The Money Thread...

[JiggerJay]

Four lots of income today, feel well rich! Although 95% has been allocated to the moving pot.

[Gario]

Is there anyone on this forum who lives independently of their family, works for a living, and struggles to get by from month to month? You earn your money, spend your money, then pay day rolls round again and the cycle repeats. You can't really afford to save anything, and when an unexpected cost comes up, like car repairs, you're strawberry floated. Anyone like that here? Cos I get the impression most of you are successful high earners with money in the bank.

*Raises hand*

I'm constantly worried about money.
I got paid and was still overdrawn.

Yaaay...

How old are you?

[Poser]

In before 'Meet?'

[Glowy69]

I'm desperate to switch to the First Direct account as Lloyds has pushed me too far with their sales tactics and monthly calls to attempt to carry out 'account reviews'.

Our ongoing mortgage application has meant I'm avoiding anything that'll spark a credit search, though.

You know that if you switch bank accounts it won't affect you dealings to do with your mortgage? Because they're searches for quite clearly different things, so lenders won't see it as an issue.

Good old account reviews. Is that so they can push that club lloyds account onto you?

I didn't know that, but I have reached Defcon 1 paranoia about my credit record after being in a mess in the past so I'm steering well clear. Also desperately need a new phone but am holding off. I totally believe you are right, but I'm just going to play it (incredibly) safe. My score is currently 993

Lloyds rant, spoilered to avoid derailing:

And yes, Club Lloyds. They obviously have no cohesive CMS system because I've had three different 'managers' from the same branch call me to arrange a review. The first one I agreed to do, over the phone. He called half an hour late, at the end of my lunchtime as opposed to half way through it.

The second guy, I just explained what had happened the previous time, and said I had no interest in applying for any financial products at that time. He said they had noticed I had some loans with other companies and wanted to 'look at those for me'. Being as polite as I could, I explained that the only reason those two loans weren't with LLoyds was because when I applied for them, Lloyds would only offer me an APR of 21% (and my credit rating was ok at this point). 21% on a £6k loan. strawberry floating dickwads: that's more than my current credit card. I got 8% with Sainsburys in the end and it'll be paid off in five months' time.

The third person, female this time, I explained the above, again. I said I didn't want or need an account review and that they had not offered competitive products for some time. I asked her to put a note on my account not to call again. I don't believe they will pay any attention.

I know they have a business to run but I really strawberry floating hate them.

Don't want to piss on your fire but a credit score means nothing. They don't exist. I'm super obsessed with my report after getting into a mess also in the past.

I've looked into it enough to know that you'll be fine if you switch accounts.

[Glowy69]

Is there anyone on this forum who lives independently of their family, works for a living, and struggles to get by from month to month? You earn your money, spend your money, then pay day rolls round again and the cycle repeats. You can't really afford to save anything, and when an unexpected cost comes up, like car repairs, you're strawberry floated. Anyone like that here? Cos I get the impression most of you are successful high earners with money in the bank.

*Raises hand*

I'm constantly worried about money.
I got paid and was still overdrawn.

Yaaay...

How old are you?

Used to be me. I had to move back with parents as landlord I rented house from was coming back, at the time I had my IVA so I would never have passed any checks to rent another property.

I've currently got 5k saved here and there. But it's only from becoming a complete Scrooge. But I need to do this. The next time I leave I'm gone for good.

[Gario]

Is there anyone on this forum who lives independently of their family, works for a living, and struggles to get by from month to month? You earn your money, spend your money, then pay day rolls round again and the cycle repeats. You can't really afford to save anything, and when an unexpected cost comes up, like car repairs, you're strawberry floated. Anyone like that here? Cos I get the impression most of you are successful high earners with money in the bank.

*Raises hand*

I'm constantly worried about money.
I got paid and was still overdrawn.

Yaaay...

How old are you?

Used to be me. I had to move back with parents as landlord I rented house from was coming back, at the time I had my IVA so I would never have passed any checks to rent another property.

I've currently got 5k saved here and there. But it's only from becoming a complete Scrooge. But I need to do this. The next time I leave I'm gone for good.

I know what you mean about the credit checks. I had to find a landlord who wasn't bothered about credit checks, as long as I showed him proof of employment and a recent wage slip.

[Bunni]

Same boat here. We're comfortable month to month, but there's no way I'd be able to make savings at this rate. All my money is accounted for and we don't really live excessively. If Anung gets a full time job I'd straight away put like £500 a month into savings. We dont need any more money than this to live on, so the excess could just get saved. If we don't do that from day 1 we'll end up getting used to living off a higher wage and find it difficult to start cutting back later.

[Gario]

Same boat here. We're comfortable month to month, but there's no way I'd be able to make savings at this rate. All my money is accounted for and we don't really live excessively. If Anung gets a full time job I'd straight away put like £500 a month into savings. We dont need any more money than this to live on, so the excess could just get saved. If we don't do that from day 1 we'll end up getting used to living off a higher wage and find it difficult to start cutting back later.

When my relationship ended three months ago I had to take on all the bills for the house. I was still managing to save £50 a month and added this to my existing savings, but I had an accident in my car the other day and my excess is £400 - which has cleaned me out. Nothing left.

[Glowy69]

Same boat here. We're comfortable month to month, but there's no way I'd be able to make savings at this rate. All my money is accounted for and we don't really live excessively. If Anung gets a full time job I'd straight away put like £500 a month into savings. We dont need any more money than this to live on, so the excess could just get saved. If we don't do that from day 1 we'll end up getting used to living off a higher wage and find it difficult to start cutting back later.

Does anung not have a job?

[JiggerJay]

Asides from my cards getting cloned several times Santander are pretty awesome to bank with, they never go out of their way to hard sell me, no matter if I'm doing well or spending like there is no tomorrow. I'm considering setting up a cash back account and my mortgage through them mainly due to loyalty.

[Bunni]

Same boat here. We're comfortable month to month, but there's no way I'd be able to make savings at this rate. All my money is accounted for and we don't really live excessively. If Anung gets a full time job I'd straight away put like £500 a month into savings. We dont need any more money than this to live on, so the excess could just get saved. If we don't do that from day 1 we'll end up getting used to living off a higher wage and find it difficult to start cutting back later.

Does anung not have a job?

Naw. He's a 'student'.

[Glowy69]

Same boat here. We're comfortable month to month, but there's no way I'd be able to make savings at this rate. All my money is accounted for and we don't really live excessively. If Anung gets a full time job I'd straight away put like £500 a month into savings. We dont need any more money than this to live on, so the excess could just get saved. If we don't do that from day 1 we'll end up getting used to living off a higher wage and find it difficult to start cutting back later.

Does anung not have a job?

Naw. He's a 'student'.

[Andrew Mills]

Don't want to piss on your fire but a credit score means nothing. They don't exist.

This is very important for people to understand.

Those 'credit scores' from Experian, Equifax and Call Credit are as worthy as me giving you a credit score personally. They mean strawberry float ALL (seriously).

Here's how credit scores actually work:

You apply for credit by filling in information that a company wants to know, to judge your 'risk profile'. Each piece of information is worth a certain - undisclosed - amount of points internally. But... these points are ONLY relevant to that company AT THAT POINT IN TIME!. Then the total number of points determines where you fall in their current 'risk' requirements.

"So why might one company accept me one month but decline me the next?" - Because their desired customer-types/risk-profiles will change every-so-often. One quarter they might want customers who only regularly pay their minimum amounts (highly profitable customers), the next month these customer-types might be 'too risky'.

However, there's usually certain ways of ensuring you're deemed as a 'better risk' than others:

1). Having a mortgage shows stability (so too does using a landline number instead of a mobile).
2). Get on the EDITED voters roll (the one that doesn't sell your details on to marketing companies that pay for it).
3). Keeping one bank account for as long as possible (3 years +) is always looked upon favourably.
4). Customers who ALWAYS pay off their bills in full each month aren't the most desirable customers as they earn the CC company's no profit. (Which is why you'll sometimes see people with 'amazing' credit files being declined (unprofitable customers aren't attractive to a business).
5). So following on from 4, sometimes just paying the minimum off of a very small balance (such as, say, £50) will cost you a small amount in interest every month, but you'll likely to be deemed as profitable to future creditors.
6). Try and keep your Debt-to-Income (DTI) ratio to around 60% maximum (or 0.6 using the DTI scale). This means that if you earn £20,000 per year you'd want to have no more than £12,000 of unsecured debt to your name (otherwise you may look as being over indebted).

There's more things you can do to improve your 'risk profile' (note how I don't refer to it as your 'credit score'); but the above will certainly put you in a decent standing.

I used all of these tips myself to take my credit file from being super-shit back in 2002 up to pretty-damn-decent in 2008.

[Glowy69]

Noddle doesn't really use a score...more a rating out of 5. But yes Andrew everything you have said I agree with. Mine shows as a risk because I haven't had my CC for a long time yet and I've just moved banks. If they wished to check however, my settled accounts proved I had a bank account with halifax for 8 years.

Also any dormant CC accounts you have, shut them off. They affect your report in a negative manner.

[Andrew Mills]

Noddle doesn't really use a score...more a rating out of 5. But yes Andrew everything you have said I agree with. Mine shows as a risk because I haven't had my CC for a long time yet and I've just moved banks. If they wished to check however, my settled accounts proved I had a bank account with halifax for 8 years.

Also any dormant CC accounts you have, shut them off. They affect your report in a negative manner.

But I never mentioned Noddle did I? /pedant (Whilst Call Credit and Noddle are the same company, they both operate totally differently).

If anyone wants a decent site to check their credit file for free (for 30 days, so remember to CANCEL the subscription so you're not charged) I've always used:

www.checkmyfile.com as it uses info from all of the three major credit file companies.

[Glowy69]

Noddle doesn't really use a score...more a rating out of 5. But yes Andrew everything you have said I agree with. Mine shows as a risk because I haven't had my CC for a long time yet and I've just moved banks. If they wished to check however, my settled accounts proved I had a bank account with halifax for 8 years.

Also any dormant CC accounts you have, shut them off. They affect your report in a negative manner.

But I never mentioned Noddle did I? /pedant (Whilst Call Credit and Noddle are the same company, they both operate totally differently).

If anyone wants a decent site to check their credit file for free (for 30 days, so remember to CANCEL the subscription so you're not charged) I've always used:

http://www.checkmyfile.com as it uses info from all of the three major credit file companies.

Pedantic twat

Yeah I used them, they do their best to try and keep you when you cancel too. I found out the other week, my ex from 6 years ago still has a financial association on my file.

[Joer]

Is there anyone on this forum who lives independently of their family, works for a living, and struggles to get by from month to month? You earn your money, spend your money, then pay day rolls round again and the cycle repeats. You can't really afford to save anything, and when an unexpected cost comes up, like car repairs, you're strawberry floated. Anyone like that here? Cos I get the impression most of you are successful high earners with money in the bank.

I'm the same. I earn enough and have enough to probably live comfortably, but I don't have enough to be able to save for anything. Saved a bit already though thanks to this thread.

[Rightey]

So Argentina may be defaulting (again) on it's debts, full story in spoiler.

Source: http://www.cbc.ca/news/business/argenti ... -1.2723440

Debt talks between U.S. hedge funds and Argentina collapsed late Wednesday, and the country entered its second default since 2001.

Argentina debt default imminent, warns mediator
Argentina, on verge of debt default, meets with U.S. bondholders
Argentina stops payment on foreign debt

Ratings agency Standard & Poor's declared Argentina had entered what's known as "selective default" after failing to make a deal with creditors on a $539-million bond payment.

Technically, that means the bondholders have the right to demand immediate and full repayment. But that's unlikely to happen, as any drastic action would worsen the country's finances and make it unlikely that any lenders would get all their money back, much less turn any profit.

With interest, the value of the loans could be as much as $1.5 billion.

After the midnight deadline passed, Argentine Economy Minister Axel Kicillof reiterated his government's position that it could not accept a deal with U.S. hedge fund creditors it dismisses as "vultures."

Kicillof said the funds refused a compromise offer in talks that ended several hours earlier, although he gave no details of that proposal.

"We're not going to sign an agreement that jeopardizes the future of all Argentines," Kicillof said after he emerged from the meeting with creditors and a mediator in New York City. "Argentines can remain calm because tomorrow will just be another day and the world will keep on spinning."
Consequences 'certainly not positive'

"The full consequences of default are not predictable, but they are certainly not positive," court-appointed mediator Daniel Pollack said.

The move is just the latest debt problem in the country, as bondholders who separately agreed to restructuring plans in 2005 and 2010. Argentina also defaulted on its loans as recently as 2001, when the country's failed to pay back $95 billion in loans.

In that settlement, the owners of about 92 per cent of the bonds accepted a deal that would see them paid back about 30 cents on the dollar. But Argentina still owes almost $10 billion even from that more than 10-year-old settlement.
'Who believes in the ratings agencies?'

Kicillof dismissed a decision by ratings agency Standard & Poor's to downgrade Argentina's foreign currency credit rating to "selective default" because of the missed interest payments.

"Who believes in the ratings agencies? Who thinks they are impartial referees of the financial system?" he said.

Argentine President Cristina Fernandez had long refused to negotiate with the hedge fund creditors, often calling them "vultures" for picking on the carcass of the country's record $100 billion default in 2001.

Some experts suggest the country could likely scrounge up enough cash to pay off this round of creditors, but it would set a dangerous precedent to others who are owed money, and who would likely then demand similar treatment.

"They’ll probably reach some deal over the next six months," BMO economist Doug Porter said.
Argentina debt crisis

A man holds up a sign during a demonstration in support of Argentina's government, who has taken a hard line approach in negotiations with U.S. bondholders. (Marcos Brindicci/Reuters)

The holdouts, led by New York billionaire Paul Singer's NML Capital Ltd., spent more than a decade litigating for payment in full rather than agreeing to provide Argentina with debt relief. They also sent lawyers around the globe trying to force Argentina to pay its defaulted debts and were able to get a court in Ghana to temporarily seize an Argentine naval training ship.

The threat of seizures forced Fernandez to stop using her presidential plane and instead fly on private jets.
2001 economic collapse

Restoring Argentina's sense of pride and sovereignty after the 2001-2002 economic collapse has been a central goal of Fernandez and her predecessor and late husband, Nestor Kirchner.

Argentina has made efforts to return to global credit markets that have shunned it since the default. The government paid its debt to the International Monetary Fund and agreed in May with the Paris Club of creditor nations on a plan to begin repaying $9.7 billion in debts unpaid since 2001. It also agreed to a $5 billion settlement with Grupo Repsol after seizing the Spanish company's controlling stake in Argentina's YPF oil company.

Analysts say a new default undermines all of these efforts.

"Argentina … has consistently reaffirmed low expectations," Scotiabank said in a research note early Thursday.

"It is an unfortunate situation which is pushing the country into another default. As defaults go, we all know when we get into one but it is very unclear when and how to get out of it," said Alberto Ramos, Latin America analyst at Goldman Sachs.

"We just added another layer of risk and uncertainty to a macro economy that was already struggling," Ramos said.

This in tern has made the US markets loose a lot of gains they made in the past 3 months today. I would think now might be a good time to swoop in and get some stocks if you have your eyes on them... would anybody else agree with this or do you think it's better to hold off?

[Grumpy David]

Timing the market is pointless. Time in the market is what matters.

Do the mathematically sensible thing and get a low cost index tracker. I use Vanguard. Set up a monthly direct debit and never sell. Keep it for the long term.

Avoid active managed funds. Their costs are much higher and they perform worse than trackers. You also suffer the tyranny of compound costs.

[Gario]

Is there anyone on this forum who lives independently of their family, works for a living, and struggles to get by from month to month? You earn your money, spend your money, then pay day rolls round again and the cycle repeats. You can't really afford to save anything, and when an unexpected cost comes up, like car repairs, you're strawberry floated. Anyone like that here? Cos I get the impression most of you are successful high earners with money in the bank.

I'm the same. I earn enough and have enough to probably live comfortably, but I don't have enough to be able to save for anything. Saved a bit already though thanks to this thread.

How old are you?

Do you know, 18 months ago my parents generously gave me a cheque for £3,600 because a savings account had matured, and I was so proud to have all that money in my bank. It was by far the most I had ever had. But sadly, the very last of it has just been spent, and I don't recall treating myself to one little thing with all that money. It just went on my crap.