Whilst there have always been first time buyers who have been reliant on money from their parents in order to help them onto the properly ladder, this is something that has become increasingly prevalent over recent years, with more and more young first time buyers having to turn to their parents in order to help get the money together to get them onto the property ladder.

Higher deposit demands coupled with frozen income and higher living costs has meant that many younger people, even if they are working, have been unable to put enough money aside to get them onto the first rung of the ladder. The Bank of Mum and Dad has therefore been raided by many of those who were determined to get their own place, even if they were unable to save up the money themselves.

However, data indicates that in this difficult financial climate even the Bank of Mum and Dad has started to run dry – which has resulted in many younger people now turning to their grandparents for financial assistance in getting a home. A recent report showed that increasing numbers of younger people were now turning to their grandparents for help with raising a deposit for a home, as a rising number of parents were struggling with finances themselves and therefore did not have the capacity to help their children to raise a deposit.

Over one thousand younger people were polled as part of the study, which was carried out by the house builder Taylor Wimpey. It was found that 10% of them had turned to their grandparents in order to get help with raising a deposit. The study also showed that a rising number of grown up children were being forced to continue living with their parents for longer in order to try and save money towards a deposit.

In fact, some grown up children now fear that they could be living with their parents until they are in their late 40’s or even in their 50’s because of their financial situations – and many said that this had caused their relationship with their parents to suffer.

Mortgage fees are one of a number of fees and charges that many borrowers have to take into consideration when taking out a mortgage loan. However, recently released figures have suggested that these fees have increased significantly over the past year, with those that are likely to be worst hit being borrowers who have larger deposits.

Data from financial site Moneyfacts has indicated that the typical mortgage fee has shot up by around £600 over the past year, with the steepest increases hitting borrowers who have got the largest deposits. It is unusual for those with larger deposits to be worse hit than those with smaller deposits, but in this case the increases have been smaller for the loans that first time buyers with small deposits tend to look for.

The figures show that the typical mortgage arrangement fee has increased from £889 just one year ago to £1498. However, the variation between the increase in the mortgage arrangement fee for those with a larger deposit and the increase for those with a smaller deposit is significant. The data showed that the increase for those taking out a 60% Loan to Value mortgage stands at 42% whilst for those seeking a 90% or 95% Loan to Value mortgage the increase comes in at just 11%.

For borrowers with a deposit of 25% the increase is even sharper, with the increase coming in at a massive 65%, taking the cost of the typical fee to £1599. The hike in fees has been imposed despite the continued record low Bank of England base rate, which has resulted in lenders offering some of the lowest mortgage rates ever.

One industry expert said that all too often those who were caught up in the excitement of taking out a mortgage and buying a new home forgot about checking the finer details such as the cost of associated fees and charges. However, she added that this was an important factor in calculating the most cost effective mortgage deal and was something that more borrowers needed to take into consideration when comparing mortgage loans.

Whilst many people already spend a lot of time shopping around before purchasing their vehicle insurance cover, this is a process that has become all the more important based on recent figures released by motor industry group, the AA. The figures reveal a significant increase in car insurance quotes over a period of just three months, which has prompted MPs to call for changes and cuts in the cost of vehicle insurance cover.

According to the British Insurance Premium Index from the AA, the typical quote for comprehensive car insurance cover even for consumers that shop around has increased by £50, with more and more cheaper deals disappearing from sight. The typical cost of annual cover for those that shopped around for comprehensive cover came in at £971.40. This reflects an increase of 5.4% compared to just three months ago and a significant 15.3% compared to a year earlier.

When it came to third party, fire and theft cover the typical increase since last October stood at £35, which represents a 2.4% increase, leaving the current typical premium standing at £1,495. The cheapest area of the UK for car insurance continued to be Scotland, with the shop around premium for comprehensive cover coming in at £587.

The most significant shop around percentage increase has, as many expected, affected younger drivers, with those aged between seventy and twenty two being hardest hit. For those in this age group the typical cost of cover has increased by 6.6% since October last year, taking the cost to £2,497.

A spokesperson for the AA said that the price difference between now and just three months ago showed that more and more of the most competitive vehicle insurance deals were disappearing, leaving drivers with only an array of costly cover to choose from. He added that younger drivers appeared to have lost out the most, with a higher than average increase.

The AA also said that younger drivers were clearly continuing to be viewed as a much higher risk to insurance providers and some would now no longer consider providing insurance cover to those that were aged under 21.

The results of a recent survey have suggested that as a result of the ongoing difficult financial climate in the UK many adults are planning to try and cut back on their spending over the course of this year. It is thought that around one third of adults have made up their minds to reduce their spending in 2012, which reflects a sharp increase from just three months ago, when the figure stood at 19%.

The study was undertaken by the Resolution Foundation think tank and around one quarter of all those polled as part of the study said that they believed their financial situations would get worse over the course of this year. However, on a brighter note around the same proportion of people out of those that were polled said that they were expecting to receive a pay rise at work this year, which would help to combat the effects of inflation on the household budget.

The Resolution Foundation also revealed that in addition to making plans to reduce their spending levels, a rising number of people were now trying to save money with 30% now putting aside money into savings compared to 22% just three months ago. Many are doing this to ensure that they have some money put aside in the event of emergencies and because they believe that they have a tough year ahead of them financially.

Amongst the luxuries that will be sacrificed by struggling households are holidays, with 20% of consumers stating that they could not afford to go on holiday this year. Nearly two thousand consumers were polled as part of the survey, and Gavin Kelly, the think tank’s chief executive, said that the survey results indicated that the current trend was a worry because the less people spent the longer it would take for the economy to recover.

Consumer confidence levels for the month of December are said to have fallen. However, retail sales for the month did increase by 0.6% as a result of the deep discounts that retailers were offering as Christmas approached.

The FOS has reported that the number of complaints being made in connection to the controversial Payment Protection Insurance has seen a fresh surge, resulting in an increase in the number of cases that are ending up with the Financial Ombudsman Service. This is reflected in the number of complaints that were being received by the FOS in the final quarter of last year compared to the previous one.

Figures show that in the last three months of last year the FOS received 55,907 complaints, which was an increase of 10% compared to the previous three months. This was fuelled by a surge in PPI complaints during the same period, with the number of complaints jumping from 19,259 to 30,301.

Data has also revealed that new complaints relating to PPI are significantly higher than others types of complaints that are being dealt with by the ombudsman. Fresh PPI complaints are said to account for around 54% of the current workload of the FOS. In the final quarter of 2011 only 18% of the FOS workload was down to complaints about credit cards, mortgages and current accounts.

It is clear from the rising number of complaints relating to PPI that the banks still have a lot of work to do before the controversy relating to PPI is finally brought to an end. Whilst banks have been paying out huge sums in compensation to successful claimants after losing their court battle against the Financial Services Authority, there is still a very long way to go.

In the final quarter of last year the FOS ruled in favour of the customer in 68% of PPI cases that it looked at. This reflected a drop from the figure of 92% in the third quarter of the year but was higher than the figure for the whole of the 201-2011 financial year, which stood at 66%.

Around £6 billion has been put aside collectively by the banking giants in order to be able to settle PPI claims. However, many of the complaints that are being rejected by banks are ending up on the desk of the financial ombudsman.

The Chinese state-run Investment Corporation (CIC) has made an investment of 8.7% in the holding company that owns Thames Water. This follows a visit by Chancellor George Osborne to Beijing to forge closer ties between the two countries.
It is thought to be the sovereign wealth fund’s first investment in the UK and is expected to be the first of many as China’s huge economy grows and looks for external investments.

CIC chairman Lou Jiwei has recently that his company was interested in investing in European and US infrastructure.
Speaking about the deal, the Chancellor said:
“This is a significant step by China. It is a vote of confidence in Britain as a place to invest and do business.”

China has a pressing need to find ways to invest in foreign countries, and the UK has an urgent need to stimulate growth and update an outdated infrastructure, it seems like a match made in heaven.

City analysts say the move could be the first of an influx of Chinese investments in the country as Far Eastern investors see the UK as a safe haven compared to the many other troubled European countries.
It is believed the planned High Speed rail link from London to Birmingham (HS2) is among the projects of interest to China and also large industrial developments, such as the Atlantic Gateway in the North-west of England, as well as other projects including updating Britain’s energy infrastructure, broadband investment and road schemes.

The chancellor is determined to invest and attract outside investment in the UK economy, stimulating growth, and making the UK a substantial player in the world, and to show he has a vision that is more that justdeficit reduction.
The Thames Water investment is the latest by foreign companies in the UK’s infrastructure in recent decades following their privatisation.
In the last ten years, Germany’s RWE has acquired utilities supplier Npower, the Australian bank Macquarie has bought carparks owned by NCP, and Ferrovial of Spain has bought BAA, the operator of Heathrow and Stansted Airports.

After a series of increases that led to the cost of renting reaching unprecedented highs, rental costs have now fallen for the second consecutive month. Figures released by LSL Property Services have shown that in December the cost of renting a property fell by an average 0.8%, taking the average rental cost to £711 per month.

Despite this drop in rental prices, however, the figures also showed that the cost of renting was still 4% higher in December 2011 compared to December 2010. LSL also pointed out that as a result of the flurry of spending over the Christmas period a rising number of tenants have fallen behind with their rental payments.

At the end of December 10.7% of all rent was shown to be either late or unpaid, which reflected an increase from the figure of 9.3% in November. According to the Association of Residential Lettings landlords are also experiencing difficulties as a result of this, prompting one member of the group to highlight the importance of conducting research and getting references before a tenancy agreement was signed. He said that seeking advice from a licences lettings agent was the best way to ensure that both tenants and landlords were protected.

Prior to November, rental costs had increased for ten straight months. LSL said that although rents had fallen over the past couple of months due to seasonal factors, the fall was not as great as it had been in previous years, partly due to the ongoing demand for rental homes, which has been helping to fuel rental increases over the past year.

The LSL figures show that the rental falls in December were experienced in all regions apart from the West Midlands, Yorkshire and the Humber, and the East Midlands. In London rents fell for the first time in the space of a year. However, annually rents increased in all regions apart from the south west of England and the north east of England.

One property industry expert said that despite the rental price drops in would be premature to assume that the rental market had reached its peak and would start to experience continued falls.

Figures released have shown that there was a sharp drop in CPI (Consumer Prices Index) inflation for the month of December, with the drop drive by lower prices on clothing and fuel. The rate of inflation, which has spiralled way above the government’s target rate of 2%, fell from 4.8% in November to 4.2% for December, reflecting a significant fall. The data was released by the Office for National Statistics.

The figures also showed that RPI (Retail Prices Index) inflation, which includes mortgage interest payments, also fell dropping from 5.2% in November to 4.8% for the month of December. The Bank of England has predicted that inflation will fall back to its target level of 2% by the end of this year and so far the figures suggest that this prediction could be correct.

The drop in CPI inflation has taken the rate to its lowest since June of last year and the drop in the level of inflation that was seen in December is the biggest monthly fall since April 2009. Clothing and footwear prices experienced a drop of 2.8% in the run up to Christmas, as retailers were cutting costs in a bid to try and bring more customers through the door. Fuel prices also fell by a small amount, dropping by 0.6% on the month. The recent rounds of gas and electricity price cuts have not been taken into account with the figures.

The price cuts on these products was, however, counteracted in part by an increase in food prices, which occurred despite stiff competition between the leading supermarket giants such as Tesco, Asda and Sainsbury’s. Figures show that food prices increased by 1.4%.

One analyst said that it was likely that there would be further falls over the coming months, which in turn could equate to a vital boost to the UK’s economy and growth over 2012. He added that the data helped to support the predictions made by the Bank of England that inflation would fall below its target rate of 2% by the end of the year.

Millions of consumers around the UK will have been relieved recently after the big name energy giants announced price cuts on gas and electricity usage. After seeing the cost of energy soar, many have been struggling to keep on top of their bills, with the high cost of usage adding to already strained household budgets.

With the cost of wholesale energy having now fallen, energy giants have applied a small reduction to the cost of energy usage, which has been welcomed by millions of energy customers. However, it has been pointed out that whilst the price cuts are good news they are only a fraction of the amount by which energy prices have been increased over the past couple of years – and the difference that the latest round of cuts will make to annual bills works out to an average of just £2 to £3 per month.

Whilst some energy consumers may have been considering switching their energy provider to get a better deal, the price reductions may have stopped them in their tracks, leading them to believe that now their provider has cut the cost of electricity of gas there is no point going to the effort of switching. However, experts have said that energy users should not become distracted by these small price reductions and should still take the time to shop around and see if they are able to get a better deal elsewhere.

Many experts have also expressed concern that whilst wholesale gas prices have fallen quite dramatically – around 27% since the summer according to reports – the benefit to consumers in the form of price cuts from energy firms has been minimal. In fact, British Gas has come under fire as it has only announced price cuts for its electricity and not its gas.

One industry expert said that the move by British Gas to cut its electricity prices but leave gas prices untouched would confuse customers, who would be left wondering why whilst some energy companies had cut the price of gas usage British Gas had failed to do so.

Experts have claimed that the economy is set to enjoy a boost this coming year, as consumers continue to receive compensation payouts from banks as a result of being mis-sold payment protection insurance cover in the past and then use some or all of their compensation to splash out on purchases. The payouts are expected to result in a massive £5 billion boost to the economy as millions of bank customers receive their payouts from the banking industry.

Any compensation that may have been due to consumers claiming to have been mis-sold the controversial payment protection insurance cover had been placed on hold until the middle of last year, as the banking industry was locked in a legal battle with the Financial Services Authority with regards to the mis-selling of the cover. The banks lost the legal battle and banks spent much of the latter part of last year dealing with claims that had been frozen and starting to make payouts on new claims that came flooding in.

Figures show that two of the High Street banking giants, Lloyds and Royal Bank of Scotland, are sending out around 50,000 compensation cheques each week, with Lloyds having a team of around two thousand working on PPI compensation. The bank has stated that it is dealing with around thirty times more complaints that it was at this time last year.

Based on various reports, the compensation payouts for the millions of PPI policies that were mis-sold could come to anywhere between £7.5 billion and nearly £10 billion. Much of this – between £3 billion and £6 billion – is expected to be paid out to consumers over the course of this year, which will equate to a huge boost in consumer spending and a knock on boost for the economy.

Simon Ward, economist at fund group Henderson, said that inflation was likely to fall over the course of this year and real incomes would most likely stabilise. He said that the boost for the economy that will comes from the compensation payouts would not be ‘a game changer’ but would definitely help.

Over recent years, we have all become used to having to pay more for our car insurance, with the cost of this cover having risen quite dramatically across the board. Like other motoring costs, the price of car insurance has put further strain on drivers who are struggling with their finances, with the fuel increases being driven by a combination of increasing inflation and high levels of insurance fraud.

While most drivers are having to cope with high vehicle insurance costs, it has been claimed that drivers who live in the north of England are really paying through the nose, with the cost of cover for drivers in the area said to have increased by more than three times the rate of inflation.

The fastest rising vehicle insurance prices for 2011 were seen by drivers in Bradford, with their annual insurance costs increasing by 17.1%. This was more than 13% higher than the national average. Drivers in Oldham saw their costs rise by 14.8% whilst drivers in Manchester saw them increase by 14.4%.

The data comes from the latest Confused.com/Towers Watson Car Insurance Price Index. The figures showed that across all age groups the average annual premium now being paid for car insurance was £844, which reflected an increase of 4.9% in 2011. For third party, fire and theft customers the increase was much higher, coming in at 10.2%.

Younger drivers were found to be paying a small fortune for their cover last year, with those aged between seventeen and twenty years paying an average £2,590 per year. The average cost of cover for those aged sixty six and over was a much lower £451 per year. For drivers with five door estate vehicles, the cost of cover also increased quite dramatically last year, rising by more than 13%.

One insurance expert said that drivers would see car insurance prices being affected by a number of things over the next twelve months, including the introduction of new EU legislation on gender, which would stop premiums on cover being based on the gender of the driver.

Payday loan firms and pawnbrokers are one of the few parts of the global financial sector to have grown during the credit crisis, as mainstream banks have increasingly refused loans to low-income customers.
Cash Converters, whose headquarters are in Australia, reported profits of $27.6 million (17.8 million pounds) for 2011, despite the global downturn in the economy. In the UK, its personal loan book grew by 746 percent to £5.0 million at 30 June 2011 and there were 100,988 cash advances made during the period, totalling 10.5 million pounds.
Due to the growth in the short-term lending market, Cash Converters plan to have 250 stores in the UK by the end of 2012, up from 206 stores currently, and the new stores will create a further 300 new jobs.
American loans firm EZCORP owns a 33 percent stake in the group.
Cash Converters stores allow customers can sell second-hand goods to get money in return. The company also has pawn broking and gold-selling services, in addition to handing out short-term loans to tide people over until their next payday. Money lent ranges from £10 to £600, and usually over a period between 2weeks and 8weeks
The sector has been criticised by some politicians for often charging exorbitant interest rates that can exceed 1,000% on loans. 34 MPs had visited his company’s stores over the last 14 months as part of steps to regulate and monitor the sector.
In response to this Cash Converters say loans could work out cheaper than taking an overdraft at a mainstream bank and added Loans usually cost between £10 and £30 for £100 pounds borrowed per month, so a £200 loan over a 30-day period could end up costing £260, however it could cost £350 pounds via an unauthorised overdraft facility.
Cash Converters’ research said this showed that while the annual percentage rate (APR) on its £200 pound loan stood at 1,413%, on a high street bank’s overdraft this could cost £350, meaning an APR of 90,888%, and banks do not have to show APR rates on their overdrafts and as such customer comparison is clouded.

At long last there is some good news in the pipeline for energy consumers in the UK after a number of major energy providers announced that they were cutting their gas or electricity prices. With many people having to fork out record amounts of cash for their energy usage, leaving them struggling financially, this news is set to be widely welcomed by the millions of people hoping to reduce their outgoings.

British Gas has recently announced that it is cutting the cost of its energy prices by 5% with immediate effects, enabling its electricity and dual fuel customers to save some money on their bills. EDF Energy recently announced that it would be reducing its gas prices by 5% in February and SSE, which was formerly Scottish and Southern Energy, has also announced a gas price cut, with prices set to fall by around 4.5% from March.

It has been pointed out, however, that despite the immediate price cuts on energy usage, the dual fuel tariffs from British Gas will still be more expensive than the tariffs of its rival providers that have also announced price cuts. British Gas currently supplies energy to around ten million customers, which equates to about 50% of the UK market but despite its huge customer base has decided that it will not be reducing the cost of gas, even though wholesale prices have fallen.

The energy giant did say that around 5.3 million people would benefit from the cut in its electricity prices, saving around £24 per year on average or £2 per month. However, this will do little to reassure confused customers who are spending a fortune on their gas bills and have no idea why energy firms are not implementing price cuts across the board given that wholesale energy prices have come down.

A spokesperson for British Gas said that the firm wanted to keep prices as low as possible due to household budgets and finances being stretched. However, he said that wholesale energy had to be purchased in advance to ensure that customers were no subjected to sudden and large spikes in prices.

The Bank of England has held the UK’s base interest rate at its record low for yet another month, with the announcement coming after today’s Monetary Policy Committee meeting. The base rate has stood at its all time low of just 0.5% since March 2009 making it close to three years where the rate has been at this level.

In October last year, the central bank also announced that it was pumping a further £75 billion into the economy as part of the quantitative easing program but has not announced any further extension of the scheme since that time. This month was no different, with no announcement from the Bank of England with regards to any plans to further extend QE.

The decision to keep the base rate on hold and not to further expand QE was widely expected by industry experts. A number of factors are thought to have contributed to the decision including the strength of the economy, weak consumer spending and the eurozone crisis amongst other things. The European Central Bank has also left its rates unchanged, keeping them static at 1%.

It is thought that analysts and economists will be eager to see the minutes of this latest meeting when they are released in order to see whether there are any clues with regards to future plans for quantitative easing. The £75 billion that was announced in October last year is unlikely to be administered until next month. However, many experts believe that once the current QE programme is complete a further £50 billion is likely to be released.

David Kern, chief economist at the British Chamber of Commerce, said that given the challenging economic environment, and the fact that these challenges were set to increase over the first quarter of this year, the BCC and other industry groups would welcome a further boost to quantitative easing in the form of a further £50 billion expansion. However, he added that in order to QE to be effective additional measures needed to be put into place to improve the flow of credit to viable businesses.

According to the accountancy group BDO, the level of fraud activity taking place in the UK increased last year, with total reported fraud breaking the £2 billion barrier. However, the group said that this was nothing compared to the amount of fraud that goes unreported.

The BDO figures showed that last year saw fraud increase by 50 percent compared to the previous year, rising to £2.09 billion. More than a third of this was said to have been attributed to tax related fraud. However, despite the high levels of reported crime, a spokesperson from the group said that at least ten times as much fraud had gone unreported.

He stated that it was important for firms to take a more proactive approach when it came to dealing with fraud, particularly given the fragile economic climate. He added that it was bad news that fraud had increased by such a huge amount but it was not surprising. He said that the economic climate meant that there was increased focus on addressing costs and because of this more and more fraudulent activity was being weeded out. However, he also said that firms needed to take further measures to try and reduce fraud levels as many firms were putting too much focus on external fraud or were not considering the huge financial implications of this sort of activity.

A big jump in fraudulent activity was seen in the retail sector last year according to the breakdown of figures from BDO. Fraud activity in this sector increased from 2% in 2010 to 12% in 2011. Around 36% of all fraud was attributed to tax fraud based on the breakdown of figures. Surprisingly, the insurance and finance sector saw its lowest level of fraudulent activity in five years.

However, BDO did express concern that the finance sector appeared to be focussing too much of its attention on addressing fraudulent activity relating to credit cards and phishing scams and were over-looking fraud related to mortgages and commercial lending, which could be very risky for the sector.

Borrowers of two lenders have been informed that their personal and financial details have been lost by the lenders, which could result in their information being misused. In the current climate, where identity theft and fraud are rife, this is news that is likely to be of great concern to the 1.4 million people who are said to have been affected.

The two lenders involved in the loss of sensitive data are Welcome Financial Services and Shopacheck, which are both under the umbrella of their parent company Cattles Group. In total the loss of data has affected around 600,000 customers with Welcome Financial Services and a further 800,000 who are customers of Shopacheck.

The Cattles Company has apologised for the incident, which is said to have occurred as a result of two storage tapes being lost. The tapes are said to have contained a range of data about the affected customers, including their names, addresses and payment histories. An investigation has now been launched by the Information Commissioner’s Office with regards to how the loss of the tapes occurred.

The customers whose details have been affected are people that signed up with the finance companies between October 2005 and October 2010. In the letter that was sent out to customers the lenders said that there was no evidence that the information had fallen into the wrong hands. However, the lenders also admitted that there was no way that they could guarantee that the day has not been or will not be used for criminal purposes and have therefore urged affected customers to remain vigilant.

The backup storage tapes are said to have gone missing from the West Yorkshire office, with the loss first being discovered in November of last year. The letters that were sent out to customers who have been affected were dated December, with the lenders admitting that it had taken several weeks to start contacting customers following the discovery of the loss. However, the firms claim that an investigation was started into the missing storage tapes right away.

It has been claimed in a recent Bank of England report that getting a mortgage could actually become more difficult over the coming months for those hoping to buy a property. The data in the central bank’s quarterly survey of lending indicated that rationing was set to increase and mortgage availability set to get worse, with more and more potential home buyers struggling to get mortgage finance for their property purchase.

It is thought that lenders could become even more stringent about who they will and will not lend to, with many expecting a tightening up of credit scoring criteria in relation to the granting of secured loans for property purchasers. With the economy still very fragile and continued volatility when it comes to property prices, lenders are having to exercise caution when it comes to lending money.

The Bank of England reported that there were a number of different factors that were set to have an impact on the cost and availability of mortgage finance, including the cost and availability of funds, expectations in relation to house prices, and the general economic climate. The central bank also said that lenders were expecting the number of mortgage approvals to fall over the coming quarter, with some lenders revising down expectations with regards to household incomes and affordability.

The banking industry has said that it recognises that this increased stringency has put some people off from applying for mortgage finance and added that over the coming months any increase in lending would be targeted towards those that were able to put down a larger deposit. With mortgage rationing having been in force since 2007 when the global credit crunch swept the UK, it seems that the uncertainty and frustration amongst those looking for mortgage finance is set to continue.

On a more positive note, lenders have reported that over recent months there has been improvement in the rate at which mortgage borrowers have been defaulting on their loans and this is something that is set to continue showing improvement in the near future.

The New Year in the UK has got off to a bad start in terms of the weather, with gale force winds across the country that have caused huge amounts of damage over the first few days of 2012. The storms and winds have affected not only homes across the country but also motor vehicles and experts are now warning both homeowners and drivers to brace themselves for an increase in premiums.

With insurance premiums, particularly on vehicle insurance, already very high, this will come as bad news for drivers and homeowners. However, insurance firms are expecting a huge number of claims over the coming weeks from people whose homes or vehicles have been battered by the stormy weather, causing thousands of pounds worth of damage in some cases.

Some motor insurance firms have already reported a huge hike in claims, with cars having sustained damage from everything from flying tiles to falling trees during the stormy weather, which is still ongoing across many parts of the country. In the meantime, AA Home Emergency Response has said that there has been a twelve-fold increase in the number of roofing claims it is dealing with, as many homes have seen roof tiles torn off in the wind.

An AA spokesperson said that such bad weather was going to do nothing to help insurance costs to come down. The company’s data shows that in the final quarter of last year, motor insurance costs remained pretty flat whilst home insurance costs increased by around 3%. The AA said that it is not expecting to see an extremely sharp increase in premiums but added that the cost of cover, such as building insurance cover, would continue to rise over the course of the year as insurance firms were expecting more frequent bad weather conditions and will need to ensure that they have the funding and reserves to deal with the claims that stem from these bouts of severe weather.

This latest weather is part of a long line of severe weather conditions that have resulted in a rise in insurance claims over recent years, with last winter having seen one of the most severe winters in decades.

Whilst many people may have thought that retail sales levels would be low in the run up to Christmas this year given the financial strains that many people are facing, one retailer has reported a dramatic increase in sales in the run up to Christmas. The figures from John Lewis suggest that consumers embarked on a spending frenzy in the run up to Christmas, which is expected at that particular time of year but also unexpected given the financial climate.

The data from John Lewis showed that like for like sales were up by 6.2% compared to a year ago, with household goods and fashion seeing very strong sales in the final five weeks of last year. The retailer also saw its total market share in electronics increase and its total sales for the period increase by 9.3%, which was an increase that was partly fuelled by the opening of several new stores last year.

Andy Street, John Lewis managing director, said that sales levels in the month leading up the Christmas Eve were ‘outstanding’ and during that time the retail giant had broken its record for the biggest sales week ever. For the week ending December 17th the company took in £133.1 million.

Whilst pre-Christmas sales were very impressive for John Lewis the sales levels have not been so strong in the post Christmas sales. The first week of the sales saw performance drop by 4.8% compared to the same period a year earlier. Executives from John Lewis have said that this was partly down to people rushing out in the final week of 2010 to snap up bargains before the VAT increase kicked in.

Rival retail giant Next has also recently reported on its pre-Christmas sales figures, reporting a drop of 2.7% in autumn and pre-Christmas sales. However, this drop was seen at its High Street bricks and mortar stores and was offset by a large increase in sales online. Retail experts are predicting that the year ahead will be a challenging one in the world of retail due to economic volatility.

Official government figures have revealed a worrying decline in the number of Brits that are saving for their retirement, with fewer than one in four Brits now paying into a private pension, which is the lowest figure for over a decade. Ministers have expressed concern over the new figures and have stated that millions of people in Britain face a bleak retirement in terms of their finances.

The figures were released by the Department for Work and Pensions, with the data revealing that the number of working people in Britain had fallen from 46% in 2000 to 38% last year. The most significant drop in numbers was amongst working peopled aged under forty. The figures also showed that men were less likely to save towards their retirement than women.

With millions more people saving for their retirement ten years ago compared to now, concerns have been raised over the financial struggles that many will now face when it comes to their retirement. The Pensions Minister, Steve Webb, said that the average number of years in retirement was now twenty three, which was a long time for people to try and cope on an inadequate financial pot. He added that the figures showed why the government’s pension reforms were essential.

Starting from next year, companies will have to automatically enrol their employees into workplace pension schemes, which will mean that millions of people get access to a pension for the first time. Webb said that it was essential that workers were encouraged to start saving for their future and their retirement and that automatic pension enrolment would bring the country one step closer to doing this.

The highest pension provision in the UK is said to be in the South East, where 43% of workers were saving into a private pension pot. Scotland came in a close second with 42% saving into a private pension fund. The lowest provision was found in London, Northern Ireland and the West Midlands, where only a third or so of workers were saving for their retirement.

It will come as no surprise to many to learn that the top resolution for 2012 amongst consumers is to get their finances sorted out. After a tough few years many people are feeling the strain financially and are determined to try and address their financial issues so that they can ease the financial pressure over the coming year.

Nearly 50% of consumers have decided that this will be the year that they will be reducing their spending and will manage their finances more efficiently and effectively to reduce their outgoings. More than 26 millions Brits were set to make New Year’s resolutions in the run up to New Year’s Day and with almost half of them resolving to sort out their money issues there will be a lot of people that will be working on their finances as the New Year kicks off.

Most industry experts are not surprised by the fact that so many people have decided to opt for improving their finances as their New Year’s resolution given the difficulties that many have been experiencing over the past year. Whilst in years gone by, getting fit and losing weight have been at the top of the list of resolutions, sorting out finances has now taken the top spot.

This year has seen around 46% of people deciding that they are going to get fit, 45% promising that they are going to lose weight and around one third planning to eat more healthily as part of their New Year’s plans for 2012. However, all of these resolutions have been pipped to the post with 49% promising to sort out their finances.

It is thought that the people most likely to start this year with the goal of improving their finances are women and people in their thirties. Many have decided that they are going to ease the financial strain by cutting out unnecessary spending whilst others have resolved to save more money this year. Experts believe that starting the year off on a positive note in relation to finances means that many consumers will be able to take greater control of their money.

Whilst there has been a lot of turbulence in the property market over the past few years, 2011 saw property prices remain relatively stable with little in the way of change. High Street banking giant Nationwide has now stated that this is a trend that is expected to continue over the course of 2012, with stagnant house prices expected for the year.

In 2011 the average house price increased by 1% according to the data although the average price fell by 0.2% in December compared to the previous month. The situation is expected to remain the same for this coming year as a result of the economic climate.

The figures also showed the geographical differences that had been seen in house price movement – or lack of it – in the different parts of the UK. For example, in 2011 house prices in Northern Ireland fell dramatically whilst in London property prices increased.

A spokesperson for Nationwide said that whilst the overall 1% increase in house prices over the past year was not a strong performance, property prices had been pretty resilient given the lack of economic growth and the situation in the employment sector. However, he said that 2012 was unlikely to be much better than 2011 for the economy and the housing market.

The average house price in the UK now stands at £163,822 and over the past three months annual price changes in different parts of the UK have ranged from a 2% increase to a 2% drop. London has seen an increase of 5.5% over the course of the year according to the figures but Northern Ireland suffered a drop of 8.7% in property prices over the course of the year.

Based on house price figures for England and Wales, the Land Registry released data showing that in the year to the end of November property prices had declined by 1.9%. This varied on a regional level from between a 5.4% drop in the North East of England to a 1.4% increase in prices in London.

As the post-Christmas sales start with many people hitting the High Street or getting online with the hope of being able to get their hands on some low cost goods from the range of retailers that wasted no time in getting their sales going as soon as Christmas Day was over. Eager consumers were hitting the shops in their droves in the early hours of Boxing Day as a range of big name retailers opened their doors with a variety of cut price goods on offer.

Many of those who shop in the sales will be feeling very pleased with themselves in the knowledge that they are saving a lot of money on the regular cost of the items that they are purchasing. However, some experts have pointed out that not all shoppers will be saving money in the true sense, as some of them may be purchasing items that they do not particularly need or want simply because they have been slashed in price.

Further concerns have been raised about the way in which shoppers will be paying for these items, with some experts pointing out a rise in high interest credit card use over the festive season. Many people will already have spent a lot of cash on their credit cards in the run up to Christmas but with the added financial burden of the money they spend in the sales, their finances could end up looking very bleak as the New Year kicks off.

Whilst some people are sensible when shopping in the sales and only make purchases that they were planning to make at some point in the near future anyway, others will simply snap up all sorts of items just because the cost of the items has been reduced. There are concerns that the amount some people have spent on Christmas and in the sales will only sink in when they receive their January card statements, at which point some are certain to realize that they have overspent hugely.

Many people across the UK who get to work by train could be facing a difficult start to the year as a result of hefty fare increases, which will leave many out of pocket. According to watchdog, Passenger Focus, fares are increasing by up to 11%, which means a hefty rise on the cost of a ticket and commuters having to cough up more money in order to get to work and earn a living.

Passenger Focus chief executive Anthony Smith said that this was a “fractured, inefficient industry” and that consumers should not be expected to keep paying for it. The average cost of regulated fares, such as season tickets, will increase by around 6% as a result of the annual rise. However, the Association of Train Operating Companies has said that the money that is raised from increased fares will help to pay for improved services.

The average increase that has been seen across all fares, which includes business tickets, advance purchases and other unregulated fares, is said to be 5.9%. Some areas have seen prices increase on a higher than average level compared with January of last year, such as Chester and Crewe, which jumped by 10.6% and Northampton and London, which jumped by 6.9%. There has also been an increase of more than 9% on some off peak fares between London and a variety of cities such as Cardiff, Plymouth and Exeter.

Whilst Passenger Focus has expressed concern about the level by which many fares have increased at the start of this year, it has welcomed the fact that unregulated fares had not been as hard hit this year as they have been in previous years. However, Smith said that the rise in fares overall would make for a ‘frosty return to work’ for many commuters following the Christmas and New Year break.

He said that the rail industry cost a lot to run but that these costs were being ‘dumped’ on passengers year after year, which is something that had to be stopped. He also praised some train companies that were offering direct debit schemes for season ticket purchasers so that the cost of travel could be spread.

In the current economic and financial climate many lower income families are being forced to look at alternative ways to get the items that they want or need for their home, and one of the ways in which many have been doing this is by going through rent to own lenders, where they make weekly payments on the items that they want for a specified period of time before they finally own them. This includes everything from DVD players and televisions to beds, settees and kitchen appliances.

However, one charity has pointed out that whilst it is the most financially vulnerable that end up opting for these deals, these are the people that are ending up paying way more than they should for the items simply because they are forced to go through rent to own lenders rather than being able to buy outright from High Street retailers.

According to Barnado’s, action needs to be taken by the Office of Fair Trading to address what it described as a ‘morally bankrupt’ society. The charity used the example of a three year rental deal with a weekly payment store for a fridge freezer, which would result in the consumer being charged a total of £1,074 for the appliance rather than the £430 that the same appliance cost on the High Street. The charity claims that some consumers are paying up to 150% more for the items that they rent to own and that vulnerable consumers are being preyed on by such companies.

Whilst the Office of Fair Trading has said that it does not have the authority to make changes to the rent to own market, Barnado’s has said that consumers continue to be lured into a debt trap in an already difficult financial climate, leaving them increasingly worse off when it comes to their household finances. The charity said that the OFT needed to protect vulnerable families from being “unwittingly pushed further into poverty by compelling these unscrupulous lenders to make clear their extortionate rates”.

The Financial Services Authority has recently confirmed that more than £1 billion has been paid out over the course of this year in Payment Protection Insurance compensation. Following the loss of the court battle over PPI compensation, banks and financial institutions have had to deal with former claims that were left pending as well as new claims from those who believe that they were sold this controversial cover unfairly.

The FSA figures show that more than £1 billion was paid out in the first ten months of 2011by sixteen firms, which accounted for 92% of PPI complaints in the first half of the year. In October alone the amount of PPI related compensation that was paid out came to £268 million, which was the highest monthly total in the first ten months of 2011.

PPI was designed to protect borrowers in the event that they were unable to earn their income and make repayments on their debt due to redundancy, sickness or injury. However, investigations discovered that the cover was mis-sold to many people in a number of ways such as being sold to those that could never make a claim on it or being added to finance without the knowledge or express wishes of the borrower.

The banking industry lost its High Court case over PPI compensation in April and then had to deal with around 200,000 complaints that had been put on hold until the court case had been concluded. The banks were given until the end of August to deal with the complaints by either offering compensation or by rejecting the complaints.

Since then, complaints over PPI mis-selling have continued to come in from borrowers who had taken out finance over recent years and claimed to have been mis-sold this cover in some way, thus demanding compensation. Some of the big name High Street banks have had to pay out a fortune to those that have made claims – and the tax office has also taken its lion’s share, earning millions of pounds from the interest paid on the compensation payouts.

In the run up to Christmas this year data showed that people were withdrawing more money from cash points than in the run up to Christmas last year, indicating that despite the difficult financial climate many people were still determine to have a fun time over the festive season and continue spending money on making purchases for the festivities. The data was released by the ATM cash point network Link, which monitored the amount being withdrawn from its cash point machines over the month of December.

Between the start of December and just before Christmas the amount that had been withdrawn by customers from the Link network cash point machines stood at £7.6 billion, which reflected an increase of 7% compared to the same period in December 2010. With Christmas shoppers appearing to withdraw more money from cash points this year in the run up to Christmas it appears that many were determined not to let the turbulent financial climate spoil their festive fun, although part of the reason for increased withdrawals may have been down to the increased prices of purchases for Christmas.

The head of the Link network, John Howells, said that the level of withdrawals from its cash point machines last year may have been affected by a number of different factors, which included the extreme cold weather and snow that we had in the run up to Christmas 2010. This impacted heavily on the ability of people to go out and shop for goods in the run up to the big day, thus also impacting on cash withdrawal levels. He said that this year had been mild in terms of the weather, resulting in some ‘big daily swings’ when it came to cash withdrawals.

He added that this December there were some days where the level of cash withdrawals was lower than the same days in 2010 but other days where the amount of cash being withdrawn via its network was much higher than the same days last year. Link network machines make up around 70% of cash point machines.

This year, like most other years, many people will be surrounded by a variety of Christmas gifts from loved ones. Some of these gifts will be ones that the recipient was hoping for and is delighted with but there may be others that the recipient will probably never use.

For those that have found themselves with a lot of unwanted gifts this Christmas there are a number of options available to save the home from being cluttered with unwanted items – and some of these could help consumers to make a little extra cash or to save money.

One of the things that can help those with unwanted to gifts to make some money is to sell their unwanted gift using one of a range of platforms. Selling them at a garage or car boot sale will help to make a little cash but if the gifts are new and in good condition there is probably more money to be made by selling them online.

Many people decide to do this after Christmas because it not only enables them to make a little extra cash but it also helps to avoid having rooms or cupboards full of items that are new but will never get used, which is a waste of space and money. By selling these items consumers can get rid of this clutter and make a little cash into the bargain.

Another option for recipients of unwanted gifts is to re-gift them, which is basically to rewrap them and give them to someone else as a gift. This means that the cost of having to purchase another gift is avoided and the home still does not get cluttered with unwanted items. Some people re-gift these items to friends or family that they are seeing between Christmas and New Year whereas others will save them and then hand them out at birthdays or even next Christmas.

For those that want their unwanted gifts to really benefit someone, there is also the option of giving the gifts to charity. For charities this can mean an influx of new items coming in to sell in their shops or online in order to raise money for the cause.

According to government plans, controversial surcharges that are applied on credit and debit cards when making a range of purchases are set to be banned in the UK by the end of next year. These charges are applied when purchasing a range of products, such as airfare or cinema tickets, and the surcharges can in some cases end up being quite hefty, bumping up the cost of the purchase for the cardholder.

These surcharges have caused a lot of controversy over recent years, with many consumers and consumer campaign groups demanding to know why some retailers are charging these fees. Even councils have been accused of charging excessive fees on card transactions and this, along with the myriad of other firms that do the same, has led to a number of complaints being made.

Companies are able to charge a payment processing fee to consumers and this will be allowed to continue after next year. However, firms will only be able to levy a small charge for this fee – at present many are concerned that the amount that is being charged to consumers is excessive and far higher than the payment processing cost that is incurred by the various companies.

Amongst the companies that have come under fire and investigation over their surcharges are airlines, particularly no frills airlines such as Ryanair, which has become well known for adding one charge after another after enticing in customers with low headline prices. For customers who are paying for their flights online or by phone there is no other choice but to use a plastic card for payment, which means that the surcharges are unavoidable unless using specified Ryanair payment cards.

Some shoppers have found that they have gone through and completed up to eight pages of a booking or purchase via a website and only then have the costly surcharges been added, resulting in them having to simply accept the charges to go ahead or admit defeat and end up having wasted a lot of time by not completing the transaction after spending so much time on it.

HM Revenue and Customs has reported that November saw the highest monthly level for property sales so far this year, with 85,000 properties being sold during the course of the month compared to 79,000 for the previous month, reflecting an increase of 6,000 month on month.

Whilst the relatively significant increase in property sales between October and November has been seen as encouraging, HMRC did point out that for the first eleven months of the year properly sales on a monthly basis had been lower than monthly sales seen in 2010, as the market continued to struggle.

Continued restrictions on mortgages coupled with high deposit demands and economic uncertainty have held the housing and property sales market back for the past few years, since the onset of the financial crisis back in 2007. This was further aided by those selling their homes refusing to drop the asking price despite the fact that their property values had fallen.

The property sales figures for November of this year have, however, brought a ray of light to the property market, with figures showing that the sales figures were not only up by 6,000 compared to October of this year but that they were also up by 9,000 compared to November of last year. In fact, the monthly total for November 2011 was the highest since July 2010 according to the data.

In the first eleven months of this year there were a total of 787,000 sales according to the HMRC figures, and this compared to 810,000 sales for the same period last year. The November sales figures will provide a much needed boost to the annual sales figures for the property market.

Stifled sales have been largely down to the difficulties that many have had in terms of getting an affordable mortgage over the past year or two, although many believe that the situation is becoming a little easier now. For first time buyers in particular, who have always kept the property market buoyant, being able to get a mortgage without a hefty deposit has become increasingly difficult, forcing many into renting rather than buying.