Folks. I apologise for the lack of posts lately. Suffice to say I have been having a war with TalkTalk (my ISP) the last few weeks. They refused to believe I didn’t have access, and only finally resolved the situation this morning.
Dreadful dreadful service… but you get what you pay for. *ahem*.
Normal service will resume shortly.
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Every Friday I publish “Frugal Friday!“, an open-ended series with some of the simple and best ways to really save you money both now and in the future.
This Friday I am concentrating on reducing electricity bills. Here in the UK winter-time is traditionally the time of higher energy usage: the elderly use electric blankets, whole families have home lighting left on for longer as British Summer Time draws to a close, and we are generally stuck inside for the evenings more often requiring entertainment.
There are some simple steps you can take (and some cool gadgets you can buy without guilt!), to help lessen the impact of this seasonal increase in our home carbon emissions courtesy of our electric usage.
Before last year, there was massive competition in the domestic supply market with various “lock in” and “fixed” deals. You may well have switched, I know I did. The fix on those tariffs has come to a close now though and prices are floating upwards so it’s time to get switching again.
There are hundreds of sites that will likely find you something cheaper; some good starting points are GoCompare, CompareTheMarket, and uSwitch. Don’t forget to finally go via QuidCo to get any cashback available, too!
Fairly obvious this one, and easy to achieve. Morrison’s just last week had an offer on of 4 for £1, and not low-quality either. As the nights get longer, more retailers will be trying to tempt us, so keep your eyes peeled. Even if you pay full price for them though you will still make a saving. The average bulb lasts for 5 years of normal use and consumes between 11 and 17 watts.
By switching all the bulbs in your house to low-energy equivalents, you could save around £112 a year and up to a whopping £307 over the life of a typical 8,000 hour bulb.
When you leave a room, turn the light off. Sounds so simple but take a moment and think – in the depths of winter – how often do you walk/drive/cycle around and think half of the houses you come across look like they are attempting to imitate the Blackpool Illuminations? Why pay even a reduced amount to keep an unoccupied room lit?
This can be a challenge with children, but with a little perseverance even the family dog can probably manage to turn the light out when it has finished in the kitchen. Your moody teenager may require slightly more effort.
Televisions, DVD players, computers, Satellite, Cable, modems, microwaves, food mixers, video recorders, printers, even modern intelligent washing machines and dishwashers. It’s amazing what has a ’standby’ mode these days. When standing by, ready for action, these devices are still sucking electricity and adding to your bills yet giving little to no benefit. Switch them off at the wall when you are done using them and again save upwards of £50 over the course of a typical year.
The Bye Bye Standby Energy Saving Kit
Last year, I got an Owl Cm119 Wireless Electricity Monitor
As convenient as the tumble-dryer may be, it costs pounds to use every time. Pop the clothes out on the line if the weather is nice and get nicer clothes that last longer, dried for free courtesy of mother nature. Even if it is windy but lacking in sun you’ll be surprised how quickly clothes can dry in the open air.
If your freezer requires it, keep it defrosted regularly. Any build-up of ice means it has to work harder, consuming more electricity. If your fridge is regularly half-empty or more, fill it with water-filled bottles. These will help keep the inside temperature stable and reduce the effects opening and closing the door have. If your appliance(s) are older, when replacing ensure you get A-rated.
Never put warm or hot items in your fridge or freezer, either. Not only will this play havok with the internal temperature, it can take hours for your appliance to restore the previous temperature and damage food already within as well.
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Every month I calculate my net worth and then publish it. While the exact figures of my wages are not disclosed, what it does to my net worth, is. This month I am so close … !
Where I work we receive our overtime 1-2 months after we actually work the hours, due to how the payroll operates and how claim cut-off dates affect claim periods. Therefore this month I am seeing the fruits of my labour from the last part of August and the beginning of September.
The graph speaks for itself.
The last little bit is just there to tease me I am sure. Flicking back through my budget for the previous 10 months there are so many places I could have shaved off that amount if I had really, really put my mind into it just a few more percentage points. If I hadn’t gone on holiday to Cyprus in April, for example. Sure the holiday itself was free – no flights or hotels to pay for – but I took over £1,000 in spending money and guiltily spent the lot.
But, there is little point in crying over spilt milk. What is done, is done.
According to one (of my many) mighty spreadsheets, this means next month is freedom month – assuming my car does not blow up in the meantime of course.
You may remember that last month I was going to attempt to make an additional £1,252.16 to bring forward the pay-off date a month nearer still. I nearly made it, but fell short by £653.58 as can be seen above.
Darnit.
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There are a few interesting differences between the way English banks and American banks seem to function on a day-to-day level. I have been trying to decide which is best, but I have come to the conclusion that ultimately each has its good and bad points.
In America, it seems to be quite unusual to have an ‘agreed overdraft limit’. Rather, a checking (current) account holder can have ‘overdraft insurance’, which seems to cover short-term budgeting errors.
Overdrafts are abused in England; some people take them as extensions of their paycheck and routinely ‘live in their overdrafts’, to the point that a paycheck merely takes them back to £0, before they start downwards into it again. Some don’t even make it back that far up the ladder month to month.
Banks love this of course. The interest charged can be as high as 30-odd percent, or in the case of the HBOS group, £1 per day in lieu of interest. Add that up over the course of a year or more and that is serious money being thrown down the drain for what is nothing more than dreadful money management skills.
My agreed overdraft is £1,500, and the first £250 of that is interest free. I haven’t entered it since January, but it is handy buffer for budgeting errors. The £250 interest free part comes with the account that I have, but the additional £1,250 beyond that just grew over the years with my account; Every once in a while they would push it a little further. It seems to have finally settled at the figure it is on.
Peculiar to my bank there is also a facility beyond the arranged overdraft called ‘Personal Reserve‘. It’s a £500 overdraft after your overdraft. Horrible little thing, it costs £22 per day to go in it, but I suspect if you need it, then it is handy to have.
Another thing I find peculiar about the American banking system is fees for using different banks’ ATMs. I have never been charged anywhere in the UK for using an ATM that didn’t belong to my bank – beyond those convenience stand-alone ATMs you find in small shops.
This could just be scale. The UK ‘grew up’ as one large piece of infrastructure, whereas America has been hacked together by different institutions in different states at different times. Or is it just one further method of extracting money from the unwary consumer?
I have written precisely 1 cheque in the last 5 years – no kidding! Cheques are pretty much extinct here in the UK. Shops have all but stopped accepting them as a form of payment. Yet I have never heard of a personal banking customer in the UK being charged for cheques - this seems ‘the norm’ in the US? Companies such as Checks In the Mail even seem to print cute designs on them.
Various blogs extol the virtues of using this system, and if you’ve only had doing the cheques yourself as prior experience, then I can understand. But it seems lightyears away from our Direct Debit system. If the company you are paying isn’t wired into the bank, the bank physically print and mail the cheque? Amazing.
Direct Debit while appearing insecure on the outside, is actually quite brilliant. Take my credit card as an example:
When I got it, I ticked the box on the online account to set up the direct debit. I punched in my bank account and sort code, and set to pay £120 a month. Just this month, it’s now set to “pay in full”. I could equally set it to “pay the minimum” or somewhere in between. The billing party then submits a Direct Debit request through the banking network, and my bank sends – electronically – the amount requested.
If anywhere along the line there is a screw-up, the Direct Debit Guarantee immediately resets the transaction. I can cancel the Direct Debit authorisation at any time from my Online Banking menu, and ultimately, it’s a stroke of genius.
About the only thing you cannot set up a Direct Debit for in England is your groceries.
It seems there are banking fees abound in America – even if you run your account right. A fee for even just having a checking account. A fee for checks. A fee for a debit card. A fee if you go over a certain number of transactions. A fee if you have less than a certain amount in your account. A fee for this, that and the other.
I am shocked by this. About the only fee I have paid in the last 10 years for banking has been the odd bit of interest for going into my overdraft here and there. I’ve never paid for cheque books, debit cards, the account itself or anything else.
Perhaps I am just viewing the UK system with rose-tinted spectacles, or the US system isn’t nearly as bad as some blogs make out. Or, perhaps, I’m spot on; in which case, for once, I am glad to live in the UK!
I’m sure at least one of my American readers will set me right soon enough if I have got it wrong. 
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One of the more common themes among personal finance bloggers, is most of us have been or currently are, working our way out of debt. Some of us are nearly there (like myself), some are a little further away but doing equally as well, and some are still dreaming about the Debt Free Day.
The commonality between us all, regardless of race, colour, country or method, is the desire to do it, and the desire to blog about it. And if we’re honest, the running cost of a blog done properly, isn’t all that cheap. Especially for those on a real tight budget.
So I was thinking the other night what I could do about it. I rent a whole server, technology is one of my weaknesses and I love not having to trust any other monkey to do what I can do myself. But this also gives me flexibility, and more CPU cycles than I need for just my few sites and blogs.
I am offering to provide the web space to host a personal finance blogger with a negative net worth. When you escape from your debt, then we shall rejoice – but you are still welcome to remain. The only real ask is that it’s used to host WordPress and your Personal Finance blog. The technical nitty gritty: Up to 1gb of disk space, 1 MySQL database, ssh/scp access (sorry, no ftp), DNS if you can’t find it for free elsewhere, and I’ll set up Google Apps for you if you need email.
Leave a comment with your blog URL, and I’ll come have a read. The story and background and current needs that touch me the most, shall be declared the winner. I’ll leave the contest open for a while, so if you know of bloggers who might benefit from this, get them to drop in and say Hi.
Sure, I know you can get hosting for like a dollar a month, but is it good hosting? Sometimes, that dollar might be important and better spent elsewhere. You cannot beat free, after all. I believe in helping others, and that is sometimes done in unusual ways.
I might get no responses to this – or I might be surprisingly overwhelmed – but if I didn’t offer it out there, then I might never know how much proper hosting for a hobby they can’t really afford, really means.
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Five Pence Piece is a British man's blog about personal finance, saving, investment, debt and frugality.
Most popular blogs that discuss these topics tend to be Americentric. The general advice holds fine but when it comes to discussing specific products, it begins to cause issues. Hopefully Five Pence Piece will bridge that gap.
