Wealth Success Strategies

These Call-Centre Staff Just KILL Me!

2008-03-09T22:04:00.005Z

This story was told to me by a participant in the Wealth Mechanic programme. I don't know if it's actually true, but knowing some of the experiences I've had with call-centre staff, I would not be surprised one bit:

A lady died in Dublin this past January, and a leading card provider billed her for February and March in relation to their annual service charges on her credit card, then added late fees and interest on the monthly charge.

The balance that had been £0.00, but was now somewhere around £60.00.

A family member placed a call to the card provider. The conversation is said to have gone like this:

Family Member: 'I am calling to tell you that my Aunty died in January.'

Card Provider: 'The account was never closed and the late fees and charges still apply.'

Family Member: 'Maybe you should turn it over to collections.'

Card Provider: 'Since it is two months past due, it already has been.'

Family Member: So, what will they do when they find out she is dead?'

Card Provider: 'Either report her account to the Frauds Division or report her to the credit bureau; maybe both!'

Family Member: 'Do you think God will be upset with her?'

Card Provider: 'Excuse me?'

Family Member: 'Did you just get what I was telling you . . . The part about her being dead?'

Card Provider: 'Sir, you'll have to speak to my supervisor.' (Supervisor gets on the phone)

Family Member: 'I'm calling to tell you, my Aunty died in January.'

Card Provider: 'The account was never closed and the late fees and charges still apply.'

Family Member: 'You mean you want to collect from her estate?'

Card Provider: (Stammer) 'Are you her lawyer?'

Family Member: 'No, I'm her great nephew.' (Lawyer info given)

MBNA: 'Could you fax us a certificate of death?'

Family Member: 'Sure.' (fax number is given). After they get the fax:

Card Provider: 'Our system just isn't set up for death. I don't know what more I can do to help.'

Family Member: 'Well, if you figure it out, great! If not, you could just keep billing her. I don't think she will care.'

Card Provider: 'Well, the late fees and charges do still apply.'

Family Member: 'Would you like her new billing address?'

Card Provider: 'That might help.'

Family Member: ' Glasnevin Cemetery, Finglas Road, Dublin 11, Ireland, Plot Number 1049.'

Card Provider: 'Sir, that's a cemetery!'

Family Member: 'Well, what the **** do you do with dead people on your planet?'

Here's How An Everyday Farmer's Milking Stool Can Help YOU Stick To Your New Year's Resolutions Against All Odds

2008-01-25T10:52:00.000Z

What did most of us do on New Year’s Eve, besides drink cheap champagne as the clock struck midnight? We made New Year’s resolutions, didn’t we? The start of a new year always seems to be the opportunity for a fresh start.

We usually resolve to change a habit that we can’t seem to shake: ‘I’ll stop watching so much television… I’ll stop eating so many microwave meals… I’ll stop buying things on the Internet… I’ll stop staying late at the office,’ and so on.

One reason that most resolutions fail is because we haven’t examined the pay-offs we receive by maintaining these behaviours. For example, many of us who struggle with our finances fall into a series of habits that seem to give us the same sort of, shall we say, ‘rush’ as behaviour we would normally label as ‘addictive.’

As a psychotherapist, I have been introduced to a whole spectrum of ways to define the term ‘addiction’: an inability to participate in the real world, some form of moral weakness, a lacking in willpower, a spiritual crisis – and even a disease of some sort.
Having said all that, most of us tend to think of addiction as the kind of ‘misuse’ that – in one form or another – does its thing by passing our lips. But maybe the whole issue isn’t as simple as that.

No doubt about it: there are certainly so-called gamblers, workaholics and overspenders who eventually find themselves suffering the same sense of despair we more readily associate with substance misuse.

The feeling certainly sounds similar to what I myself felt when I – a reformed ‘compulsive spender’ – was hopelessly overspending. On a day-to-day basis, I suppose I was invariably trying in vain to bring into my life three sensations that everyone in the world seeks:

· Purpose and meaning
· Genuine happiness
· Peace of mind

Having our fair share of each of these sensations isn’t a lot to ask for, is it? Naturally there are times when we have one or more of them in our life to a greater or lesser degree, but we want all of them equally – and most of us want them full-on, 24/7. The reality is that none of us gets an equal share of these feelings at any one moment – but (as is the case with a farmer’s three-legged milking stool) uneven legs can still provide a stable platform.

In hindsight, my own problem with overspending seems to have been an attempt to manage those moments when one aspect or another of this “three-legged stool” seemed to break away. If I didn’t feel equally supported by all three sensations at the very same time, things felt a bit wobbly underfoot.

So many of us fail to realise that when one of these ‘legs’ falls short for a while, without a doubt the others will balance and support us. But if we cannot accept that each of life’s supportive sensations is actually meant to step in and out of our lives, we find ourselves at odds with the way the world is set up. We then search for other forms of contentment in an attempt to sustain a permanently upbeat mood.

I myself started to believe that the best way to ‘take a happy pill’ was through my silly spending habits. And you could say that I embraced life’s highs. Who doesn’t, in some form or another? But when the highs were absent, I wrongly interpreted what was happening as some sort of drug-like ‘comedown’. Ultimately, though, the same holds true for all of us: it’s all smoke and mirrors; just an illusion that we are filling some kind of emotional void.

And yet somehow I believed that ‘retail therapy’ gave my life a sense purpose and meaning, made me feel happy, and eased my mind. Thus the self-confessed ‘shopaholics’ aren’t actually in search of clothes or shoes – though it certainly looks that way when an army of bags marches into the downstairs hall. Such people are simply trying to re-create an upbeat sensation, and who can blame them for that?

Think about it for a minute: what’s actually IN all those shopping bags? When under the illusion that shopping brings some form of emotional satisfaction, such people are actually trying in vain to fill their bags with something money can’t actually buy.

Here's A Reminder Of The Bank Fees You Could Be Clawing Back

2007-08-30T15:57:00.000Z

UK Home repossessions have risen almost 30 per cent over the past year, according to recent findings by the Council of Mortgage Lenders. What that translates into is 14,000 homes being repossessed in the first six months of 2007… and things look set to get worse, according to many pundits.

And that’s not the only bad news: the stormy times look set to continue in the stock markets. This is something that should concern all of us, not just those who are playing the markets. It’s all in the mix, and the international status of cities like London means that financial market turmoil ripples through the economy and can ultimately undermine employment trends and purchasing power. In fact, the boss of one of Britain’s best-known retailers was reported as noting that the spending power of those on £30,000 incomes has fallen by a quarter in the past couple of years.

Hurrah, then, for the Financial Services Authority. Homeowners can now reclaim so-called ‘exit fees’ on mortgages, as reported in the Sunday Telegraph – but there’s a rush to the gate for those trying to claw back bank fees and overdrafts. Here’s a reminder of some of the bank fees YOU could be clawing back from your bank:

Claw-Back Target #1: overdraft charges. Bank customers seem to be getting their own back. A full £1bn has been reclaimed on overdraft charges levied over the past two years. But the music stopped playing – rather abruptly – when, unsurprisingly, the banks agreed with the OFT at the end of July to test the legality of these charges in court. And it could take up to two years for a view to be offered in court… Don’t hold your breath.

Claw-Back Target #2: credit card fees. The OFT did rule that the commonplace £30 penalties for missing monthly credit card payments should be cut to a more equitable £12. So if you’ve been hit with anything more than this, you can claim it back.

Claw-Back Target #3: mortgage exit fees. As mentioned above, if you’re one of over 12m households who have switched mortgages in the past five years, then you might well be due a refund on exit charges – and that adds up to an average of £180 (but could be nearly £300 if you’re with certain providers). Keep in mind that you won’t be able to reclaim ‘early redemption’ penalties that might have been imposed when you paid off a mortgage during the timeframe of a special deal, such as a fixed-rate deal.

The Biggest Shake-Up Of The Mortgage Market For Decades?

2007-08-20T22:01:00.000Z

The Government’s moves toward 25-year fixed-rate mortgages could potentially cause an industry shake-up, according to Sean O’Grady. Today on Radio 4 they did a whole programme on the subject. But can Gordon Brown really convince Britons to lock into a long-term agreement that outlives many marriages? Why is this being mooted?

When I moved to Britain in the late Eighties, I was amazed to find short-term deals of just a few years. After all, in the US and mainland Europe, mortgages that span just a handful of years are uncommon; unthinkable to some. But why? Long-term fixes have a few benefits that contribute to the stability of both the housing market and the economy itself. On a household-by-household basis, the so-called ‘churning’ of mortgage rates and providers means that a staggering amount of money is given over to arrangement fees at each transaction.

So why do longer-term agreements seem like such a big gamble to the British public? Well, I’ve seen the late Eighties, where my colleagues were handing over the keys to their first-time-buyer flats because of negative equity. It was heartbreaking. Those same people enjoy telling me, of late, that “my house goes up in value by £100 a day! Drinks are on me.” The thing is, over the span of 25 years you will see some good times and you’ll see some bad times. It’s the nature of a market economy. Now that Nationwide has entered the long-term market with a deal that’s just over 6%, we may see many Britons joining up with what has been commonplace in America for generations.

In the meantime, many who have seen their short-term rates expire have been set up with a nasty shock. Here are four strategies you might consider to cope with a higher mortgage, if the luck of the draw means you’re on the tail end of your short-term deal:

Coping Strategy #1: cut down on your repayments. If you’re coming to the end of a short-term and are temporarily trying to gain financial equilibrium, you might consider an interest-only deal for a short period. This would reduce your overall monthly payments. But you’ve got to keep your eye on the ball and switch back to a repayment deal when you get your bearings and cashflow within your household become a bit more balanced.

Coping Strategy #2: extend the term. Even though you’d be hit with a much higher interest bill over the entirety of your debt, extending the term might be a pragmatic measure – one whose aim it is to cut down monthly repayments and improve your cashflow over the shorter term.

Coping Strategy #3: compare the fees. If you’re borrowing a large sum of money, you might consider paying a higher arrangement fee if that means you are at the very rock bottom of variable and fixed rates. But you must weigh in all factors: lenders who are offering the cheapest rates might well claw back their outlay through levying hefty fees. One mortgage lender whose tempting offer (on the face of it, at least) levies an arrangement fee of 3.5% of the value of their loan. You’ve got to have your eye on the ball, considering you’d be adding well in excess of £5,000 to a mortgage of as little as £150,000.

Coping Strategy #4: be one step ahead of the game. Make certain that you switch BEFORE your fixed-rate period comes to an end. That sounds obvious, but we all get busy, don’t we? Wait, and you’re likely to be transferred to the lender’s standard variable rate – which is never as favourable. Borrowers with that £150,000 loan mentioned above could well see repayments increase by a THIRD if they sit on their hands as their lower-cost deal comes to an end.

Do You See A Black Swan On The Horizon?

2007-05-08T11:48:00.001Z

The economy across the pond is slowing considerably, and the dollar is at its lowest point for some years – and yet the Dow Jones is reaching record-breaking milestones.

Here in Britain, the Bank of England advises prudence as the stock market continues to gently rise. And why should it do otherwise? After all, there is rapid growth in the world economy and, here at home, the profitability of our corporate sector remains good.

But do you see a ‘black swan’ on the horizon? A black-swan event, according to Nassim Nicolas Taleb (author of The Black Swan), makes reference to the Australians’ surprise discovery of swans that were black in colour instead of white. It makes reference to the fact that people in general are astonished by the unexpected because we simply think the ‘unexpected’ is ‘impossible’. Because it lay so far outside the realm of our expectations, the impact of a so-called black-swan event is often seismic in proportion.

So far as I can tell, the commonly-held view is that the markets are presently awash with white swans – but, if you squint your eyes, might that be a black one on the horizon?

Good News If You're In A Saving Mode; Not So Good If You Aren't

2007-05-01T13:51:00.000Z

Many are predicting that interest rates will rise to 5.5% in May. But with the Retail Price Index now running at 4.8%, even the very best savings accounts do little to protect savers. It’s said that a basic rate taxpayer would need to earn 6% just to break even, and for higher-rate taxpayers that figure stands at 8%.

But if you aren’t in a saving mode, inflation may yet rear its ugly head. With the Retail Price Index suggesting that the real cost of living is rising at 4.8% per annum, the outlook might be bleak. It’s fair to say that Britain has enjoyed a fair few years of cheap debt, and many predict further increases as interest rates adjust to head off inflation. In America, Japan and across the rest of Europe, inflation appears to have subsided now that oil prices have stabilised, whilst British figures appear to be following another trajectory altogether, driven not just by oil and gas figures but also by the rising cost of consumer goods and services.

If you’re in the black, none of this may be cause for personal concern. But if you’re in the red, it might be worth forming a view on how you see your circumstances in the medium term. If wages start to struggle to keep up with the trends, it may yet be the case that our record house prices are built on shaky foundations.

But if being in the red means you’re now ‘sweating’, remind yourself that most banks don’t have a problem with it. So much so that barrister Tom Brennan has filed a suit against his particular bank for ‘abuse of power’, after they charged him £2,700 in fines and interest for going over his credit limit. His argument is that such penalties are ‘disproportionate’ and therefore illegal. The test case, at the Mayor’s and City of London County Court, could lead to millions of similar claims. Watch this space.

What's The Real Price Of A New Set Of Keys?

2007-04-20T19:18:00.000Z

More than two million Americans face the prospect of losing their homes over the next couple of years, according to the head of America’s Senate Banking Committee. Senator Christopher Dodd attributes this to the dramatic collapse of the ‘sub-prime’ mortgage market. Sub-prime mortgages, typically 2% to 3% higher than the average interest rate, are generally offered to home-buyers with a less than shiny credit history. The banks and finance companies that cater to the sub-prime market are being accused of exploiting those least able to afford the premium rates and additional charges associated with this form of borrowing.

Repossessions in the United States are now at a record high; in Detroit, Michigan many homes can presently be bought for less than the price of a car!!!

Meanwhile, on our side of the pond, according to James Daley in The Independent, selling your home is about to get more expensive. From 1 June all vendors must provide a Home Information Pack containing evidence of ownership, a range of legal searches, and an Energy Performance Certificate (so all this talk of ‘carbon footprints’ has far-flung implications). At an estimated cost of £300 to £400, the packs are an attempt to speed up transactions and protect multiple buyers from having to pay for surveys before deciding on whether to place an offer.

The astonishing thing is that the Government has decided to scrap the requirement for the vendor to provide a structural survey, probably the most critical pre-purchase information a buyer needs to know. Extraordinary! Nonetheless (despite some exceptions) the provision of a ‘Hip’ will be incumbent on the vendor. You can either compile one yourself or obtain one from an estate agent, a solicitor, or a specialist provider.

However, with no sign of prices abating as of yet, and mortgage providers seemingly doing whatever it takes to attract first-time buyers, many have an uneasy feeling about the UK property market. After all, this is all within the context of the recent news that inflation unexpectedly jumped to 3.1% on the consumer price index. Many feel that interest rates will have to rise to reflect this jump, whilst others look with alarm at the retail price index as it heads toward 5% – in the eyes of many a far more accurate measure of our economy than the CPI because it includes housing. Others observe that we are seeing price gains on everything from consumer goods to food and basic services, and want to see the Bank of England act fast. Whilst nobody anticipates an ‘Anglo-Detroit’ disaster, the less sanguine observer is already preparing for higher interest rates, perhaps as soon as May.

Bank Holiday Bonanza

2007-04-20T16:00:00.000Z

Don’t despair! May Bank Holiday is around the corner. The only question is whether it will rain or not! Bank Holidays are often a chance to go on a bit of a shopping spree, and that’s fine for many. But you really need to think carefully before using one of those courtesy cheques to have a bit of fun.

Here’s an interesting statistic: 1 in 5 customers mistakenly believes the interest rate on purchases with courtesy cheques is effectively the same as that of a credit card, according to a December 2005 survey by More Th>n.

The Office of Fair Trading supports these findings, estimating in March 2006 that courtesy cheques cost Britons up to £57 million a year in unexpected interest charges and fees.

I Forgot To Get Out The Candles

2007-03-11T23:56:00.000Z

Christmas time is well and truly a distant memory (that is, unless you are still paying off the credit card balances you racked up!!!), but a significant milestone in 21st Century British life was celebrating its second anniversary around about then, and I must admit I forgot to get out the birthday candles. Doh!

At precisely 10:38am on 29 December 2004, Britons were logged as spending more with credit cards than with cash for the very first time in history. As reported in the newspapers the very next day, leading banks determined the exact moment a schoolteacher made her historic credit-card purchase somewhere in west London.

Less than 40 years after Britain’s first-ever credit card, each and every one of us has an average of 3.5 plastic cards in our wallets.

It's Just Common Courtesy

2007-02-26T13:50:00.000Z

I have noticed that I receive more courtesy cheques in the December festive season, and when the bills come in after the “festive season fallout”. Everybody I hear from has had a stack of them land on their doorstep in recent weeks. I suppose these companies are hoping that their customers will decide to use these cheques to mastermind a visit from Santa for their children, then they send them when we know it’s all behind us. And the next time they seem to land on the doorstep is around the time we’re all suffering from wanderlust, itching to go away on a sunny holiday. Maybe I am being cynical.

These kinds of offers from your card providers are indeed common, especially when you’ve had a large balance that you have managed to pay off. They’d like you to return to the fold. Be careful if you use a courtesy cheque. It’s often full of more nasty surprises than a cheap package holiday to Tenerife.

Back To The Same Old Grind

2007-02-12T23:19:00.000Z

The festive season is well and truly over now, and we’re all back to the same old grind. But here’s something worth remembering for next year: Santa Claus doesn’t always arrive on a sleigh!

Courtesy Cheques often arrive in the post attached to your monthly credit card statement. They can provide a perfect means for you to immediately transfer a whacking great balance from your most exploitative credit card.

However, you’ve really got to read the small print on any such offer before you sign the dotted line. Some companies have special rules for transfers done with courtesy cheques. For example, they might not give the same grace period or interest rates as you would get if you’d purchased something with your credit card. That means you get charged interest as soon as you make the transfer. Other courtesy cheques offer the same immediate lending opportunities – but at higher rates. So beware! It is never wise to use one of these courtesy cheques without first reading the small print and ringing up the call-centre to find out exactly what the offer entails.

It's that Time of Year

2007-02-06T20:56:00.000Z

How did you fare at the winter sales? If you went mad on the credit cards, will you be able to pay them off when the bills come due?

If not, you’re not alone. After the Christmas and New Year sales, many shoppers experience a financial hangover that a couple of aspirin will do little to cure. According to the 7 January 2006 Guardian, one person in eight has no idea how to pay for the festivities once the whole thing is over.

As a matter of fact, fully two million people who used credit cards to Christmas shop for 2005 were still paying off their Yuletide bills from 2004. I’m sure it’s even worse this year… one clothing and lifestyle accessories store in the Southeast had a queue more than a mile long when they opened on Boxing Day at 5am. They had to call in extra security when they unlocked the doors.