Friday, 29 July 2011

Motor insurance premiums fall for young drivers

Car insurance premiums for younger drivers have fallen for the first time in two years, according to figures released today.

Young man in driving seat of car - Young drivers left in limbo by insurers
Motor insurance premiums fall for young drivers 
According to the AA's British Insurance Premium Index, the cost of insuring drivers aged 17-21 fell by 5.6pc during the last quarter, bringing the average annual premium to £2,294.
Simon Douglas, director of AA Insurance, said young drivers have for a long time been the biggest losers in the insurance market with premiums driving them off the road.
"Premiums have been rising at a disproportionate rate, but it seems at last that insurers are starting to compete a bit more for their business with rates starting to come down," he said.
Premiums have always been higher for young drivers, due to higher risk or traffic accidents. According to road safety charity Brake, one in five new drivers has a crash within six months of passing a test and newly qualified drivers are more likely to be involved in a traffic accident during the first two years after passing their test.
But it is young male drivers that pose the biggest risk figures from the charity show that 74pc of deaths among young adults are now on the road, and in 2009, more 16 to 19 year-olds died as passengers in cars than those who died as drivers.
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However, Mr Douglas warned that with the end of gender-based pricing in December 2012, young women under 25, who typically pay premiums up to 40pc less than their male counterparts, can expect to see a sharp rise in the cost they pay for their cover.
Premiums for the rest of the market have shown signs of levelling off, with the average cost of an annual car insurance premium increasing by 3.6pc over the last quarter to £923.90, the lowest rise for 18 months. However, premiums overall are up by 30.1pc since last year.
"This is the smallest increase we have seen for some time, and I believe that over the rest of this year we will at last see premiums level off, despite the gloomier predictions of other market commentators," said Mr Douglas.

By The Telegraph

Tuesday, 26 July 2011

Best five-year fixed rate mortgage breaks through 3.5% barrier

The best five-year fixed rate mortgage has been slashed to below 3.5 per cent by Yorkshire Building Society – delivering further good news to borrowers hunting security.
Cheap money: The best five-year fixed rate is now 3.49%
Cheap money: The best five-year fixed rate is now 3.49%
The 3.49 per cent five-year fixed rate mortgage from YBS is on offer to borrowers with a 25 per cent deposit or equity and comes with a fee of £995.
Borrowers who would prefer not to pay for their new mortgage can secure a 3.69 per cent five-year fixed rate, which comes with a £95 fee but £250 cashback.
The cut marks the latest stage in a renewed battle for borrowers from lenders, with rates having fallen substantially in recent months. In March the best five-year fix on offer was from Nationwide at 4.39 per cent.
YBS has also cut the rate on its two-year fix mortgage to 2.59 per cent, or 2.79 per cent on the lower fee option.
The driving force behind the fall in fixed rates has been the horizon for interest rates rising from 0.5 per cent being pushed back substantially.
This has come as the recovery has struggled, eurozone debt crisis fears have hit and the Bank of England has signalled that it intends to keep rates lower for longer to protect the economy.
Interest rate futures have seen a big shift in recent months and now point to September or October 2012 for the first base rate rise. 
However, these market predictions are very volatile and just earlier this year they suggested a rate rise was imminent to counteract high inflation, driving up fixed rate mortgage costs.
Since then money market swap rates, which heavily influence fixed rate mortgage pricing, have fallen to 2.3 per cent on 21 July, having hit 3.2 per cent in February.
Thanks to this there are now a host of five-year fixes below 4 per cent, mainly for borrowers who can raise at least a 25 per cent deposit. 

It's cheap money and rates may not go lower


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This is Money's Simon Lambert says: This is a fantastic five-year fixed mortgage rate from YBS. Borrowing money for that period at 3.5 per cent is cheap and the 25 per cent deposit requirement and £995 fee are not overly onerous requirements.

Those looking for fixed rate security would do well to consider this. 
Borrowers may be tempted to sit on the fence and hope rates go lower still – they could do so, but the same approach left many disappointed that they didn’t seize the great fixed rates that were on offer last autumn. 
These swiftly vanished when the mood changed and remember that any signal from the BoE that it has had a change of heart and mortgage lenders will take advantage by raising fixed rates. Bymailonline)

Wednesday, 6 July 2011

The high price of a single life... £3,500 a year more than if you are hitched

Being single costs around £3,500 a year more than being part of a couple, research shows.
Rising utility, council tax and food bills in particular are hitting Britain’s 19million single-person households harder than those with partners and families.
And with a growing number of divorced, elderly and other people choosing to live alone, more Britons than ever are feeling the strain.

Living alone costs just under £14,000 a year on average, including essential bills and non-essential items such as nights out or going to the gym.
But for those living in a multi-person household, the figure falls to around £10,500, the study found.
This is because utility bills, council tax and other outgoings such as petrol are more likely to be shared.

If the figures did not include non-essential items, the gap would be more like £5,000, the researchers said.
Those living in couples or families tend to spend more on going out and clothes, for instance, possibly because they have more disposable income as a result of other bills being smaller.
Singletons have to pay an extra premium for food, the study found
Singletons have to pay an extra premium for food, the study found
The study by Co-operatives UK, a group made up of the country’s various co-op societies, found that essentials take up 51 per cent of the income of those living alone, on average.
But for those living with others, essentials take up just 30 per cent.
The figures are based on Government cost of living statistics and a survey of 1,000 adults.
The number of people living alone  is rising by around 145,000 a year, according to official statistics. In large part, this is down to an increasingly ageing population.
Ed Mayo, secretary general of Co-operatives UK, said: ‘Everyone is experiencing greater pressure on household budgets.

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‘But people who are living alone are suffering more than most, at a time when there are more single households than ever before in the UK.
‘Whether you live with friends, family or a teddy bear is a personal choice, but there is a growing recognition, whether it is your home, food or car, that it is cheaper to share.’
Some of the extra burden of living alone could be shared with simple measures such as pooling car journeys or taking in a lodger, he added.
The study found that single people have to spend about £7,400 a year on housing. Those living with other people spend just £4,000.
When it comes to bills, singletons spend £3,200 a year and others spend £2,000.
Single people spend nearly £2,000 a year on food on average, compared with around £1,500 for couples.
On non-essential spending such as socialising, single people spend £738 a year. Others spend £1,174.
And while single people spend £717 a year on their appearance – clothes,  haircuts and going to the gym, for  example – those with families spend nearly £2,000.