business IPODespite making decent gains in August, following the Chinese bank’s decision to devalue the Yuan, the Euro slipped back again as European bankers cut growth forecast figures and left interest rates unchanged. The Dollar also improved amid positive employment figures. On a wider scale, the reduction in growth forecasts has raised some serious questions over the validity and effectiveness of the trillion dollar asset acquisition plan, which was meant as a means to stimulate economies and encourage growth in the region.

The bank cited low oil prices and a slowdown in emerging markets as the reasons for the reduction, with China being a primary reason for both of these factors. During a speech given by European Central Bank President Mario Draghi, where the new forecast figures were announced, the euro dropped 1.4%, especially as investors and analysts saw the announcement as an indication that the central bank would have to increase its financial support in asset investment.

Positive figures for the U.S. helped to ensure that the dollar performed well against most major currencies, buoyed by positive employment figures and a reduction in the trade deficit, although there are still some fears that the trade deficit will increase further now that the Yuan has been devalued and buyers are likely to invest in cheap Chinese products once again.

The Chinese economic crisis, which has drawn some comparisons with the early stages of the global economic crisis in 2008, has seen oil prices drop as demand from the world’s largest oil buyer dropped considerably. Chinese businesses have also suffered as the Yuan has been dragged upwards by its loose link to the Dollar over the past year. This increase in the cost of the Yuan means that companies have not been able to benefit from the low prices typically associated with Chinese manufacturers and Chinese services, and in turn this means that those businesses have had less to spend.

The result of the Chinese economic problems has been a huge drop in crude oil prices, as well as a reduction in the money spent by Chinese businesses. According to the European Central Bank, these are the two main reasons that the Eurozone has underperformed when compared to its earlier forecasts. As a result, forecasts for both inflation and economic growth were reduced.

Exchange rates closely follow forecasts, and where an economy fails to meet forecasts or is forced to revise forecasts, the market reacts. In this case, with both reductions being seen as a negative indicator of the region’s economic performance, it meant that the Euro slipped in value, undoing the gains it had made in August.

The Euro had performed well in August, following the breaking of the news of Chinese problems. Investors moved away from the Chinese economy, both in terms of stocks and foreign currency, and they moved towards the low yield Euro. The move represented investors looking for less risk and greater stability, but there had been signs that the market was becoming less risk-averse, and with poor inflationary figures around the corner, the lack of potential reward has put many investors off.

In contrast, the U.S. released positive employment figures, which led to positive sentiment regarding economic growth for the country. An increase in exports also meant that the trade deficit for July fell, and sentiment was firmly behind the USD from that point on.

Sweden’s decision to keep rates unchanged meant that Swedish crown also performed well, although this is not considered one of the major currencies. The crown hit a six week high, proving once again that interest rates really do matter to foreign exchange investors looking to turn a profit.


When I set up Magical Penny in 2010, I had a strong interest in personal finance but I didn’t think it would be become my career only a few years later.

The inspiration behind the site was an assertion that investing is not the reserve of the very rich, but a way for everyone to save today to grow their wealth for their families tomorrow. Magical Penny remains a place to both teach and inspire those who wish to have their dreams of financial freedom realised.

The site began as a passion project after first seeing small but consistent contributions into the financial markets grow over time. It was 2007, only months before the world-wide ‘Credit Crunch’. The ensuing months were a transformative experience that fostered a passion for helping people achieve financial empowerment on their own terms.

But as the site grew I received more and more requests for financial advice, from both friends and complete strangers.

I felt stuck.

I could only share what had worked for me, and a lot of the problems I encountered I didn’t have a good answer to help. I resolved to get ‘legit’ and start learning about financial planning.

I decided to pursue a Diploma in Regulated Financial Planning – the benchmark qualification to become a financial adviser in the UK.

Two years later and I have achieved a pass in my final exam, R06 Financial Planning Practices, so I have been awarded my Diploma in Regulated Financial Planning!

R06 Pass

How Long Did It Take?

When I first heard about the Diploma I was told it could be achieved in as quick as 9 months. My plan was to get the exams done within a year. My journey took a little longer, just a couple of months shy of the 2 year mark, but I also found employment during that time with a Chartered Financial Planning firm which has provided me with valuable ‘real-world’ experience.

The Diploma consists of 6 exams.


This module is to develop knowledge and understanding of the financial services industry, including regulation, legislation and the Code of Ethics. I managed to pass the exam with just reading the book, no revision aids or extra study.


This module is to develop knowledge and understanding of investment products and the application of the investment advice process. The exam has formulae and mathematical concepts to get your head around but it’s not too difficult though -roughly GCSE level as far as I remember. I had worked in a quantitative field in my previous career but I wouldn’t say I’m particularly gifted at maths. I still managed to pass this exam on my first attempt. The consensus online says this is the hardest exam of the R0s but I found the subject matter interesting so perhaps my enthusiasm for the content made studying easier and got me over the line.


This module is deceptively difficult. The textbook is written to inform exam candidates about the UK taxation system, and give readers the ability to analyse the taxation treatment of individuals and trusts during the investment advice process. So a lot to cover.

This is the exam that took me off course for getting the Diploma within a year, which was my original time-scale.  Working to get this exam passed tested my resolve but also made me more sure than ever that this path was what I wanted, and I got there in the end.


This exam tests knowledge and understanding of and ability to analyse pension and retirement planning issues. It was around the time of sitting R04 that I finally found a financial planning business to join, to learn the practical side of financial planning.


I felt I was on the final straight by the time I was sitting this exam. This module is on insurance, an area that was new to me, but a very important aspect of financial planning.


This is a 3 hour written exam answering financial questions about 2 case studies. I left the exam with a smile on my face which is always a good sign, and I was thankful for the pass which concluded my journey to Diploma level.


I am delighted to have achieved the benchmark qualification to be a financial adviser and planner in the UK. And more importantly, I’m excited about the future of Magical Penny too…because I now officially know what I’m talking about! :)

I’m looking forward to sharing new information and relaunching Magical Penny: watch this space!


unboltedHave you ever been so short of money that you’ve considered selling something of value?

One Magical Penny reader, Stephanie, approached me in this exact position a few months ago. In her case, she was considering something drastic…selling her engagement ring! She needed a cash injection into her business and this seemed the easiest way to get her hands on money as soon as possible.

Hearing her situation sent shivers down my spine.

Whilst a price can be put on a diamond ring in terms of its monetary value, the sentimental and emotional value could be much higher.

Selling your precious valuables to fix a temporary money problem may not be worth it. Money problems are temporary and financial situations can improve a lot over time if you stay focused. Remember this.

One possible solution if you are in a tight money spot is a service is called Unbolted.

Unbolted is a peer to peer lending platform that allows you to use your valuables as collateral to access money at better rates than traditional loans. The site connects borrowers and lenders using technology.

Individuals can borrow from other individuals in complete privacy, using their personal assets as security.

The site essentially allows anyone to be a mini-pawn broker, using technology to deliver a transparent, low-cost and convenient alternative to high street pawnshops. The service is also authorised and regulated by the Financial Conduct Authority for peace of mind.

If you have valuables that you would like to use as security for a cash payment, the process is simple: you can upload photos of your valuables and get a loan offer in less than 3 hours and then have your item couriered for safe keeping and receive money in 24 hours. The speed of the service is one of the most attractive aspects.

The service is best used for short term cashflow issues. If you have underlying financial problems that you don’t think are resolvable over the next few months, you risk losing your valuables. But as long as you understand this and are happy with the terms of the loan contract, Unbolted  may make your life a lot easier and such a service could be helpful to reader Stephanie with her precious diamond ring so she does not have to part with it forever.




Home owners: There’s something you can do to reduce your monthly bills, and potentially add value to your home at the same time.


The answer is investing in energy saving technologies that prevent money leaving your pocket through your roof, walls, windows or out-dated electrical products. Investing now could lead to long-term savings and help increase the value of your home:

The Clydesdale Bank have put together a great infographic highlighting ways to save:


Source: Clydesdale Bank

Infographic Sources:
1 2 3 4 5 6 7 8 9 10


Free Insulation and cavity wall insulation

Heat rises so you could be losing heat (and therefore money) from your roof.

Fixing it does not have to be expensive. In fact you could be entitled to free insulation!

You can apply for grants as part of the UK’s “Energy Company Obligations (ECO) scheme” -it’s available for people who get tax credits and have an income of £16,010 or less, or those who are receiving certain benefits such as pension credit.

A quick way to check if you qualify is to call the Energy Saving Trust and answer a few basic questions on 0300 123 1234 (England), 0800 512 012 (Wales) or 0808 808 22 82 (Scotland).

Alternatively just call an energy provider for a free assessment. You’re free to pick any energy provider –even if you are not a customer. One popular choice is British Gas who offer free loft and cavity wall insulation to everyone, regardless of income or whether you are its customer.


Green Deal: energy saving for your home

Did you know the British Government wants to help you save money too?
You may be able to claim back money from the government if you make energy-saving home improvements.

 The Green Deal Home Improvement Fund could allow you to claim up to £1,250 towards the cost of installing any 2 of the following:

  • a condensing gas boiler on mains gas
  • double or triple glazing as a replacement for single glazing
  • secondary glazing
  • energy efficient replacement external doors
  • cavity wall insulation
  • floor insulation
  • flat-roof insulation
  • insulation for a room in the roof
  • a replacement warm air unit
  • fan-assisted storage heaters
  • a waste water heat recovery system

More information is available on the Government website.



The Success (and Failure) of Help To Buy

by Adam on June 22, 2015

It’s been over two years  since the ‘Help To Buy’ initiative was launched in the UK in April 2013, but 60% of England’s postcodes have no ‘Help To Buy’ Homes.

There are more than 400,000 eligible homes that buyers could have made their own through the scheme but according to housing market data from the HM Treasury,  1,261 out of 2,117 Postcode Districts in England have yet to see any ‘Help to Buy’ mortgage completions.

help to buy

See also the interactive map from,


The map in the infographic above highlights all mortgage completions across the UK that were as a result of either the Help to Buy 1 (Equity Loan) or Help to Buy 2 (Mortgage Guarantee) scheme, revealing 1,261 ‘black spots’, where no Help to Buy properties are available or where the scheme simply hasn’t been taken up.


Other findings of note:

  • Mortgages on 52,691 Homes in England (as of February 28th, 2015) have completed as a result of Help to Buy so far.
  • 42% of postcode districts in England e.g. NW1 (1261 out of 2117 Total) have yet to see any ‘Help to Buy’ mortgage completions.
  • Leicester is England’s number one Help to Buy city, with 892 completions.
  • MK42, in Bedford, is England’s top Help to Buy postcode, with 309 completions,
Top 10 Regions Total Completions
Leicester 892
Leeds 891
Hampshire 811
Birmingham 788
Wiltshire 749
Liverpool 726
Staffordshire 697
County Durham 696
Norfolk 685
Bedford 683


The Help to Buy initiative is available in 2 parts: An Equity loan and mortgage guarantee options:

Help to Buy 1 – Equity Loans

The initial scheme offers first-time buyers easier access to new builds. Help to Buy 1 offers 5-year interest-free Government loans up to 20% of the property value. Once the 5-year interest-free period is complete, interest is charged at 1.75%, with annual rises of 1% above inflation. First-time buyers using the scheme require a minimum 5% deposit and a mortgage to cover the remaining 65-75% of the property value


Help to Buy 2 – Mortgage Guarantees

The second phase of the scheme offers mortgage providers more incentive to lend higher loan-to-value mortgages. Access to Government guarantees on these loans allows lenders to give both first-time buyers and existing home owners mortgages with deposits as low as 5% on new builds and older properties.


I have friends in Leeds and Leicester who have taken advantage of the scheme, but from the looks of the data, my perception about take-up is more rosy than it should be as Leeds and Leicester are the areas with the highest take-up rate. I would attribute this to quantity of affordable housing stock but its certainly interesting to see how the take-up in distributed up and down the country.

Do you have a ‘Help to Buy’ story you can share in the comments or would like featured on Magical Penny? If so, please get in touch (adam AT


retirementRetirement may close the door on your current career, but it paves the way to a wealth of opportunities such as starting your own business.

Entrepreneurialism isn’t just for the young, with a sudden abundance of time and savings, combined with years of real-life experience, retirees have the ideal skill sets for breathing life into their own business ventures.

Assess your financial situation

It’s a good idea to plan your business venture before you hit retirement, so that you can properly assess your financial situation. If money shortages look likely to be an obstacle, then consider cashing in your pension to generate some extra funds. While this may not be the best option for everybody, taking a small amount of your pension pot to bankroll your business may be the answer if you can’t find any other way to fund your idea.

retirementPick something that you love

You may have spent a great proportion of your life working in an industry that you hated, in order to earn a decent living, but retirement is the time where you get to decide exactly what you want to do.

There is no point pursuing a business that you aren’t passionate about, simply because you think it’ll be a good way to make money. Choose something that you love and your enthusiasm will shine through to your customers.

Use existing skills and knowledge

One of the biggest advantages retirees have over younger entrepreneurs is that they possess years of experience and knowledge. Harness this knowledge and implement existing skills into your start-up business.

If you have spent years working in a particular industry, why not spend your retirement working as a freelance consultant, offering pearls of wisdom to the next generation of workers in your specific field of expertise?

Do your homework

After deciding which industry you are going to go into, ensure that you know the current market inside out by researching your competitors and customers. This is essential to make sure that you have enough ability to be successful and that you’ll have enough demand for your product or services.

Enjoy it!

Have fun, this is your retirement after all! Think of this venture as an exciting project, rather than an all-consuming business. While it is easy to let things stress us out, remember that retirement is a time to enjoy life, put yourself first and let the business come second.



Smart saving tips for families

by Adam on October 31, 2014

The amount of cash that UK households are spending per household seems to be ever increasing, and it’s certainly top of mind for many of us as we head towards the festive season! (yes, it’s coming!)


Here are top 4 tips to start using today for your family’s budget

If you are the person who is responsible for the family’s budget, you should consider some of these strategies to keep your family’s personal finances looking healthy:

  • Ensure you are on the right energy tariff for you.

    It’s worth shopping around for your energy. You should be as diligent with this as you most likely are when you shop around for the best mobile phone contract or car insurance. It really can help save you money. And thanks to recent reforms in the energy market, things are now simpler, clearer and fairer – making it easier to check your existing energy deal and work out if you’d benefit from a change. You can learn about the best ways to shop around by visiting Go Energy Shopping. You can also learn all about the new changes that the UK government has introduced to make shopping around for energy easier and clearer than ever.

  • Check your transport costs.

    In a 2012 report on household spending, the ONS stated that transport was one of the biggest drainers of household cash. Transport ranges from motors to scooters. If your family lives close to school, consider walking children to school in the morning if it is close to your home. Using public transport to cut down on the effects of paying for petrol and diesel. We all know that the fuel pump is one of the most expensive aspects of life in the UK – avoid it and try different methods of transportation such walking and cycling which relies on your body and energy for power

  • Keep technology purchases to a minimum per quarter: The ONS also found that more families are spending household money to purchase items such as computers for the home. If this sounds like something you want to invest in, try and look for as many deals and bargains as possible such as using vouchers that you see in print media or checking online. This gives great value for money so you can best use your savings when purchasing a computer. While IT companies such as Apple might convince us that we need an iPad and a Mac book, look beyond the marketing before you buy. Be stringent with your technology purchases in order to balance your family’s budget each month.

  • Buy supermarket brands: This is an area that many families can find themselves overspending because after all, we all need painkillers for headaches and keeping the house clean is a priority. This is where plenty of savings can be had if families opt for supermarket brand versions instead of the market leading brands.

With a frugal grip on household budgeting thanks to these tips, you can manage your family’s money prudently so you don’t feel strapped for cash towards the end of the month.

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Whether you’re finding it slightly more difficult than usual to make ends meet, or you’re simply after that little bit of extra cash on the side to give you more financial freedom, being able to turn one of your favourite hobbies or pastimes into a genuine moneymaker is an essential skill for those of us who are looking to earn that little bit more than what our day jobs facilitate. You never know, if you follow the advice below, you might be able to quit your day job altogether and simoney making ideasmply run your home business full time.

Step One: Explore Your Passions and Select a Niche

If you want to be good at what you do, a good dictum to follow is to do what you love. If you can do this, you’ll be able to put your everything into the product you’re trying to sell, and after all, the best sales person is somebody who truly believes in what they’re selling. So, the way to achieve this is to go through your interests: fashion, jewellery, video games, comic books or anything else, and select the one that you know you’ll be able to dedicate all your spare time to selling without it getting boring. You also need to take into consideration your work process; we’ll discuss this in the next point.

Step Two: Create a Process and Refine Your Workflow

Once you’ve selected your niche, you need to define your process. Are you going to produce your own jewellery, or are you simply going to resell what other people have made? Are you going to design a smartphone game or an app, or are you going to buy classic arcade cabinets, restore them, and sell them on to collectors? Answering these questions will help you to generate a great business plan that you can work from, and that you can adapt and tweak when the need arises.

Step Three: Pleasing the Customer with Quality Service

The third point is probably the most important: customer service. If you really want to impress your customers, you need to leave them with a brilliant lasting impression. There are a number of ways to do this, from setting up a Facebook account and interacting with your customers, by producing an amazing FAQ section on your site to help your customers answer their own questions, or by delivering products on time across the world using a reliable courier like TNT Direct. You could offer the best customer advice, but if their purchase turns up late, your customer will still probably leave you a negative review.

So there you have it: three simple ways to transform your hobby into a genuine moneymaker.

Have any other ideas?

Share them in the comments!


History of the Credit Card

by Adam on September 30, 2014

Using credit cardsThese days, most of us have a credit card tucked away in our purse or wallet. Some of us probably even have a lot more than one. Now, with so many different credit card types on the market, offering things from cashback rewards to air miles, they have become so much more than just a convenient way to pay. But credit cards haven’t always been available, so when did it all begin?

Though the credit card itself didn’t come about till the 20th century, the concept of credit has been around for a very long time.

The first recorded use dates back almost 3,000 years, to civilizations in ancient Egypt and Babylon, where merchants would allow customers to pay for an item at a later date if they didn’t have the means to pay then and there, after making a note of the due payments. Fast forward to the mid 1900’s and in the US, oil companies, as well as local department stores and petrol stations, had a similar system, creating charge accounts which could be accessed using a card for their customers in an effort to create customer loyalty. It is from this system that the first credit card stemmed from.

The Charg-It Card

The ‘Charg-It’ card is often considered as the world’s first actual credit card and was a concept thought up by Brooklyn banker, John Biggins back in 1946. The idea was that when a customer made a purchase, the bank would pay and the customer would be sent the bill later. It wasn’t without its catches though. The card could only be used to make purchases locally and unsurprisingly was only available to those customers who had a bank account at Biggins’ own bank.

Three years later, in 1949, a new credit card was developed with a rather fanciful tale behind its creation. The story goes, that Frank McNamara, the head of the Hamilton Credit Corporation was out for dinner at New York’s Major’s Cabin Grill along with his attorney and a man named Alfred Bloomingdale, the grandson of the founder of the famous store Bloomingdale’s. A discussion arose regarding one of McNamara’s problem customers who had borrowed money and was unable to pay it back in a short space of time. Embarrassingly, shortly after this conversation had ended, McNamara realised that he had forgotten his wallet and had no way of paying for the meal. He had to phone and tell his wife to come to the restaurant with some money from home.

The Diners Club Card

With thoughts of the problem customer still on his mind, and vowing never to be stuck in this situation again, McNamara came up with the concept of a credit card that could be used to pay at multiple locations. The three men present at the dinner, then got together some money and started a company called The Diners Club. The Diners Club Card saw a step away from individual companies offering their own credit to customers as previously seen and gave customers the chance to pay using one card across many different companies.

At first, the card was only used by a select few at a small selection of restaurants and entertainment venues (hence the name Diner Card) but by the end of its first year, it had spread with over 20,000 people using the card.

Again it was not without its catches. Customers didn’t pay interest, however they were charged an annual fee for using the card and had to pay their bills back in full at the end of each month. Also, companies that accepted the Diners Card, were charged 7% on each transaction made with it.



Wider Adoption

It wasn’t until 1958 that The Diners Card saw real competition in the form of American Express. American Express as a company had existed for a long time before this date, but it wasn’t until then that they turned their attention to credit cards. It was a year later that the company introduced the first ever plastic credit card that we are now so used to seeing. Up until then cards were made of paper or cardboard. In its first five years, American Express could boast over one million card users across approximately 85,000 establishments and soon became used worldwide. Similar to the Diners Club Card, the early American Express cards required users to pay back their bills in full at the end of each month and it wasn’t until 1987 that the company allowed users to pay across a longer period of time.

Though this put customers at the risk of getting themselves into debt, when used sensibly, it provided customers with more flexibility with their money, which is what we enjoy today.




Looking to Sell Your House?

by Adam on September 18, 2014

If you’re in the UK and either buying or selling a house, you’ll definitely find this info-graphic very interesting. London House prices have doubled compared to the rest of the UK. This is the widest gap since the history books began.




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