Last year ended on something of a sour note in terms of the economy, with most well aware of the bleak outlook for the economy and in terms of things such as rising unemployment and soaring repossession levels. Whilst the Bank of England has been cutting the base interest rate aggressively in order to try and ease the situation for consumers, reduce the number of repossessions, and revive the economy many think that we could still be a long way from recovery.

In fact, things are looking bleak in many different areas for Britain. Holidaymakers will be disappointed by how weak sterling is against the Euro and the dollar, many people are nervous about the security of their jobs with unemployment set to soar, and many are worried about how they will keep on top of their mortgage repayments and other financial commitments in the current difficult financial climate.

A number of industry experts were recently interviewed by a leading financial company, and gave their views on what the future held over the course of this year in terms of areas such as unemployment, the economy, interest rates, and finances.

One expert, Jonathan Loynes from Capital Economics, stated: ‘The year will be marked by startling visible effects like deflation – consumer prices falling – for the first time since 1960. And what we see as the fastest contraction in the real economy since the 1940s. But the key cause-issue in the economy will be the degree to which banks start lending to each other and to business again – and this will determine the speed of the economy’s recovery: a continuing credit crunch will lead to a prolonged depression rather than a brief recession.’

He added: ‘Interest rates will drop to 0% – although a technical buffer may prevent the base-rate being put actually at 0%. And that will happen faster than most people think, in the next two or three months. Sterling will remain fairly flat in our opinion. There is a danger of more weakness in the near-term but most of the adjustment has occurred and there is even a possibility of some recovery – against the euro particularly – later in the year.’

Another official from Commerzbank, Peter Dixon, stated: ‘The UK stands on the verge of its worst recession since the early 1980s. Its dependence upon financial services and the public sector to drive growth and jobs will be a problem during the downturn as neither sector will perform well. The situation may feel worse than it did during previous recessions as the economy has been so stable in recent years that it will not take a big increase in volatility to raise insecurity levels.’

He went on to state: ‘The housing market collapse is ongoing and although we look for a 25% peak-to-trough correction, there is a good chance that matters could turn out even worse. Consumers will take a big hit from falling housing and equity values but real income growth may be buoyed up by a sharp fall in inflation. The key to the depth of the downturn will be the extent to which the labour market collapses, and the portents are not good. The massive loosening of fiscal policy will probably not make a big enough difference to growth in the near-term since it largely reflects a temporary tax cut which may not give enough of a boost at a time of weak employment. The BoE does, however, have room to cut interest rates further and could take them as low as 1% as CPI inflation undershoots the BoE’s target.’

He also added: ‘Sterling remains in dire straits as interest rate support diminishes. Parity against the euro is not our favoured scenario but in the spirit of ‘always expect the unexpected’ we cannot make this claim with any degree of confidence. To paraphrase former Chancellor Kenneth Clarke, the pound is – or was – ‘a Dolly Parton currency: An unbelievable figure blown out of proportion with no visible means of support’.’
Finally, Philip Shaw from Investec stated: ‘The defining feature of 2009 will be the extent to which banks begin to lend to each other again on the wholesale markets. If the credit market doesn’t free up then the second half of the year and beyond is looking bleak to us. If the authorities take further successful steps to get credit moving again then we will see the recession ease off after the first half so that in the second half of the year the economy should cease contracting. But the recovery will be slow.’

He continued: ‘It’s clear from recent Bank of England minutes that they still feel rates are too high and we think they will come down to 0.5-0.75%. But also we think the Bank will take ‘quantitative easing’ measures to pump liquidity into the economy. With rates having further to fall, the pound is still vulnerable and the currency markets obviously have a poor appraisal of UK fundamentals at the moment. But all industrialised economies are looking very fragile and we think the markets have oversold the pound and overvalued the euro.’

He also said: ‘They are underestimating the problems in the eurozone economy and the extent to which the ECB will be forced to cut rates next year. So the euro will reverse some of its gains and we will see the pound in a range of 1.15-1.20 by the second quarter. The dollar will be strongest of the three currencies in 2009, and we see sterling dropping to $1.40. But it will be another year of volatility and the second half could present a very different picture to the first.’

What the experts are expecting this year is a post from: The Thrifty Scot

Whilst you may think that saving any significant amount of money will be too difficult and time consuming there are actually many ways in which you can save money, and as many people have already realised every little helps, and saving small amounts of cash can quickly add up to leave you with considerably more cash in your pocket at the end of each month.

One way of trying to stop yourself from overspending is to try and avoid putting things on your credit card. It is all too easy to spend a fiver here and a tenner there when using your credit card because you don’t need to have cold hard cash on you. However, you need to remember that at some point you have to give the money back, and in some cases with interest on top. So, try to avoid putting things on your card here and there, as they can quickly add up, and you will feel far less tempted to waste your cash if you have to actually take real money from your pocket to pay for it.

We all like to indulge in a little shopping now and again, but there is nothing to say that we have to shop at the most expensive shops and boutiques around. In fact, if you try out some charity shops you can get some real bargains, from designer clothes and accessories from next to nothing, to books, DVDs, CDs, and much more for just pennies. One consumer said: “I recommend shopping in charity shops. You can really buy some bargains, if you look and get lucky. Go to posh areas, where they donate some good things. Or shop on eBay for the things you need it’s much cheaper than the high street.”

Another consumer offered tips on what to do with cast that you normally pay out each month via direct debit but have a couple of months’ break from, stating: “Most householders pay their water bill and council tax by direct debit. Council tax for 10 months and water for eight. When not due, be disciplined and move the payments to a savings account – such as a cash ISA.”

Another suggested that giving up smoking and drinking could save a fortune, and renting DVDs rather than paying money for expensive cinema trips could also help to save cash, stating: “Give up smoking, drinking or any other vice legal or otherwise. The cinemas are highly overpriced so rent DVDs instead. Oh and give up big label shopping: supermarket own brand stuff saves cash.”

With food prices having rocketed over the past year many of us are spending a fortune on groceries, and this is made worse by the fact that so many of us tend to purchase lunch on the days that we are working rather than taking a packed lunch in.

One consumer offered a few tips to help to curb these costs, and she said: “I’ve invested in a breadmaker and have started baking my own bread. Average saving over £1 per loaf and no artificial additives. The breadmaker will have paid for itself in a couple of months. I’ve also started making a huge batch of soup on Sundays and taking that into work for my lunch every day, along with the home-baked bread. Average saving £15-£20 per week. I also cook in batches and eat the same meal for two days and freeze the rest. I seem to have cut my food bills by over half.”

Another helpful consumer also offered some tips on saving money on food as well as household goods, stating: “Buy a slow cooker so you can use cheaper cuts of meat and poultry, and when you cook do an extra portion or two for the freezer. Home made soup and a sarnie is an adequate dinner.

Shop at discounters like Lidl and Aldi – you will be surprised by the quality if you shop carefully. I buy most of my everyday toiletries, toothpaste, cleaning stuff and stationary from Poundland. You could also look for things to do that are free – a walk in the park costs nothing and keeps you fit and healthy.”

Consumers give tips on saving some money is a post from: The Thrifty Scot

Recently, the Governor of the Bank of England, Mervyn King, made a long and poignant speech about the state of the economy at the CBI dinner in Nottingham. His speech addressed various aspects and issues relating to the financial crises, the recession, and the changes that have taken place both nationally and globally over the past year.

Mr King began: “Certain truths are self-evident. One is that financial markets and the economic outlook can change quickly and in surprising ways. You in the Nottingham business community know that only too well. In line with businesses across the United Kingdom, your economic fortunes have changed markedly over four months. Before last September, the world economy was slowing and at home the Monetary Policy Committee published a central projection of falling output in the United Kingdom in the third quarter. Inflation, though, was still rising. But after the failure of the American investment bank Lehman Brothers, there was a widespread collapse of confidence in the banking systems of the industrialised world. That led to an unprecedented and synchronised downturn in business and consumer confidence around the world. Our business contacts at home and abroad, and my international counterparts, started to report that orders and confidence had, in the same telling phrase, “fallen off a cliff”.”

King went on to outline some of the problems that had been experienced not just in Britain but on a global basis and affecting many different major economies. He continued: “Global equity prices fell more in the month following the failure of Lehman Brothers than in any but a handful of months in the Bank of England’s 300 year history. Chinese electricity production, having risen steadily at 15% a year, fell in November to a level 8% lower than a year earlier – the steepest fall on record. Car sales in Brazil contracted by a quarter compared to a year earlier. In Japan, industrial production fell by 8.5% in just one month in November, and in Germany, the value of exports declined by over 10%. In the United States, over a million jobs were lost in the final two months of last year – the fastest rate of job losses in over 60 years. And in the United Kingdom, manufacturing output contracted at its fastest rate since 1980. Trade was badly affected – the Baltic Dry Index, an indicator of demand to ship materials around the world – fell at the fastest pace on record in October. For the world economy as a whole, consensus forecasts of growth in 2009 have been revised down from 3% to just 1% since September.”

He told attendees at the CBI dinner that both central banks and government around the world had tried to act positively to try and combat these issues, stating: “Governments and central banks around the world responded decisively and boldly with large fiscal injections and cuts in interest rates, and the provision of hundreds of billions of pounds in capital and funding to support banks. The scale and urgency of their actions embodied an audacity born out of pessimism.”

Amongst other issues, he also addressed the problems that have hit the banking industry over the past year, and he said: “In the past year the true scale of the risks taken by financial institutions has become painfully apparent. As losses mount it has become obvious that banks did not have sufficient capital to support their inflated balance sheets. Questions about the adequacy of liquidity have turned into questions about solvency. In response, banks have been trying to raise new capital and shrink their balance sheets. The banking system is in the throes of a difficult and prolonged adjustment to much smaller balance sheets relative to their equity capital – or leverage, as it is known. Leverage ratios of large banks remain at remarkably high levels, and the required adjustment will not happen quickly.”

He added: “I know that bankers around the world realise this. The incentives they face to adjust, in whatever way they can, are now overwhelming. With fresh capital from the private sector difficult to obtain, banks have opted to reduce their lending and that is why the flow of credit to all parts of the economy, here and abroad, has been heavily disrupted.”

In conclusion Mr King ended his speech stating: “…the very significant policy actions taken in recent months will eventually stimulate a recovery in demand, output and employment. Bank Rate has fallen from 5% to 1½%. And, as I have explained, the Monetary Policy Committee has a range of options to stimulate the economy further if required. Fiscal policy has been eased. The banking system is receiving massive support to cope with the need to restructure its balance sheet. That will take time, but time is a great healer, even of banks. Since the summer, the exchange rate has fallen by almost 20%; and oil prices have fallen by around two thirds, both of which will boost demand. No one can know at what point the impact of all this stimulus will have a visible effect on activity; the lags in economic policy are notoriously long and unpredictable. But well-designed policies implemented within a consistent policy framework will eventually work.”

King comments on economic downturn is a post from: The Thrifty Scot

Along with the usual line up of monthly payments, the high cost charged for gas and electricity has put a huge financial strain on the outgoings of most families. The result is that they have had to cut down in other areas in order to pay the bills coming in from these service providers.

Since gas and electricity is such an essential service, most people take it for granted especially since the prices have remained stable for so many years. It was once very easy to predict what the costs would be and to budget for them.

This is no longer the case resulting in many UK households having to spend more of fuel costs than they do for food or their mortgage payments. Just as you can save in other areas of your financial obligations, there are also ways you can save on the amount of money that you have to pay for your consumption of gas and electricity.

With the many gas and electric service providers in the UK, you do have a choice of which ones to use. A simple online search of the rates that each of these providers in your area charges will give you a good idea of how much money you will be able to save by switching to a new company.

The websites of the various providers do have comprehensive information for the consumer. You can visit several of such websites and do the comparison yourself, but there are also sites that will do the comparison for you returning you results that start with the company with the cheapest rates.

You can also cave money by using the same company for all your fuel needs. If you currently have one provider for your gas and another for your electricity, by choosing one company to provide you with both, you will realize savings even though you won’t have to cut back on your usage of either product. This is often called the “dual fuel” plan and companies offer consumers discounts by having both accounts with the sane provider.

Many of the companies also have a charge for refilling your tanks and sending out the bills each month and then wait for you to make a payment. You can save this extra charge by setting up an account in which the company can debit your bank account for the amount of the bill. The company does not have to wait for payment and you have the convenience of knowing that this monthly expense is automatically taken care of.

Many UK firms are advertising special deals for new customers in an effort to entice consumers away from their current suppliers. When you receive such an offer, you should analyze it very carefully to look for hidden charges in the fine print.

At the same time, there are energy deals in price plans and tariffs that you can take advantage of and save yourself money in the process. Most companies do not widely advertise such deals and reserve them for their best customers. Whether you are looking at switching to a new company or staying with your present provider, you should inquire as to whether there are any of these energy plans that may apply to your situation.

If you do decide to switch gas and electric service providers, you need to request a quote of how much the service will cost. Some will require a set up fee while others do not. According to consumers who have switched providers, the process of doing so is very easy and seamless. The new provider does not have to install any new pipes or wiring.

It is simply a matter of having the gas supplied by a different company and the bills for electricity coming from a different source than at present. The new supplier that you choose will take charge of making the switch for you and will even conduct the final meter reading so that your present supplier can prepare the statement to close your account.

There is a rating system of gas and electric providers in the UK that you can consult to determine whether or not the new provider you are thinking of using is one that is rated highly in customer service and the quality of the product. By browsing this rating you can find out if this provider has a range of payment plans available and whether or not there have been any actions taken against them in the past by regulatory bodies.

With the various savings now being offered to UK consumers, there has never been a better time to start looking for ways to save on your gas and electric costs to have more money available for other household essentials.

Ways of Saving on Essential Gas and Electric Services is a post from: The Thrifty Scot

In fact, it is surprising just how much we benefit from having access to the Internet, and with a growing number of providers competing for custom being able to get low cost packages and deals on high speed broadband access has become relatively commonplace, which means that homes and businesses do not have to pay out a fortune in order to enjoy the many benefit that having fast Internet access offers.

A recent report showed that those that have access to broadband are able to shop around for the best deals on a wide range of services and products, and there are indications that because of this those that have broadband access are able to save up to £70 a month compared to those that do not have access, simply by being able to easily shop around for the best deals on things such as insurance, energy providers, loans, mortgages, and more. This for itself can help to pay for your monthly broadband costs.

Of course, there are many other benefits that have to be considered when it comes to broadband. If you have kids you will find that they able to enhance their education by using the Internet for research. You may find that having broadband access enables you to conduct a business more effectively from an office or even from your own home. You can use the Internet to purchase goods from all over the globe, from your local supermarket to retailers in the United States and beyond. And, of course, you can simply use the internet to catch up with friends, keep up with news, enjoy some entertainment, and simply browse for fun.

Of course, in the current economic and financial climate nobody wants to pay over the odds for their broadband service, and with household finances getting tighter many are trying to cut back on costs when it comes to their monthly outgoings. The good news is that in order to cut back on the cost of broadband you don’t have to worry about losing the benefits of broadband access by getting rid of your service, as there are a number of ways in which you may be able to reduce the cost of your broadband.

One way in which you can cut the cost of your broadband is by shopping around for the right provider. As with other services, providers of broadband, or Internet Service Providers, offer a different range of broadband packages and the costs can vary based on the provider you choose and the package that you opt for. Make sure that you compare different packages from a range of providers and choose one that fits in with your needs rather than being over-ambitious and choosing a higher spec, faster package than you need.

If you already have high speed broadband access but you only use it for very basic things such as shopping, browsing, etc. then you may want to consider dropping the speed to the next level down, as this could save you money on your monthly subscription. The higher speeds are often only of use to certain groups, such as gamers, so you may be wasting your money by signing up to a higher speed than you need.

Taking a bundle package from the same provider is another way to save money, and this is where you get your broadband, television service, and landline all from the same provider. This could save you money and means that you won’t have to deal with three different service providers if any problems arise. Also, remember that the broadband field is a very competitive one, and the various providers are often coming up with special deals and offers such as free months’ service, freebies, incentives, and more in order to get people to sign up, so look out for these to see if you can save money.

Cutting your broadband costs by ensuring that you have the right package and the right provider, and by looking our for special prices and deals, means that you can ensure that your finances are not any more strained than they need to be and you can still enjoy the ease, convenience, and many benefits of having access to broadband in your home or office.

Cutting your broadband costs is a post from: The Thrifty Scot

Saving money on your monthly outgoings is therefore vital if you want to try and weather the financial storm more effectively, and there are a number of changes that you can make in order to cut back on the amount that you have to pay out each month. Of course, you may need to put in a little effort to make these changes, but by being proactive and taking some simple steps you could find that you make a big difference to your monthly outgoings, which will make it easier for you to cope in this challenging and turbulent financial climate.

There are many different changes that you can make to reduce what you pay out based on your situation and circumstances, and below you will find a list o ten simple changes that could help you to make savings on a monthly basis.

1 Consolidate your debts: If you have a range of high interest debts you may find that you end up paying a fortune each month on repayments, not to mention the hassle of dealing with a range of different creditors. By using a low interest loan to consolidate these debts you could save yourself the hassle of dealing with different creditors and you could save yourself some money on your monthly outgoings.

2 Switch your energy provider: As most of us know the cost of energy usage soared last year, with two increases in usage costs. If you feel that you are still paying too much for your energy then consider switching to another provider, as you may find that there is a big difference in price. Also, if you are not doing so already consider switching to direct debit payments and opting for dual fuel from the same provider, as this could also help you to make savings.

3 Switch to a water meter: If you are currently paying a lot on your water bills and there are not many people in the home then you may find that switching to a water meter could help to cut your bills. For those that do not tend to use as much water as the average household water bills can be higher than they need to be, so look into switching. Also, be more efficient about your water usage, and try not to waste water unnecessarily.

4 Change your shopping habits: There are a number of changes that you can make when it comes to your shopping habits to save you money. If you tend to go shopping practically every day switch to a weekly shop. Plan your family meals in advance so that you know what you need to get rather than just choosing when you get there, and always go armed with a list that you then stick to. Don’t be tempted to pop items into the trolley if you do not have them on your list, and avoid shopping on an empty stomach as this can result in you buying items that you don’t need simply through temptation. Also, consider switching from a main supermarket to a discount one for at least part of your shop, as this can help you to make big savings.

5 Change your car and home insurance provider: The cost of insurance cover, such as home and car insurance, can be high, and you may find that you are paying over the odds on your cover. Take the time to compare prices from other providers to see if you can save money, as the cost of cover car vary considerably from one provider to another, and you could enjoy making significant savings by switching provider without having to compromise on the level of cover that you have.

Making small changes such as these can help you to really build up your savings each month, and the money will really come in useful in the current financial climate. With price comparison sites and other resources available to help you to make changes such as switching providers you will find that you can cut your monthly outgoings in next to no time, comparing prices, services, and products from the comfort and privacy of your own home.

Five things that you could save money on this year is a post from: The Thrifty Scot

You look forward to not have to answer to the demands of an alarm clock waking you each morning so you can get ready for a day of work. According to recent reports however, the retirement dreams of many are disappearing and they find that they will have to work for longer than they thought before they can afford to retire.

The reason that many people will not be able to retire at as early an age as they anticipated is because they are deep in debt. If they choose to retire, even with a pension, their income will not be enough to allow them to live comfortably, paying their essential living expenses and making the monthly payments on loans and credit cards. Economic statistics tell us that millions of men and women who are of retirement age are still in the work force –not because they love working, but because they can’t really afford to retire.

Today’s working men and women in the 55- 65 age group owe about ten times as much as people of the same age owed a decade ago. The average person in this group owes about £2500 in personal unsecured debt in addition to mortgages, car loans and other secured loans on which they have to make monthly payments.

According to the group “Help the Aged”, which supplies these statistics, this debt may not seem to be overwhelming, but for those facing a lower fixed income in their retirement years, it is a greater amount of debt than they are able to manage.

Debt is not the only reason that more and more people are finding that they have to continue working longer than they anticipated a few years ago. The economic downturn that has hit all parts of the world has resulted in increased prices of food, petrol, home heating and clothing costs.

These people find that if they do have enough money to get by on, they have nothing left over for leisure and want to have something extra to add to their enjoyment. Plus, they are trying to save some money for a rainy day just in case they find themselves out of work or for that vacation they are planning on taking when they do retire.

The generation of people now approaching retirement age has grown up with the convenience of credit card usage. They feel that they have lost their best friend if they do not have a credit card with them. Businesses too, have added to this attitude because it is next to impossible to book a hotel room without one.

With the popularity of Internet shopping, the use of a credit card is essential. However, credit card use has led many people into debt because of impulse shopping when they buy something because they like it and not because they need it.

With dependence on buying on credit and then making monthly payments that include high rates of interest, people have to spend years paying for something rather than saving up the money they need to make the purchase with cash. The practice of making monthly payments has also made it next to impossible to save any money for the future because there is very little money left after all the bills are paid to put into a savings account.

Financial management when young can ease the burden of debt when you get older giving you investments and savings on which you can rely for your retirement. In this way you can look forward to retirement as a time when you can start living your life as you wish. The fact is, though, that most people today who are able to retire see their golden years disappearing because they can foresee that it will be a time of worry about finances for them.

Even those who have been saving for years and have had retirement investments are not so sure of the amount of money they have available to them. The losses in the stock market have wiped out many investment plans in terms of the interest gained and many people are only left with the amounts of their initial investments if they did put them into guaranteed funds. Those who invested in companies that have succumbed to the global financial breakdown are now without this savings on which they were dependent as their retirement income.

The depression that we now find ourselves in is perhaps a wake up call to many that we have been overspending and relying on credit to the detriment of retirement needs.

Preparing Financially for Retirement is a post from: The Thrifty Scot

The sales are always a good time to save a fortune on a wide range of things, so whether you are thinking of doing up your house or whether you want to treat yourself to the latest gadgets you should find that you can get some great deals.

In the current financial climate and with things set to get even worse over the coming year for some people in terms of their finances it is important for people to be wise when it comes to spending in the January sales.

Most people can ill afford to spend frivolously on items that they do not really want or need, so avoid making unnecessary purchases even if the items are on sale, as otherwise you are wasting money rather than saving it. However, this does not mean that you cannot take advantage of the sales, as there are many ways in which you can save money.

Many people decide to revamp their home and do some decorating once the New Year comes around, and it this is something that you are planning to do then the sales may be an excellent time to pick up some bargains in terms of furnishings, decorations, and new items for your home. You could save a fortune on all sorts of electrical items, furnishings, and other items for your home, so even if you are planning to start work on the home a few months down the line get what you need in the sales so that you can make savings from the sales.

It is also a good idea to make a list of birthdays that are coming up over the coming year for which you will be buying gifts. By doing this you can go to the sales and purchase presents in preparation for all of your forthcoming birthdays.

This will enable you to save a fortune on gifts over the course of the year, and also means that you will not have to dash around at the last minute looking for birthday gifts because you will already have them lined up ready – and at just a fraction of the usual price.

We all know how manic shops can be at Christmastime, and the sales will provide you with a great opportunity to save yourself some of that frustrating queuing when next Christmas comes around. Many people take advantage of the sales by purchasing things such as cards, gift wrap, and some presents ready for the next Christmas.

You can pick up some of these items at just a quarter of the original price once the sales come around, and when next Christmas comes around you will find yourself with a far healthier bank balance and with time to enjoy the festive season rather than running around trying to get cards and gifts organised.

You may have a special even lined up for the coming year, such as a wedding, work’s function, or other event for which you are thinking about buying a new outfit. If you do plan to buy any new clothes try and get them in the sales, as again you can save a fortune on the cost of all sorts of attire during the sales, so you can revamp your wardrobe or buy that special one off outfit for a far lower price than you might get them once the sales are over.

If you are wondering how you will find your purchases in the January sales, getting hold of a 0% purchase credit card may be a great idea. By using one of these cards you will be able to make your purchases whilst the sales are on, make gradual repayments on what you have spent, and providing you repay the balance within the interest free period that is specified you can then also look forward to avoiding payment of any interest.

If you plan to pay in one go for all of the purchases that you make in the sales then you could get a rewards based credit card, as this will enable you to make your purchases and then accrue rewards for every pound that you spend. You will therefore be able to get a little something back for the money that you spend in the sales, and this can increase affordability even more.

Making the most of the January sales is a post from: The Thrifty Scot

The economic difficulties in the financial sector of the economy are playing havoc with people’s lives. Jobs are being lost and businesses are closing their doors. Everyone is being affected, both those in the business of lending money and the ordinary consumer who needs to borrow money.

Lenders are having difficulty gaining access to funds and this means they have limited resources for those who wish to take out a loan regardless of one’s borrowing history or the amount of collateral used as security for the loan. Homes no longer have the same value they once did with prices falling and home sales reaching record lows.

The difficulty consumers have in obtaining needed funds by borrowing is not limited to banks and mortgages. It also applies to approval rates for credit cards. The foreclosure rate on homes has risen drastically in the US real estate market and lenders all over the world are fearful that this will happen in other countries.

So many borrowers are having difficulty meeting their monthly financial obligations and as a result are defaulting on their loans, placing lenders in a very difficult position. Thus, the criteria you need to meet the borrowing conditions of most lenders are much stricter than they were a few months ago. It is quite possible that you may have been approached by a lender six months ago and were offered very generous repayment options for a loan and now you cannot get the approval you need.

Consumers are left to wonder where they can turn next to get the financing they need for various purposes. As a result most are cutting back and looking for ways to save money on their usual living expenses. With the Christmas season fast approaching, many are cutting down on the list of people to whom they do give gifts and are being more prudent when shopping.

Stores as well are offering deeper discounts on the items they sell in the hope of making money prior to the Christmas season. Financial experts say that the prices charged for some items this year are comparable to what you would see in after Christmas sales. It is also likely that many of these stores will not be able to withstand the credit crunch and may have to close their doors in January.

No one knows where the current credit crunch will lead or when it will end. This is why it is essential for consumers to start taking stock of their finances to see where they can save. This may mean a change of lifestyle with spending less on dining in restaurants and cooking more meals at home. Putting some money away for a rainy day is more than just an old saying as many are now starting to realize. Even if you are financially secure and your job is safe, this could change with very little notice and you do need to be prepared.

It is very difficult for the average homeowner to be able to save a significant amount of money each month. However, putting a little money aside each month as savings and taking steps to reduce one’s debt makes sound financial sense.

Open a savings account that you don’t intend to touch except in the case of an emergency. One way you can find the money to save is to pay yourself first when you receive your pay cheque. If you take only 10% of this amount and deposit it in a savings account that is not attached to your debit card and on which you cannot write checks, it won’t be long before you start to see an increase in the balance.

When you start saving, you will still continue to pay your normal monthly expenses, but you will find ways of cutting back enough to save the money each month. If you have subscriptions to magazines that just pile up without being read, cancel them. Instead of taking the car to work every day, take the train on car pool with your colleagues. Better still walk to work if the distance is not far and you will also be able to get in shape at the same time.

Try not to use your credit card unless it is an absolute necessity. When you stop using the card you will see a difference in the amount of money you owe. As the balance decreases, so will the payment. You can choose to take the extra money and save it or you can continue to keep making the same level of payments and become debt-free sooner than you expect. If you do find yourself out of work in the future then the money you have in your savings will help to tide you over. It will last even longer if you can reduce your debts and save money at the same time.

Saving Money In Difficult Times is a post from: The Thrifty Scot

In order to get the most competitive account, you need to compare various savings accounts with several financial institutions. While your own bank may tell you it is offering you the best possible deal, you should never take their word for it. Do your own homework and visit many sites to find out the types of savings accounts that are available. Each of the sites will have a chart in which you can compare the key features.

These include the interest rates and how many free transactions you can conduct each month. If this number is lower than what you usually do, then you have to compare the costs of additional transactions you will need to paying your bills. Look at the fees charged for making withdrawals from ATM machines and whether or not you can access your savings account from another country.

The Bank of England has raised interest rates paid on savings accounts in the past few years. This means that your savings were earning more money for you. However, in the present global financial crisis, these rates have fallen in recent months. These interest rates have fallen to an all time low, which means you are not getting a very large return on the money you have saved. In spite of this, many financial institutions are continuing to pay the higher interest rates, so it would be in your best interest to open a savings account in these locations.

Some of the savings accounts paying higher than usual rates of interest do require a minimum level of savings. If you do not maintain this level, then you will not benefit from the higher interest rates and it may cost you money to make withdrawals. You do have to check to see how many withdrawals you are permitted to make free of charge within a month or on an annual basis. If you can afford to leave your money in an account and not touch it for a while, then this type of account will be the best one for you to choose.

There are also differences in the ways banks pay the interest on savings accounts. Some pay annually based on the amount of money you have in your account at the end of each year. Others choose the anniversary date of when you opened the account to make the interest payment into your savings.

The problem with this type of interest payment is that although you do get a year’s interest at one time, your balance may be at its lowest at this time of the year and so you are not gaining the full advantage of the earning power your money can have. When you compare savings accounts, the best ones to look at are those that pay interest on the money on a monthly basis. This is especially advantageous if there are months of the year when you have more money in your account than at other times.

Some savings accounts also have a maximum amount of money you can have in your account.  The majority of accounts will allow you to start with an opening balance of £1 up to a maximum of £2 million. Of course the more money you have in your savings, the more you earn on it. If you do have a lot of money saved, then you should look for an account that pays a high rate of interest and does not have a maximum amount for the account.

Another item that you should use for comparison purposes when comparing savings accounts is whether or not the account has a guaranteed rate of interest. Some UK savings accounts have a guarantee rate of interest attached to them that specifies that you will definitely receive a rate of interest of 0.30% above the rates set by the Bank of England until a specified date. Right now that date is December 31, 2011, which tells you that your money has more earning power for the next few years. Hopefully by then the current credit crunch will be a thing of the past and the interest rates will have risen.

Compare Savings Accounts for the Best Returns on Your Money is a post from: The Thrifty Scot