Categories
Online Banking

Is it the Product or the Bank that is Most Important?

It can be difficult choosing a financial product and thinking about whether you want to put priority over the product itself or the bank when you are comparing them. It is something that it is important to think about though as it could make the difference between whether you get a good product or not.

What to Look out for in the Product

One of the main things that people will want to look out for in the product is the cost of it. They will want to make sure that they are not paying more than necessary for the item that they are using. If this is a savings account then it will be the interest paid out rather than charges that will be considered. If it is a loan then it will be the interest and any fees. With a current account there may be charges or it might be the overdraft rate that you are looking at. It is a good idea to think about the value for money that you are getting from the product though. Consider other features of it in light of the cost to see whether you think that it is good. Consider whether you are prepared to pay more for an item due to features that it has. For example, you might be prepared to pay more for a loan if the repayments are smaller and easier to manage. You might be happy to receive less interest on your savings if the account allows instant access to the money. So, it is important to look at the cost side in relation to what else you are offered and then you will be able to think about the value for money that you are getting.

What to Look out for in the Bank

Banks will vary in different ways. It is worth thinking about what might be important for you. Firstly, it is good to think about how you want to deal with the bank. Some will have high street branches and you might want a bank that has one but some may only deal over the telephone or online. Think about what you would prefer or whether you want to be able to use all of these if you want to.

Also, you may want to think about the reputation of the bank. You might want to go for a bank that you have used before so that you are happy that you will be able to trust them. You might want to go for a bank that you have heard of or that people you know recommend. You may want to read some reviews to find out more about them. It is a good idea to be cautious and find out as much as you can. However, make sure that your sources are reliable. Reviews can be biased and even people you ask might be. Also think about what they are saying, they might love a bank as it has a high street branch but you like to online bank s that is not relevant. So, think about whether the things that people like and dislike about the bank are relevant to you and what is important to you in a bank.

It is probably the case that it should be both that you consider. However, think about what factors you feel are important to you and prioritise those. We all have different ideas and so it is hard to say whether one is better. It is important though, to be aware of the cost or interest on the item and think about whether it offers good value for money when considering its features as well as what the bank itself is like. 

Categories
Building Society

Is a Bank or a Building Society Better?

There are some people that prefer banks and some that prefer building societies. If you are trying to pick between them, then you might wonder whether one is better than the other. The problem is that whether one is better for you will depend on what you are looking for. You should have in mind an idea of what you want and then you will be able to look at the different banks and building societies and you will be able to compare them and see which of them comes closest to what you are looking for. You may wonder though, what you should be looking out for in each.

  • Products that you Want – it is good to think about what products you are looking for. It might be that you are just looking for one product such as an ISA or that you want a selection – perhaps a current account, instant access savings account and mortgage. Most banks and building societies will offer standard products, but if you want something a bit different then you may have to search harder to find it. If you want products that are general but with a specific feature, then again, you may have to look harder for it. In this case you may find that you will have to reject a lot of different banks and building societies.
  • Competitive Prices – for many people knowing that they are either being paid competitive interest on their savings or are not overpaying on their loans is important. It does make sense as well because you want to make sure that you are not paying more than necessary as well or are getting a good savings rate. It is important though, to realise that the rates are not everything as you want to make sure that you are getting good value for money.
  • Good Value for Money – some people think that a loan which offers good value for money is just the cheapest loan that you can get. This is not right though and it is important to make sure that you understand this. It is actually referring to the fact that you think what you are getting for your money is fair. It is a bit easier to explain it in terms of food. You might buy an apple for 20p, but if there is a cheaper one for 10p, it will not be good value for money if it is bruised and rotten, the 20p one will be better value because you will be getting a nice apple that you can eat. The same applies when you are applying for services such as banking. It is a good idea to have a think about what you would see as good or bad value in a banking product or even a particular bank or building society. It might be that the product is easy to repay, that it allows flexibility with repayment, that the loans last a long time or that it is repaid quickly etc. There are lots of possibilities. One thing that can be really important as well is the service that the place provides.
  • Customer Service – knowing that you will get support when you need it can be really important. It is good to think about the fact that you might want to be in touch with the bank or building society. You may have questions or queries or even problems and need to be able to get hold of them so that you can discuss them with them. Some will be easy to contact, using a method that you like and respond quickly with useful information. Others will be hard to contact and take a long time to respond and then not come up with useful help. It is good to consider this and you will find that you can contact their customer services before you even apply and this will give you an idea of what they will be like.
Categories
Online Banking

Should I Trust Online Banking?

There are many people that use online banking but there are some people that just do not trust the system. They might worry about all sorts of things and wonder whether it is a good idea for them to use. There are some really good advantages of using online banking though

  • Can access account details at any time
  • Can do transfers and change direct debits etc yourself
  • Can check balance easily to keep a track of what is going on with your account which can help with budgeting

If you haveto wait for a bank to be open to make transfers or things like this it can mean that you might even have to wait until a Saturday if you are at work full time in the week. You may not even have a local branch or you may find that you will have to travel to one or it might be due to close in the future so then you will not have anywhere to go in order to get these things done. Being able to keep a check on your balance is really important if you are carefully budgeting and so you will want to be able to easily do this. You could keep a written record, but that will not allow for any payments that go out that you have forgotten about, perhaps old cheques that took a long time to be cashed or irregular direct debits, for example.

So online banking can be a very useful option but there is mistrust in it. People are worried about others being able to more easily get hold of their details and steal money from them. This is possible but there are different measures that you can take to protect yourself.

  • Make sure no one is watching when you are logging in
  • Try not to log in using a public computer but if you do log out and close the tab when you are done
  • Keep your passwords very secure and make them impossible to guess
  • Have virus protection and firewalls on your computer
  • Be wary of phishing

Phishing is probably the major one here. This is where you go to a website which looks like your bank and enter your details and then someone else has them. These sites are entered by people either using a search engine to find their banking website and following a link which looks like their bank but is not or by clicking through a link in an email or giving details over the telephone. It is therefore important to make sure that when you are banking you always enter the URL of the bank rather than using a search engine. Never click a link in an email as your bank will never send you one and on the telephone never give details over the phone unless you have telephoned the bank and are sure you are speaking to them. They should not phone you and if you get a call which says it is form the bank, hang up and call your bank using a number you are sure of, to check whether they just called you.

The above might sound like a hassle, but once you get into a good habit of knowing how to use your banks website, it should be easy and you should feel confident that you will not be subject to any problems. If you are at all worried that something has gone wring then calling your bank will allow you to be able to check and they will be able to sort out any problems you have had.

Categories
Overdrafts

Should I Extend my Overdraft?

Most of us will have an overdraft that is toed to our current account. Our bank will determine how much we are allowed to borrow and will set a credit limit. This will be the amount that we will be allowed to borrow up to. The amount will vary depending on the bank that we are with and depending on the person as well. Sometimes it can be possible to extend or increase the amount that we are allowed to borrow. This has advantages and disadvantages and it is a good idea to be aware of both and then we will be able to decide whether it will be a good idea for us to extend our overdraft or not.

Advantages of Extending an Overdraft

Extending an overdraft can be useful if you want to borrow more money. You will have more money available to borrow which means that you can spend more. Therefore, if you need money quickly and the overdraft is not normally enough or you often need more money than you have, then this could help you out. It can also be reassuring to know that there is this money available if you need it. Many of us will worry that we will not have enough money in an emergency and so knowing that overdraft is large, will help to give us reassurance that there will be some money available for when we need it. This can reduce our stress levels and allow us to stop worrying so much about whether we will be able to afford to buy everything that we need, because we will know that there is money there that we can borrow if we need it.

Disadvantages of Extending an Overdraft

Whenever we borrow money, we will have to pay for it. With an overdraft we will be charged interest for every day that we have it. The interest rates for overdrafts tends to be 35% to 40% and this means that they can be very expensive compared to some other types of borrowing. It can therefore be worth thinking about whether it is a good idea to extend them or whether it might be better to look into alternative ways of borrowing.

Having access to more money is not always a good idea either. It will mean that we will not be forced to budget and therefore we could end up spending more than we have. Some people will even see an overdraft as money that is theirs to spend and despite the large interest rates they will always spend it. If this is the case with you, then extending the overdraft will mean that you will keep paying those high rates which will be expensive. It is worth thinking about whether it will be better to find a way to spend less money rather than relying more on borrowing.

Once we do extend the overdraft amount, we may find that it is still not enough and want to extend it more and more. This could lead to us borrowing really large amounts of money and that will mean that we might struggle to repay it. If the overdraft is bigger than our salary then we will not repay it each month. Even if it is smaller, we may still struggle with it if we have lots of other bills to pay. It could be better to see whether there is a way that we can reduce the amount of money that we are spending instead. We might be able to choose cheaper items or buy less and then we will not need to borrow more money.

Categories
Emergency Lending

Are Payday Loans my Only Choice in an Emergency?

If we need money really quickly we can often be in a panic and then go for the first opportunity we see. It can be a good idea to therefore investigate the different options that are available to us beforehand and then we will be able to have a good idea of what to do before we are in this situation. Then we will not need to panic and we will be able to make a more informed choice which will mean that we are likely to be able to fid a more suitable loan.

Is a Loan Even the Best Option?

It is worth standing back and checking whether a loan is the only option that you have to start with. You may feel it is but just make sure that you do not have other choices. It might be that you have some savings you could use, for example. You might have time to earn some extra money. You may be able to sell some things to raise the money. You may even be ale to ask your employer for an advance on your salary – where they will give you some of your pay early. Have a think about whether you might be able to try any of these things and whether they will be able to give you enough money so that you will not need to borrow anything anyway.

Which Loans are Available?

It is also a good idea to think about which loans are available to you if you decide that a loan is the right option for you. If you need money quickly, then you will need a loan that is quick to arrange or one that you have already arranged.

  • Overdraft – if you have a current account then it is likely that you will already have an overdraft facility with it. If this is the case, then you will be able to use this. To use an arranged overdraft you just spend the money, either by withdrawing cash from a cash machine, writing a cheque or paying with a debit card. If you do not have an arranged overdraft then you may be able to quickly get one if you speak to your bank. Of course, you may have already used it up. Do make sure that you are aware of the charges for an overdraft as they have recently changed. They tend to now be between 35-40% interest which can soon add up to being quite expensive. It is unlikely to last long though as you will repay the overdraft automatically a soon as money is paid in to your bank account.
  • Credit Card – a credit card will allow you to buy products without having to find the money. You will not even have to pay interest for a while, unless you use them to draw out cash. The cards can be used to buy things in shops and to sometimes pay bills as well and so if you need money for these purposes then they can be handy. They will take time to apply for and get, but if you already have one then they can be a handy choice. However, you do need to make sure that you repay everything that you have spent by the date on the statement or else you will be charged interest. The amount varies between card issuers.
  • Payday Loan – payday loans are designed specifically to help those people that need money in an emergency. They can therefore be arranged very quickly. It can be possible to get money within a few hours. You will have to repay the loan quickly though – when you next get paid you will need to pay back all of it plus the interest and fees.