Saving Money

Posts about saving money from a 60-plus perspective, including cashback schemes, deals sites, discount offers, and so on.

Five Simple Money saving Hacks for Over 50s

Five Simple Money-Saving Hacks for the Over-50s

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Today I am pleased to bring you a guest post by Paul Green from Over50smoney. Paul is the founder and CEO of this popular website, which acts as a consumer champion for the over-50s.

Paul also has his own blog on Over50smoney, in which he mixes financial tips and guides with some personal pieces on subjects including sourdough bread making and growing his own fruit and vegetables!

In the article below (shared from his blog) Paul sets out some great tips for saving money that may particularly appeal to older people (though relevant to younger ones as well).

Over to Paul then…

 

My career has been spent helping people and businesses save money. With a business it makes sense to run operations efficiently as this enables investment to grow the business in the future. For individuals, saving money on everyday purchases is just the same. It enables you to save for the future. You can then spend the money you save however you like. This could be on holidays and enjoying life or maybe longer-term savings for your retirement. The choice is yours.

In this blog post I wanted to share five easy ways of saving money on everyday things that have worked for me. If you have other great tips that people over 50 could benefit from, please do share then below.

Don’t Take Out an Expensive Mobile Phone Contract

The smart phone has become a big part of most peoples lives. And this isn’t only the case for younger people. At Over50smoney about 80 percent of our website users visit the site with their mobile phones. However, those of us who wait in eager anticipation of upgrade time on our phone contracts are probably wasting hundreds of pounds. This used to include me until I realised how much money I was throwing away needlessly.

Let’s start by looking at why the standard type of pay monthly phone deal doesn’t make sense. The table below compares the latest Apple top of the range phone on a 24 month contact on the Vodaphone network against buying the phone upfront and getting the same data and minutes deal from Vodaphone on a SIM only deal. Taking out a phone contract is essentially the same as buying your mobile phone on Hire Purchase (HP). You have to pay for this. In the example below you are out of pocket to the tune of £250 over the course of a two-year deal. 

You could also make buying your own phone and SIM even cheaper. If you shop around, you could get a significantly cheaper SIM deal depending on your needs. Keeping the same amount of data but giving up 5G capability can save money, but do you really use all your data anyway?

 

   Comparison of a 24-month phone contract to buying your own phone

Phone contract Get separately  Savings
Apple IPhone 12 Pro Max £75 per month for 24 months = £1,800 Phone £1,099

Data £20 per month for 24 months = £480
Upfront payment £29 £0
Total cost over 24 months  £1,829 £1,579 £250

*Data from Carphone Warehouse, Vodaphone and Apple, correct as at 31 May 2021

There are also cheaper SIM providers than the main networks so it’s worth considering providers like ID Mobile that uses the 3 network. The point is, if you buy your phone, you have more flexibility on the SIM deal you use.

Not everyone has a thousand pounds to buy a new top of the range phone outright. And in my opinion, this wouldn’t be the best option if you wanted to maximise savings on your smart phone anyway. Have a think about these ways of getting a good phone for less.

If you have a phone coming to the end of a contract why not keep it for another year? The build quality in modern phones is high, so unless you already have a problem with the phone, it’s likely to last for an additional year or two. It’s been a while since there were any real breakthroughs in phone design, so the extra benefits of upgrading are likely to be limited to things like a slightly more sophisticated camera. A friend of mine recently decided to keep his Samsung when he came to the end of his 24-month contract. He had been paying £65 per month during the contract term with O2. He wanted to stay with O2 so based on his usage he decided to move to an O2 SIM only deal and now pays £20 per month. As he stayed with the same provider, he didn’t even need to get a new SIM card. He now enjoys the same phone he really likes for £45 per month less than he was paying during the contract term.

If you want a new phone, it’s definitely worth looking at buying second hand. You can do this online or in many of the high street phone retailers. A quick Google search will show you several companies that specialise in selling high quality second-hand phones including WeSellTek [sponsored]. These will be wiped clean of previous owners’ data, refurbished and sanitized. You can get models that are currently being sold new for hundreds of pounds less. However, the biggest savings are usually on models that are just out of date. Given the pace at which the main manufacturers release new phones this probably means the phones are only a couple of years old and will have all the features and capabilities you want.

I’m not going to cover the pros and cons of moving to pay-as-you-go deals here. If you use your phone infrequently or usually have access to Wi-Fi this is something you could consider as additional cost savings are possible.

Double Savings With Amazon

Being someone who likes to shop local where I can, buying grocery items from Amazon initially went against the grain. However, financially it can make really good sense.

I first noticed this with a couple of items. We love coffee and a few years ago invested in a great, beans to cup, machine. This means we use a lot of coffee beans at home. Likewise, my wife makes amazing risotto. This is a staple on our menu once a week. Which means we also use a lot of arborio rice. Of course, we can pick up coffee beans and arborio rice from the supermarket, but they come in fairly small packets and we go through these pretty quickly. I discovered both coffee beans and arborio rice were available in big 1 kg sized packs from Amazon and that the price per KG is less buying these bigger packets than the smaller ones we used to get in store.

However, on top of the saving for buying bigger packets, if you use something regularly Amazon can give you additional savings. If you buy using Subscribe & Save you can control how often Amazon sends you a product. And, if you used less than normal it’s easy to delay an order so your cupboards don’t get too full. For most grocery items Subscribe and Save seems to offer a 10% price reduction initially that can increase to 15% with repeat orders over time. For some products the saving is lower, with a 5% initial reduction increasing to 10% over time.

So, I am now converted to getting some of my groceries from Amazon. The value is really good with both cheaper prices for bigger quantities and a Subscribe and Save discount on top of that. I also like the additional benefit of the products being delivered which means you don’t have to remember to put them on your shopping list and then carry them home!

Big Savings With Groupon

As the over-50s community is now well and truly online, I wanted to look at another couple of routes to savings when buying online. First up, Groupon.

Groupon has been around since 2008 and is based on the American love of coupons. The site works in the same way as cutting coupons out of a newspaper. You select an offer from the site, and read the small print so you understand things like the time period the offer is available for and how to claim it. Traditionally you had to print a voucher from Groupon, though nowadays that isn’t generally the case.

Groupon is easy to sign up for. You need an email address. It’s the most useful if you download the app to your phone or tablet as you can use the settings to get offer alerts close by when you are out. Groupon guarantees sellers a minimum number of customers. This means that they can create offers for the platform to drive sales when they need them. Groupon claim the typical discount on an offer on their site is the range of a 30-40% discount, although I have seen discounts stated as high as 90% and as low as 5%. Groupon earn a commission every time a customer takes an offer.

Groupon organises offers into different categories, making it easier to find what you want. The offers are updated all the time so if you can’t find what you want its worth coming back again. Different people I know use Groupon in different ways. For example, I have a friend who before the pandemic only bought toilet roll in bulk from Groupon (today, I have seen an offer of 120 rolls of Cusheen quilted luxury aloe vera toilet tissues for £17.50!). I’ve not typically used the site for “basics” but have found offers for services near where I live to be really useful. Again, before the pandemic when my wife and I went out with friends regularly, Groupon was a good source of mid-week deals on food in local pubs and restaurants.  

So you understand why I like local deals on Groupon, these three are a selection from the recommendations near me as I write this post:

  • 40% off a two-course meal for four people in a local fish restaurant. The price includes a glass of wine each and is reduced from £84 to £50. The offer is for Tuesdays, Wednesdays and Thursdays only, unless you book at least four weeks in advance when it also applies to Fridays;
  • 60% off a spa day at a local hotel Mondays to Fridays or 56% off for Saturdays and Sundays. The offer for two people includes use of the spa facilities and hotel pool, Rasul mud treatment and lunch served with a glass of Prosecco. Mondays to Fridays the price is reduced from £201.90 to £79 or Saturdays and Sundays from £205.90 to £89. As it’s my wife’s birthday in couple of weeks this is an offer I may consider as it’s the type of experience she enjoys at a resort I know she likes;
  • The most interesting offer for me today is from a local chiropractor. Having hurt my back about a month ago lifting heavy pots in the garden I have put up with ongoing back ache. However, I will now book a visit for a chiropractic consultation and exam, which includes a report of findings and a treatment session. I haven’t been to this practice before, but it is offering a whopping 84% discount with the price reduced from £81 to £12.95. I wouldn’t have booked this at the full price but am happy to pay just under £13 to see if I can sort my ongoing backache out!

I think the two most important tips for using Groupon are to read the small print of the offers, especially availability in terms of dates or locations. Also, you do need to include the cost of postage when assessing an offer for goods. While the postage amount is specified on the site, for low value goods this can outweigh the savings from the offer.

Cashback Sites Offer Great Deals

I’ve written about cashback sites before and there is a range of content on the Over50smoney website about them. For example, they are mentioned on the short video here Revolutionise your finances – Part 2 (over50smoney.com).

You need to join a cashback site and because of the way they work this takes a little longer than signing up to Groupon. The two best cashback sites in the UK are TopCashback and Quidco. Both are well established, reputable businesses and free to join. Once you have signed up you can search the cashback offers available. If you select an offer, you will receive your goods or services and the appropriate cashback amount will be credited to your account. This can take a few weeks. Once the money is in your cashback account you will be able to transfer it into your bank account so long as you stay within the conditions of the site you are using. Transfers are usually straightforward. According to TopCashback members earn an average of £345 cashback a year. Retailers pay cashback sites a bonus based on volumes of sales. Cashback sites also earn revenue from sponsored adverts and promotions on their sites.

Cashback offers typically range from a few pounds for everyday products to hundreds of pounds for expensive items or ongoing services like energy or broadband deals. The important thing to remember with cashback sites is that while the offers can represent really good value for money you need to make sure you don’t get swayed just by the cashback amount. High cashback amounts can seem compelling but may be associated with high-cost products. You should be aware that many businesses use cashback sites to drive volumes when their prices may not be competitive. Always take a look online and see if the product or service you are thinking about is cheaper elsewhere when you include the cashback discount. If you have done your research and are confident that the cashback offer you have seen is a good overall deal, representing best value for money, it makes sense to purchase this way.

Both TopCashback and Quidco have a wide range of offers split into different categories including clothing, electricals, insurance, travel and so on. There are many offers in each category, so normally there will be a fair amount of choice if you want to make a purchase.

At the time of writing the following deals were available on TopCashback:

  • £210 off iPhone contracts with Tesco Mobile
  • £200 off energy with Scottish Power
  • Up to 8% discount on purchases from Marks & Spencer (different reductions depending on products purchased)
  • Up to 7% discount on purchases from ao.com (different reductions depending on products purchased)
  • 3% discount on Lego

If you would buy online directly from a retailer it always makes sense to see if there is a discount available from a cashback site. For example, why send flowers from Marks & Spencer directly when you can save 8% buy buying through TopCashback?

Always Use the 30-Day Rule

As someone who used to be a spontaneous shopper, buying things I liked when I was out, the 30-Day Rule has been a godsend for me.

The 30-Day Rule goes like this:

If there is something you would like to buy, think about it for 30 days. If after that time you still want it, go and get it.

Putting this discipline in place stops you buying things you don’t really need or want. The ultimate waste of money is buying things you never use!

I think all of us have bought things on the spur of the moment because they seemed like a good idea, but ultimately, we didn’t really use them. Recently, I was talking to friends who were moving house. Their weakness was kitchen gadgets! They had cupboards full of things they were planning to give away before they moved. They had bought soup-makers, salad spinners, air fryers, rice cookers, etc, etc, that had seemed like a good idea but were ultimately only impulse buys. Bought, used once, and then forgotten about!

For me the 30-Day Rule has stopped this. Waiting 30 days gives me time to reflect on whether I really want something. I no longer waste money on things that I don’t use or enjoy.

Paul Green, 1 June 2021

 

Many thanks to Paul for an eye-opening guest post. I shall definitely be checking out Groupon more often in future! Do check out his blog on Over50smoney and the Over50smoney website itself.

I do strongly agree with Paul about the savings to be made through buying your mobile and SIM card separately. And there are some amazing deals out there right now. Personally I pay EE just £6 a month for a SIM-only deal with unlimited texts, unlimited voice calls and 5 GB a month of data. Okay, 5 GB might not be enough if you are out and about all day, but personally I’m nearly always within wifi range and don’t need that amount of data or anything like it.

  • Older people might also want to look into getting a big button mobile phone. These can be great for those whose eyesight isn’t what it once was and/or those with arthritis or similar who struggle to use the small buttons on modern mobiles. Click here for more information on big button mobile phones.

I am old enough to remember the days when mobile phone calls were so expensive you only made them when you really had to and kept calls as short as possible. How times have changed!

Release the Equity from Your Property

While 50 won’t cut it, the great news for homeowners over 55 is that you can use your property value while still retaining full ownership. So, if you’re not planning to move out any time soon and dream of retirement at home, then opting for a lifetime mortgage will provide you with up to 65% of your property value in tax-free cash.

You can receive your home equity as a lump sum, put it in a drawdown facility to release as you wish, or opt for a monthly salary lasting up to 25 years. What’s best is that the money can be used in any way you desire, and no repayments are necessary during your life.

Be warned that equity release can impact one’s access to means-tested benefits. Luckily, homeowners are required by Equity Release Council regulations to use a financial adviser to help with sound decision making throughout the process.

As always, if you have any comments or questions about this post, please do leave them below.


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What is an IFISA and Why Might You Want One?

What Is An IFISA And Why Might You Want One?

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If you’re reading this post you will almost certainly know what an ISA is.

The term stands for Individual Savings Account. ISAs effectively serve as tax-free wrappers for various types of savings account. The two best-known types are the Cash ISA and the Stocks and Shares ISA.

You get an annual allowance for your ISA investments which currently stands at a generous £20,000 a year. Money saved in an ISA is permanently exempt from taxes such as income tax, dividends tax, capital gains tax, and so on.

So What Is An IFISA?

IFISAs are a lesser-known type of ISA that can be used for peer-to-peer (P2P) lending. They were launched in April 2016. After a slow start, the range available has grown steadily.

You can put any amount into an IFISA up to your annual ISA allowance. In the current 2021/22 tax year, as mentioned, this is £20,000. This can be divided however you choose between a cash ISA, a stocks and shares ISA, a Lifetime ISA (if eligible – you have to be under 40) and an IFISA. So, for example, you could invest £6,000 in a cash ISA, £10,000 in a stocks and shares ISA and £4,000 in an IFISA.

  • Note that under current rules you are only allowed to invest new money in one of each type of ISA in a tax year. It is though generally possible to transfer money from one type of ISA to another without it affecting your annual entitlement (although there may be platform fees to pay).

IFISAs vary considerably in the returns they offer. Annual rates range from from around 4% to 15%. Obviously, the higher rates reflect the higher levels of risk involved.

Although all IFISAs involve P2P lending, a number of different types are available. They may include lending for all the following purposes:

  • property development
  • business loans
  • personal loans
  • green energy projects
  • bonds and debentures
  • entertainment industry loans
  • infrastructure projects

What Are The Risks?

All UK IFISA providers have to be authorized by the Financial Conduct Authority (FCA) and HMRC. This doesn’t in itself protect lenders (or investors if you prefer) against the failure of a platform, however. While savers with UK banks and building societies are covered by the government’s Financial Services Compensation Scheme (FSCS), which guarantees to reimburse up to £85,000 of losses, this does not generally apply to IFISA platforms.

All IFISA providers do offer various safeguards, though. These vary, but include provision funds to cover potential losses, insurance policies, and so forth. In many cases loans are made against the security of property or other assets, which in the worst case could be sold to pay off any debts.

Even so, IFISA investors don’t enjoy the same level of protection in the UK as bank savers. This is, of course, a major reason why the returns on offer are significantly higher. It’s therefore important to be aware of the risks and ensure you are comfortable with them before investing this way. It’s also important to lend across a range of platforms and loans, and not make the mistake of putting all your savings eggs into one P2P lending basket.

What Are The Attractions?

So why might you want an IFISA? There are several reasons.

One is that they offer the potential of much higher rates of return that ordinary (bank) savings accounts. Even the best of these are currently paying interest rates of under 1 percent. IFISAs typically pay several times more than that (though obviously at somewhat greater risk).

Another big attraction of an IFISA is that it provides a way of gaining extra diversification for your portfolio. As mentioned earlier, the law currently only allows you to invest in one type of stocks and shares ISA per year. This rather perverse rule actually makes it harder to diversify your investments. But you can have an IFISA as well as a stocks and shares ISA, so long as you don’t exceed your total £20,000 allowance. So having an IFISA gives you a way of diversifying your investments while keeping them all protected within a tax-free ISA wrapper.

And finally, IFISA investments are typically not tied to the performance of stock markets in the way a stocks and shares ISA would be. This is a different type of investment, with different risks and rewards. While an IFISA won’t provide a way of hedging your equity investments directly, it is likely to be less directly affected by short-term fluctuations in the markets.

Two IFISA Examples

Two IFISAs of which I have direct experience are offered by Kuflink and Assetz Exchange. Both of these platforms offer tax-free IFISA options. They are both based around property investing.

Kuflink – which I reviewed in this post – offers an automatically diversified IFISA comprising loans on property. They quote interest rates from 5% to 7%, depending how long you invest for. Your money is automatically diversified across a range of secured loans. The screen capture below from the Kuflink website sets out the main features of their IFISA.

Kuflink IFISA

One point to be aware of is that there is no ‘self-select’ option with the Kuflink IFISA. So you have no choice about which projects your money is invested in. But, of course, it does make investing in a Kuflink IFISA very quick and simple.

Assetz Exchange – which I reviewed in this post – has some similarities with Kuflink. But they concentrate on low-risk investments, typically with corporate clients (e.g. charities) on long leases. Here’s an example of the sort of investment I mean…

Assetz Exchange hostel 1

Assetz Exchange hostel 2

Assetz Exchange aims to offer net yields to investors of between 5.2 and 7.2% per year. One thing I especially like about them is that you can choose your own IFISA investments (indeed, they don’t currently offer an auto-select option). In addition, you can invest as little as 80 pence per project, making it easy to build a well-diversified portfolio even if you are only investing small amounts.

I am using Assetz Exchange for my 2021/22 IFISA, so here is a screen capture of my current portfolio for your interest. Note that while I have only invested £500 so far, I already have a well-diversified portfolio with 17 different investments!

Assetz Exchange IFISA

Summing Up

If you are looking for a home for some of your savings that can offer better interest rates than banks and building societies and won’t incur any tax charges, an IFISA is certainly worth considering.

As well as the higher interest rates, they can add diversity to your investments, helping you ride out peaks and troughs in the financial markets.

Just be aware of the risks involved in P2P lending, diversify as widely as possible, and ensure you invest only as part of a well-balanced portfolio.

As always, if you have any comments or questions about this blog post, please do leave them below.

Disclaimer: I am not a registered financial adviser and nothing in this post should be construed as personal financial advice. You should always do your own ‘due diligence’ before investing, and speak to a professional financial adviser/planner if in any doubt before proceeding. All investments carry a risk of loss.

This post (and others on Pounds and Sense) includes my referral links. If you click through and make a qualifying transaction, I may receive a commission for introducing you. This will not affect the products or services you receive or any fees you may be charged.

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How to get free stuff!

How To Get Free Stuff!

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Almost everyone loves getting something for free, and in this digital age it is easier than ever to get freebies. So why do so few people take advantage of the great opportunities on offer?

In some cases, people simply aren’t aware that such opportunities exist. However, the main reason for people not actively pursuing freebies is that they are suspicious of getting something for nothing – they believe that there is some sort of catch involved. Alternatively, they might assume that the freebies available are cheap, low quality or not worth the effort. Neither is necessarily true.

Whilst some freebies are undeniably low cost or in sample-size proportions, there are a lot of really great products and services available too. The trick is to identify what product niches you are specifically interested in, then target the offers accordingly. This can yield better results than scanning offer websites with no real intent, and is less labour-intensive if hunting for offers is not something you actively enjoy.

Where you should look for freebies will depend on what type of niche you are targeting. For example, if you are a parent looking for baby- or child-related items, simply signing up to a manufacturer’s website will sometimes result in freebies. Occasionally they may provide the items in exchange for consumer feedback or a product review. But often they will give away items for no other reason than to encourage brand loyalty.

Literature is another good niche to target if you love a free gift. Publishing companies are always looking for people, both adults and children, to review newly published books. You have complete control over which books are sent to you, and are only required to review those which truly interest you.

If your interests are broad and you are more motivated by the thrill of receiving something for nothing, there are many websites and forums where people will list opportunities for obtaining free goods and services. The most impressive freebies are normally offered in limited quantities or for a restricted time period, so you will need to check the listings regularly to get the best deals. Signing up for emails or downloading an app which will generate alerts can make the process easier.

Some of the best free products and experiences are available to those people who are willing to put in a little effort. In particular, mystery shopping can produce great results because the company is required to reimburse you for your time. Your assignment may involve a free experience, such as eating at a restaurant or visiting a local attraction, or visiting a specific store and getting financial recompense for shopping there.

However much free time you have, and whatever your interests, you will be able to find freebies which suit you. Companies frequently send out free samples in order to generate interest in their products, and often all you need to do is fill out your name and address. If you are willing to provide something in return such as a review or completing a short survey, the freebies you receive can be even more enticing.

Disclosure: This is a sponsored post on behalf of Free Stuff websites.

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Is it time to clean your solar panels?

Is It Time to Clean Your Solar Panels?

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According to the Department for Business, Energy and Industrial Strategy (BEIS), there are now roughly a million homes in the UK with solar panels.

Mine is one of them. We had ours fitted in April 2011, just in time to benefit from the highest Feed-In Tariff (FIT) before the rate was slashed by over half.

I hadn’t really given the panels a lot of thought since then. I submitted meter readings every three months, and a few days later a handy, tax-free payment appeared in the bank account.

In March 2019, though, I had a couple of builders doing repairs to the woodwork around the eaves. This was an awkward job that involved having scaffolding put up. Anyway, one of the builders (a guy I have known for several years and trust) asked if I would like the panels cleaned while they were up there. “They’re filthy,” were his exact words.

He quoted me £60, which seemed a good price, and clearly it made sense to have the work done while they were there and the scaffolding was up. They gave the panels a thorough clean, using large sponges and buckets of warm water with washing-up liquid.

I was intrigued to see how much difference this would make to the amount of electricity the panels generated, so I downloaded a free program called Sunny Explorer that works with my solar PV system. It communicates with the inverter (the device that turns the electricity generated by the panels into usable power) via Bluetooth to show how much electricity your panels are producing. And, thankfully, it shows historical data going right back to when the panels were first installed.

Monitoring Solar Panel Performance

I found the data from Sunny Explorer genuinely eye-opening. First, take a look at this chart showing the total amount of electricity generated by my system year on year since the panels were installed.

Electricity Generated Year by Year Since Installation

As you can see (bearing in mind the panels weren’t installed till April 2011), for the first five years the total power output was pretty consistent. Then in 2016 and 2017 it dropped quite substantially, and again by a smaller amount in 2018, even though that summer was one of the hottest, driest on record. Obviously, if I was being scientific I would compare the total number of sunny days in each of those years, but I think it’s safe to assume that from 2016 onwards the build-up of dirt on the panels began reducing their efficiency.

Now take a look at the monthly chart for March 2019. Can you guess what date the panels were cleaned?

Electricity generated in March 2019

Full marks if you said 27th March. The power generation was quite low that day as the panels weren’t cleaned until the afternoon, and obviously they had to be switched off while the cleaning was going on (the builders actually forgot to switch the system back on before they left, but I’ll forgive them that). Notice how much more power the panels generated in the last four days of the month, though.

2021 Update

Two years on, here is a chart showing how much electricity my panels have been producing year on year. Remember, they were cleaned in March 2019.

Solar Panels Output 2021

As you can see, in 2019 and 2020 my panels were back generating at the same level they had been prior to 2016. And neither of these years featured exceptional amounts of sunshine. Obviously as it’s only mid-April now the total figure for 2021 is lower, but from comparing the month-by-month figures from previous years it is clear that they are still working well.

If I hadn’t had the panels cleaned it’s likely that their electricity production would have continued at the 2018 level (and probably lower). As it was, in 2019 and 2020 they generated an extra 1,700 kwh compared to the 2018 level, worth about £850 to me in financial terms. So that £60 I paid to have them cleaned was a very good investment!

Overall, I think the lesson from this is that it’s well worth monitoring the performance of your panels, and having them cleaned if you notice it is declining. When our panels were installed we were told that they were ‘self cleaning’ due to the amount of rain we get in the UK, but that clearly wasn’t sufficient in my case anyway!

More Top Tips

  • I used the free Sunny Explorer software to monitor my system. This works with inverters made by SMA Solar Technology. If you have a different make of inverter it may not work for you, but there should be some other way to check your system’s performance. Ask your installer if in doubt.
  • If you have trees nearby (as I do) there will probably be more birds around, and over time their droppings are likely to build up on your panels and reduce their efficiency. While dust generally washes off with a good rain shower, bird droppings may not.
  • Before cleaning or inspecting solar PV panels, it is essential to switch them off via the main isolating switch (in my home it’s a bright red switch next to the solar power meter). Failing to do so could result in a severe electric shock.
  • If you cannot safely access your panels to clean them, hire a professional to do it. Don’t get up on the roof yourself unless you have the necessary training, expertise and equipment.
  • A good solution for cleaning solar panels that can avoid the need for going up on the roof is a water-fed pole with a soft brush, combined with a squeegee. Avoid using abrasive tools or products in case you scratch the glass.
  • Avoid cleaning your panels when the weather is hot, as spraying cold water on very hot panels could cause smearing or even damage them. Instead try to clean the panels in the morning or evening or on cooler days.
  • Based on my experience, it may not be necessary or cost-effective to clean your panels every year, but every three to five years could be a good strategy. In any event, monitoring the output of your panels will help you decide.

Good luck, and I hope your solar panels are soon working at peak efficiency again!

If you have any comments or questions about this post, as always, please feel free to post them below.

This is an update of my original 2019 post.

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Assetz Exchange Review

Assetz Exchange: My Review of This P2P Property Investment Platform

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Today I’m looking at P2P property investment platform Assetz Exchange (launched in January 2019)..

As I have noted before on Pounds and Sense, I am something of an enthusiast for property investment (and specifically property crowdfunding). Among other things, I like the fact that you can make money from both rental income and capital growth. And investing in property can be a good way of spreading the risk when you have equity-based investments.

Of course, investing in property directly is costly and carries all the risk inherent in putting all your eggs in one basket. A major attraction of P2P property crowdfunding investment is that you can get started with much less money and build a diversified portfolio to help mitigate the risks.

In addition, if you invest this way you don’t have to deal with the day-to-day hassles of being a landlord, from finding tenants to repairing broken boilers. This is taken care of by the platform itself and/or their management company. You just have to sit back and – all being well – wait for the rental income and (hopefully) capital gains to materialize.

That said, there have been a few reversals in the P2P property sector over the last few months (see this recent post, for example). So I am now more concerned than ever to ensure that any investments I make in this category control risk as effectively as possible.

What Is Assetz Exchange?

As mentioned above, Assetz Exchange is a licensed P2P property investment platform. It is owned by well-known P2P lending platform Assetz Capital, but run quite separately from them. If you already have an account with Assetz Capital, you will have to register separately with Assetz Exchange.

Assetz Exchange aims to offer net yields to investors of between 5.2 and 7.2% per year. These are generally paid by institutional tenants through multi-year leases. All properties are unleveraged, providing additional security (and stability) for investors.

Assetz Exchange has some similarities with Property Partner, but they differ in some important ways. For one thing, many of the properties are rented out to charities (e.g. NACRO) or housing associations. These organizations generally sign longer contracts than private individuals. They don’t have voids (periods when the property is untenanted and producing no income). Neither are there any maintenance costs, as the organizations take responsibility for this themselves. And finally, these organizations are directly funded by the government, giving them a secure income stream.

Another area of specialism is show homes. Working with a national housebuilder, Avant Homes, Assetz Exchange purchases fully furnished show homes from multiple sites around the country. These are then leased back to the developer for fixed periods of up to five years to be used to help sell other plots. This eliminates potential void periods and avoids any maintenance costs. At the end of the leases, investors will be able to vote on whether to lease the houses to tenants or sell them to home-buyers on the open market.

Assetz Exchange also offers investors the chance to get involved with a new generation of modular eco-homes. This is already a popular approach to house-building in Europe and the United States. Assetz Exchange fund the acquisition and conversion of land into serviced plots, allowing buyers to then order a house to be built on that plot to their own specification. These modular-built eco-homes are sustainable and low energy. They are also typically quick to complete and have a lower impact on the environment.

Assetz Exchange do also buy and let some standard properties as well, offering investors the chance to further diversify their portfolios.

Signing Up

Before you can invest through Assetz Exchange, you will of course have to sign up on the platform. This is pretty straightforward. You just visit the Assetz Exchange website, read the information there, and click on Register in the top-right-hand corner.

You will then be required to enter your contact details and confirm which of four categories of investor you fall into. The options are as follows:

High Net Worth Investor – This includes individuals who have an annual income of £100,000 or more or net assets of £250,000 or more.

Self-certified Sophisticated Investor – This includes individuals who have made more than one peer-to-peer investment in the last two years or who meet certain other criteria relating to investment experience. This is the category I selected myself.

Investment Professional – Including corporate investors and SIPP or SSAS professional service providers.

Everyday Investor – This category is for investors who don’t fit into any of the categories above. They can still invest via Assetz Exchange but must pledge not to invest more than 10 per cent of their portfolio in P2P loans.

You will also be required to answer some multiple-choice questions to confirm that you understand the nature of investments that can be made on the platform. I found some of these questions quite challenging, and was pleased to get them all right first time. I would therefore recommend reading the information on the Assetz Exchange website (including the Help pages) carefully before proceeding to register. If you do make any mistakes, however, feedback is provided, and you can take the test again until you achieve a 100% correct score.

Once you have done all this, you will be able to fund your account. This must be done by bank transfer, as Assetz Exchange do not allow debit card payments. You will then be able to browse the range of currently available property investments:

Investing

Once you are registered on the platform and signed in, click on Exchange in the menu at the top of the screen and all current projects will be displayed. Here are a couple that are showing at the time of writing…

Assetz Exchange 1

Clicking on any of these will open a page devoted to the investment concerned. Here you can read all about it, view reports and site plans, and so on. One very important area is the Order Book (see example below).

Order Book

All buying and selling on the platform is conducted via an exchange (otherwise known as the Order Book) which works similarly to the secondary market on Property Partner.

So if you want to buy shares in a particular project, you can do so by accepting the best price currently available on the exchange. In the example above, there are £4,895 of shares available at zero discount (i.e. the original offer price).

If you want to get your shares at a lower price than this, you can make a bid. In the example, an investor has put in a bid for £75 at a 1.04% discount and another investor (or maybe the same one) has put in a bid for £154 at a 2.08% discount.

Conversely, if you wish to sell some or all of your shares at any time, you can accept the best bid (or bids) on the Order Book currently, or place an offer and wait to see if this is matched.

It does take a little bit of getting your head around at first, but it’s actually a simple and straightforward process. One thing to note is that if there is nothing showing on the right-hand-side of the Order Book (under Offers) you won’t be able to buy shares in that project there and then – though you can of course place a bid if you wish and see if a seller wants to match it.

In any event, if you want to buy, just click on the green Buy button (either on the Exchange page or the details page) and complete the short online form. You will need to indicate how much you want to invest, whether this should be from your General or IFISA account (see below), and whether the amount should include the FCC or not (see What Are The Charges? below).

You will also need to indicate whether you want to buy at the current best price (selected by default) or you want to try for a better price (in which case your bid will be added to the left-hand column in the Order Book).

The IFISA Option

As mentioned above, if you wish you can invest with Assetz Exchange via an IFISA (Innovative Finance ISA). As discussed in this recent post, this type of ISA for P2P investing gives you the same tax advantages as a cash or stocks and shares ISA. You don’t have to pay any tax on the money you make, whether this takes the form of dividends, income or capital gains.

Everyone has a generous annual ISA allowance of £20,000 in the current 2020/21 tax year (and next year as well). This can be divided any way you like among the three types of ISA. So if you open an Assetz Exchange IFISA, you can still have cash and stocks and shares ISAs with other providers as well, so long as you don’t invest more than £20,000 in total. You can also only invest money in one of each type of ISA in any one financial year.

Choosing the IFISA option on Assetz Exchange is very easy. You can do it when first registering on the site or later. The only extra thing you have to do is enter your National Insurance number.

If you have maxed out your ISA allowance – or have already invested in another IFISA in the current tax year – you can still invest via your default ‘Regular’ account. You can invest any amount this way, but of course any profits you make will potentially be taxable.

What Are The Fees?

Assetz Exchange do not charge any monthly fees to investors (this is in contrast to Property Partner, who made the unpopular decision to impose an Assets Under Management charge and monthly fee, greatly impacting small investors on the platform especially). The company does have to make money somehow, of course, and they do this from three sources:

Arrangement fee

When a property is first purchased, Assetz Exchange charge an arrangement fee which is included in the Fixed Costs & Contingency (FCC). When parts of the property are sold on the Exchange, this fee is added to the purchase price of the buyer (see above) and so is recovered by the seller. The size of this fee is included in the loan conditions.

Monitoring fee

Assetz Exchange charge a percentage of the gross rent received for the property. The percentage is stated in the loan conditions of the property.

Property disposal fee

A fee of 2% of the gross sales proceeds is charged if investors vote to sell and the property is physically sold.

What Are The Safeguards?

Like most other property crowdfunding platforms, all investments in any project on Assetz Exchange are held in a Special Purpose Vehicle (SPV) for the project concerned. This gives investors in the project some protection if the main company were to go into administration.

A contingency balance is held within each SPV which acts in a similar manner to a provision fund, covering unexpected short-term cash-flow disruptions. It is topped up from receipts and no distributions are made to investors if it falls below a certain level.

SPVs also benefit from indemnity insurance which covers non-payments from tenants. This in theory also covers disruption to cash-flow, but it does not cover voids (periods where the property does not have a paying tenant). For reasons mentioned above, voids should not be an issue with most of the properties listed on the platform.

In common with most other P2P investment platforms, Assetz Exchange does not fall within the remit of the Financial Services Compensation Scheme (FSCS), which covers customers with UK financial services firms up to £85,000 if the institution in question were to go bust.

Pros and Cons

Here is my list of pros and cons for Assetz Exchange.

Pros

1. Fast, easy sign-up.

2. Well-designed, intuitive website.

3. Low minimum investment (as little as 80p per project!) – this makes building a diversified portfolio straightforward.

4. Assetz Exchange take care of all the work involved in buying and managing properties. You just choose which ones to invest in.

5. Option to access money any time by selling on the secondary market (though this does depend on another investor being willing to buy your shares at a price you find acceptable).

6. Relatively low-risk investment options (though of course there are no guarantees)

7. Customer support (in my experience anyway) is fast, friendly and helpful.

8. Charges are reasonable. There is no charge for selling investments.

9. Potential to make money through both capital appreciation and rental income.

10. Rental income is paid into your account every month. You can either withdraw or reinvest it.

11. No monthly fees and only transaction-based charges to pay.

12. Opportunity to invest in socially beneficial developments such as sheltered housing

13. Tax-free IFISA option to which any investment on the platform can be added

14. Investors can vote for their favoured exit option (e.g. selling up) when the time comes

Cons

1. Can’t invest using a debit card

2. No auto-invest option currently available

3. Not as many opportunities as some P2P platforms (although the number is increasing steadily)

Closing Thoughts

I was impressed enough with Assetz Exchange to invest a small amount (£100) of my own money initially and will report back on PAS about how my portfolio fares. Here is how it’s looking at the time of writing, roughly a month after I opened my account. As you can see, my initial investment has grown by £3.87 from a combination of income received and capital growth. For a month that’s not bad at all – if it carries on growing at that rate I’ll be delighted! – but of course it is much too soon to draw any firm conclusions from this.

My Assetz Exchange investments

I particularly like the fact that with the low minimum investment on Assetz Exchange, even if you’re starting very cautiously (as I am) it’s easy to build a diversified portfolio. I like the relative simplicity of investing on the website and the fact that you can exit an investment any time via the exchange (though that does depend on willing buyers being available at a price that is acceptable to you). It is also good that there are no charges associated with selling on the exchange.

  • You can, of course, withdraw uninvested funds from your Assetz Exchange account at any time.

Obviously there are risks in any form of investing and it is important to do your own ‘due diligence’ before proceeding. You should also bear in mind that this type of investment is not covered by the Financial Services Compensation Scheme, which covers savers with UK banks and other financial institutions up to £85,000. On the other hand, the potential returns are significantly better than the fractions of a percent typically on offer from savings institutions right now, while the risks appear to be at the lower end of the spectrum, with many of the properties on long-term leases with corporate/institutional tenants.

To be very clear, nobody should put all their spare cash into Assetz Exchange (or any other investment platform for that matter) but in my opinion there is definitely a case for including AE within a diversified portfolio.

As mentioned above, I shall be reporting back on how my Assetz Exchange investments perform on PAS in future. In the mean time, if you have any comments or questions about this post, or Assetz Exchange more generally, please do leave them below as usual.

Disclaimer: I am not a registered financial adviser and nothing in this post should be construed as personal financial advice. You should always perform your own ‘due diligence’ before making any investment and speak to a qualified professional adviser if in any doubt how best to proceed. All investments carry a risk of loss.

Please note also that this review uses my affiliate links. If you click through and make an investment or perform some other qualifying transaction, I may receive a commission for introducing you. This will not affect any charges you pay or the product/service you receive.

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March 2021 Update

My Coronavirus Crisis Experience: March 2021 Update

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Here is my latest monthly Coronavirus Crisis Update. Regular readers will know I’ve been posting these updates since the first lockdown started a year ago now (you can read my February 2021 update here if you like).

I plan to continue these updates until we are clearly over the pandemic and something resembling normal life has resumed. Obviously, I very much hope that will be sooner rather than later.

As ever, I will begin by discussing financial matters and then life more generally over the last few weeks.

Financial

I’ll begin as usual with my Nutmeg stocks and shares ISA, as I know many of you like to hear what is happening with this.

As the screenshot below shows, since last month’s update my main portfolio has been through some ups and downs. It is currently valued at £19,155. Last month it stood at £19,008, so it is at least up a little (£147) overall.

Nutmeg March 2021

As you may recall, three months ago I put £1,000 into a second Nutmeg pot to try out Nutmeg’s new Smart Alpha option. The value of this pot rose as high as £1,040 in mid-February, though it currently stands at a more modest £1,007. Here is a screen capture showing performance to date, though obviously it is much too early to draw any conclusions from this.

Nutmeg Smart Alpha March 2021

You can see my in-depth Nutmeg review here (including a special offer at the end for PAS readers).

I mentioned last time that my first investment with P2P property investment platform Property Partner reached its five-year anniversary, at which point investors can vote to sell their shares or continue for another five years. Along with just under half of the other investors, I voted to sell my shares.

The shares of everyone who wanted to sell were duly put up for sale on the platform. Unfortunately, though, there were few buyers, so with a substantial number of shares unsold, the property has been put up for sale on the open market. That means there will be a period of several months – possibly longer – before a buyer is found, and there is no guarantee that the independent valuation price will be achieved.

That is obviously disappointing, though as I only have a very small amount invested in this property (about £50) I’m not going to lose any sleep over it. In my view Property Partner didn’t make much effort to market these shares to investors. I suspect the same may be the case with at least some of the other properties coming up to their five-year anniversaries. It may be that Property Partner are happy to get some of the smaller houses and apartments off their books, especially the city-based ones for which demand has fallen as a result of the pandemic. Currently I have another small investment going through the five-year process. I voted to sell my shares in this too, but suspect the outcome will be the same.

As I have noted before on PAS, shares in many properties on Property Partner are currently available on the secondary market at a discount to the independent valuation price  Based on my experiences to date, however, I would advise caution about regarding this as a buying opportunity. If properties that are relisted attract little interest from existing PP investors, they will have to be sold on the open market. In that case you are likely to have a long wait until you see any return on your investment, and there is no guarantee of an overall profit even then. I shan’t therefore be investing on the Property Partner secondary market for the foreseeable future.

That wasn’t the only disappointing financial news last month. Property crowdfunding investment platform The House Crowd unexpectedly announced that it was going into administration. I still have some investments with THC, though thankfully not as many as I did two or three years ago.

Apart from one small loan – which I accepted some time ago had gone south – my remaining investments are in traditionally crowdfunded properties, all of which are currently up for sale. The money is therefore secured by bricks and mortar, so I expect to get at least some of it back (and have of course been receiving dividend payments from rent received). As with other property crowdfunding platforms, each THC property is owned and managed by a separate Special Purpose Vehicle (SPV), which gives it legal protection from claims against THC by creditors. How this will pan out in practice remains to be seen, but I note that the administrators have said that their appointment is ‘not expected to have a material impact on investors.’

So I am being philosophical about this and awaiting further developments. These have undoubtedly been tough times for property investors, and regular readers will know that I also recently lost money with another property crowdfunding platform called Crowdlords. Overall, when you allow for my successful property investments and rental income, I am more or less breaking even, but even so (as I have said on the blog before) I am a lot more cautious about this type of investment nowadays.

Personal

February was another long, cold month, but at least there are signs of better times ahead now. The vaccine roll-out continues to go well and case numbers are dropping rapidly, giving us all hope for a return to something approximating normal life in the weeks and months ahead.

And, of course, we are heading into the spring now, with longer, brighter days and – eventually – the prospect of some warmer ones!

One thing that always lifts my spirit at this time of year – and especially in the current circumstances – is the arrival of spring flowers. In my garden I have crocuses and snowdrops out at the moment, and it won’t be long until the daffodils are in bloom. Here’s a photo of a flower bed in my front garden…

Garden

I had my first Covid jab in February, at the Whitemore Lakes mass vaccination centre near Lichfield. It was run by a team of NHS staff, military and volunteers. Everyone was friendly and efficient. The only slight blip came when I was checking in. I happened to notice that the clerk had put ‘female’ on my form, doubtless due to my lockdown hair. She was embarrassed when I pointed this out, but of course I couldn’t just say nothing. I shall be very pleased when we are allowed to visit hairdressers again!

I received the Oxford-Astra Zeneca vaccine. After I had a bad reaction to my last flu jab (fever and nausea) I was prepared for something similar with this, but thankfully that didn’t happen. Apart from very slight soreness in my arm the next day, I had no side-effects at all. I hope I am just as lucky with my second jab, which I have already booked for May.

Also on a medical theme. I had my latest trip to the eye clinic at Queens Hospital Burton last week. Regular readers will know that last autumn I was diagnosed with a perforated retina in my left eye. My first laser treatment was only partly successful, so Iast time I received a (more powerful) top-up treatment. This visit was to check if it had been successful, and I was pleased and relieved to hear that it had. So once again I need to express my thanks and gratitude to all the staff there, and especially to Mr Brent, the consultant who performed my final laser treatment and gave me the good news this time. I have been told that if something like this happens once it increases the chances of it happening again, so I have to be on the lookout for any potentially worrying changes to my eyesight in future. But that aside I am lucky that this problem was detected early before anything more drastic (e.g. a detached retina) occurred – so big thanks to my optician at Vision Express Lichfield as well!

As I write this update, the schools are just about to reopen to all students. I am delighted about that, as I know that it has been a tough time for many children. While some schools have been very good about running online classes, these can never be a complete substitute for face-to-face teaching. I also know from speaking to friends that some schools have been less supportive, simply sending pupils written lessons or assignments to complete on their own. That is obviously less than ideal for younger children especially.

I do think it is regrettable that the government has advised that secondary school children should wear masks in classrooms. The same applies to the mandatory twice-weekly testing. In my view these measures will achieve little apart from traumatizing young people and making it harder for them to learn. I understand these measures have been introduced partly to placate the teaching unions and some worried parents, but hope they will be swiftly withdrawn when (as I fully expect) there is no big ‘spike’ in virus cases following the return. Okay, I’ll get off my soapbox now!

As always, I hope you are staying safe and sane during these challenging times. If you have any comments or questions, please do post them below.

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Grow Your Money Every Week With Plum!

Grow Your Money Every Week With Plum!

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Updated 1 Feb 2021

British people generally are not very good at saving.

A third of us have under £600, and 1 in 10 have no savings at all (source: https://www.finder.com/uk/saving-statistics). Having so little money put away makes people especially vulnerable in the event of a sudden change in their circumstances such as redundancy or divorce.

So today I thought I’d bring to your attention a money-management app called Plum that aims to help with this problem.. Plum is designed to help you set money aside painlessly for any purpose – from holidays to major purchases or simply for a ‘rainy day’ fund.

Plum is one of a growing range of apps that make use of so-called Open Banking. This allows third-party apps to access your financial information (read only) – so long as you provide the necessary authorization, of course – and perform certain transactions on your behalf, if you choose to set up a direct debit.

Open Banking is now becoming well established in the UK, and safeguards are in place to ensure that your security isn’t compromised. Even so, this is something you need to be aware of – and comfortable with – before signing up with Plum or similar apps.

In this post I am looking at features available on the Plum Free (or Basic) account and the paid-for Plum Plus and Plum Pro Accounts. The Plum Free account is – of course – free of all charges. Plum Plus costs £1 a month (the first month is free) and Plum Pro costs £2.99 a month (again, the first month is free if upgrading from a Plum Free account). Plum Plus and Plum Pro  offer a wider range of features and higher interest rates in interest-bearing ‘Pockets’ (further discussed below).

The screen capture below from the Plum website shows the features available with each type of account.

Plum accounts Feb 2021

You can read more about the three account types if you wish on the Plum website.

How It Works

Plum is available as an iOS and Android app. It uses Open Banking in combination with a direct debit authorized by you to manage and grow your money for you in an intelligent way.

Every few days, Plum’s algorithm calculates what you can afford to stash away based on your spending habits. It then transfers that money automatically from your current account to your Plum account. In this way you put money aside regularly while barely being aware of it – so it builds up, and in due course you can spend it on things that really matter to you.

You can change the amounts the app takes at any time, and also pause the service if you wish. This means you don’t have to worry about Plum pushing you into the red. You always stay in control and can change the ‘mood’ at any time if you want to be more ambitious or cautious with your saving (see picture below).

Plum savings mode

Plum currently works with most major UK banks. The full list from the website is as follows:

  • Barclays
  • Danske Bank
  • First Direct
  • Halifax
  • HSBC
  • Lloyds
  • M&S
  • Monzo
  • Nationwide
  • Natwest
  • Revolut
  • RBS
  • Santander
  • Bank of Scotland
  • Starling
  • Tesco
  • TSB
  • Ulster Bank

Currently business accounts and joint accounts are not supported by Plum. They also do not support Channel Island bank branches.

How to Get Started

Start by downloading the app free of charge from Google Play or the Apple iStore (see links here).

Once you’ve downloaded the app and signed up, you can begin a dialogue with the Plum chatbot to help you set up your account. You will, of course, have to connect the app to your bank, so you will need to have your current account details to hand. Once it’s all set up, turn notifications on. This will allow the app to alert you when it wants to start setting money aside for you.

There is an option to speak to a real person if you need to. You can also increase or decrease the amount to stash away, set up ‘Pockets’ for specific purposes (see below), and even pause any transactions completely if you wish.

Do You Get Interest?

With the default ‘Primary Pocket’ on your Plum account the answer is no. The app is free and helps you set money aside painlessly, but Plum doesn’t pay interest on this.

Even Plum Free accounts can, however set up a secondary interest-paying Pocket. This facility is provided by Investec Bank and takes the form of an easy-access account paying 0.20% for all users

Plum Plus users can also set up one easy-access Pocket paying 0.40% interest. And Plum Pro users can have up to 10 such Pockets for different purposes, all paying 0.40% interest.

What Exactly Are Pockets?

Pockets let you set money aside with a specific goal and amount, e.g. to buy a car, save for a trip, or put down a deposit on a house. You can think of them as ‘pots’ or even jam-jars!

As money accumulates in each Pocket, the app will show your percentage progress towards achieving that goal.

All Pockets (except the default Primary Pocket) can be interest-bearing as well, as explained above. The interest paid will contribute towards achieving your goal/s.

Where Do Plum Keep Your Money (And Is It Safe?)

The app puts money away in your Plum account, which is the safeguarded account created when you sign up.

Your Plum funds in your Primary Pocket are held as e-Money by PayrNet (a subsidiary of Railsbank), Plum’s e-Money provider. Your funds are safeguarded with a UK Bank chosen by PayrNet. Your money is safeguarded because e-money cannot be lent out (this is also why it doesn’t earn interest). That same safeguarding also prevents any of Plum’s or PayrNet’s creditors from claiming your money in the event that either business should go bankrupt. Both Plum and PayrNet are regulated by the Financial Conduct Authority (the UK’s financial watchdog). Plum also boasts 256-bit TLS encryption to ensure your data is kept safe.

Money saved with Plum in interest Pockets is held on Trust with a UK Bank (Investec). A Trust is a legal mechanism that means Plum can look after your money but legally it never stops belonging to you. This means that if anything were to happen to Plum then the bank would return your money to you directly. Should something happen to the bank itself, you would be protected up to £85,000 under the Financial Services Compensation Scheme (FSCS).

How Easy Is It to Withdraw?

Transfers from non-interest Pockets back to your Primary Pocket are usually instantaneous. it is different with transfers from interest-bearing Pockets:

• When requesting an interest Pocket withdrawal before 15:00 UK time on business days, it will be completed the same day.

• When requesting after 15:00 UK time on business days or during weekends, it will be completed the next business day.

Note that withdrawals from interest and non-interest Pockets go back to your Primary Pocket initially. Withdrawals to your bank account will always be from your Primary Pocket. Such withdrawals are processed the same day (typically in around 30 mins) and will appear on your bank statement under your full name.

Other Benefits

As well as making it easier to put money aside, Plum can help you keep track of your income and expenditure. You can set it to provide daily or weekly balance updates, and it will also automatically track your transactions by category, week and month. Plum will let you know all of this without having to wade through bank statements.

In addition, Plum has AI (artificial intelligence) built in, so if it notices you are being overcharged on a bill or for a financial product, it lets you know. It will also suggest cheaper solutions for you and – if you wish – help you switch over in just a few clicks.

Plum also offers a variety of optional automated features. These include

Round Ups – Get Plum to round up your past week transactions to the nearest £1 and transfer the spare change.

52-Week Challenge – Starting with £1 in the first week, £2 in the second week and increasing up to £52 in the final week of the challenge, Plum can help you set aside £1,378 in a year. This feature is only available through Plum Pro.

Rainy Days – Once activated, Plum squirrels away extra cash automatically each day it rains where you live. This feature is also only available through Plum Pro.

Pay Days – The best time to set money aside is when you get paid, so tell Plum an amount and it’ll move this automatically for you on payday.

Plum Reviews

Plum has an average rating of 4.5 stars (‘Excellent’) from over 1200 reviewers on the independent Trust Pilot website. Just over three-quarters (76%) gave it the maximum five stars, with many mentioning the great customer service and how the app had helped them to save more. Of those who gave Plum three stars or less, the main issues mentioned were delays or problems in withdrawing. To be fair, the Plum team generally respond to such comments on the Trust Pilot website explaining how the app works and offering additional help where issues have arisen.

Final Thoughts

If you want to set more money aside but need a little help and encouragement to do so, Plum is well worth a look.

I like the way it stashes money away automatically, so in all probability you won’t even notice it. You can set it to take as much or as little as you like, and you can also make one-off additional payments if you are feeling particularly flush. You can also withdraw some or all of your money back to your bank account at any time.

Pockets are a great feature, allowing you to set aside money for specific purposes. And, as mentioned above, by using an interest-bearing Pocket, you can get interest as well (0.20% with a Plum Free account and up to 0.40% with a Plum Plus or Pro account). Obviously that’s not a fortune, but in the current low-interest rate environment it is still very competitive (and a lot better than nothing!).

In my view Plum is likely to work best for people with a regular monthly (or weekly) income. If you receive income more irregularly – e.g. you’re self-employed – it might not work quite as well. Even so, Plum say that their algorithm can detect patterns in your income and expenditure and adjust your transfer amounts accordingly.

In any event, there’s no reason not to try Plum yourself to see if it can help you set aside more. Just click through this link for more information and to sign up.

As always, if you have any comments or questions about this post, please do leave them below.

Note: This is a fully revised and extended version of my original Plum review from last year.

Disclosure: I am an affiliate for Plum so if you click through any link in this article and sign up, I will receive a modest referral fee for introducing you. This will not affect the service or benefits you receive in any way. Please note also that I am not a registered financial adviser and nothing in this post should be construed as personal financial advice.

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Top 20 Posts 2020

My Top 20 Posts of 2020

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As is customary for bloggers at this time of year, here are the top twenty posts on Pounds and Sense in 2020, based on comments, page-views and social media shares. They are in no particular order. I have excluded any posts that are no longer relevant.

I hope you will enjoy revisiting these posts, or seeing them for the first time if you are new to PAS. Don’t forget, you can always subscribe using the box on the right to be notified of new posts as soon as they appear.

All posts in the list below should open in a new tab/window when you click on the link concerned.

1. Ten Reasons Over-50s May Need an Independent Financial Adviser

2. How to Make Money From Your Old Tech

3. Save Money on Your Mortgage With Dashly

4. Twenty Ways to Make Extra Money From Home During Lockdown

5. Nutmeg Review: My Experiences With This Robo-Adviser Investment Platform

6. Why I Switched my Santander 123 Account to 123 Lite

7. How to Make Money From Affiliate Marketing

8. How to Get a Better Night’s Sleep

9. Should You Use Equity Release to Unlock the Value of Your Home?

10. What Are the Best Video Calling Tools for Older People?

11. Why I am (Still) Not a Fan of Premium Bonds

12. Get a Free Share Worth Up to £100 with Trading 212

13. Managing Your Finances and Tackling Debt – A Q & A With MoneyNerd

14. Booking a Holiday With Airbnb

15. Ten Things I Have Learned About Self-Employment Over 30 Years

16. Kuflink: My Review of This P2P Property Investment Platform

17. Looking After Your Mental Health in the Coronavirus Crisis

18. How Over-75s Can Claim Pension Credit to Keep Their Free TV Licence

19. Can You Still Make Money from Matched Betting?

20. Surviving the Covid Winter

I’ll be taking a break from blogging over the festive period (though I’ll still be around on Twitter and Facebook). I’ll therefore close by wishing you a happy, Covid-free Christmas, and for all of us a far better new year 🙂

If you have any comments or questions, of course, feel free to leave them below as usual.

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Moneynerd interview

Managing Your Finances and Tackling Debt – a Q & A with MoneyNerd

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Today I have a Q and A for you with my fellow money bloggers at MoneyNerd.

MoneyNerd is a UK personal finance blog that aims to help people learn to manage their finances and tackle debt. I asked a number of questions about personal finance and debt, and added my own thoughts as well. Our answers are also being shared separately on the MoneyNerd blog. I hope you find them interesting and informative.

What’s your number 1 financial tip?

MN: It’s hard to give advice that would apply for everyone, because everyone’s finances are different. But I would suggest ‘write it down’, as a fairly universal and important financial tip. Start with your financial goals, then write down the steps you’ll take to get there according to your budget. A lot of people have good financial intentions, but without having clear goals on paper, it’s easy to get led astray.

PAS: Agreed. I would also say, keep on top of your money. Know what’s going in and what’s going out every month, and budget accordingly. Always be on the lookout for ways you can maximize your income and minimize your expenditure. And try to put some money aside for the proverbial rainy day. Everyone should really have at least three months’ worth of income set aside in case of emergencies. Sorry, that’s at least three tips, I know!

What do you think are the main causes people find themselves in financial difficulty?

MN: I think financial difficulties are mainly caused by unforeseen life-events, such as bereavement, unemployment, and relationship breakdowns. These kinds of bumps-in-the-road can severely throw people off course, particularly if their financial situation was fragile in the first place. Unfortunately, all three of these examples have sky-rocketed due to the pandemic, and many people in the UK will be facing financial difficulties over the coming year.

PAS: Not much I can add to that. Although sometimes failing to monitor your income and expenditure closely enough can lead to debts mounting up before you realise it.

What personal finance tools do you currently use to track and manage your money?

MN: I’m quite old-school and still use spreadsheets for a lot of money-related things! There are some good apps out there though – Money Dashboard is a particularly good one.

PAS: I am the same and use spreadsheets a lot. I started with Microsoft Excel, but these days mainly use Google Sheets. As regards personal finance tools, I like Snoop [referral link], a relatively new app that helps you keep track of your finances and suggests easy ways you can make savings.

Any tips for people coming to financial management later in their lives?

MN: It might be a little harder to undo old habits and reinstate new ones if you’re approaching financial management from an older perspective. So start by setting simple goals, and work at them consistently. It’s probably worth taking a little time to assess what’s important to you right now, too: what range of outgoings does your money need to cover in later life that you didn’t need to consider before?

PAS: I am 64 and have friends in their seventies and eighties, so I have seen the sorts of problems older people can face. In particular, so many aspects of our personal finances are dealt with online now, from banking to applying for state benefits. The pandemic has probably accelerated this trend.

Many older people struggle with the technology and it’s often not as intuitive as it should be, especially for those whose eyesight isn’t as good as it once was. So I would say to any older people, try not to get left behind by technology, and ask younger friends and relatives for help when needed. Last year a group of us clubbed together and bought a friend (a retired builder) a Chromebook for his 80th birthday. He had never engaged with computers or the internet before and I must admit I was expecting him to struggle at first. However, he took to it like a duck to water, and was soon ordering tools and components online from a local builders merchant. So even old dogs can definitely learn new tricks!

2021 is going to be tough for many. Do you have any advice on how to keep things under control?

MN: I’d start with the obvious – plan as much as possible, in order to save as much as possible. This is so that when those ‘bumps-in-the-road’ come along, you have some kind of safety net, however small. Unfortunately, however, I imagine a lot of people will do everything right this year and still fall into difficulty. As and when that happens I would say be proactive in reaching out and seeking help. There are plenty of free services and helplines to reach out to, before matters spiral.

PAS: Yes, definitely. As I said earlier, everyone should have a financial safety net to tide them over when life throws you a curveball.

In my earlier career I worked as a debt counsellor at a citizens advice bureau, so I know that there is lots of help out there if you ask for it. And friends and family can be a good source of practical and emotional support too. Just don’t bury your head in the sand and pretend to everyone that nothing is wrong.

What would be your top tip for someone who is worried about a debt (or debts) they can’t repay?

MN: I have two tips: the first is don’t panic, the second is be proactive. If you can’t afford the repayments for a loan or credit card, contact the company and explain your situation. If you’re struggling to meet the repayment amounts, you may also need to look at whether a debt solution is appropriate for you. Having unaffordable debt can be a scary place in which to find yourself, but by taking action you can dissipate some of that anxiety by feeling you are doing something about the problem.

PAS: Yep. It’s worth bearing in mind also that if you have a debt you can’t repay, it’s not just your problem, it’s a problem for whomever you owe the money to as well. It is therefore in their best interests to work with you to find a method for paying down the debt.

What are some good ways of boosting your income?

MN: Ask yourself: do I own anything I could rent? A parking spot, a vehicle, a garden shed, even a room in your house if you own it. Then ask yourself: do I own anything I could sell? Old clothes, a bicycle, old furniture, anything in storage. Then finally, ask yourself what you could do with your spare time: dog-walking, Uber-driving, delivering takeaways/parcels, painting and decorating,completing online surveys, match betting, free-lancing, etc. I have a whole blog post which goes into this very topic in more detail: Making Money – Tips and Tricks.

PAS: Lots of great ideas there. Like MoneyNerd, I also have a section of my blog devoted to ideas for boosting your income. I like online surveys, with Prolific Academic (a website needing people to take part in academic research) a particular favourite. And I do matched betting as well, though not as much as I used to, as I’ve been restricted (or gubbed as we say in MB’ing) by many of the leading bookmakers!

What is the best way you can help a friend or family member who has debt problems?

MN: Honestly, I don’t think there’s a one-size fits all here. Everyone and everyone’s debt problems are different. But that seems like a cop-out! So I think showing genuine, non-judgemental support, and ensuring they have all the right resources (StepChange, CitizensAdvice, etc.) to hand are two good places to start.

PAS: I agree with this. But based on personal experience with a friend a few years ago, I would also advise thinking hard before lending them money, as this seldom solves the problem and may simply exacerbate it. With my friend, who lived alone, I found that acting as a lender to him changed the nature of our friendship, and not for the better. I also felt that by constantly bailing him out, I was allowing him to avoid addressing his money management issues. Eventually we had a difficult telephone conversation when he asked me to lend him money again and I refused. He took it better than I expected and our friendship actually returned to something more normal after that. He got his finances under better control, although I did on a couple of occasions afterwards send him supermarket vouchers to ensure he had enough to get food. I didn’t expect to be repaid for these, obviously!

If you had a sudden, unexpected windfall of £5,000, what would you do with it?

MN: Firstly I’d pay off any loans or outstanding credit card debts. Then I’d take my family out for a nice meal, and put what’s left-over into a tax-free ISA.

PAS: Paying off debts would be my first priority as well, though I am fortunate not to have any at the moment. I would put most of the rest in my Nutmeg stocks and shares ISA, and some in my Kuflink property loan investment account (from which I have had good results over the last three years) to provide a bit of diversification. Going out for a nice meal with family and friends sounds good too, although as I live in a Tier 3 area I might have to wait a while for that!

What was your best-ever financial decision, and what was your worst?!

MN: My best financial decision was investing in a tech based stocks and shares ISA which has done really well over the last 5 years, although don’t know if I’d recommend the same investing approach in the current economic climate.

On the other hand my worst financial decision was living in London for 10 years where rent and cost of living is exorbitant.

PAS: My best financial decision was probably paying off the mortgage when I had a windfall a few years ago. At a stroke one large item of monthly expenditure was gone, giving me greater financial flexibility as well as saving me a lot in future interest payments.

My worst decision was investing too much in property crowdfunding a few years ago when it was still new and exciting. I had money to invest at the time and liked the idea of owning stakes in a portfolio of properties across the UK. Some of my investments worked out but others didn’t, and I am currently sitting on a number I can’t access because the properties in question can’t be sold for one reason or another. The money is still there in bricks and mortar but I have no idea when or how I will be able to access it. That said, I do still believe in the property crowdfunding concept, but I do it a lot more selectively now.

About MoneyNerd

MoneyNerd.co.uk is a personal finance blog that was set up with one aim in mind: to help people learn how to manage their finances and tackle debt. The blog includes a variety of straight-talking articles that cover personal finance topics from credit card guides to mental well-being tips. These can help you understand exactly how financial products work, as well as what your rights are when dealing with debt. We want to offer authentic and truthful information that can help you deal with your situation, whatever that may be.

MoneyNerd

Many thanks again to MoneyNerd for their insights. Please do check out the MoneyNerd site for much more information about tackling debt and getting your finances under control.

As always, if you have any comments or questions about this post, please do leave them below.

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Nutmeg Launches Smart Alpha Portfolios

Nutmeg Launches ‘Smart Alpha’ Portfolios Powered by J.P. Morgan Asset Management

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Updated 16 November 2023.

Regular readers of PAS will know that I am a fan of the Nutmeg robo-adviser investment platform, and have a good portion of my own money in a Nutmeg stocks and shares ISA. You can read my in-depth review of Nutmeg here.

I was interested to hear that Nutmeg had launched a new investment style for their ISA, Lifetime ISA, Junior ISA, SIPP (personal pension) and general investment account customers. Previously such customers had a choice of three options: Fixed Allocation, Fully Managed and Socially Responsible.

All Nutmeg portfolios are managed by human experts, but the Fixed Allocation ones are altered annually, whereas the others are managed more actively. The Socially Responsible portfolio aims to optimize your investments according to various environmental, social and governance (ESG) factors. So it focuses on companies with a good track record and proactive strategy in such areas as water use, pollution, greenhouse gas emissions, proportion of female board members, and so on. Currently my own stocks and shares ISA is in the Fully Managed category (which was the only option available when I originally invested with Nutmeg).

Whilst all three of these investment styles remain available, a new one was launched in 2020…

Smart Alpha Portfolios

Nutmeg’s Smart Alpha portfolio range is powered by J.P. Morgan Asset Management. It includes five risk-rated portfolios, each holding between 10 and 14 passive and active exchange traded funds (ETFs). They are run by J.P. Morgan’s multi-asset solutions team, giving Nutmeg clients access to the investment giant’s experience and expertise. Writing on the Nutmeg blog, their Chief Investment Officer James McManus explained the benefits of this approach as follows:

The name recognises the intelligent way these portfolios are designed with the potential to achieve alpha (returns above the market) for our clients in three ways. 

Firstly: The use of J.P. Morgan Asset Management’s multi-asset specialists, a team with a 50-year history of investing for institutions and professionals worldwide. These specialists inform Smart Alpha portfolios’ long-term (strategic) asset allocation. 

Secondly, Smart Alpha portfolios have the ability to be flexible around this long-term asset allocation, allowing us to manage risk and capture opportunities at different stages of the market cycle.  

Thirdly: Nutmeg and J.P. Morgan Asset Management have added to these capabilities a means to make smart security selections within active exchange traded funds (ETFs). These smart selections are made based on the insights of J.P. Morgan Asset Management’s research analysts with the aim being to capture returns in excess of the market benchmark (alpha). 

How do these smart selections seek to gain alpha? The active ETFs we use allow us to move overweight in certain positions that J.P. Morgan Asset Management’s analysts expect to perform well and underweight in those positions they expect to perform poorly. This gives us the ability to move above and below market benchmark positions, delivering greater potential returns with similar risk to the overall market. 

As well as allowing Nutmeg investors to tap into the expertise of J.P. Morgan Asset Management, these portfolios are ESG integrated, meaning that (as mentioned above) environmental, social and corporate governance considerations are factored into every research and investment decision. These portfolios are therefore suitable for the growing number of investors for whom ethical considerations are particularly important.

The terms and conditions for the new Smart Alpha portfolios are copied below, alongside the other portfolio types.

Nutmeg fees Nov 2023

The above is correct as at 16 November 2023, but may have changed subsequently. Please note also that Nutmeg has also recently introduced a new ‘thematic’ investment style. More information about this can be found about this in my full Nutmeg review and on the Nutmeg website. Remember that all investing carries a risk of loss.

My Thoughts

This is undoubtedly an interesting move by Nutmeg and gives investors the opportunity to benefit from having their portfolio actively managed by a leading investment house at no extra cost. If you are a Nutmeg investor already, you can start by investing as little as £500 to test the water. You can either use ‘new money’ from your bank account or another ISA, or you can transfer money from another pot within your Nutmeg ISA account.

Personally I am very happy with the way my Nutmeg ISA has performed during this tumultuous year and don’t want to rock the boat too much. On the other hand, I am curious to see how the new Smart Alpha portfolios perform in comparison. So I have created a new £1,000 pot within my ISA and have selected Smart Alpha as the investment style. The risk level is 4/5, which roughly corresponds with the 9/10 risk level in my Fully Managed portfolio.

I will of course report back on Pounds and Sense about how my investments perform. Obviously, if my Smart Alpha pot seems to be doing significantly better than my Fully Managed one, I will switch some or all of the latter to Smart Alpha as well. It is one of the attractions of Nutmeg that you can have multiple pots within a single ISA with different investment styles and risk levels attached to them.

  • Capital at risk. Tax treatment depends on your individual circumstances and may change in the future.

In Conclusion

I am obviously a fan of Nutmeg and – as stated above – have a significant proportion of my investments with them.

Of course, I am not a qualified financial adviser and everyone should do their own ‘due diligence’ (and/or take professional advice) before deciding to invest. In addition, you shouldn’t consider investing with Nutmeg (or anyone else) unless you have paid off any interest-charging debts and have at least three months of easily-accessible savings in case of emergencies.

Based on my personal experiences with Nutmeg, though, I am happy to recommend them. They provide a simple, easy-to-understand investment platform, the customer service is excellent, and certainly in my case the results to date have exceeded my expectations.

If you have any comments or questions about this post or Nutmeg in general, please do leave them below.

PLEASE NOTE: As with all investing, your capital is at risk. Tax treatment depends on your individual circumstances and may be subject to change in the future. The value of your portfolio with Nutmeg can go down as well as up and you may get back less than you invest. 

Note also that I am not a qualified independent financial adviser and nothing in this review should be construed as personal financial advice. You should always do your own ‘due diligence’ before investing and take professional advice if in any way uncertain how best to proceed. All investing carries a risk of loss. 

Please note also that this review includes affiliate links. If you click through and make an investment or perform some other qualifying transaction, I may receive a commission for introducing you. This will not affect in any way the terms you are offered or any fees you may be charged.

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