Top money stories - 21st - 27th January 2008

Top Tip:

If you are filling out a self-assessment tax return for the 2006/07 tax year the deadline is 31st January! Failure to meet this deadline will result in a £100 penalty with an additional £60 per day. To find more about self-assessment tax return go the HMRC website.

Research by RAKM for, a financial information website, has revealed that taxpayers are expected to pass £463 million to the government due to late returns, miscalculations and surcharges on unpaid tax. Act now or risk being one of those who gets caught out.

Monday 21st January

Record savings in building societies – The Building Society Association revealed that a record £16.1bn was deposited in building societies in 2007 – almost double the inflow in 2006. While some of the increase came as a result of the run on Northern Rock, some of the increase has been attributed to an increased willingness to save. As the economic climate remains uncertain, now is the time to get saving if you haven’t already. We could yet be in for a year where financial conditions improve but, at present, the signs are that we should be preparing for the year of low or negative growth. Hence get saving now. A little bit of short-term pain (by cutting non-essential spending) and can lead to long-term peace. Moneybasics is a great first stop for Savings help.

Tuesday 22nd January

Price comparison websites to be scrutinized – The Financial Services Authority (FSA), the UK financial watchdog, is going to examine whether or not price comparison websites ‘offer advice’. There are strict regulations constricting those who ‘offer advice’. This investigation was launched because many of the current price comparison websites available on the market are built based on financial assumptions. The financial assumptions used are made based on opinions about how to get the best deals. The FSA aims to determine whether the fact that the prices comparison websites use these assumptions means that they ‘offer advice.’

This piece of news serves to highlight a recurring suggestion on the Moneybasics website that it is important to have a look at two, if not three, price comparison websites in order to try to find the best deal for your circumstances.

U.S. interest rates slashed by 0.75% - The U.S. Federal Reserve cut interest rates by three-quarters of a point on Tuesday. This was a shock to the market and initially helped stock markets around the world to recover lost ground. The cut should help to reduce the burden of high interest rate repayments for borrowers. This is a dramatic move to try and help stimulate the economy and ward of a recession in the U.S.

Wednesday 23rd January

Economy grew at the rate of 2.9% at the end of 2007 – Gross Domestic Product (GDP) growth in the 4th Quarter of 2007 (Oct – Dec) was 2.9% on an annualised basis. This is encouraging news and serves to support Prime Minister Gordon Brown’s statement that the UK is “well placed” to deal with the recent falls in leading stock markets around the world.

Thursday 24th January

Mortgage approvals at record low – Mortgage approvals for December 2007 fell 37.8% according to the British Bankers’ Association. The fall indicates that lenders are continuing to tighten the purse strings, limiting the ability of many to take out mortgages.

Prepared for Moneybasics by Jason Taylor, Advocacy Officer (Credit Action).