Interest-Only Traps: How, Why and What Can You Do?

One could say UK banks are focused on making profits instead of ensuring consumers get the most out of their financial products. As some terms and conditions trap UK consumers into an interest-only mortgage with a very high rate, only re-mortgaging becomes the option to lower the fees.

Some UK banks have these terms and conditions:

A customer with an income of £75,000 or a joint £100,000 annual income could change their interest-only mortgage rates smoothly. 

Initially, your bank could refuse your request. But look for the following clause in your terms and conditions.

“Banks could make a decision on interest mortgage rates should they find the customer satisfactory in fulfilling the requirements needed.”

Or something like that.

If banks ignored this instance, you could talk to them. Never settle for anything less and never let your bank decide. Make sure that you feel uncomfortable with your current interest-only mortgage rates.

Remortgaging, which puts the interest at a higher rate for your mortgage, has some advantages. It reduces your taxes yearly. Think about that. But if you’re decided to lower the rates on your interest-only mortgage, then whichever works for you is better. 

Just make sure to avoid the trap. Read your terms and conditions thrice and avoid giving the bank the final decision.

Austria Is Becoming Greece. Wait, What?

Austria’s financial troubles seem to mimic the early signs of Greek financial mismanagement. According to Telegraph.co.uk’s Jeremy Warner, Austria’s failed Hypo-Alpe-Adria Bank International falls into the same category. He said that the latest turn of events aren’t yet in the eyes of financial markets or policymakers.

The Austrian government has had enough to fund the banks’ losses. The government said it would “bail-in” external creditors with €7.6 billion. The Austrian government is to cut loose an entire region and let it “go bust.”

Warner said this is a similar situation to Greece during its early financial downfall.
The bail-in for Hypo will create consequences for other Austrian banks, especially those holding a high volume of bonds from Hypo and interlinked banks throughout Europe.

Greece is Still In Trouble

Despite his charisma and intelligence with the "war of words" in Germany and other European countries, Greek Finance Minister Yanis Varoufakis bears no fruit. Greek Prime Minister Alexis Tsipras warns him to "stand down" and maintain a lower profile.
Varoufakis is told to "talk less, do more" instead of babbling with the media about his plans. He has since maintained a low profile in social media and limited his appearances in the media.
Local Greek newspapers are warning Varoufakis that his "support profits" from the Greek elections are running out because of his actions.

How Investors Lose Out Their Investments Through Emotions. [Infographic]

Three Reasons Why You Should Put Forward Your Retirement Instead of Your Child’s College Plan

For most parents, the love for their child dominates their own personal need, only to find that they may become fiscal burdens in their child’s future. Most will prioritise their kids’ college funding because it is “the right thing to do.” However, being a good parent also requires being a critical and thinking parent, and sometimes, your retirement is more important to put forward because of the following.

1.    There Are Many Alternate College-Funding Sources

You don’t have to build capital to ensure that your child gets a proper education through a college fund. Your children will have the option to get grants, financial aid, scholarships and even a college loan that can help them cover their college costs. Meanwhile, you have no other option for making up for lost money from retirement savings. Children are also likely to appreciate your fiscal investment if you tell them they are also part of it.

2.    If Your Retirement Is in Good Shape, Then Consider Saving For College

If your retirement fund is already in good shape, then it is the time to fund for your child’s college. Remember, there are avenues to get educational financing. However, you don’t have any alternative for your retirement fund. You will end up weighing down your kids when they become successful and you become a burden to them, which could strain your relationship despite your earlier good intentions.

3.    Stick With Your Financial Plan

Your financial plan gets altered when things go out of hand. When it does, you end up having to give your children their dreams rather than fulfilling yours. However, it would end up as big trouble with your children’s financial plans in the future if you haven’t fulfilled yours, or you are unsatisfied with your own lifestyle by that time. This is why fulfil your own dreams and responsibilities to yourself first before your give them anything to pursue their dreams.

Three Quick Ways to Save On Your Christmas Spending

Christmas is just around the corner. You’ve been feeling the hassles of the Christmas shopping rush, the traffic and the dent it will leave on your expenses. However, the season of giving doesn’t mean you should give a lot for the department stores and other retailers. Here are some tips you could do to decrease your spending.

1.    Credit Cards

 A high credit limit isn’t the quickest solution to help your Christmas spending. While it does allow you to enjoy the holidays and pay for your debts later, having a debt-laden Christmas isn’t exactly a bringer of glad tidings. Always use the money you have on hand. This will limit your expenses and will even improve your creativity!

2.    Consider Discount Vouchers

Right now, many mobile stores offering assorted items such as clothes, toys and even vacations have discount coupons. They even let you have free delivery if you’re just within the country. Think of the amount of money you’ll save from expenses and gas money!

3.    Get Creative

Christmas is about giving and banking on this idea means imparting not your money, but your time. Make creative projects that personalise the items you’re to gift to important people in your life this Christmas. You could also host a Christmas cook-off where everyone brings their best dishes for Christmas. This saves you lots in hosting a Christmas in your home and having a feast with people very important to you.

Things To Take Note When You’re Feeling Demotivated

It’s just the start of the week and I can’t blame you if you feel quite demotivated to do work or anything. The Monday Blues is now amedically-accepted condition. Dealing with Monday or early-week demotivation can be hard, but it is possible to do so.

1.    Charity

Giving money to charity might be the farthest thing from your mind. However, you validate your capacity to give to others by doing this. This will help uplift your spirit and mood, and have confidence in your capabilities by the start of the next day.

2.    Watch Inspiring Videos

Searching for inspirational videos will help you see that your Monday Blues is just a speck of psychological trouble compared to people who had risen from a huge setback. You don’t only get motivated, you actually get psyched and learn a few lessons that could help inspire confidence in yourself.

3.    List Your Goals

Listing your goals helps you remember them faster and activates your body’s “fight” mode. It also helps your body steer itself in the right direction. Every human being needs a goal, or else life and existence will have no value at all.

4.    Share the Love

Even if you’re demotivated, showing your parents or your lover with surprises and love helps you get the same love back. Even if they do not reciprocate, the feeling could give you a validation of your capability to exist and express yourself.

Things Students Didn’t Know About Their Taxes. Yes, Students Still Pay Taxes.

Today, a full-time student doesn’t exist anymore because many work with a part-time job while studying. Some have different jobs to make ends meet during vacations. As a working student, you have tax liabilities, which the HMRC oversees. But the HMRC is not unfair, students have a great cut from their payslips, but it is the student’s responsibility to tell the employers they are not part of the Pay As You Earn Code.

If you think you had paid too much tax because of an error on behalf of you or your employer, you must have the following documents with you before you could launch a dispute: A p60 or p45 from your employer, p11D, details of taxable state benefits received, bank statements or certificates of tax deducted, building society statements or certificates of tax deducted, dividend certificates, details of rental income and expenses.

Students also have some tax credits. As most college students are still below their twenties, students could claim for Working Tax Credit or a Child Tax Credit, which could help them reduce the amount of tax they pay on a monthly basis.

Student entrepreneurs will have some income tax deductions and will have to pay for their employees national insurance. If they are self-employed, they need to report their own income to the HMRC.