Things I Did

Our two week holiday to Mexico was one whirlwind of an adventure. The first week was crammed full of action packed activities:

• Diving the Cenotes – We managed to cram in 6 Cenote dives, ticking off one item on my bucket list and taking me a few steps closer to another; becoming a PADI Divemaster (Read about Grand Cenote and The Temple of Doom)
• Swimming with Dolphins / Manatees / Sealions
• Took a Catamaran trip in the Caribbean Sea
• Visited the Chichen Itza and Mayan Ruins

Our second week was spent taking full advantage of our 5 star all-inclusive hotel and the facilities. With over 20 different restaurants, we were definitely not short of variety! I even managed to continue with the Tough Mudder training and ran 5 miles every second day. This probably cancelled out the excessive amounts of food and drink that were consumed If you want to see the hotel you can check it out here.

Things I Read

Time spent in the air meant that there was time to read! Making it two months in a row, I got my head into another book:
Abraham Lincoln Vampire Hunter

I’m not normally a fan of any book about vampires, but this book really made an impact! Without ruining it for you, I have been looking at the world slightly different since reading this

What I Watched

Once again, we watched a massive mismatch of shows. May’s flavor of the month was Game of Thrones Season 1. It has been on my list of shows to watch for months and we finally got going with it. Needless to say, we are officially addicted and blasted the whole first season out in about a week!

I know I am probably preaching to the choir, but this show rocks!!!

What I Cooked

To be totally honest, most of this month was spent appreciating other people’s food…. The time spent in the UK was unsurprisingly filled with BBQs, with Pork Ribs definitely the favourite! We are trying to reduce our meal portions for the summer and perfect buying the ‘right amount’ of food. We already waste a minimal amount, but there is always room for improvement. Making soups with leftovers is not so appealing in this hot weather!

What’s new with you?

One such luxury that can often be overlooked in times of frugality is boiler cover. While there is plenty of boiler insurance information online that helps to explain just how little it costs, it is often put off by homeowners looking to save a few pounds. With a range of price plans available at British Gas, boiler cover can start at just £4 a month, covering any boiler repair you may need in the future, while you can also include an annual service for a few more pounds a month. It’s understandable that families are trying to save money wherever they can to make their life a little more comfortable during the economic downturn, but should that mean forgoing boiler cover?

It’s certainly not for everyone but there are plenty of good reasons why boiler insurance should be considered to help protect your home. While it’s often unnecessary for tenants in rental accommodation, homeowners who have the responsibility to maintain their property may benefit from specialist insurance such as boiler cover.

The Unpredictable Weather

Unfortunately, our English weather isn’t the most predictable of things and no sooner do you get used to a heatwave, do you then wake up to a torrential storm. The winter, in particular, can be horrendous at times and sub-zero temperatures can really take their toll on boilers. While an annual service will help to keep your boiler shipshape, an insurance policy will help to protect you should it break down for whatever reason.

Can you imagine your boiler packing up during the winter months or God forbid, just before Christmas? Repairing a boiler isn’t cheap and replacing it is even more pricey – something that can be avoided if you have the necessary insurance. According to uSwitch, over a fifth of homes had a boiler break down over the winter in 2012, costing, on average, £320 – much more than a few pounds per month, right?

The Home Insurance

It’s sensible to check your home insurance policy before you do invest in any additional insurance packages – boiler cover, or otherwise. There’s little point shelling out more per month if you’ve already got the cover as part of your home insurance policy.

If you find that your home insurance doesn’t cover your boiler, this is where the specific insurance comes in handy.

No Hot Water!

If you have a combi boiler, you’ll know how annoying it can be waiting for the boiler to heat up the cold water so you can take a shower or enjoy a bath. Imagine the rigmarole if the boiler clapped out and you had no hot water at all!

Boiling water to wash yourself and wrapping yourself up in blankets because your boiler has broken is definitely not an enjoyable experience. The huge costs of fixing the problem can be avoided with boiler cover.

The Cold Home

It’s not too bad during the summer months, when the natural sunshine will help to keep the residual temperature of your home higher, reducing the need for your central heating but the same can’t be said for the colder days. If your boiler breaks and you can’t afford to repair it, who knows how long you’ll have to deal with the cold before you find the funds. Wrapping up warm and snuggling under blankets only goes so far.

The Price

Best of all is the price of boiler cover. Depending on the provider you choose, you can secure a boiler insurance policy for next to nothing. While you may be trying to tighten the pursestrings in every way you can, with cover starting at £4 a month, it’s certainly not going to affect your budget too much.

Not all insurance cover is necessary so before signing into a contract, make sure you definitely need it.

Frugality

Despite ranking number 2 on the Forbes world billionaires list, Warren Buffet is arguably the thriftiest of them all. He is the one of the world’s richest persons who has been living in the same home for more than 50 years. His Omaha home has no gates or fence. In an apparent aim to show some type of ‘global reach’, many millionaires today, would get one of their first toys- a business jet.

Buffett owns NetJets, the largest private jet-sharing company in the world; but he does not own a jet for himself. This great economic sense has paid off for him in his many business acquisitions and the growth of his main company-Berkshire Hathaway.

Hiring

Following Buffett’s hiring lessons, it might be easy to point out the smartest, quickest or the one with the Ivy League certificate. But is he or she right for the job? Warren Buffett suggests selecting the one with the right habits for the job. This could be an important point when choosing your next hire.

Living Your Life

Buffett is undoubtedly ‘old school’. Warren Buffett likes technology and has invested in quite a handful of such firms. Nevertheless, he does not own a mobile phone. Successful entrepreneurs like Buffett, including the ‘new school’ ones value the importance of being oneself and not trying to live to impress external influences.

It is a lesson that living to please others at the expense of who you truly are, could be a road to failure.

Doing the Job you Love

This could be most interesting lesson from Buffett. It looks simple but it could come tough on many folks today. Warren Buffett bought his first plot of land at the age of 14 and from his earnings selling newspapers. His love for business and any great stock took hold from that time and it is has reflected till now. In Buffett’s perspective, rich people will still go to work because of what they love doing.

The Right Association

A few years ago, Warren Buffett met with Microsoft founder and world richest man, Bill Gates for the first time. Bill scheduled for a quick 30-minute meeting but that meeting ended up lasting for 10 hours. The two billionaires shared common interests and passion. Warren Buffett’s heroes who helped him in developing himself include his dad, Katharine Graham (former chief editor of The Washington Post) and his first wife, Susan.

Buffett’s advice for entrepreneurs often is that, “When on a career path or business decision, move with people with whom you have common goals and who love what they do.”

Great Habits

Good habits are cultivated and developed until they appear perfect. A life lesson Warren Buffett gives is about developing good habits especially those of generosity, cheerfulness and giving other people credit. These look unimportant but they are vital in building any great personality and company. Warren Buffet does regular charity lunch auctions.

He and his Berkshire Hathaway company are active donors to the Bill and Melinda Gates Foundation, Smile Train, Glide and Make-A-Wish Foundation among others. Buffet claims to be an introvert who has battled communication issues in the past but he is one of the few billionaires today who mix public speaking with a good sense of humor.

Warren Buffett is one of the world’s most prominent investors with his net worth equivalent to about 3% of the Californian economy. He never claims to have achieved the feat all by himself. He often gives his team credit. He spends money wisely and not to impress anyone. His generosity extends beyond the United States.

He partakes in poverty and health-related charity work in poor countries. This great sense of discipline has made Warren Buffett have some experience-based lessons to mete out, that could give the younger generation the thrust to even bigger goals.

My name is Kevin Watts and I am the creator of Graduating from Debt. I was like millions of recent college graduates in heavy debt with very little hope. With the right attitude and discipline I took control of my financial picture and now I can say proudly that I am debt free.

 1.     Getting started is easier than you think

It’s relatively cheap to set up your own business, with prices starting at less than £20 at The Formations Company to register your company name. You can also buy bigger packages with training, board minutes and much more to help you in your first start up.

Make sure you get in touch with HM Revenue and Customs too, where you can declare yourself as a business owner and make sure you’re paying the right taxes to the right people.

2.     Don’t use recruitment agencies at first

They can be costly to use, especially if you’re hiring your first member of staff. Have a look around your local area to see if there are any networking groups or jobs boards that specialise in your industry. Don’t be afraid to ask around on Twitter, Linkedin, Facebook and face-to-face too. Hiring freelancers or contractors can also be a good money-saver if you don’t have a regular stream of work or the need for a permanent member of staff.

3.     Set up some social media accounts

Use Facebook, Twitter, LinkedIn and Pinterest to set up social media accounts on behalf of your business. People are increasingly reverting to social media to contact companies about doing business or to ask a question about a service you may offer. Getting these accounts set up straight away shows how available you are.

4.     Market yourself accordingly

As well as using social channels to market yourself, remember to get a good website in place, invest in advertisements online and offline and shout about your new venture. While you may have a business plan in place, a bit of good old fashioned marketing will only help to boost your customer base and get people talking about you.

5.     Get an accountant

Unless you’re an accountant yourself, an accountant will not only sort out all of your finances, they will advise you on the best places where you should save money and when you should spend your money too. Make sure you work with an accountant who is a specialist in your area of business, and preferably one who is local too. It makes it so much easier when April rolls round and you have to have all your finances in place for the new tax year.

You should also shop around for the best business bank account, as some banks will offer you special deals such as insurance and other benefits if you’re a new enterprise. Business bank accounts usually come with their own financial advisor too, ensuring that someone is always keeping an eye on your business accounts.

6.     Be insured and be licensed

If you’re running a business that requires a licence, particularly in the food and drink sector, make sure that you have these licences in place before going into business. In addition to this, depending on the type of business you’re running you may need to get a specific type of insurance, especially if you expect to welcome members of the public into your business establishment.

The key thing here is to know the areas of the law to do with business you are running and make sure you are adhering to it before opening your doors. The government’s website has a coherent list of all licences available, but it’s highly recommended that you go and visit a solicitor with your business plan before you start taking any action to ensure you’ve not overlooked anything.

7.     Don’t quit the day job

Unless you’ve got a huge cache of money stored up, don’t quit your current job as it’s a steady source of income – one that your new business venture isn’t guaranteed to bring. It can take a while to get a new business off the ground, so don’t jump in at the deep end. Most importantly, when you cut the ties with your previous job, make sure you give yourself a salary in your new business.

Do you have your own business? What do you do? Do you make much money? Care to share how much?

1. Let your bank know you’re moving

This usually only takes a few minutes to do over the phone if not faced with a queue. In the past I’ve given them a few weeks’ notice to ensure that when I move in I can buy things online without there being any confusion between the billing and delivery address.

2. Redirect your mail

For anyone who gets a lot of mail then setting up a redirect can be a lifesaver. It comes with a small fee which has to be paid to the Royal Mail but it’s worth it to not lose any correspondence and to not annoy the occupiers of your old home with unwanted mail.

3. Invest in some insurance

This is usually the last thing on my mind when moving in to a new home, but again it’s one of those things that can be planned in advance. As I usually rent a house, my belongings aren’t covered in the case of a natural disaster, so getting home contents insurance before moving in is protection if the worst comes to the worst.

4. Transfer your energy supply

Usually energy companies have a special home moving department that will transfer the supply to the new home on the day of moving, and require just a final meter reading on the last day.

When I first moved into a home of my own I found it surprisingly difficult to get an energy supply if you’d never had one before, so bear this in mind if this is your situation. I spoke to the landlord who told me which energy company supplied the property previously and this game me enough information to set up a new tariff with a different company as the current supplier didn’t have the best value for money.

5. Update your driving licence

As outlined on the Government’s website changing the address on your driving licence is a simple procedure that’s free if the photo on the licence doesn’t need to be changed. As a regular driver, changing this is very important. I often hire cars too, and if you no longer live at the address on your licence it usually means that you cannot rent a car.

6. Contact anyone else who needs to know you’ve moved

I usually make a list of everyone that has my address, including my mobile phone operator, internet provider, TV licence, store memberships, the Student Loans Company, and most importantly my employer. I then go through this list on a quiet day and phone them up or try to do it over the internet. Usually the latter is the most convenient and widely available option.

7. Change the locks

I’m a serial renter, so this is something that the landlord usually does, but I like to double check and ask them on the day of the move. If buying a home this should be something that’s done within the first week of moving in. This is a good security precaution as you never know who had access to your property previously, so changing the locks will prevent any unwanted visitors to your home.

8. Become a box hoarder

In the run up to the move I always find it impossible to find containers to store everything in and usually resort to buying costly boxes that I end up throwing out after moving day is over. In the weeks leading up to the move I usually ask friends and family for spare boxes, visit supermarkets and ask for any free boxes, or invest in some reusable plastic boxes that I can still use when I get to my new home. It makes it so much easier, especially on the last day when I usually resort to throwing things in plastic bags and hoping for the best.

Got anything else to add?

If you are serious about sorting out your finances, saving money and making your money work for you, you can start by following these tips.

1. Cancel subscriptions and ditch unnecessary expenses. Take a look through your Direct Debits and other regular payments and check whether you actually use the goods or services you are paying for. Things like gym memberships and magazine subscriptions are all big money-wasters if you don’t actually use or need them.
2. Open an ISA. The start of the tax year means another great thing – that you have a new tax-free allowance of £5,760 which you can save in a cash ISA. The rates are great on cash ISAs (especially if you can lock your money away for a couple of years) and every penny of the interest you get to keep. This is a great way to make long-term savings go further.
3. Deal with your debt. If you have debt, now is the time to deal with it. Take action by switching your debt to a balance transfer credit card. A quick credit card comparison will help you find one with a nice long 0% interest period, which will give you time to pay off what you owe without incurring any extra interest.
4. Switch your current account. If you’ve had the same current account with the same provider for years, it is likely that you are on a rock-bottom interest rate. Just because it’s a current account, it doesn’t mean that you can make some interest on your money. Take a look at your current account, compare other accounts from other providers and see if switching could make you some extra money. There may even be a cash incentive or other reward for opening the new account.
5. Check and improve your credit score. Go online and find a credit reference agency which will give you access to your credit report for free, usually as part of a trial period. Check your credit history and score and if what you find is not encouraging, take steps to improve your credit rating.

Click HERE for Part 1

Click HERE for Part 2

Any Personal Finance Blog will tell you that the fundamental key to financial freedom and success is to make more money than you spend. There are a number of fancy ways to say this and different equations that can be used, but the basics should be kept simple. I have had credit cards for all my adult life (almost 7 years now) and took advantage of numerous student credit cards whilst at University. With discipline and control over the years, these have been building me a nice credit score which makes me eligible for some pretty good deals on balance-transfers, rewards, cashback and introductory spending periods alike. Aqua is just one of many brands who offer cards to all sorts of people – it is a common misconception that you can’t get a credit card when you are just starting out. Credit History is VERY important!

If we have a trivial formula of Money Leftover = Money In – Money Out, anyone with even the most entry level of education will be able to decipher that there are therefore 2 ways to ensure that we are left with more money:

1. Earn More – Whether it be side hustles, impressing at work, passive income or a second job – there are lots of ways to take home more money. This article won’t discuss making more, but be sure to check out the Passive Income Series.
2. Spend Less – Probably not the first thing you think of when deciding how you can end up with more money each month, but by far the best place to start in my opinion. Too many people take even basic fixed costs for granted – assuming that services and utilities are fixed costs.

Recap: How to Spend Less

As discussed in the two previous posts, here is a quick summary from each:

• Always Calculate the Pre-Tax Amount You are Spending! What the heck does this mean? This means that when you see a mobile phone bill at £40 a month; not only is this £480 a year, but it is equivalent to £600 a year before tax as a standard rate tax payer),or £800 a year as a higher-rate tax payer. This means that it is more valuable to reduce money out than to increase the money in by the same amount due to Tax.
• Regularly Search for New Insurance / Utility Deals – Searching for new policies and utilities should be a regular task. I frequently use cash back sites like quidco or topcashback to save even further. There are frequently affiliate cashback offers to be had!
• Use Comparison Sites and Consider Combining Policies to Save More – Bit of a no-brainer, but comparison sites help to ensure that you really do get a competitive deal. I always check more than one and then also try with the cheapest companies directly / via cashback sites to get the best deal possible!

The Continuous Process Continues..

In Part 1 I mentioned a number of my basic monthly outgoings and set myself a target to reduce these. One of the questions I pitched to you guys was around the topic of Gym Membership – I was paying £91.00 per month for a (joint) membership to a very nice health club close to where we live. Given that we live such busy lives and that I have a free gym available to use at work, unfortunately we were only managing to go a couple of times a week (at most).

A lot of you had some great advice, especially Tonya at Budget and the Beach:

Now I know that Tonya is into her fitness as well as being a very wise person, so I really took this comment on board. I decided to speak to somebody from membership and use my negotiation tactics that they had experienced only a year before! The result? Membership slashed by £9 a month.

Truth be told, I didn’t really do very much to get that reduction in my bill… I just mentioned that we had fulfilled our 12-month contract and was wondering if she could do anything for us. Still – £9 is £108 a year, or £180 pre-tax!

BUT, I still thought I was paying too much!

To cut a long story short, I figured that £82 a month was still too much when there are at least 2 gyms in my area offering a no-frills membership at £16.99 per month (no contract). While these gyms are far more basic and don’t have the luxury of sauna, steam rooms and pools; the equipment is brand new as the gyms are less than a year old. To put this in perspective, we have reduced our monthly outgoing in the gym category from £91 to about £34 – a saving of £57 per month, £684 a year, or £1,140 pre-tax per year! Not bad at all. Furthermore, the new gym is 24 hours so I can go whenever I want!

What’s Next?

After a sweet win on reducing the cost of insurance policies and now the gym – my next step is to cross another one of the list.  To be continued…

How Much Does Health/Fitness Cost You Each Month?

The boundary of the Grand Bahia makes a vast footprint on the Rivera Maya – hundreds and hundreds of Acres. Whilst the 27-hole golf course takes up a large portion of this space, dense untouched forests remain within the perimeter of the resort. A large development in currently underway to transform much of this space into new neighborhoods; offering a lifestyle change to lost souls, a second home to rich tourists or perhaps an investment opportunity to the Savvy!

Buying a Holiday Home Abroad to Let

If you are here to read advice on how to go about buying a holiday home in a foreign country to make you rich – I’m afraid you have come to the wrong place. Instead, I am going to give you my two-cents on why buying a holiday home in Mexico is definitely not for me.

Perhaps everyone has a dream of owning a beautiful property abroad where they can stay anytime for free and rent it out while they are not using it. It Sounds wonderful doesn’t it? Other holidaymakers can pay your mortgage off and you can use the place whenever you like for free!

It just so happens that the hotel here is currently offering Condos for sale starting at around $160K, going up to $600K. The homes are nothing short of stunning – set in a tropical paradise in the jungle, just minutes from the sea.

To begin with, I was lured by the idea of owning a little piece of paradise. After a reality check and further research – here are four reasons why I am definitely not going to buy a holiday home in Mexico as an investment property:

1. Under-developed legal / political system. Buying a rental property in Mexico is very different to buying one in the UK or North America. In a country still rife with bribery and more dodgy-dealing than most, legal documents might not hold the same credence as they do back home. It would be a lot of work to find a reputable Mexican lawyer who could read over any contracts / agreements etc.  and that is not to mention what could be lost in translation!
2. Pre-approved developer financing sounds great, but schemes can just as quickly fall flat on their face. The chances are a lot of investments will be for properties that are not yet built – a promise of paradise.
3. The condos are likely already over-valued. Mexico is a poor country and while the condos are in a beautiful and rural setting, things can change. The hotel may decide to chop-down too much of that beautiful forest and all of a sudden the condo loses its appeal (and value)!
4. It is too far away! Mexico is simply too far away from the UK if anything major should go wrong. Whilst I could employ a property management agency to clean the rooms etc. after each visit, bad things can happen. This was highlighted to me even more today when I read the article on This is Money – 10 Strangest things on rental properties.

Buying a Hotel Suite to Let

An alternative to buying a condo to rent privately would be to buy a hotel suite. The Sian Kaan hotel in Mexico is actually a series of investor-owned condos, which are leased to the hotel. Essentially, the hotel provides a management service for you; cleaning rooms, pool, entertainment, drinks, food etc.

The deal is that you pay a minimum of $160,000 for a single suite. The hotel provides you the deeds to the property and the opportunity to make use of the hotel room whenever you like – the catch being that you still have to pay the all-inclusive supplement. The hotel pays you a guaranteed lease fee (which is not dependent on occupancy) at around 7-8% p.a. The hotel also pays the maintenance fees, insurance and takes care of everything else.

Sounds like a good deal right? Perhaps… but there are a couple of caveats that I have with the arrangements:

1. The leases have terms of up to 10 years. If the hotel goes bankrupt or decides to change their terms, you are left with an asset that has lost a lot of appeal and hence value. Furthermore, if the hotel’s quality slips or brand is de-valued, will this investment be as valuable?  I like to have much more control over my investments than this!
2. The asset itself is highly over-valued. You are paying for the opportunity to make money leasing it back to the hotel (and hence its reputation) and not just the building itself.
3. It is very unclear who is responsible for ‘refreshing’ the room. The term maintenance is very loose and I would need far more reassurance that the hotel would ensure it was well kept.

Conclusion

The idea of a rental property in paradise is still very much appealing – in fact it is still very much a dream. Investing in Mexico in general is quite risky – bad weather, political situations, corruption and shear distance from the UK makes me far too uneasy at this stage. A 10 hour+ flight is too long and too expensive to allow regular check-ups.

At this stage in my life, there are far more appealing things to invest in – I am still confident that the stock markets are on the rise and that my investments in emerging markets will reap some long-term benefits. Furthermore, these investments allow me an easy out – I can quickly sell out if my situation changes or I get uncomfortable! They are also far less demanding than dealing with foreign income, taxes and copyright laws.

Real estate investing is definitely something on the horizon – but perhaps a little nearer to home and in a country with better-established laws and regulations. I am sure that plenty of people who invest in hotel suites and condos here in Mexico and in other places make a tidy return – kudos to them.

For me a yield of 10% ish is not worth the required hassle… especially when I have doubled that yield in only 8 months on the FTSE

Do you know anyone who has invested in a foreign rental? Did they regret it? Do they make money?

Check-Ups are Preventative

A check-up is intended as an exercise to avoid something bad happening. In the example of the dentist, regular appointments ensure that bigger problems can be spotted early. Similar to how men go for prostate examinations and woman get cervical cancer tests – A check-up provides an early indication if things are not going to plan.

Do you see where this is going?!

Financial Check-Ups

Having grown up in a world full of check-ups – from tests at school, to drug tests at work – why is it that most people forget one of the most important check-ups of them all? The financial check-up!

5 Reasons to Monitor Your Finances Regularly

• Income < Spending = Trouble – The fundamental reason for monitoring your finances is to ensure that your spending is controlled. We all know how easy it is to have too many meals out, buy too many new clothes for the month or lose track of the lattes. Regularly checking your current account ensures that you know where your money is going. Many banks and building societies make this ridiculously easy for you too by providing apps / portals that automatically categorise your spending into genres. Nothing says you are spending too much money on your mobile phone bill more than a giant red area in a pie chart!
• Tracking Goals – We all have goals in one form or another. For a lot of young people, a financial goal is to save up for a deposit to buy their first house. For others it might be a dream holiday, investing for your children’s future or even your own retirement. How can you keep track of progress without regularly assessing your financial position? One thing is for sure – you won’t magically get their by closing your eyes and hoping for the best! It doesn’t work!
• Things Change Quickly - Just because you signed up for the best gas and electricity prices three years ago, it certainly doesn’t mean that you still have a competitive deal. Insurance companies thrive on customers who automatically pay the renewal price without batting an eyelid or trying to negotiate. Companies are at their weakest point shortly after you have served your contracted period; They will do a lot to keep you (or sign you on for another term), yet most people just keep on paying. I regularly contact Sky to ensure that I am receiving the most competitive TV package and 1st central insurance to ensure that I have a competitive car insurance policy. It takes time, but don’t forget that everything can be monitored – Internet, House Insurances, Mobile Phones etc. Also remember, the opposite can also be true – if you are willing to lock yourself in to an expensive contract then be sure to negotiate; just like I did with our Gym.
• Investments Need Nurturing – Whether you are an experienced professional or passive investor, you can’t just ignore your options. Government policies, world trade movements, competitor behavior, economies etc. all have a substantial impact on investments. Just because you bought options in a bluechip multi-national a year ago, it doesn’t mean that it is forever safe. You need to regularly review all your options. For example, P2P lending investments used to be far more appealing than they are today – I won’t be offering any more loans as competition has driven the rates right down.
• Peace of Mind – One might argue the most important thing of all – being safe in the knowledge that you are ‘OK’ if the sh** hits the fan. Ignorance is not bliss when it comes to finances and I shudder when I read stories of people who throw their bills in the bin because it depresses them to read them. One of the key messages in a holistic book that I have just read is all about health being more than a physical thing – rather a complete connection with your surroundings. Unfortunately your financial situation dictates much of this!

After reading back through this post I feel that it is time for a major financial check-up in my household. I have been responsible with the check-ups, but this time my teeth might need to get some work done…

How often does your household have a financial check-up?!

Since the introduction of credit and debit cards, the need to carry lots of cash has been reducing, and with the latest developments in payment solutions people are starting to wonder whether we might eventually move towards a totally cashless world. Since 2008 contactless payment using credit and debit cards has been available through Barclaycard, and similar technologies have been used for prepaid payment cards such as Oyster cards.

Recently Travel for London (TFL) introduced contactless payment capabilities on most London buses and there has been a big uptake on this option. If the UK’s future looks anything like that of Hong Kong or Tokyo, it is quite possible that contactless payment for public transport could be the tipping point for the UK’s traditional chip and PIN machines to start falling out of favour. One of the main barriers to a greater uptake of contactless is consumer concerns over security, but as contactless payment becomes normalised and people are better educated about how secure the technology is, customer confidence will likely grow.

Meanwhile, the Barclaycard PayTag (a sticky backed RFID chip which can be stuck to your mobile phone) is gaining traction as an even more convenient way to pay without the need to get your wallet out at all. Barclays also recently introduced an app called Pingit which allows customers to transfer money from one bank account to another without the need to exchange bank details. This is another big step towards fast and secure money handling that doesn’t require cash.

So what is next, and how far away are we from a cashless society? A recent study by PayYourWay.org.uk showed that although most people predict there will be cash in their pockets for the foreseeable future, many believe that in the next 10-15 years the innovations in payment solutions could involve such futuristic options as paying by thumb print or contact lens scanners, and mobile phone payment is expected to become one of the main ways to pay for services – something which is supported by the current innovations already being rolled out in this area.

We might not be quite ready for a fully cashless world, but financial institutions are racing to develop the most secure and convenient ways to make payment faster and easier for consumers; so it’s likely that the innovations will keep rolling in over the next few years.

What Do You Think?