• Business and Finance
• Family
• Computers and Internet
• Auto and Trucks
• Education
• Health
• Hobbies
• Home Improvement
• Legal
• Marketing

• Home
• Arthur's Articles Home
• Browse Categories
• Browse Authors
• Submit an Article
• Search for Articles

Home » Business And Finance Articles » Avoiding The Sound Of Jingle Bills

Avoiding the sound of Jingle Bills

The Commons Trade and Industry committee has stated that the recent rises in UK gas prices has lead to increased suffering by many of the most exposed groups such as the elderly and, "non-elderly vulnerable groups, particularly disabled people, whose difficulties in relation to fuel poverty have been known for a long time".

A lack of gas supplies from Europe, and dwindling North Sea production has been blamed for the price increases by most of the major energy suppliers leading to average bills being put up by as much as 15% recently, with fears that costs are likely to rise even higher if the UK experiences a cold winter.

The Committee report also added that: "If fuel prices continue to rise it will be essential to provide further assistance to the elderly."

The news also appears to be bleak for many non-elderly or disabled groups, following research commissioned by Egg.

The results of research by the online bank Egg has shown that the average household monthly income is just £1,953 in the UK while the average monthly spend on bills is £888. After all bills and regular monthly costs have been included, Egg calculated that the average Briton spends about 23 days a year, effectively without any money, and living on overdrafts and credit cards. A survey by YouGov earlier in the year found that 4 out of 5 people were not saving enough for a comfortable retirement, and personal debt was seen as a major factor for many in preventing future saving.

Egg suggests that a reliance on credit cards and poor budgeting are proving to be expensive for many consumers, who are currently borrowing to cover the short-fall at an average authorized current account overdraft rate of 12.6% and at an unauthorized rate of 24.3%. To add insult to injury, almost a third of consumers have been penalised by their current account provider during the last 12 months, at an average cost of £27.

The financial comparison site Moneynet ( http://www.moneynet.co.uk/ ) has also recently warned that when finances are stretched to breaking point then store cards and unsolicited cheques sent by the credit card companies can be very seductive, "just to get through to next pay day". Moneynet chief executive Richard Brown says, "We have always advised consumers to avoid credit card cheques like the plague. Many people have no idea that these cheques carry extra charges and do not work like the credit card in their wallet. It's unethical and irresponsible."

Mr Brown also feels that, "Store card charging structures also need to be radically reformed. The worst offenders are invariably some of the most prominent names on the High Street, and government watchdogs need to properly show their teeth and crack down."

Following the festive period overspend a lack of financial knowledge and inadequate budgeting skills can lead to a very poor new year. The growth in the number of financial products and advice can lead to an information overload and a fear of taking any action, however the organisations such as the BBC provide some useful sources of information and several financial help sites like Moneynet.co.uk and Fool ( http://www.fool.co.uk/ ) have sprung up in recent years to enable consumers to get over their financial phobia and easily compare the rates of credit cards, loans, bank accounts, gas and electric suppliers as well as other financial services.

Until statutory legislation is put in place to control rates charged for credit, and other financial services, consumers need to take control of their own personal finances. While little can be done by most to significantly increase their income, most people can reduce the amount of unnecessary spending that occurs on a continual basis through the use of over priced financial services.

Disclaimer:

All information contained in this article, is for general information purposes only and should not be construed as advice under the Financial Services Act 1986.

You are strongly advised to take appropriate professional and legal advice before entering into any binding contracts.

Useful resources:

Moneynet ( http://www.moneynet.co.uk/ )

Motley Fool ( http://www.fool.co.uk/ )

And here is another random article you might be interested in...

The Conflict of Interest Game

Disgruntled investors are going after Wall Street once again, this time accusing one of investment bank Morgan-Stanley's high-tech mutual funds of making biased stock picks.

Recent lawsuits allege the Morgan Stanley Technology fund was influenced to buy and hold stocks of companies that delivered huge investment banking fees - or could potentially bring big business - to the investment bank.

According to the lawsuits, the Morgan Stanley fund followed the biased recommendations of the firm's analysts - decisions that have cost shareholders millions of dollars since the portfolio's October 2000 inception.

The fund lost 48 percent in 2001 and was down another 50 percent during the first nine months of 2002. While Morgan Stanley strongly denied the allegations, I fail to see how the management of the fund is somehow distinct from the other divisions of Morgan Stanley. Ultimately, they all work for the same boss.

The suits further claim that the tech fund failed to disclose that the firm had investment banking ties with a number of companies whose stocks were part of the portfolio. They also failed to reveal that those links could affect the fund's buy or sell calls.

Why bring all this up? For one thing, it is interesting to note that Morgan Stanley offered four of these types of funds in October 2000. Just around the time when we sold all of our positions (Oct. 13, 2000) and it became clear, at least to those of us who were tracking long-term trends, that a major trend change had taken place.

More recently in the news it's been Merrill Lynch who had a questionable deal involving transactions with failed energy trader Enron. Of course, the financial services industry regulates itself so well, that an $80 million payment to the SEC is sufficient to wrap up this case without admitting or denying wrongdoing.

What's the moral of this story? While it is impossible to predict these alleged conflict of interest schemes, it is definitely possible to follow a disciplined approach and be on the "right" side of the market so you can avoid jumping aboard a sinking ship.