May 7, 2015 10 Budgeting What is Expenditure? Rent Service charges Council tax Child support Water Contents Insurance Life Insurance Car Insurance Pension Pets Telephone Internet Alcohol and cigarettes Gas, Electric Wood Housekeeping Food Travel TV + Licence Fines Loans Hire Purchase Clothing Prescriptions
May 7, 2015 20 Budgeting Compare the market! £300 – repaid over 50 weeks Correct as of 11.03.11 Weekly Payment %APR Total Cost of Credit Total Amount to Repay Provident £10.50272.2%£246£546 Shopacheck £9.99230.2%£225£525 Just Credit £6.5126.8%£38.08£338.08 FAIRshare Credit Union £6.5126.8%£38.08£338.08
May 7, 2015 21 Budgeting Weekly payment centres Cash price £1,654.74 + Service Cover + Damage Liability Cover £27.01 per week for 3 years TOTAL COST £4,214.11
May 7, 2015 22 Budgeting Loan Sharks A loan shark is an illegal money lender A legal lender will be registered with the Office of Fair Trading. You can check if a lender is registered by contacting the Consumer Credit Register: 020 7211 8608 or visiting their website: www2.crw.gov.uk/pr
May 7, 2015 23 Budgeting Loan sharks tend to: Offer loans on very bad terms Charge an extortionate rate of interest Harrass people who get behind with their payments Pressure people into borrowing more money to repay one debt with another Suggest that borrowers will be prosecuted or sent to prison if they don’t repay their debt – this can’t happen as they are not legally registered lenders.
May 7, 2015 24 Budgeting Already used a loan shark? You are under no legal obligation to pay back a lender who is not properly registered. You should contact your local Trading Standards office immediately: www.tradingstandards.gov.uk/advice www.tradingstandards.gov.uk/advice You can report a loan shark anonymously: 0300 555 222 firstname.lastname@example.org email@example.com Text LOAN SHARK and the lender’s details to 60003
May 7, 2015 25 Budgeting Reduce your spending Use your local Credit Unions! Owned by its members Secure savings Affordable loans Responsible lending Fully regulated Free protection on all savings and loans
May 7, 2015 27 Budgeting If Debt gets OUT OF CONTROL Red Bills… if you fail to pay on time Bailiffs… calling at your home Attachment of earnings… if you are working Bankruptcy… will mean no loans, no holiday, no car Arrest… if you fail to comply with a Court Order Prison… for Contempt of Court