Pension Scheme Could Earn Britons Hundreds of Pounds Monthly if Used Before April 5

Pension Scheme Could Earn Britons Hundreds of Pounds Monthly if Used Before April 5

Britons who have reached retirement age are being urged to increase their state pension income by taking advantage of a government offer that is due to be withdrawn on April 5th.

The scheme allows all Britons who missed out on the recent state pension introduced in 2016 to trade in a lump sum in exchange for a generous (index-linked) income for life. Any person who attained state pension age before 6th April 2016 has approximately two weeks to take advantage of the scheme which requires Class 3A national insurance as a pre qualification requirement.

According to Steve Webb, Former pension minister & Royal London policy director, retirement products working in a similar manner pay out two to three times higher than what annuities pay. Besides offering extra income, the scheme also offers a 50% payout to survivors when a pensioner dies.

In essence, a 65-year-old pensioner can trade in £8900 for £520 annually which would increase according to CPI inflation figures every year. The same pensioner would get just £195 annually or £347 after inflation adjustments if he/she bought an index-linked annuity.
The total cost of purchasing additional state pension under the top-up scheme depends on an individual’s age as well as the top-up amount. However, there is a maximum amount set at £25/week or £1,300/year. According to Mr. Webb, the scheme is attractive to individuals with a small pension/saving pot. The scheme is also attractive for women as well as individuals in good health since they are bound to live longer.

The scheme offers better value when compared with the annuity rates available today in the market. It’s a great way to boost a person’s recurrent income according to Mr. Webb. As a result, anyone who is eligible should consider taking advantage of the scheme before the April 5th deadline.

How Do You Plan For Retirement Successfully?

How Do You Plan For Retirement Successfully?

We all want to have a stress-free retirement. However, very few people give much thought to saving or investing for the future. Those who have taken some steps agree to being overwhelmed, daunted and bored by the entire process. The good news is; successful retirement planning doesn’t have to be boring. It doesn’t have to be overwhelming either. Here’s what you should do to retire successfully.

Step 1: Know your retirement investment options

To retire successfully, you need to invest in things that generate income for you long after you have stopped working. With that in mind, setting up a fixed deposit savings account won’t get the job done. In most cases, savings don’t earn enough interest to cover inflation and leave enough income behind. As a result, you need to consider other options. There are many investments specially meant for individuals planning for retirement. Employers have special retirement investment options for their employees. The government also offers the same. It’s important to take advantage of such investment options but first, understand how they work. Invest in financial education.

When considering retirement investment options, focus on the risk/reward ratio. You should avoid investments that expose you to a lot of risks for obvious reasons. Your retirement funds need to be secure. Nevertheless, the investment option/s you choose should reward you accordingly. Retirement vehicles such as; defined benefit plans, company pension plans, individual retirement accounts, etc. are great. If you don’t mind taking more risk for a higher return, you can consider portfolio investments such as; stocks, bonds, mutual funds, annuities, cash investments, etc.

Step 2: Plan meticulously

This step is obvious but commonly overlooked by many people. Saying you want to retire successfully won’t get you anywhere. You have to formulate a concrete plan to kick start the process. A plan gives you a clear vision for the future. A plan also breaks down the entire process into small manageable steps. Most people become overwhelmed by retirement planning because they look at the entire process as a whole. Planning for 20-40 years of your life can be overwhelming if you look at everything as a whole.

Furthermore, successful retirement planning is all about making clear, definitive steps as opposed to random ones. Financial success isn’t about making one big decision but making small decisions with one big goal in mind. A good plan makes everything easier and gives you direction. You increase efficiency and waste less effort. There are many great planning tools available online today so, it shouldn’t be a problem creating a great retirement plan. The most important idea in every retirement plan is to make sure you save enough and make the most use out of your savings to create long-lasting and growing income streams long after you have retired.

Step 3: Make lifestyle adjustments

To retire successfully, you need to compromise on something. Most people want to be financially free and lead a great lifestyle at the same time. It doesn’t work like that! You need to make lifestyle sacrifices initially. This step is crucial because it can jeopardise a great retirement plan. The most important principle of wealth building is investing/accumulating assets. You will never be rich/accumulate enough money for retirement if you don’t control your expenditure.

Step 4: Start immediately

Time is crucial when planning for retirement. Your probability of success is higher when you have more time. Furthermore, procrastination is among the main causes of failure in life. To retire with enough money, you should start acting immediately. Procrastinating only pushes your retirement date further. You also have less time to make mistakes and recover from them if you procrastinate.

Step 5: Take full responsibility every step of the way

Last but not least, you need to own the entire process. Planning for retirement successfully takes serious commitment and consistency. You have to take all the necessary actions and adjust accordingly when the need arises. If you don’t like the pace at which you are going, make the necessary adjustments. If you aren’t content with the results of a certain retirement investment option, look for another one. You can’t afford to rely on anyone 100% when planning for your future. You must do your homework. It’s important to get expert advice, however, own the entire process. Invest in financial education so that you can be able to make wise decisions on your own.


Planning for retirement successfully shouldn’t be a daunting task if you follow the steps discussed above to the letter. Investing in financial education is the first and most important step. You also need a concrete plan. You should also make the necessary lifestyle adjustments and start taking action immediately. Lastly, take full responsibility. Don’t blame someone else. You are solely responsible for your financial future.

What Questions Should You Ask Before Taking A Loan?

What Questions Should You Ask Before Taking A Loan?

Many questions linger in the minds of borrowers before they take loans. When you consider the implications of taking a loan and being unable to repay it, it’s important for every borrower to be properly informed from the onset. In case you are wondering what you should ask yourself and your bank before you take a loan, here are important questions to consider.

1. Do I really need a loan?

It’s easy to get a loan nowadays, so it’s crucial for you to ask yourself if you really need one. Banks advertise loans all the time. However, you need a better reason to take a loan. If you don’t have a reason of your own, let your bank give you a good reason. Some banks have business loan programs meant to provide people with business loans as well as the expertise needed to set up prosperous businesses. If you’ve always wanted to start your own business, you can consider such a program.

2. What type of loan is the best for me?

You should ask yourself and your banker this question before you decide to take a loan. This question is important since there are many types of loans ideal for different purposes. For instance, a payday loan is perfect for emergency expenses. However, it’s not handy for starting a business. Personal loans also have notable benefits over business loans and vice versa. Depending on your reasons for taking a loan, your banker should be best suited to suggest the best type of loan for you. Nevertheless, you should be able to assess if the type of loan you are about to take is actually the best type of loan for you. You can assess things like interest rate charges among other repayment requirements i.e. the term of the loan to decide if the loan in question will work for you.

3. What’s the total cost of the loan?

This is another crucial loan question to ask yourself and your banker. It’s worth noting that loans are usually structured in terms that can be difficult to understand. Some lenders actually do this on purpose. The chances of a loan being more expensive than you actually think are very high so, make sure you find out the actual cost. You should do your own calculations if you have to or ask your banker to do the same on your behalf. This question is very important since the actual cost of most loans is usually hidden in confusing financial jargon. Don’t take chances. Know the total cost of any loan beforehand otherwise, you won’t be able to make an informed decision.

4. What happens when I repay early?

It’s also crucial to find out if there are any penalties if you repay your loan early. Most lenders don’t want you to repay your loan early since they earn most of their money in the form of interest income. It’s usually in the best interest of banks for borrowers to service the loan for the entire term. To discourage early repayment, banks usually have penalties. Although most banks disclose these penalties, some may hide them in the fine print. It’s crucial to find out if there are such penalties and when they apply if you are interested in repaying your loan faster.

5. What documents do I need to provide?

To get your loan amount in record time, you need to ask yourself and your bank what documents you need to provide to qualify for the loan in question. Business loans require business documents ranging from licenses to financial reports. Personal loans require bank statements, pay slip/income information, etc. Since different lenders tend to have different requirements, find out the type of documents you need in advance and provide them with your application to reduce the time it takes for your bank to process your loan.


You shouldn’t take a loan because everyone else is taking one. You shouldn’t assume the total cost of your loan either or take any loan that comes your way. It’s also important to know all the requirements for qualifying beforehand to avoid wasting time. Loans come with many requirements, risks, and costs that you should be aware of before committing yourself.

Saving Money vs. Taking Out Loans

Saving Money vs. Taking Out Loans

It is always advisable to build an emergency fund by saving a portion of your income every month. An emergency fund is always handy when you incur unexpected expenses such as; medical bills and car repair bills. You can’t afford to put such expenses on hold. If you don’t have savings, you will be forced to take out short-term loans such as payday loans to cater for the expenses. Saving money has always made sense. There are however exceptions. Below is a discussion to help you make an informed decision if you are torn apart between saving and taking loans.

Saving money is highly recommended

You should always strive to save a portion of your income every month whether you have loans or not. Developing a saving culture is important because there will always be something that you can buy with excess money. Furthermore, life is full of eventualities. You can fall sick, get involved in a car accident, lose your job, etc. When any of these eventualities happen, you need to have an emergency fund to cushion you before you get back on your feet. In such cases, you may not be able to qualify for a loan. Your savings will be your last resort. Having substantial savings also gives you that much-needed peace of mind. Many people suffer from financial stress because of living from hand to mouth. You need to save to avoid unnecessary stress when you incur unforeseen expenses.

When is taking loans better than saving money?

When you have a business idea that requires a substantial amount of money, it may be better to take a loan than to try and save up money. Taking loans for investment purposes is advisable. It can take you decades to save up enough money to start your business. Furthermore, most business opportunities don’t remain viable for long. You will almost always lose out if you save up to start a business. Savings can only take you so far if you don’t have a substantial income. There is nothing wrong with taking a business loan provided you have done your research. You should also make sure you get favorable loan terms.

Short term loans like payday loans are also ideal when you don’t have access to your savings. If you have a locked your savings in a savings account, you may not have immediate access to your money in case of an emergency. Payday loans come in handy in such cases. The loans are available instantly at reasonable interest rates if you borrow from a reputable payday loan lender or use a licensed broker like Swift Money. Payday loans are also easier to access. You can apply online. Some savings accounts aren’t accessible online. In cases where you don’t have the luxury of time, it’s always better to take out a payday loan or other types of short term loans instead of waiting to save up.

Saving and taking loans

There is nothing wrong with saving and taking loans at the same time. As long as you qualify for a loan and you have a good reason for taking the loan, you can save while you take up new loans. You should stop taking up new loans if you will have problems repaying them. However, don’t forget the benefits of taking up loans. For instance, you are bound to boost your credit score by taking up new loans provided you service them as required. Savings don’t offer such benefits.

Should you start saving after you are debt-free?

Although it is better to start saving when you are debt-free, in most cases, it may take too long for you to start saving if you focus on clearing all your debts first. Some debt i.e. home loans take more than a decade to clear. Home loans can take less time if you channel your savings to repaying the loan. However, it’s not advisable to do so if you don’t have a substantial emergency fund. Your priority should be setting up an emergency fund. Once you have done that, you clear your debt and then go back to building your savings account.

Furthermore, it may make more financial sense to service debt than repay it as soon as possible. Most lenders charge fees for early repayment making it better to continue servicing debt. You may also be getting a loan at a very good rate.


When it comes to saving vs. taking loans, it’s a matter of perspective and scenario. It is prudent to save in most cases. In other cases, however, it may be better to take loans. In a nutshell, it is up to you to analyse your current situation to be able to make an informed decisions.

What Is Investing and How Can It Work For You

What Is Investing and How Can It Work For You

Overview: What is investing?

Investing can be defined as the art of making your money work for you. There are two main methods of making money. One, you can work for a salary. Two, you can buy assets or anything that gives you a return (i.e. you can invest). Anyone can invest. You can use your own money (savings) or borrow a loan to invest. Investing is very important because your money works for you. When you buy stocks for instance, you just need to wait for them to increase in price. You don’t need to do anything else. You may be required to do research before buying stocks however, that’s very little work compared to working for a salary. Investing is clearly important. It can, however, be challenging given the number of investment opportunities available today. So, how do you find the best investment for you?

Tip 1: Identify your investment needs and goals

To be able to find the best investment for you, it’s important to ask yourself why you are investing in the first place. Although people invest to make more money, one person may be investing for retirement while another person may be investing to get money to buy a home. In such a case, the person investing for retirement is best suited for investment opportunities which take longer to mature compared to someone investing to buy a home. Some investments may also be better for specific investment goals, so it is important to think of what you desire from your investment before you think of investing.

Tip 2: Know your risk appetite

It’s also crucial to know your personal attitude towards risk. Since all investments come with risks, you should know how much you are willing to lose in case things don’t go as planned. You can assess your risk appetite by assessing your investment goals, need for returns as well as your investment time frame. When assessing risk, ask yourself how much money you would afford to lose. If the investment in question is bound to lose you more money than you are willing to lose, it’s time to look for another investment. Shorter investment terms also come with more risk, so it’s important to choose investments with the appropriate risk timeline.

Tip 3: Choose an investment with an appropriate term

To be able to find the best investment for you, you also need to think about how soon you want your money and/or the returns back. If you are not in a hurry to get returns, longer-term investments like property are always better. If you need returns fast i.e. in a few years, you can invest in stocks. The risks are however higher with such investments since stock prices fluctuate.

Tip 4: Identify a suitable investment platform

To find the best investment for you, it’s important to find an investment platform that works for you. For instance, if you value convenience, an online investment platform will be perfect for you. In such a case, investing in stocks and currencies may be perfect for you because there are very many online stock and currency brokers. With such investments, you can do everything from the comfort of your home.

There are many other investment platforms. For instance, you may want someone to invest on your behalf. In such a case, you can choose investments that come with managed accounts. With such investments, you share your investment preferences with an investment expert, and they do everything else for you at a small cost. If you don’t have a problem paying someone to make investment decisions for you, such a platform will be perfect for you. In a nutshell, the investment you choose should come with your preferred investment platform.

Tip 5: Consider your interests/passion

Your investments should also be in line with your interests/passion. If you are passionate about real estate, you should consider investing in real estate before considering other investments. This should be the case because you are more likely to succeed investing in things you are passionate about. Your investment decisions shouldn’t be guided by returns only. Passion will help you maintain consistent interest in your investment. Furthermore, you are more likely to secure investment funds if you are passionate about your investment opportunity.

Tip 6: Get professional investment advice

If you aren’t able to find the best investment for you after considering the above tips, you should seek professional investment advice. An investment expert can help you discover the investment options available to you. He/she can also match investment options with your interests, finances, appropriate term, platform, risk appetite, etc. Although you will be required to spend some money to get expert investment advice, the cost is insignificant compared to the consequences of making bad investment decisions.


Your chances of becoming financially independent are very slim if you are not an investor. Saving alone won’t make you rich. Although choosing suitable investments is challenging, the above tips have simplified the process for you. Start by identifying your reasons for investing. Proceed by assessing your risk appetite. If you fear risk, stick to safer investments. You should also consider choosing suitable investment terms and platforms that match your preferences. Don’t forget to consider your interests or passion to increase your chances of success. Lastly, you can seek professional help if you have problems finding a suitable investment.

The Ultimate Guide to Becoming Your Own Financial Adviser

The Ultimate Guide to Becoming Your Own Financial Adviser

Did you know that everyone has the ability to manage their own finances? The truth is; you don’t need to hire a financial adviser to manage your finances perfectly. Here’s what you need to do to;

Learn the fundamentals of finance

If you’ve handled money before, chances are you already have the most important financial information and knowledge at your fingertips. You just need to remind yourself or discover what you know. The first and most important step to becoming your own financial adviser is learning the fundamentals. The internet has everything you need to know about finance. The information can, however, be overwhelming. To make things easy, focus on the fundamentals of finance namely; general financial planning principles, investing, taxes, insurance, retirement and estate planning. Most people hire financial advisers to advise them on these areas so learning them goes a long way.

When learning about the fundamentals of finance, pay attention to the sources of information you choose. The internet is packed with information from all kinds of sources, so it is crucial to focus on validated sources only. For instance, it is better to learn about taxes from a tax expert than an individual with little to no experience on tax issues. So, pay attention to your sources to ensure you get accurate information. You should also focus on the basics before you dive deeper.

Apply the knowledge

This may be an obvious step. However, most people hardly apply the financial knowledge they have. Once you learn general financial planning principles like budgeting, apply those principles to the letter. Learning how to prepare a budget will help you track your income and expenditure. You can then proceed and find ways of saving and investing. You don’t need a financial adviser to force you to prepare a budget and save money for investing and emergency expenses.

Applying financial knowledge is crucial for financial success. Learning the fundamentals of finance should help you understand your unique financial circumstances as well as help you craft appropriate financial strategies to help you. Financial success is all about taking action and holding yourself accountable. Having financial goals will help you remember why you are working so hard to manage your finances. Financial goals also come with check-in points for assessing your progress. You should revisit your budget every month. Your investments and financial plan should be revisited quarterly and annually respectively. You don’t need a financial adviser for this.

Manage your behaviour and emotions

Financial advisers do more behaviour management than actual financial advising work. In fact, most people have financial problems because of behavioural problems. For instance, misappropriating finances makes it hard to save money. Regardless, people still spend money on things they haven’t budgeted for. It is usually easy to manage money. However, bad habits and emotions usually get in the way of most people. Furthermore, many people assume history will repeat itself and fail to have contingency plans to ensure they always make prudent decision regardless of their emotions.

For instance, stress tends to distract people from their financial goals. Peer pressure also influences many people negatively when making financial decisions. In a nutshell, many things make it challenging to make seemingly simple but smart financial decisions. To make good financial decisions, start by learning how to manage your behaviour and emotions.

Financial advisers stress on making small consistent steps in the right direction. You also need to create action plans in advance and stick to them regardless of your emotions. You should also be willing to get rid of bad behaviours that have a severe impact on your finances i.e. impulse buying. It’s also important to know when you are making financial decisions based on emotions like fear and greed.


It costs a considerable amount of money to hire a financial adviser yet, all the advice you need is readily available online. The most important thing is sourcing financial information from reliable sources. You should also pay attention to the fundamentals of finance only to avoid being overwhelmed by information. Last but not least, apply what you have learned and manage your emotions and bad behaviours that tend to ruin many people’s finances. If you have a problem managing your emotions and bad behaviour, think about what is on the line i.e. your future and that of your family. You don’t need a financial adviser to take action in the right direction.

Top 7 Reasons to Avoid a Bad Credit Score

Top 7 Reasons to Avoid a Bad Credit Score

Having a bad credit score may be worse than what many people think because credit scores don’t stop with credit. Your credit score affects many more things apart from your access to credit. Here’s why you must avoid a bad credit score.

1. UK landlords are wary of bad credit scores

Since a credit score is an indication of a person’s ability to service their debt, a bad credit score can be taken to mean that you have a problem paying your expenses i.e. rent. In the UK, landlords have the right to ask potential tenants for their credit reports. A bad credit score can result in bad rental terms. In the worst-case scenario, you may not be able to rent certain apartments/offices if you have a bad credit score. To avoid missing out on great rental opportunities and terms, it’s important to do whatever it takes to maintain a good credit score.

2. It is harder to get a job if you have a bad credit score

Most employers in the UK and other parts of the world reserve the right to request for credit information from potential employees. Employers usually use this information to make hiring decisions. Although there are regulations dictating the extent to which employers can use credit information to make hiring decisions, you can lose a good employment opportunity because of a bad credit score.

3. Auto insurance may cost more if you have a bad score

Some auto insurers have found a direct correlation between creditworthiness and a person’s propensity to cause an auto accident and/or file dubious claims. Some auto insurers also assume people with bad credit scores are less likely to pay their premiums on time. Although this isn’t necessarily the case, some insurers use bad credit scores as reasons for increasing premium rates or denying coverage altogether. As a result, avoiding a bad credit score will help you avoid paying high auto insurance rates.

4. Professional licensing problems

You may also find yourself facing professional licensing problems if you have a bad credit score. UK Government agencies which regulate professions are allowed to use credit information when licensing many professionals. You may have problems getting your license as a professional i.e. financial adviser if you have a bad score even if you have met all other requirements.

5. Credit report errors can land you into legal problems

A wrong entry can ruin your credit score. If your credit score is bad because of errors, you can find yourself in legal problems since authorities i.e. investigating agencies usually pay attention to discrepancies in financial documents and such discrepancies can be used as a basis for investigations in financial fraud cases among other related cases. To avoid such problems, you must check your credit report frequently for errors.

6. A bad credit score can ruin your personal relationship

Relationships such as marriage can be affected by bad credit scores in the event where the bad score is caused by defaulting on debt. Most people wouldn’t be comfortable having serious relationships with individuals who have taken too much unmanageable debt. So, if you’re thinking of getting married, you need to work on your credit score. You are also bound to get into a lot of problems with your friends, family members, etc., if you don’t repay the money you have borrowed them and other people.

7. A bad credit score can cause you a lot of stress

Access to credit is very important for a person to be able to advance themselves financially as well as meet day-to-day expenses. If you can’t get a loan because of a bad credit score, you are bound to get stressed. You are also bound to be stressed if you can only qualify for bad credit terms i.e. high-interest payday loans. Stress can lead to other health problems like depression.


A bad credit score can cause you a lot of unnecessary problems that go beyond accessing credit. You are bound to have a difficult time finding a place to live (rent) if you have a bad credit score. The same applies to securing employment, getting car insurance and securing a professional license. A bad credit score can also ruin your personal relationship and land you into legal as well as health problems. The importance of avoiding bad credit scores can’t, therefore, be overemphasised.

How to Switch UK Energy Suppliers to Get the Best Deal

How to Switch UK Energy Suppliers to Get the Best Deal

It’s always good to look for new avenues of saving money. Reducing your energy bill is a great place to start. By switching energy suppliers, it is possible for you to save a lot of money every year. What’s more interesting is; it’s not a tedious and time-consuming process as many people are led to believe. In the UK, you just need a recent energy bill, your postcode and approximately 10 minutes. It is possible to switch energy suppliers online or by phone. Here’s what you need to do to get started;

1. Find a reputable energy price comparison website (uSwitch)

Before you decide to switch energy suppliers, it’s important to conduct a thorough price comparison. You can do this using accredited energy price comparison websites like uSwitch. The best energy price comparison websites are accredited by Ofgem. Such websites are proven to offer accurate data and make the process very simple. The websites also compare prices offered by the entire energy market. You also stand to get customised comparisons matching your energy usage when you use reputable energy comparison websites like uSwitch.

2. Enter your postcode and usage information

After finding a reputable energy comparison website, proceed by entering your postcode. Energy prices are usually set regionally for easier comparison. Furthermore, some energy suppliers serve certain areas. Entering your postal code will help you narrow down the best energy plans and suppliers.

Proceed and enter your usage information to get accurate comparison results. It’s also advisable to enter household consumption details. Such details can be found on your energy bill. You can also give estimates. It is important to fill in all the fields to get the best estimate possible.

3. Review the results and pick the best supplier

Once you have estimates from different suppliers, it’s time to pick the best energy plan and supplier for you. The results you get can be overwhelming so consider using filters to refine your results. Depending on your preferences, you can choose to see all energy plans and suppliers or view fixed rate energy plans only, plans without cancellation fees, etc. The best energy comparison websites offer detailed information i.e. most popular energy plans/suppliers in your region so, it shouldn’t be a problem finding the best energy plan and supplier.

4. Make the switch

After identifying a good energy plan and supplier, it’s time to make the switch. You can make the switch by selecting a suitable supplier, plan and providing your personal information i.e. address and bank details (if you have chosen a direct debit plan which is usually the cheapest). Your new energy supplier will be alerted immediately. They should contact you before the cooling off period is over (i.e. the time required to switch energy suppliers). It takes approximately two weeks to finish a switch. Your new supplier should contact you with specific details/information i.e. service switchover date.
Other important information to consider

The above steps are adequate enough to help you find the best energy supplier and make the switch seamlessly. You should, however, be aware of some important details.

Energy supply interruptions?

You shouldn’t expect any interruptions i.e. your new supplier coming to your home to install new piping, cabling, etc. When switching energy suppliers, you only change the company that bills you. Everything else remains the same.

Switching period

It takes approximately 17 days to complete a switch (a 2-week cooling-off period plus an extra 3 days). Your new supplier is supposed to maintain contact with your old supplier to agree on things like a switch over date. Depending on the type of switch i.e. gas and/or electricity, the switch over dates may differ for each. Your new supplier will, however, keep you informed.

If you decide you don’t want to switch energy suppliers, you should contact your new energy supplier before the switching period is over (within 14 days). They should cancel the switch without causing any interruptions to your energy supply.


The above information summarises what you need to know about switching energy suppliers in the UK. Once you select a good energy price comparison website like uSwitch, you shouldn’t expect to face any other problems. Reputable energy price comparison websites have all the information you need to switch energy suppliers successfully and enjoy huge savings every year.