March in review: the top finance stories this month
The Budget’s gift to savers, the demise of Money Advice Service and credit card confusion – ClearScore shares this month’s most important personal finance stories
Personal saving: ISAs and LISAs
This month, the eyes of the nation locked onto George Osbourne’s red briefcase for the Budget. It was good news for savers as the ISA yearly limit rose to £20,000 from £15,240.
The Lifetime ISA (quickly coined LISA) will come into effect next year and should give a bit of extra help to under 40s who want to get on the property ladder or save for retirement. You can save up to £4,000 a year and the government will top it up by 25%. This means if you save the full £4000 you’ll have £5000 by the end of the tax year. This money can either be used towards your first home or paid out when you retire.
New products like the LISA could go some way to helping people get a leg-up onto the property ladder. This is particularly important for people using a single income to buy a home: it was revealed by the Hamptons this month that a single Londoner would have to save for 46 years to get a mortgage. Elsewhere in the country the picture isn’t as bleak, but singletons in the North still have to wait an average of nine years.
The demise of the Money Advice Service
In the Budget, the Chancellor also announced that the Money Advice Service (MAS) would be scrapped and replaced by a new, ‘slimmed down’ guidance body. It was set up in 2010 to help people navigate the murky world of finances, giving free advice and guidance over the phone or via its website.
Its replacement will be of crucial importance. As Gillian Guy, chief executive of Citizen’s Advice, stated: “Getting effective financial guidance to people early is key to improving household finances and economic security.”
Credit card confusion
In credit card news, Money Mail revealed that for most 0% credit cards the perk period starts as soon as the card is applied for – not when you transfer the balance or physically receive the card. Because some customers didn’t realise this, many have received higher than expected bills. It’s worrying that this happens, but it’s important that when you take a credit card out you properly research the terms and conditions to avoid any unnecessary fees.
If you want to find out how the Budget will affect you, check out this handy calculator from the BBC.