A Deadline You Need to Take Note Of

Every so often there comes along a new government rule in finance that we all have to take note of. The latest one is that we all have to swap out our fifty pound notes.

Don’t sound the alarm just yet, Kiran Trivedi readers, it doesn’t mean all your 50 pound notes (if we’re lucky enough to have them), just the old style ones with the face of Sir John Houblon on the front. This note was first introduced into circulation in 1994.

This old style of fifty pound note is being withdrawn from circulation by the Bank of England. They will be accepted as legal tender until 30^th April this year, and then retailers and some banks, by law have the right to refuse the note after this deadline has expired.

This is actually quite a common practise when it comes to legal tender. More generally, coins after a certain amount of time in circulation and melted down and notes are burned.

It’s a system that has been put in place to prevent the money from being used illegally. Notes are usually withdrawn from circulation as a whole if they have become obsolete due to new technologies in the money industry.

The particular banknote in question is the fifty pound note depicting the face of Sir John Houblon, the Bank of England’s first ever governor. It is set to be replaced by a note featuring Matthew Boulton and James Watt.; a pair famous for manufacturing coins that are hard to counterfeit. This new note entered circulation in 2011.  

The rules are as thus. Anybody who has this note has up to 30^th April to do so. Up to this date they can have any amount they want exchanged at any bank and receive the full value in exchange. After 30^th April, the rules will change.

Some British banks, notably Barclays, NatWest, RBS, Ulster Bank and the Post Office have agreed to keep on exchanging the notes until 30^th October this year. However there will be a limit of £200 worth per transaction. After this date, only the Bank of England itself will have the authority to exchange notes; by law it always has the authority to exchange notes that are no longer legal tender.

So it goes like this. Exchange those notes as quickly as possible; to do so after 30^th April will only cause you more stress that you don’t need. 

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Why Is It Essential to Save Energy if You Want to Save Money?

Wherever you go these days, the cost of energy is rising. Why is this so important in the handling of your personal finances and how can you change it?

All we have to do, Kiran Trivedi readers, is look at the situation in the UK energy market to know what is happening to energy prices across the board.

The UK market is currently embroiled in yet another energy price row. This came about after a proposed 20 month energy price freeze from Labour leader Ed Miliband. The energy companies have reacted by you guessed it, raising prices before anyone could possibly freeze them.

This has created pandemonium. The politicians at Westminster were quick to condemn rising energy prices, but were divided on how to handle it. The coalition government has now responded by changing its energy efficiency schemes in a bid to reform the sector. Naturally it’s hard to see how this can affect energy prices; however some energy companies have already cut the amount of their price hike in response. Some, not all.

However the statistics on rising prices are telling. Back in November, when the energy row was at its height, the Citizens Advice Bureau predicted that if energy companies stayed on their current trajectory, they would have, by December, raised energy prices by 37% since October 2010.

Going on this figure this means that energy prices have been raised by more than a third in just over two years. A steep rise by anyone’s standards that has an effect on the way many households live their lives. This holds true especially when you consider that average earnings have risen by 4.4% in the same period.

This means that many households are left unable to pay their energy bills along with all their other costs. It doesn’t have to be that way.

The best way to combat this is to save energy. Turn off a light when you’re not using it.  Don’t leave the TV on standby when you’re not watching something. Don’t over boil the kettle. These small things can have a real effect on the amount we’re left to pay once the energy bill comes in.

At the end of the day, energy bills are rising steeply, it’s a fact. Don’t let yourself fall prey to rising costs, turn off some fixtures and fittings and save money as you do. 

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UK Train Fare Rises: What You Need To Know

With my work for the KiranTrivedi Blog I work on a core principle. This principle is that when out your personal finance you need to budget. So why are train fares the current concern for budgets in 2014?

The key element to note about a budget is that it can be volatile. A budget is based around the idea that you total your incomings and the divide them between your outgoing costs. Logically, this leads us to the conclusion that if an element of that budget were to change, to increase or decrease, then the entire budget needs to be redrawn.

This is why train fares are a key budgetary concern to the professional in 2014. Many professionals commute by train. Whilst some only commute at certain times, some commute on a daily basis. Estimates ascertain that many professionals in modern Britain commute for longer than two or even three hours.

Naturally costs add up. When you are commuting for hours at a time on a daily basis, it has to factor into your budget. The cost of any commute, even if it is only a few pounds, is bound to add up. It is bound to have a significant effect on the budget over time.

If you are a commuter then the news that as of January 2014, train fairs have risen on average by 2.8% is of major concern. Again, it may not seem a major concern. For example a train fare of £1.90 will only rise by ten pence. However ten a day is three pounds a month and three pounds per month is £36 per year.

It’s even more dramatic for specialist tickets of certain types. Price hikes have actually gone as high as 3.1% for some season tickets, anytime and off peak tickets. However the government claims that these are the lowest price rises in the last decade.

The matter of the fact is that for most commuters’ costs of train travel are significantly higher than £1.90 a day. When you consider that a 2.8% rise on this means £36 a year rise, it starts to add up. According to the BBC for some commuters’ it could mean that they are now paying over £5,000 for some annual season tickets.

For example take a passenger commuting from Deal and Dover Priory to London. They used to have an annual ticket cost of £4,864. They will now have a cost of £5,012. This is an annual increase of £158, which this commuter then has to find in their current budget.

Budget’s change every day, it’s a fact of life. Costs rise and fall and as a consequence we have to take them and what they mean into account. With the Kiran Trivedi Blog you can keep track of the major changes to ensure your budget stays up to date. 

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UK GDP Growing Faster than Originally Expected

Statistics released to the financial industry this month indicate that UK GDP (gross domestic product) is growing at a rate faster than initially expected. This further bolsters the position that the British economy has entered a period of sustained recovery.

The statistics, released by the Office of National Statistics, (ONS), provides key insights on the rate of growth of the national economy. The key figure showed that GDP was up 0.8% in the July – September period from the same period in 2012.

In this case this confirmed earlier figure estimates the ONS had provided on the rate of national GDP growth. However it also led to a revision of earlier figures. This means that the rate of estimated annual growth, originally estimated at 1.5%, has now risen to 1.9%. This helps confirm economists’ theory on the positive state of economic recovery.

GDP is the primary tool that most economists use to measure economic growth. It is the market value of all officially recognised financial goods and services. Measuring GDP measures trade, this is the key element to estimating growth.

In an article for the BBC that featured when the statistics were first released, they feature a statement from a spokesman from the Treasury on the figures in question.

At the time the spokesman said that "today's data show that the recovery has been stronger than previously thought and that the government's long-term economic plan is working.”

However the spokesman was also cautious. He warned that “risks remain and the job is not done, so the government will go on taking the difficult decisions needed to deliver a responsible recovery for all." 

This is a warning many in the economic sector have issued over the latter half of the year in connection to the perception of a national economic recovery. Economists from various sectors have warned that recovery in such areas as the housing market could be indicative of future bubbles that could lead to future economic crashes.

This position has been strengthened by data released by the ONS on Britain’s current account deficit. This figure shows the gap in money received from exports and imports. This gap saw a sharp rise in the third quarter of 2013.  It rose £20.7 billion, up from £6.2 billion in the second quarter. This has led to fears over government borrowing.

Kiran Trivedi readers the economy is in constant flux, the industry can’t accurately predict where it may take us next every time. However as long as the sector remains vigilante against excess, we should be able to avoid a financial calamity the likes of the infamous 2008 crash.

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