How Much Money Are You Really Going To Need For Your First House?

by Magical Penny on March 13, 2017

landlord insuranceIf you’re saving up for your first house, then you’re going to need more than your deposit and first mortgage payment to get going. Many people don’t realise just how much they need to pay out when moving into their first home. Let’s talk about how much you’re really going to need…

Some Of Your Major Upfront Costs Include:

Your deposit is the most obvious thing, and likely something you haven’t forgotten. It is one of the major upfront costs, and can be anything from 5%-20% of the purchase price. When you have your eye on a house, make sure you figure out how much you need to buy it.

Valuation Fees

The mortgage lender is going to need to assess the house so they know how much they are prepared to loan you. This can be a small amount, but it can also be thousands depending on the value of the property. However, depending on the type of mortgage you have you may not be charged for this.

Surveyor’s Fee

This will help you to understand whether there are any problems before you buy the place. If you choose a good surveyor, you’re going to save money in the long run. It’ll also give you an idea of things you may want to change later on down the line.

If you live in Australia and you plan on doing this yourself, you may need to get a 137b report. This can help to protect you and the things you choose to do.

houseLegal Fees

You usually need a solicitor to help you do all of the legal stuff before you buy a house. You’ll need to be prepared to pay them too; this is another thing that can cost hundreds-thousands.

Electronic Transfer Fee

Yep, you even get charged for having the money transferred from the lender to the solicitor. It isn’t a huge payment compared to everything else, but it all adds up. You may even encounter more small fees like this, so it’s always worth reading the small print and staying aware of what you’re agreeing to.

Furnishings

It’s unlikely that you’re going to move into a fully furnished house, so you’re probably going to need to buy your furnishings. Having things like a bed, sofa, and other essentials is important right from the get-go. Things like a TV may be able to wait. How much this costs will depend on your taste and how much you want to save (second hand stores anyone?).

ImportantHaving An Emergency Fund

Having an emergency fund is a good idea. Not only does this make it easier to get accepted for a mortgage, it gives you peace of mind. Having 6 months of living expenses in your bank will cover you should you lose your job, take a pay cut, or even have a real emergency. You can’t afford not to have an emergency fund when you decide to take on a responsibility like a house!

Bonus Tip For British Readers

If you are using a Help To Buy ISA, you will not have access to the Bonus payment until after you complete on your house sale, so the bonus money cannot be used as part of your deposit. However, as this article has highlighted they’ll be plenty of other things you will need money to buy after the house sale is completed so it’s a great source of extra funds.

Hopefully, you now see just how much you need to have saved up to get your first house. Good luck!

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How Can You Be Sure That Your Next Investment Is The Right Choice?

by Magical Penny on March 13, 2017

 

financial newsYou don’t need to be a genius to know how influential smart investments can be for a person’s future. Growing your personal wealth in this manner can be your ticket to financial freedom, especially in later life. Given the increased life expectancy throughout the west, the importance of investments is even greater.   

 However, investments do come with a risk. So if you’re going to take a leap of faith, it’s imperative that you make the right move. You cannot predict the future with 100% accuracy. Nonetheless, an educated guess is always better than a stab in the dark.   

 Here are some crucial factors to aid you throughout the process.

 The Budget

 First and foremost, you need to know whether investing is right for you. The harsh reality is that a lot of households simply don’t have the money. Meanwhile, many that have a little budget set aside may find that a high-interest ISA is the better option.

 Whatever happens, you must not leave yourself short. Even if your investments pay off, it may take some time before you start to see a return. This is a huge financial decision, so being honest about how much you can afford to invest is vital.   

 After all, the last thing you want to do is put yourself in a tighter position through a lack of maturity.

 The Timing

As well as personal situations, you need to think about society and trends in general. Those nationwide and global movements will inevitably cause a huge impact on your future investments. Researching different markets, spending habits, and financial influences is vital.

Timing is everything in the world of investment. This research will allow you to make far more educated decisions. While this won’t guarantee success, it should help you avoid entering the market during a slide. This will stop you from encountering short-term losses and can maximise long-term gains also.

 

riskThe Risks

 Investing is never free from risk entirely. However, some markets are far less vulnerable than others. For example, trading stocks can potentially bring huge returns quickly. On the other hand, you could lose a lot of money in next to no time also.

 Property is probably the most secure area. Even if the market takes occasional dips, the long-term curve will always point in a positive direction. Before rushing into the market, you should know the differences between buy to let and property development plans. The right pathway for you could be dictated by location, timing, and many other factors. So make sure you get it right.

 It’s important that you give yourself a chance at gaining big returns, but you don’t want to risk everything. Finding that balance is key.

 The Enjoyment

 In truth, financial motives should always be your main incentive. Nonetheless, investments can consume part of your free time for months or even years. Therefore, finding an investment opportunity that you can actively sink your teeth into is vital.

 Apart from anything else, your passion for the investment should give you the best chance of maximising your returns also. If that doesn’t put an even bigger smile on your face, nothing will.

Read more Investing articles here on Magical Penny

 

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Telltale Signs That It’s Time To Move House

by Magical Penny on March 13, 2017

house questionA home that seemed perfect a few years ago might no longer be a good fit, and there are plenty of reasons that can happen. When your home no longer suits your current needs and lifestyle, it might be time to move to greener pastures. While renovating is a possibility it’s not the answer for everyone. Perhaps your home has a ceiling price meaning any renovations won’t pay off when you come to sell. Maybe you can’t raise the upfront cash and don’t want to get into any more debt. Maybe you just don’t want to live on a building site while it’s being completed! Here are some of the reasons you might need to consider a new house

Your Family Has Grown

A growing family is one of the main reasons people look into moving house. If you’re living in a place that’s unsuitable such as an apartment with lots of stairs or somewhere with just one bedroom, then you will have to pack up your bags and move elsewhere. Maybe you want somewhere with a garden so they can play, or a home that’s close to good schools and parks? Perhaps your children are getting older and no longer want to share a room, or you all just feel like you need more space? Either way, moving to a more suitable home is likely to make everyone a lot happier. There are plenty of real estate lawyers out there who will be able to assist you with the tricky legal side of selling your home. From there, you’re free to do the exciting stuff- like finding the perfect new home!

You’ve Gone Freelance or Set Up a Home Business

More people than ever are taking the leap from employee to self-employed. Not only does it give you the potential for unlimited earnings, but you can work in your own time and have far more freedom than a traditional workplace. However, when you’re working from home, you really need your own space. An office with a desk, comfortable desk chair and good storage are essential. You might need to store stock, depending on the kind of work you do. If you don’t have the luxury of a spare bedroom to transform into your working space, moving might be the best option.

house mortgage UKThe Area Has Declined

Areas can change over time, and maybe you don’t like the way yours is headed. Nuisance neighbours might have moved in, or the crime rate could go up. You can change your own home, but you can’t do much about the area. If it’s something that bothers you, your only option would be to move. When you’re searching for properties, be sure to do plenty of research on the area too. Find out what the transport networks are like, the local amenities. There are sites where you can check out the crime rate and other important factors that need to be considered. You don’t want to move and end up in the same position again, so be sure there’s nothing you’re overlooking.

Check out more Property-related articles here on Magical Penny

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The Do’s & Don’ts Of Dealing With Debt

by Magical Penny on March 9, 2017

life insuranceLet’s face it; the global economic situation is still far from perfect. Unsurprisingly, then, more and more people are finding themselves in debt each year. But you cannot afford to worry about anyone else. Your full focus needs to be getting yourself out of debt and back into the black.

There is no quick fix solution. However, abiding these simple rules will help you avoid spiralling into further problems. And once you stop the descent, you can start to focus on climbing back towards financial safety.

Do: Consider Your Next Steps Carefully

Falling into debt can’t always be avoiding. Medical emergencies are just one example of unforeseen circumstances that could change everything. Regardless of how you reached this situation, it’s imperative that your next moves are the right ones.

Consolidating your debts with further agreements is an option. However, you cannot afford to make a bad choice. Researching the top banks for personal loans are a great starting point and could help you find the best long-term situation. Whatever you do next, though, studying your situation before rushing in is key.

Don’t: Ignore Debt Repayments

Facing debt can be quite scary, especially when you have companies chasing you for money. The worst thing you could do, though, is ignore their calls. If you do that, it’s likely that you will encounter additional fees and late payment fines. Quite frankly, that’s the last thing you need.

Companies are often far more understanding than you’d imagine. Don’t be afraid to explain the situation in an attempt to find a new agreement. Creditors are often willing to listen to customers that are showing genuine signs of making the repayments. Even if it simply buys you a little more time, making those communications is key.

Do: Seek Help

The direct creditors aren’t the only people that you should try contacting, though. Help is often available, but it isn’t going to arrive at your door. Finding that support is your responsibility, which is why you should take the time to educate yourself on the subject and pursue all avenues.

Whether it’s direct debt support or gaining additional financial aid in other aspects of your life doesn’t matter. Meanwhile, it could mean claiming back mis-sold PPI or services. Whatever your situation may be, speaking to the local legal aid experts is a great first step. Alternatively, try speaking to people that have overcome similar situations. Their experience could be key.

Don’t: Think Solely About Short-Term Situations

When facing an immediate problem, you may be tempted to focus your full attention on this matter. While it should be a priority, you can’t fall into the cycle of fixing one issue only to find that you’ve opened another. As well as solving your current problem, try to fix your credit score and keep general finances in a better place. This will pay dividends in the long run.

Likewise, it may require a short-term sacrifice to bring long-term gains. Selling some of your luxury assets may generate the funds needed to clear those debts. Once you’re back to square one, you can think about building a better future. Besides, you’ll only lose those items to the bailiffs anyway.

View more articles on Debt by clicking here

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Forget Stocks: Small-time Investments For Beginners

by Magical Penny on March 9, 2017

Investing can make you a lot of money, but it can sometimes be a gamble that in some cases requires you to have a large sum of money to begin with. Before taking the dangerous dive into stocks, investment newbies are best trying a few low-risk low-cost strategies first in order to get a feel for it.

Here are a few strategies – most of which you can buy into for less than fifty quid.

investingWine

A good bottle of wine can dramatically increase in value with time. Buying a few bottles to store in the wine rack could make you a profit in years to come. You’re best off consulting a wine aficionado first that can tell which harvest seasons and areas are worth looking out for. If you have the money, you may even be able to invest in a crate. Keep the wine stored away from heat and let everyone know not to open it!

Disney movies

The Disney vault has become an investment strategy for keen filmaholics. Every decade, Disney releases limited hard copies of its films that have attracted the eager eyes of investors. A box set costing ten quid could possibly go up to thirty quid in ten years, whilst older copies can go for more. Horde a few copies and sell them in ten years and you could make a tidy profit.

Crowdfunding

Some crowdfunding sites now allow you to buy bonds. You can invest as much as you’d like into whichever project you’d like. Funding startups can be risky, as you’re never entirely sure whether they’re going to make it or not. However, given that you can practically invest as much or little as you’re willing to give away, the negative payoff for your risk is minimised.

Peer-to-peer lending

Lending sites are becoming more popular, allowing you to loan money to those in need. From these loans, you can make a return, although it will generally only be a miniscule amount for small loans. Go big and you could be guaranteed a good profit. Use review sites to ensure you pick a reliable peer to peer site and aren’t swindled out of your money.

Saving moneyForeign currency

Investing in foreign currency can be unpredictable, but you have a lot of freedom as to how much you put in, unlike the majority of stocks. Many choose to convert via ETF. Larger amounts are better for seeing a return – the transfer cost needs to be catered for and can make converting small amounts of money worthless. However, if you’re lucky enough to convert to a fast rising currency at the right time, you could make a lot of money on an investment as low as a hundred quid.

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What the Brits spent our money on in 2016

by Magical Penny on March 9, 2017

Spending and saving moneyAccording to the latest figures released by the Office for National Statistics, the average British household spends £53.40 a week on food. The North East of the country was the thriftiest region, forking out just £45.70 on the weekly shop while those living in London splashed out the most on their groceries with £57.90 the average spend in the capital.

Recreation and culture saw a big north/south divide, with the north east spending £50.50 a week while their south eastern counterparts splashed out a whopping £71.40. However, one of the biggest differences was in education, with the ONS revealing that London-based families spend £15.70 a week, compared to those in the North East who allocate just £3.20.

Knowing where your money is going

Though it may not seem like a big difference in spending, it all adds up, impacting on household finances and affecting everything from the amount we save, to the amount we can borrow. If you’re currently saving for a mortgage, knowing where your money is going can help you hit your financial goals. Lenders now take a much closer look at affordability, so being able to show you’re good with your money will stand you in excellent stead when it comes to securing a mortgage.

Where to make savings

According to The Mirror, the amount Brits spend on coffee house brews has shot up 28% – from £2.32bn to £2.97bn in the last five years. By 2020 sales of lattes, cappuccinos, flat whites, and mochas are expected to reach a staggering £3.75bn per year. If you’re one of the estimated 75% of British adults who buys coffee when they’re out and about, it’s likely that your caffeine habit is putting a dent in your finances.

Another area where you could save serious money is the lunch box. According to The Telegraph, Brits spend up to £10.60 a day on lunch, snacks and other treats when they’re at work. This adds up to a huge £2,500 a year. If you can ditch the bought food and pre-pack your lunch instead, you could find you have a lot more left in the bank at the end of every month.

Likewise, if you can ditch the car, or the train, and cycle or walk to work, you could save up to 13% of your annual salary. While savings could also be made by quitting the gym and going for a run or a bike ride instead.

If you know exactly where your money is going, it will be a lot easier for you to get your finances in order. For more tips or advice on getting ready to apply for a mortgage, or if you want to find out how we can help you get your financial life on track, take a look around Perception Finance site today.

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3 Epic Ways To Sell Your Home

by Magical Penny on March 7, 2017

 

Shouse questionelling your home can be stressful. It is a matter of making sure you are selling for the right reasons, knowing what the market is like, understanding what buyers are looking for and completing any work that needs doing, either to increase the value or prevent anyone having solid grounds to negotiate on.

But it isn’t just about the preamble because there is also the matter of how you go about selling your house. Yes. There are different avenues that you can go down. It isn’t just a matter of speaking to the local real estate agents in your town anymore.

As such, we are going to go through some of the different methods available to you, as a home seller, and what the advantages of each method are.

Estate Agent

Despite there being a shift in recent years, around 90% of all homeowners still sell their house through estate agents of some kind. The main reason for this is because most sellers want a professional to hold their hand through the process, and that is what you get from a good estate agent. But always do your due diligence first, and make sure you get a good estate agent. That means someone who will deliver on the valuation of your property and not just high-ball you for your business. But that isn’t all because a good estate agent will also market your house carefully, arrange and conduct viewings, negotiate a good deal and remain a support throughout the process. That is an attractive proposition for many.

sell buy smallCash Buy Specialists

Not all homeowners have the luxury of selling when the market is high. A lot are required to move for a myriad of reasons that could be divorce, it could be moving closer to an elderly relative, it could be a recession, or any number of reasons that makes ‘how fast’ more attractive than ‘how much’. In this case, you should sell your house fast with Cash Offers. There are others but you should only go with a licensed real estate broker. The obvious advantage of this route is the efficiency in which they will buy/sell your house. They will offer a good service too while ensuring they try and get the best deal, which is typically around 80% of the market value. Always make sure you do your research, though, and ask questions about fees and what expenses are covered.

Auction

This can be an incredibly attractive route for many, especially those that are in possession of a unique property, something that will catch a buyer’s eye in some way. Of course, it isn’t a route that will please everyone. Typically, the type of properties that do well are those that need a lot of renovations doing, those that are rare or desirable, unusual buildings that are hard to value, and those will tenants. Sell dreams, not the property, as they say. As with everything, there are pros and cons to weigh up, such as the possibility of your home not selling versus the fact you can put a reserve price on. If nothing else, though, it is certainly the most exciting means of selling a home.

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Digital Solutions To Pro-tech-ting Profits

by Magical Penny on February 28, 2017

video callThere’s no denying that technology dominates the modern world. All elements of our personal and business-based worlds are ruled by the latest and greatest in modern solutions. Of course, just because the digital era is here, this does not mean every business is necessarily utilising technology to its greatest potential. Your company may be one such example. There’s profit to be made in digital solutions, and just because your business is using the internet or modern technology, this does not mean it has fully realised the potential of such tools in the modern world. If you’re unsure as to how your business could truly be utilising technology to increase profits, then here are some digital solutions you may not have considered.

Virtual conferences

One of the greatest ways technology has transformed business, as well as personal life, is through ease and scope of connectivity. One can communicate with a person on the other side of the world in real-time, and this has obvious, numerous positive implications for any business, whether it’s operating on a small, local scale or as a huge, global enterprise. Video conferencing, for example, through straightforward and intuitive software such as Skype means that meetings can be carried out between high-profile employees in different branches and locations at any time.

There’s now no excuse to postpone that important meeting if people are absent from the building, because they don’t need to be physically present in order to be involved with the proceedings. Don’t stall, and don’t let standards slip. Protecting the operation of your business depends on protecting a solid, strong line of communication at all times. Constant and consistent updates through online software is a great way to ensure that, wherever employees are, everything is running on schedules. You shouldn’t be wasting time or money trying to catch up with people.

laptop smallMake your business remotely accessible

The internet isn’t just a great place to put up a pretty website or search for solutions to your business; it can affect the core operations of your company. There are digital, online solutions to an effective business on an internal as well as an external basis. For example, you might choose to purchase a business address, because this could help to keep all your mail coming in to a virtual location, no matter where you are in the world. It’s very important for a business in the modern age to have access to information at any time in any place, as I’ve already mentioned that immediate and instantaneous access has become a requirement for employees and customers alike.

Remote access has numerous applications within any company, whatever its scope. For employees, remote access to the information and facilities that your business could be offering online is something you should consider. Not everything has to take place on the business premises, and it could highly benefit the company and staff members in terms of travel costs to allow workers the opportunity to work from home (or wherever they want). When certain roles no longer require work to take place in-house every day of the week, then salaries no longer need to cover travel expenses, and workers might be more productive, given their newfound freedom; in turn, productivity will lead to better work and increased sales. Remote working is a win-win situation all-round.

Mobile payment solutions

Customers want the fastest solution. In fact, in the modern age, people have come to expect it. Technology has made everything instantaneous, and if your company doesn’t live up to the expectations of super-fast, immediate service that your potential customers have come to expect, then said customers will likely grow impatient and move to a provider which can offer the same goods or services almost instantaneously.

For example, mobile banking solutions are making the payment process faster than ever for clients and businesses alike. Customers don’t even have to pull a card or change out their wallet to purchase something. People can just scan their phone over a payment machine, and they need not even enter their pin number; no cash needs to be counted out; no faffing around is required. If you’re running a restaurant or a retail store and you’re not making the most of these payment options, then you’re alienating a market of customers who are already living in the future and waiting for you to meet their digital demands. It’s time for your business to step up its game and ensure it keeps reeling in profits.

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How Young People Can Escape The University Finance Mentality

by Magical Penny on February 27, 2017

Are you in controlYoung people, especially those who are currently in their twenties, still have what could be called a “college/university finance mentality.” It’s this idea that you can just go into debt to get the things you want without really being productive or smart about how you go about getting money.

In the UK, university debt is financed by a government lending service, meaning that the interest rates on the loans are artificially low. What’s more, the money doesn’t even have to be paid back, unless you earn more than £22,000 per year. As a result, many young people spend like mad, not really thinking about what it is going to cost them in the long-run.

The problem is that not managing your money correctly and failing to take advantage of opportunities as they present themselves will take their toll on your finances eventually. Here’s what to do to escape the college/university mentality.

Take Control Of Your Financial Future

If you don’t manage your money, other people will step in and try to manage it for you. Some of the time, these people will have your best interests at heart. But often, they won’t, and they’ll try to send you up the creek without a paddle, so to speak. Mainly we’re talking about credit card companies, personal loan outfits and mortgage sellers who want to put you on a treacherous adjustable mortgage rate.

Rather than leaving your personal finances to the whims of others, take control of them yourself. Start off by tracking your bank account on a monthly basis to make sure that every transaction is accounted for. If you see that a company has jacked up a direct debit without telling you why, cancel it using your online banking or over the telephone and go to a different company.

Take Care Of Your Health

At college or university, you probably didn’t bother all that much with your health. Instead, you stayed up late, chowed down on whatever you wanted and spent all day sitting in the library, rather than moving around. At the time, this was all good fun, but as you’ve gotten older, you’ve started to realise that it’s a bad policy. Being unhealthy makes you less productive and ruins your professional life.

Taking steps to protect your health, however, can only go so far. Sometimes it’s necessary to go a step further and approach a personal injury law firm if you have been hurt. After all, you are your own most productive asset, and if you’re out of action, you can’t make any money. Take injuries seriously, and use them as an opportunity to improve your financial position.

save early, save oftenStart An Emergency Fund

 

Right now, you might not think you’ve got an awful lot of spare cash lying around to pay into a savings account – what with student loan fees, credit card debt payments and rent going out every month. But putting something into an emergency fund every month is an excellent way to help yourself to feel more relaxed. Nothing affects your performance at work more than constant gnawing thoughts about what you’ll do if your next paycheck arrives a day late.

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8 Financial Habits Of Successful People

by Magical Penny on February 24, 2017

We all know someone in our lives who seems to have ‘made it’. They enjoy a good quality of life and, certainly on the outside, they appear happy. It’s unlikely these people have stumbled on a magical formula, and there may be many reasons for their success. However, many successful men and women have similar financial habits that have contributed to their achievements.

  1. They Know What They’re Entitled To

Successful people are extremely savvy when it comes to working the system. They know exactly what they are entitled to. They have realised their PPI claims and are familiar with tax laws and use them to their advantage. If they’re unsure about anything, they do their research and put in the legwork. They stay within legal boundaries but make it work for them.

  1. Save pounds as well as pennies with a budget!They Save

Success rarely comes overnight, and for most people, it is due to hard work. From an early age, they get into the habit of saving money. This may have been a small percentage each month that built up over time. When their income increased, so did their savings. Even during times of hardship, they set aside a small amount each month.

  1. They Mitigate Risk

Financially savvy people work hard to manage risks. This doesn’t mean that they are risk averse, it means that they are smart with their money. They don’t put all their eggs in one basket and set limits on investments.

  1. They Remain Current

Save money nowThe world of business and finance changes constantly. In fact, the only certainty is that things will change. It is, therefore, important to keep up-to-date with new legislation and trends. Smart investors keep abreast of lucrative opportunities.

  1. They Negotiate

People who have prospered in their careers or through their investments have done so by seeking out the best deals. They don’t accept the first offer but negotiate to achieve the best possible outcome. This isn’t focused entirely on their working life; they use it in their personal life too. For example, they research the best energy providers to obtain the best price. And they shop around first before making a purchase.

  1. They Act Quickly

Being well-informed allows you to act quickly when opportunities present themselves. Because you’re familiar with the market and the pitfalls, you don’t waste time deliberating over decisions. That said, they don’t act impulsively. Any financial decision that is made is done so through careful planning and research.

  1. ImportantThey Set Objectives

Smart people set SMART objectives. The SMART acronym stands for specific, measurable, achievable, realistic and timebound. This is a framework that can be used for any goals in your life, from making investments to starting a business, to losing weight. Approaching tasks in this way ensures you remain focused on your outcomes and encourages you to monitor and measure and find ways to improve.

  1. They Switch Off

Finally, and perhaps most importantly, successful people know when to switch off. They recognise their limits and know the importance of taking a break. They plan for busy periods and make sure they don’t burn out. Spending time away from work, being with family and friends, and relaxing are all part of living a successful and balanced life. Achieving this is not always easy, but it is essential.

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