Is it Worth Buying Premium Bonds

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Premium BondsPremium bonds have been around for several decades, and are one of the most well-known ways to invest in government-issued securities. Last year, the limit for investment in premium bonds was quadrupled from £10,000 to £40,000. But what exactly do premium bonds entail, and are they really a good place to put some of your savings?

About Premium Bonds

Premium bonds are a very safe place to put some savings. You can sell the bonds and reclaim your money at any time, and the risk to your funds while they are being held is low. However, unlike bank accounts or investments, there is no interest paid on your money. Instead, a random draw assigns monthly prizes to bond holders. Each individual bond is entered into the draw, so the more money you place into premium bonds the greater your chances of winning. Around 21 million individuals in the UK – which equates to roughly one in three of the population – currently hold 100 or more bonds. The top prize is a tempting £1 million, but of course the vast majority of prizes are much more modest.

Premium Bonds vs Savings Accounts

People purchase premium bonds in the hope of making money on their savings. It is therefore worth comparing the amount you can expect to receive with the most popular way to save; bank accounts.

The returns you can expect to receive from premium bonds average out at 1.35%. This is not a particularly attractive rate. It is no better than many easy access savings accounts, and these offer more flexibility and more instant access to your funds should you find that you need them. If you are willing to tie up your money for a certain term, you could receive significantly better returns from simply sticking with your bank.

Of course, the allure of premium bonds is that you might be lucky and win much more; perhaps even the million pound jackpot. However, this is pure gambling and the odds are not all that special. Equally, you might be unlucky and win nothing at all. It is, quite literally, just down to luck of the draw.

Are Premium Bonds Worthwhile?

This sounds like a very bleak picture of premium bonds, and indeed many people overestimate their value as a saving strategy. However, this does not mean they don’t have their uses.

Interest rates are so low that it can be tempting to invest some of your savings in premium bonds for the added excitement. Your invested capital is subject to extremely low risk, and you only stand to miss out on interest. When that interest doesn’t amount to much, it can be tempting to forego it on the offchance of a big win.

Premium bonds can also be useful for wealthier investors with a diverse portfolio who are not necessarily relying on every penny they can get from their investments. Premium bonds provide a very safe place to keep up to £40,000, and there is still that chance that they might win a prize.


Save as you Shop

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Receipt PrinterWhether buying online or doing your weekly food shop in the supermarket, there are a number of tactics you can use to save money. Some of these are as simple as looking for offers or not buying more than you need, but others don’t actually, directly have anything to do with the items you buy. Instead, they give you a small saving on every bit of money you spend, and over time this can build up into a nice sum you’ve managed to save.

Reward Cards

A lot of people wonder whether it is really worth bothering with loyalty cards and reward programmes. In fact, they are definitely worthwhile – at least for places where you shop often. All you do is hand your card over to the checkout assistant or swipe it at the self-service checkout – almost no effort at all. In return, you get a small amount of what you spent “reimbursed” in the form of loyalty points, and you will also usually receive vouchers for money saving or extra points. With regular shops you will be surprised how many points you can rack up.

Different schemes work in different ways. Tesco Clubcard points can be spent as a substitute for money in Tesco stores. Nectar Points are a bit more flexible. They can be earned and used in Sainsbury’s and in some other places, including some online retailers. Co-Operative Member Points, meanwhile, pay out annually in cash, with the value of each point depending on the year’s profits.

Cashback Websites

Cashback websites give you money back when you shop online. You can shop at the same sites you normally do, but instead of heading directly there you go via a link on the cashback site. The site then gets paid a commission for bringing your business to the retailer, and they pay a percentage back to you.

Top Cashback and Quidco are the two highest-paying cashback sites. They give you 100% of the commission, and rely on advertising revenue to make profits for themselves. Not all retailers can be accessed through cashback sites but a lot of them can, including most major names. Probably the biggest exception is eBay.

Cashback Cards

Some credit cards offer a percentage of cashback on purchases. Even if you would not normally use a credit card for day-to-day shopping, doing so with a cashback card and then paying the bill off promptly each month can give you small but noticeable savings through the cashback scheme.

Usually, cashback offers on credit cards will be limited. Either they will only be valid until your purchases have reached a certain combined value, they will only be offered for an initial period, or they will be limited by a combination of the above. For this reason, getting a credit card exclusively for a cashback offer may not be worthwhile unless you have a big purchase coming up.


How to save money on Mondays

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Do not fall into Monday blues by making the most of your money on the first day of the working week. No matter how big or small are your funds, here are some amazing discount deals that are available for every pocket.

Mondays at Yo Sushi

The deal at Yo Sushi is called ‘Blue Plate’ day when fifty of its best dishes are reduced to £2.50 a plate which saves you up to 40% on their usual prices. Some of these discounted dishes include things like spicy pepper squid, tuna maki and duck and moromi miso hand roll. However, keep in mind that freshly cooked hot dishes will be still available at their standard price. The Yo Sushi outlets are open until late, around 10pm, on Mondays.

Half price meals at The Slug and Lettuce

The ‘Happy Monday’ deal at Slug and Lettuce will really make your Monday happy. You automatically get 50% off your food bill at whatever time your turn up there. You can choose anything from their standard menu from chilli con carne to sausages, burgers and chicken dishes. If this is not a great deal, I don’t know what is.

25% off at Frankie & Benny’s

Frankie & Benny’s deal is called ‘Monday Madness’. With that offer you get 25% off your food bill every Monday evening. Frankie & Benny’s claim to be a New York Italian restaurant and bar whose menu includes things such as burgers, pastas, meatballs, salads and steaks.

The only thing you need to do in order to enjoy this deal is to turn up anytime from 5pm to 10pm in one of their 200 locations. And you can even make the most of their free Wi-Fi, in case you have some unfinished work for the day.

A Mojito on the house

Until 30th of November 2014, there is a ‘buy one, get one free on cocktails on Mondays at Drake & Morgan’s bars and restaurants. There are three locations in the city from which you can choose from. It is worth £7.50 a time, so when you go with a friend, it will be £3.75 for one cocktail each.

Movie Mondays

Anyone who is a Sky TV customer can buy up to two tickets for £3  each to watch any movie, including 3D, in O2 Cineworld in London. You just have to sign in online with your Sky ID details and you can either print your voucher to get your tickets or pre-book online for the upcoming Monday. This can save you nearly £8 per ticket.


Parents- Sort your Junior ISA this New Tax Year!

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Yes it’s the start of a new tax year, but with the same pitiful savings rates for those of us who want something back for our hard earned cash in the bank!  Most people are aware of ISAs and their allowances, but what about Junior ISAs for our darling offspring?

Family Investments published a report indicating that almost 60% of parents whose children are under 18 years of age do not know what a Junior Individual Savings Account even is.  However 92% of parents believe that saving is vital for their children which show that despite parents’ intentions to save for their children they do not know of all of the methods in which they could save more money, tax-free.

The 2 Junior ISAs available are cash Junior ISAs – where up to £3,720 can be invested in any one tax year and no tax needs to be paid on any interest earned; and stocks and shares Junior ISAs which are where the money is invested by the ISA providers and again no tax needs to be paid on any growth in capital or dividends that are received from the investment.

Money put into Junior ISA accounts is only accessible by the child at the age of 18 or older.

The product was made available in November 2011 with the goal of providing tax-free savings to those now unable to use a Child Trust Fund – the initiative that was previously set up by the Labour government to help people save for their children’s futures.

Currently up to £3,720 every tax year can be put into a stocks and shares Junior ISA and a cash Junior ISA. Within the first 5 months of the announcement of Junior ISAs, 72,000 in total were sold.

Family Investments’ Head of Savings and Investments Kate Moore commented: “We need to encourage those who do not currently save to get into the habit of doing so, i.e. those on lower incomes. Young adults today face very significant financial costs such as university tuition fees and deposits for a first home. If the current situation with children’s savings is not addressed then the government is unlikely to achieve its objectives.”


Why and How You Should Start Saving

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You might have heard this many times.. but really why start saving? Just think of the needs you have, your need for basic commodities such as food, and personal emoluments, responsibilities like paying rent, electricity bills and water. You also want to have fun and travel. Not forgetting those unexpected issues that you need to take responsibility for financially.

Don’t keep your cash in the house and use it whenever you need arises or keep it all locked up in a safe. Although a safe is somehow secure, you never know you could be coerced into giving it up. So why really save?

Security!!

You need to to have the assurance that you still can pay for those unexpected expenses or unforeseen circumstances. In a recession many things can happen, in particular there is the risk of losing one’s job. There are tonnes of places you can save your money chief among them a bank.

In a bank, and not just any bank, choose a trusted bank. So go to a bank or building society and register for a savings account to keep your money safe. Money in your savings account in the bank earns interest so it proves to be an investment over time. In addition you will be able to keep track of how much money you have withdrawn, input or received in your savings account.

Loans

In this day and age loans are very unavoidable. The great thing with saving you can be able to enjoy loan options from your bank. Whenever you need a loan you can always approach your bank. However, loan payment differs with the type of bank. So it is advisable to partner with a bank that doesn’t charge a lot in interest.

How to effectively save

Budget on your needs according to the period of your income/salary gain rate. For example, if you earn your income monthly budget for that month’s spend and save the rest in your account.

Record your expenses. This is to look at your successes in your budget and work on the unaccomplished ones.

Clear your debts. Debts may hinder your saving ambitions if not cleared in time.

Extra cash should be sent to your savings kitty and this means that you should be very discipline to achieve this.

Have goals. If you have goals everything will be simple since you will know what you are saving for. This will make you economize your spending habits and save more!


Saving Up for Retirement? Here’s What You Need to Know

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During the different stages of your life, there is always something that you need to save up for. There’s your college education, your first car, your house, raising kids, your kids’ college education and your retirement. Out of all these, retirement might as well be the most important because there will come a point when all your kids will move out and you will be left to fend for yourself.

Once you’re already retired, your retirement fund will be the only source of money from where you can get your daily expenses. Naturally, you’d want to live a comfortable life during retirement, so a significant amount for this specific fund is involved.

retirement

Know How Much Money Should be Saved for Retirement

Fortunately, there are ways that you can save money for your retirement. The rule of thumb to follow is that the earlier you save up for it the better. You should also take a look at the state-sponsored pension funds which are available for future retirees.

To determine how much money should be saved for your retirement, take a look at the following tips:

  • In the UK, you will never know when someone in the British government might propose to end the state pension. As the population gets older, the more expensive it will be to provide for the elderly. This is precisely the reason why you need to consider saving up for a personal pension plan. This is suitable for individuals who have 20 years or so to go before retirement.
  • Again, the earlier you start saving up for your retirement plan, the better. A good rule of thumb to follow is to set aside 50% to 70% of your current income multiplied by 20. Twenty is the average number of years that people live after they retire.
  • The bigger your retirement money is, the more comfortable you will be while living your retirement years so take the task of saving up for it very seriously.

How Should I Start Saving?

The simplest way to start saving up for your retirement is to set aside the funds in a savings bank account. But depending on your current financial status, there are investments that you can put your money on so that you can have a bigger amount to set aside for your retirement. To learn more about the possible investment schemes that you can go for, consult a wealth management expert or a financial advisor.