees attached to the products. While exit fees
may have been curbed, moneysupermarket said, fees for
copying documents, charges for changing payment methods and
other ways for banks to make money have been introduced in
their place.

Some 11 different fees and charges are attached to loan
products, according to the website, with personal loans,
secured loans and debt consolidation loans in certain cases
carrying late payment fees or early settlement fees. Unpaid
direct debits or bounced cheques related to loans can set
consumers back about 35 pounds a time too, moneysupermarket
claimed.

Credit cards and overdrafts attached to current accounts,
two further methods of borrowing, also carry fees. While
the Office of Fair Trading has capped credit card fees at
12 pounds, moneysupermarket notes that the number of credit
card charges has risen from 17 to 19, suggesting that the
providers are introducing further fees to replace capped
revenue. Where current accounts are concerned, slipping
over the agreed overdraft limit can result in a charge, as
can having a payment bounced, just two of 27 possible
charges consumers face in relation to their current
accounts.

"A year on and providers are still giving with one hand and
taking with the other. It is understandable that banks want
to make up any profit lost by the clampdown on fees. But we
are seeing sneaky tactics by some providers, who are
renaming charges or introducing a new fee in their place -
a practice that doesn't treat customers fairly," Mr
Glendinning added.

The area that least charges or fees are attached to is
savings accounts, where just four such penalties are
imposed. Withdrawal charges or problems through not
depositing the required monthly funds are two of those
involved, but these are far less in number than those
associated with loans or mortgages especially.

Last month, the managing director of Picture Financial
emphasised the importance of structuring debt in the best
possible way to make payments more manageable, something
that would potentially avoid some of the fees highlighted
by moneysupermarket.

----------------------------------------------------
Abbi Rouse writes for All About Loans. Our visitors are
offered advice and information all about loans, they can
also apply online for tenant loans and secured loans for
any purpose. Visit today: http://www.allaboutloans.co.uk

Why Women Stay Poor

The UK Equal Opportunities Commission has stated that it
will take at least two more generations for women to bridge
the gap and reach the same earnings as our full time male
colleagues. This is despite the fact that the first equal
pay legislation was introduced over 30 years ago. Progress
is being made, but ever so slowly. Why is it that women
can't seem to catch up?

There are certainly enough motivators. We hate the fact
that we don't have enough money, we know we probably spend
too much and we certainly know we don't save as much as we
should. There are also all the horror stories about
failing pensions and old age poverty. These are still not
enough to spur us into action and take control of our
income generation. The answer is deep seated and lies in
our conditioning. Until we understand how this impacts our
attitude to money, all the changes in legislation and
extended maternity leave in the world will not raise our
earning levels.

Our conditioning is determined at a very early age. Some
time between the ages of 0 and 8 we are taught a set of
values or beliefs. In fact, David McClelland,
Distinguished Research Professor of Boston University,
proved it could be as early as 0 to 3 when our 'values' are
determined by our parents and those most closest to us.
These values impact how we feel about and respond to all
sorts of things including our attitudes to money, wealth
and the types of work we should be pursuing.

The emphasis on should is deliberate. Values are all about
what we believe we should be doing to please others, to
please society in general and to fit in.

For women and money this is complicated. Women today are
taught the importance of being financially independent, to
be self reliant because, afterall, 'a man is not a plan'.
However, sometimes the messages we hear growing up are
inconsistent and conflicting. On the one hand, we're
taught about the importance of money the need to spend and
save it wisely. On the other, we're implicitly and
explicitly taught that it's equally important to be kind,
nurturing and collaborative; that the most important thing
is our relationship with others and not our relationship
with money. Unlike men, we are not taught to be powerful
and 'go for the kill'. This makes us reluctant to demand
what we think we deserve, including equal pay.

To add insult to injury, we are told at a very early age
that girls are poor at maths. From this we conclude that
we must be bad at finance and managing money as well. As a
consequence, we lack confidence in dealing with money,
preferring others to take charge.

If our parents were raised during or shortly after the war,
we also inherited a mentality of scarcity which continues
to impact our attitude to risk and money as we become
adults and parents in our own right.

What has been the result?

Besides the earnings gap which persists, a recent survey by
the Economist Intelligence Unit on behalf of Barclays
Wealth showed that we are far less likely to take risks
with our money, whether in personal finance or business
affairs. Women tend to place less importance than men on
our income from investments and we save to reach a goal.
Once the goal is reached we will often act to protect what
it is that we have built up. This means we are limiting
our potential to create even more wealth and be superrich.

Men have a different attitude and game plan. The same
survey showed that men claim to have better knowledge than
women of every aspect of personal finance. They are more
confident and as Dr Ros Altmann, Governor of the London
School of Economics states, "Men have more of a mindset
that you have to just go out and get it and you can see
their attitude towards risk taking in the games they play."
It may just be a matter of confidence or bravado, but men
play to win, take less time researching investment products
and invest in the longer term.

Does this all mean we are doomed to stay poor for the rest
of our lives? No! It means that what you focus on is what
you get and it's time to focus on getting rich. Being rich
is a positive thing. It is about flexibility, freedom and
being in control.

What do we to become rich?

1. Choose to do something about your financial literacy
Financial skills are not innate but learnt. We need to
learn financial skills and practice them to gain
confidence. This means undertaking short courses in
financial literacy which teach you how to prepare a balance
sheet or income statement. Read the financial pages of
daily newspapers to build an understanding of the financial
world at large. Don't be put off by 'big words', buy a
jargon buster such as "The Dummies Guide to Investing".

2. Spend don't save Invest a defined amount (minimum 10% of
your net income) every month into a high income bearing
savings account – but don't leave it there. Once you have
accumulated enough, buy an asset which will produce passive
income indefinitely. This could be a buy to let property
which produces positive cash flow. Use this positive cash
flow to buy a second income generating asset and continue
to build assets.

3. Develop financial goals and stick to them After you've
built your financial skills and have learnt to prepare a
balance sheet and income statement, define how much income
and assets you need to make you feel 'rich'. This will be
different for each individual. If you are planning your
retirement fund aim to build a fund that contains 25 times
the annual amount you want to have when you retire. So, if
you want a total income of £30,000 each year when you
retire, you need to have £750,000 in your retirement fund.

4. Reward achievement in investment – don't use spending as
an emotional crutch

Our client wanted to buy a new Audi sportscar for £500 per
month. Our challenge to her was to develop a stream of
passive income to produce £500 per month within a year and
then buy the sportscar as a reward.

5. Network, network, network – but network with
financially literate and clever people.

We are told that women are great at networking so use this
skill to build networks with others (both men and women)
who are interested in building wealth. Ask around to
identify good tax accountants, IFAs, property companies and
so forth. Build your own 'wealth team' with those
individuals and companies who share your views and your
ideals.

----------------------------------------------------
Pam Kennett is a Director of WealthBeing. Pam has first
hand experience of the confusing world of finance and money
through building a buy to let portfolio of £2 million.
WealthBeing is a wealth education and coaching company
which helps individuals develop practical skills and
knowledge to build their wealth.
Find out more by visiting http://www.wealthbeing.co.uk or
contact Pam direct at pam@wealthbeing.co.uk

Practical Self Employed Tax Tips

What is self employment? Directors of companies are not
self employed but employees of that company. In essence
anyone who is in business either as a sole trader or part
of a partnership and receives income that is not taxed
under the PAYE system is effectively self employed.
Occasional miscellaneous receipts would not be regarded as
self employment and should be entered on the tax return as
"All Other Income" however a regular source of receipts
would be regarded as self employment income and anyone self
employed should register with the Inland Revenue within 3
months of starting trading or risk being fined £100.

Keep a record of all transactions. Sales turnover is the
amount the business earns before deducting business
expenses including receipts of any kind for goods sold or
work done such as commission, tips, payments in kind, fees
and insurance proceeds. Sales of fixed assets are excluded
from sales turnover as are Business Start up grants which
are entered in a different section of the self assessment
tax return. DIY Accounting produce excel spreadsheets to
record the sales income and bank receipts. Check the
amounts deposited do not exceed the declared turnover which
would indicate that you have understated your sales and
your tax liability would at the least be increased unless
you could provide a solid reason for the anomaly.

Ensure financial, purchase and sales records are
compatible. Compatibility will vary from business to
business. Examples if you post 100 EBay items your records
should show 100 items of income and 100 items of postage.
Buy food for a restaurant for resale at four times cost,
some wastage is inevitable but the underlying compatibility
between sales generated and purchases should be reasonable.
The average number of meals sold from a take-away shop
should be compatible with the number of take-away cartons
purchased. A taxi driver should not claim fuel receipts
during his holiday period and the fuel bills should be
compatible with the fares obtained. Unusual and
incompatible expenditure declared on the self assessment
tax return can and do trigger Inland Revenue enquiries.
Many Inland Revenue enquiries result in a higher tax
liability due to the scrupulous professional way in which
compliance investigations are carried out.

Obtain receipts for everything. Tax payers lose millions
each year by not obtaining or retaining receipts for
expenses. If you are claiming fuel costs for a business
trip and fill up with £50 of petrol get a receipt. The tax
saved by including that receipt in your accounts is £11 at
basic tax rates and £20 at higher tax rates. If your
business turnover is over the vat threshold of £64,000 p.a.
for 2007-08 the receipt is worth even more. £16.81 vat and
income tax at basic tax rate and £24.47 at the higher
income tax rate. The same is true for all other business
receipts. Obtain a receipt for everything. If you lose a
receipt then still include that expenditure in your
accounting records but if your tax return is enquired into
by the Inland Revenue that expenditure may be disallowed
unless you can argue and sometimes prove the expense was in
fact incurred. May help to note in your records - receipt
lost.

Do not mix business and personal. The general rule is that
items solely for business use can be claimed for tax
purposes and the business proportion of personal
expenditure may be allowed although the rules are applied
quite strictly. If you purchase both business and personal
items from a supplier the business expenses only can be
claimed but if you obtained all the items on a single
receipt you would be disallowed the cost of that journey as
it was not solely for business purposes.

Claim business expenses incurred prior to trading. Business
expenses incurred up to seven years prior to trading
actually commencing can be deducted from business turnover
if these expenses were solely for the future business
purposes. Enter such expenses in your accounting records as
if they had been incurred on the first day of trading but
show the actual purchase date.

Claim home costs if you work from home. If part of your
home is identifiable as solely for business purposes then
home costs can be claimed. The cost allowed is the
proportion of the total area of the home the business area
occupies. For example, excluding shared facilities of
kitchen and toilet if the home has three bedrooms, living
and dining room and one bedroom is used solely as an office
then 1/5 of home costs could be claimed. The home costs to
claim would be heat and light, insurance, general and water
rates and mortgage interest excluding repayment amounts.
Where mortgage interest is claimed the revenue might also
claim as a capital gain the increase in value of that
proportion of the home, such Capital Gains Tax being
subject to tapering relief over time. It may be safer not
to claim mortgage interest as part of the home costs.

Take care if claiming a partner's wages against profits.
Partner's wages can be deducted as a business expense
although there are rules which would be applied in such
circumstances to ensure the amount paid is both real and
reasonable. The business would need to operate a PAYE
scheme for the partners wages, deducting income tax and
national insurance, perhaps using a package such as DIY
Accounting have available using Payroll Software to produce
all the statutory requirements. The work carried out must
be real not invented and the rate paid reasonable for the
nature of the work and the time spent. Evidence may also be
required that the partners wages were actually physically
paid to that partner, for example in the form of a cheque.

Claim vehicle costs or mileage allowances. Vehicle running
costs and expenses such as fuel, excise duty, insurance,
repairs and breakdown membership may be claimed as business
expenses if the vehicle is used solely for business
purposes. Travel from home to work is not business use and
disallowed. The proportion of vehicle running costs and
capital allowances which are claimable are dependent upon
the proportion the vehicle is used for business and
personal use. Parking fees for business purposes may be
claimed. Parking fines and penalties for motoring expenses
are not claimable as business expenses for tax purposes. An
alternative to claiming vehicle running costs and vehicle
capital allowances would be to claim mileage allowances
which at the time of writing are 40p for the first 10,000
miles and 25p per mile thereafter.

Write off expenditure against taxable profit unless the
item is a fixed asset. Depreciation is not allowed and
replaced by Capital Allowances for the purposes of
calculating the tax payable. Capital allowances are
designed to write off the cost of purchasing a fixed asset
over the life of the asset rather than in the financial
year in which it was purchased thereby spreading the tax
relief on the asset over those years. Many assets purchased
by small businesses fall into a grey area as whether they
are fixed assets or normal business expenses. Generally a
fixed asset would be defined as an item that would be used
by the business over several years and usually of
significant value. 100% tax relief is obtained on items
purchased which are not fixed assets.

Avoid fines and penalties by submitting tax returns on
time. Accounting records and Self assessment tax returns
should be prepared well in advance of the first submission
date of 30th September to enable the information to be
checked and verified before submission to ensure all
possible claimable expenses have been included. The final
deadline for submission is 31st January with late returns
and payments being subject to penalty fines and interest
payments which should be avoided.

----------------------------------------------------
Terry Cartwright provides tax efficient Accounting Software
packages http://www.diyaccounting.co.uk/index.htm with DIY
Accounting Software for Self employed and small companies at
http://www.diyaccounting.co.uk/selfemployed.htm

5 Tips To Buy Affordable Health Insurance

Affordable health insurance is a must even when you follow
a fitness program. Eating right and exercising regularly
goes a long way to extending our life. We all should have
regular health checkups. For many people, affordable
health insurance is too costly.

Most Americans get health insurance through their jobs or
are covered because a family member has insurance at work.
This is called group insurance. Group insurance is
generally the least expensive kind. In many cases, the
employer pays part or all of the cost.

Some employers offer only one health insurance plan. Some
offer a choice of plans: a fee-for-service plan, a health
maintenance organization (HMO), or a preferred provider
organization (PPO), for example.

What happens if you or your family member leaves the job?
You will lose your employer-supported group coverage. It
may be possible to keep the same policy, but you will have
to pay for it yourself. This will certainly cost you more
than group coverage for the same, or less, protection. You
must seek out affordable health insurance on your own.

A Federal law makes it possible for most people to continue
their group health coverage for a period of time. Called
COBRA (for the Consolidated Omnibus Budget Reconciliation
Act of 1985), the law requires that if you work for a
business of 20 or more employees and leave your job or are
laid off, you can continue to get health coverage for at
least 18 months. You will be charged a higher premium than
when you were working.

You also will be able to get affordable health insurance
under COBRA if our spouse was covered but now you are
widowed or divorced. If you were covered under your
parents' group plan while you were in school, you also can
continue in the plan for up to 18 months under COBRA until
you find a job that offers you your own health insurance.
More often than not, this coverage is pretty expensive. If
you have a pre-existing condition though, this may be
better than the market pricing.

Not all employers offer affordable health insurance. You
might find this to be the case with your job, especially if
you work for a small business or work part-time. If your
employer does not offer affordable health insurance, you
might be able to get group insurance through membership in
a labor union, professional association, club, or other
organization. Many organizations offer affordable health
insurance plans to members. Also, check out local credit
unions and chamber of commerce groups for affordable health
insurance coverage.

If your employer does not offer group insurance, or if the
insurance offered is very limited, you can buy an
individual policy. You can get fee-for-service, HMO, or PPO
protection. But you should compare your options and shop
carefully because coverage and costs vary from company to
company. Individual plans may not offer benefits as broad
as those in group plans.

If you get a non-cancelable policy (also called a
guaranteed renewable policy), then you will receive
individual insurance under that policy as long as you keep
paying the monthly premium. The insurance company can raise
the cost, but cannot cancel your coverage. Many companies
now offer a conditionally renewable policy. This means that
the insurance company can cancel all policies like yours,
not just yours. This protects you from being singled out
but it doesn't protect you from losing coverage.

Before you buy any affordable health insurance policy, make
sure you know what it will pay for...and what it won't. To
find out about individual health insurance plans, you can
call insurance companies, HMOs, and PPOs in your community,
or speak to the agent who handles your car or house
insurance. Also, search the internet for many affordable
health insurance companies that will give you multiple
quotes free.

Here are 5 tips when buying affordable health insurance:

1. Shop carefully. Policies differ widely in coverage and
cost. Contact different insurance companies, or ask your
agent to show you policies from several insurers so you can
compare them. Make sure the policy protects you from large
medical costs. Compare the on-line sites for fast turn
around on affordable health insurance.

2. Read and understand the policy. Make sure it provides
the kind of coverage that's right for you. You don't want
unpleasant surprises when you're sick or in the hospital.
Many contracts have subtle limitations, exclusions and out
of pocket costs that will bury you going forward.

3. Check to see that the policy states: the date that the
policy will begin paying (some have a waiting period before
coverage begins), and what is covered or excluded from
coverage. Pre-existing conditions, children and the
possibility of starting a family can increase your costs.

4. Make sure there is a "free look" clause. Most companies
give you at least 10 days to look over your policy after
you receive it. If you decide it is not for you, you can
return it and have your premium refunded. Get all promises
and pledges in writing!

5. Beware of single disease insurance policies. There are
some polices that offer protection for only one disease,
such as cancer. If you already have health insurance, your
regular plan probably already provides all the coverage you
need. Check to see what protection you have before buying
any more insurance. Do you only want to cover 1 disease
going forward?

In summary, by researching the internet, talking with your
family and friends, you will select the absolute best
affordable health insurance available for your family.

----------------------------------------------------
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