Key events that may impact your finances this year
There’s always a myriad of news articles on the TV, in the papers and online, so its hard to pick out which will directly affect us. Here we’ve collated a few that may hit your pockets this year and a few tips on how you could prepare for these costs.
The return of European Roaming Charges
Another result of the Brexit negotiations is that many mobile companies will return to charging for roaming while visiting other countries. Vodafone, EE & Three have all confirmed their return to the charges so it’s something else to feature in when making your travel plans this year
What can you do about it?
If roaming charges are a priority for you when considering the uses of your tech, consider awaiting a contract renewal or upgrade a little longer as the costs don’t kick in until you get a new contract. Similarly, shopping around with the providers who still haven’t reinstated the roaming charges could be wise, or even consider getting a special roaming sim if you have an unlocked phone.
Changes to Insurance costs may cause a price hike
The Financial Conduct Authority have recently instilled a new rule for those companies’ providing insurances, including motor, home and even protection insurance. The new rule disallows these companies from rising prices when a person’s policy auto renews, otherwise known as price walking. Which should be good news in theory, but many providers are now reabsorbing those losses by rising their prices in general.
What can you do about it?
Never auto-renew. Shopping around and rebroking is still a wise choice as you’ll often find more suitable deals. Switching 23 days before renewal is the sweet spot for car insurance (21 days for home insurance). Delay, and prices can almost double as insurers’ algorithms show later quote-getters are a higher risk.
Going to direct to providers to ascertain the best deals on offer is usually wise too, or via an insurance broker who can scour the market and find the policy best fitted to your needs.
Rates are rising
In December 2021, the Bank of England increased base rate to 0.25% from 0.1% – the first rise in over three years, with more increases expected. This is good news for savers but bad news for borrowers, and if the rates continue to rise next year the cost of borrowing will only spike further
What can I do about it?
If you’re a mortgage holder you have a few options:
Fixes are fixed – but if yours is coming to an end soon you can ‘reserve’ a new deal up to six months ahead. As the name suggests, rates WON’T change during the fixed period. But it’s worth searching early for a new deal just in case the base rate continues to increase this year
Lenders MAY raise standard variable rates (SVR). You’ll usually be on an SVR after your fix or tracker ends.
On a tracker mortgage? Rates will increase. As the name suggests, these ‘track’ the base rate, so mortgage costs will go up, so check now to see if you can switch to a better deal.