What should I ask George Osborne?

On Thursday I’m part of a panel of four interviewing the Conservative Shadow Chancellor George Osborne MP for the News of The World. As far as I know there’s a senior economist, business person, city financier and me.

While of course I have my own ideas, I thought I would tap MoneySavers for what issues you need answers from him.

Of course my role is to look at consumer issues, so credit cards, shopping, mortgage and savings policy, bank charges are core territory. So what you’d like to know should be within those subjects or similar ones.

One thing I can guarantee you I will be asking is “If the Conservatives were to form the next Government, will you ensure that compulsory personal finance education in schools continues as planned for September 2011?” (see the a nation educated into debt editorial comment).

And just in case you’re wondering why I want to pull that one out, it’s because I suspect this blog will get read by his people, and I’d like him to be prepared so he can either give a huge great big positive commitment there and then, or be prepared to tell MoneySavers they won’t back it up (see the MSE Education poll result for how many are in favour).

What would you like me to ask?

So if you have any suggestions for questions within the appropriate areas please let me know using the link below.

Comment and Discuss

Monopoly tactics

Picture it… you’re sitting on a train, three twentysomethings are playing travel monopoly next to you, you glance over and one is within easy reach of smashing the others out of existence. Yet he’s completely unaware of what he should do – the game drags on…

It’s pure pain

That may sound like no big deal to you, but it gnawed away at me like a woodpecker on an oak. Regulars will know I love my board games, and before my current scrabble obsession, (see 158 point single go scrabble joy, I hate Stoozers (17) and Scrabble – an easy way to win) it was monopoly.

In fact I was once close to agreeing with my publisher to write a book on ‘Money lessons from Monopoly’ though time meant I ended up not getting there (and I would need a snappier title).

So I found myself itching to interfere and explain what he should do (I’ve similar issues when I hear people talking about their money products and making obvious errors) and while I know I shouldn’t, embarrassingly I did. Mrs MSE rolled her eyes at me, she’d seen me itching to do it but they’d opened a conversation by asking about plug sockets and then mentioned they knew who I was.

So in a blush of enthusiasm the door was whammed open to monopoly tips-ville…

I hope you don’t mind, you own all the yellows and no one else has the ability to get any house or hotels. If you mortgaged all your other properties and used the cash to buy houses on the yellows, and barring any freak dice roll anomalies you should win the game quickly.

Just ensure you keep a small emergency fund if you pay rent. This is a much more efficient use of your cash than simply relying on rents for all the non-developed properties.”

Luckily they were good humoured about it, and intrigued to know a little more so we got onto more tips such as which were the best properties to buy and my nerdiness came in (after all, we are a nation educated into playing monopoly but never an education about playing monopoly)…

“For me, the orange properties probably just tip the scales as best-buy. That’s because the return on capital employed is high (i.e. the amount of cash you can get back compared to outlay for both the initial property and developing it) and there’s a very good chance of landing on them.”

“That’s because the jail square is the most visited on the board, and 7 is the most likely outcome of throwing two dice – and the orange properties are 6, 8, and 9 away from the jail board.”

With slightly gawping faces at my ridiculous geekiness they then played on. Very quickly the yellow owner, who’d started following the ‘mortgage all but yellow’ system started to rocket into the lead, so the other two teamed together, which extended the game somewhat, but it was already too late – a “you’ve unleashed a monopoly monster” was flung back at me.

Thankfully I didn’t kill their enjoyment completely – they then went on to start to play again…

Comment and Discuss

Give pocket money as pay

Pocket money is under-rated as a way to teach kids core money lessons. The idea of them having their own cash is beneficial…

• It teaches them about regular income.

  By having a regular amount of money you start to learn the concept of saving versus spending.

• It incorporates ‘opportunity cost’.

  While each of my two money mantras normally have three questions to ask yourself before you spend (see the stop spending guide for more, actually there’s a core question in each. If you’re skint it’s ‘ask yourself do I need it?’, if you’re not skint it’s ‘is it worth it?’

  The latter is all about opportunity cost, whether you could get better benefit or enjoyment spending the same cash on something else. For a young child it’s perhaps “do you want to buy sweeties with your money every week or save up to get the toy that you want”?

  If they get the sweets, when they ask for the toy it’s worth reminding they had the sweeties instead, and next time they may want to change the decision. In life we’re always faced with such choices, so learning to manage them early is great.

• It’s a beginners’ guide to saving.

  It even allows them to start to understand more complex questions such as ‘to save at home or put money in the bank and gain interest’ which of course should always be maximised (see top children’s savings guide)

Working for your cash makes you realise what it’s worth

As I’ve got more involved with the coming launch of financial education in schools, I’ve found myself being interviewed and thinking more about how to construct money lessons in all circumstances, and I think there’s still possibly a key lesson some parents miss.

As adults we all know money doesn’t grow on trees, you need to work for it and generally the more work you do the more money you have…

• Don’t just dole out cash to kids.

  When children are regularly rewarded for doing nothing, in effect it’s ‘trust fund teaching’ the idea that you’re simply given money because of who you are. Doling it out on a plate is unrealistic and isn’t a good idea (even for those who do have trust funds, it can be a disincentive for improvement), so rewarding for work done is important.

• Be careful about what counts as work.

  Reward a child for cleaning their room or behaving well. The message is this is something you’re not normally obliged to do, rather an added benefit, and that’s not particularly what you want.

  Far better is to reward doing things for others such as cleaning the car or for the family like washing up everyone’s dishes or even helping others like taking the bins out for an elderly neighbour who can’t do it for themselves.

  Of course there’s a balance when effort above and beyond the call is made (such as great exam results) but in general, in the adult world, if work were so good we wouldn’t get paid the same concept can be applied for pocket money.

• Be consistent.

  To make this work you need to be consistent and give legitimate expectation to your child – make it as fair as possible.

Of course it’s easy to say this on paper, and I know sometimes rewarding children financially is an easy way to get them to behave or quieten down, yet if possible it’s worth considering the message too.

I’d love to know what you think and your top pocket money tips.

Comment and Discuss

The Shouting Men film premiere

Normally Tuesdays are sacrosanct, it’s the day we send the weekly money tips email, so from the moment I get up (which is early as it’s a GMTV day), barring a few appearances, it’s all guns a blazin’ until we finish sometime before 10pm (on a good day)…

My diary is permanently blocked out on that day, nothing comes ahead of it. But this week was an exception, I got invited to the 6pm film premiere of The Shouting Men (link shows the trailer), a new Brit flick comedy following a potty mouthed, disabled football thug as he lands a bunch of misfits in trouble (see the Guardian Review for a proper description).

Why break the Tuesday rule? Simple, Mrs MSE was in it, and if there’s one thing that comes ahead of the weekly e-mail, it’s Mrs MSE. She plays herself in it, a TV reporter who is following the story of Gillingham’s trip to Newcastle, and mistakenly believes the thug’s a victim.

Now while I suspect my review is slightly coloured with bias, I have to say I loved it and was laughing out loud most of the way through. It’s got a good heart, quick paced, road trip feel to it, mixed up with a bit of toilet humour and some great one liners.

The oddity though was sitting in the cinema at 6 o’clock, having to go through emails about the weekly email, as this week there were some issues that needed careful legal handling.

Then as we briefly popped into the after show party, I was leaning over a chair to get close to the window so I could hear the lawyer I was on the phone too, when I felt Mrs MSE tug at my jacket tails. It turned out a photographer was snapping pictures of her and me, with the seat of m’pants in plain sight!

Then back home to carry on with the email!

Comment and Discuss

Gio Compare

Following on from my early comparison site advert missive on Moneysupermarket’s Omid Djalli there’s more news in the sector, this time about the GoCompare Opera singer. It’s without a doubt the most annoying financial advert, garnering 50% of the vote (see most annoying ads poll, yet a new story shows it’s a massive hit for the company…

This isn’t a surprise for me, a few weeks ago I wrote a blog on are annoying ads are really bad? I wondered whether the attention and name recognition they bring paid dividends. I was put off this theory slightly by the number of people in the blog’s forum discussion that postured it couldn’t be good as they’d never use the site – even though it’s currently one of the top pick car insurance comparison sites.

Yet the following press release has just dropped into my in-box…

“Gio Compario, Gocompare.com’s fictional opera singing ad character, has helped drive a 20 per cent increase in customer numbers for the comparison site with over 2 million insurance quotes a month in January and February.

Full details are attached but if you would like to talk to Gocompare.com, find out more about this story or need pictures please don’t hesitate to get in touch.

“Gio drives Gocompare.com to record results
Opera singing character’s campaign produces over 2 million insurance quotes a month

Gio Compario, the larger than life opera singing character from the Gocompare.com TV adverts, has helped drive record customer numbers for the insurance comparison site.

The campaign, which launched in August 2009, has driven a 20 per cent increase in customer numbers for Gocompare.com over the last six months and, in the first two months of 2010, has helped generate over four and a half million quotes for insurance alone.

The campaign stars opera singer Wynne Evans who recorded the reworked George M Cohan classic ‘Over there’ as well as acting in the ads. So far Gio has been seen popping up in coffee shop and restaurant settings, as well as jumping out of a cupboard in a finishing school and hovering over suburban driveways.

Gocompare.com’s head of marketing, Nick Hall, said: “We’ve seen a dramatic increase in brand awareness since the campaign started – up by 450%* – which puts us at the top of the price comparison category, and this has ultimately converted into record customer numbers. The aim was always to differentiate the brand and put some fun and personality into the ads and to date it has worked exactly as planned.

“Gio is a great character with huge audience recall and we are looking forward to developing the campaign further in 2010. It will be interesting to see how Gio evolves.”

Wynne Evans, who plays the fictional tenor said; “Gio is great fun to play, he’s a larger than life comic opera character and it is a role you can really throw yourself into. I’ve always enjoyed playing the comic parts as well as the more serious stuff, so I think Gio is a combination of all those great comic opera characters. Everyone seems to know the character now and I get so many people singing it back to me. The reaction has been amazing so I’m not surprised at how well it is working for Gocompare.com.”

Comment and Discuss

Omid Djalili

This Sunday Time’s money section back page ‘Fame and Fortune’ profile was on comedian Omid Djalili, who’s referred to as the “Star of the Moneysupermarket adverts”…

Initially I found it tough not to picture the press office at the big comparison site, heads in hands, while reading the paper. Then again maybe it’s just part of a clever campaign positioning for them to do a money makeover later?

In the ads he berates the nation for being awful hagglers, telling people they should be more like him and use the website, yet the profile suggests it was more from the script than from the heart (read it in full here Omid Djalili Fame & Fortune)…

• Until a year ago he had bailiffs around, though I was pleased to read he now has a direct debit to repay at least the minimum repayments on his credit cards, to avoid fines or credit impacts (though I would urge him to try the minimum repayment calculator to see the impact – then keep the direct debit but manually try and pay off more on top)
• Then there was the fact he didn’t know he’d been contributing to a pension until his accountant told him.

Neither of those are too damaging to the Moneysupermarket message, as they’re not about best products but examples of poor financial management or low income and thankfully it seems he’s getting a handle on (and I’ve a slight suspicion it was a little tongue in cheek – can’t be sure though)

Yet there was one quote that seemed to run square on counter to the comparison message:

Are you a saver or a spender? A bit of both, even though I’m getting something pathetic like 0.5% interest on my money, I quite like leaving it in the bank and looking at it build up.”

The rate is hideous, currently you can get at least 3% in the top saving account and 3.5% in a top cash ISA too.

From a MoneySaving perspective there’s an even bigger worry though, it breaks one of the basic rules to pay off debts with savings.

I’m secretly hoping that as this blog appears in Google News, it may pop up if he searches his name, and he’ll read the info below.

Omid, the biggest thing to sort is those credit card debts. Past defaults mean you’re unlikely to have a good credit score I suspect these are costing you 18%-30% (or £180-£300 per year per £1000) while your savings are earning you 0.5% (£3 after tax per £1000).

Therefore pay off the debts with the savings account you’d be £177-£297 per £1,000 better off – lowering your debts and the commensurate interest and helping you be debt free much more quickly – if you’ve five minutes please read the pros and cons here (read repay debt with savings for full info). Best of luck with it.

Comment and Discuss

It's raining men

There are some things you thought you’d never say. For me, “my wife’s getting jiggy with Michael Fish” is right up there, but it’s true…

On Saturday night Mrs. MSE is taking part in the Sports Relief Let’s Dance programme as part of the weather girls’ team. Alongside GMTV’s Claire Nasir and ITV’s Becky Mantin, she’ll be dancing to a pretty appropriate song for weather people (Im not allowed to give it away). And who’s the secret sexy ‘hunk’ due to appear in the midst who pops up as the object of their lust… Mr. Fish.

I’m going along to the studio to watch as part of the cheer squad, and for once I’ll find myself dialling the number of a TV phone to vote for her – all other support welcome too!

Comment and Discuss

Engagement, wedding, babies...what next?

On Friday night in the office, we were celebrating MSE Dan’s engagement to his girlfriend, now fiancée, Laura the week before (huge congratulations to them both)…

I instantly thought of my own engagement. Within three minutes everyone started asking ‘when’s the date’ and the pressure came on to sort out the wedding.

Then it occurred to me, in adult life there are always these constant big questions that friends, and especially family, ask…

For me they’ve been:

• When single – “when are you going to settle down?”
• When in a stable relationship – “when are you going to get engaged?”
• When engaged – “when are you going to get married?”
• When married – “when are you going to have children?”

I’ve always found they grate somewhat, after all they are so obvious. Surely if a decision had been made I would’ve told people?

What’s next?

So I wanted to ask those further on in these life stages…. what are the next ones? What do I have to ‘look forward to’?

Comment and Discuss

Happy Birthday MSE

This site was founded 7 years ago today, 22 February, and the design cost me £100. I’d drawn exactly what I wanted on a piece of paper and sent it out to a designer in Uzbekistan (see MSE history).

Prior to that, while I used the same URL, it was effectively just my home page and looked like this: MSE pre launch.

Then the new site launched with proper navigation (ish) and the forum for the first time – MSE just launched.

It’s been through a few iterations since then such as 2005 MSE and 2007 MSE to get where it is now.

The site is now roughly the UK’s 55th biggest, with over 9 million unique users in a month and 4 million getting the weekly money tips email.

It’s grown far beyond what I ever dreamed it could be, and is now far bigger and beyond me, not just the team of nearly 30 working full time, but the movement and concept that’s grown behind it.

There are areas in the forum discussing subjects I know little about, yet the contributors and volunteers make that an amazing social resource too.

Thank you to everyone who’s helped – long may it continue.

Happy Birthday MSE!

Comment and Discuss

Sir Nicholas Winterton's comments on Radio 5

The furore over Sir Nicholas Winterton MP’s uncouth comments about train travel seems to miss the point. Of course his remarks were ill-judged and out of order, saying on Radio 5 of people in standard class, who of course pay his salary…

“They are a totally different type of people. There are lots of children, there is noise, there is activity and all I can say is I like to have peace and quiet when I travel because more often than not I am working and I want to concentrate.”

Yet had he just said “I can work better in first class as it tends to be quieter and I get a power socket for my laptop” then I doubt it would’ve raised an eyebrow. I know when I’m filming TV programs across the country I put a similar point of view across when they’re booking my travel, and do tend to get more work done.

The real question is about value not class

Where I think the point’s been missed, is that as we taxpayers are paying for his train journey, surely we should care more that he’s getting value for money than which class he’s sat in.

If he’s on a first class £50 London to Macclesfield return as opposed to a £200 open flexible standard class return, then bravo – enjoy first class.

And that pricing dilemma is common (see the cheap train tickets guide), it’s not as simple as first class is expensive and standard class cheap.

And it’s this that the system should delineate on – just give MPs a constituency travel budget and let them spend it as they will. Then like everyone else they can choose between prioritising whether they want a flexible open ticket or to travel up front in 1st class and if they want both, they can reach in their pocket to do so.

We could cut a whole lot of nonsense out of the expenses system by just allocating a flat rate of expenses. Each MP would get something like this…

• Salary.
• Staff and office allowance. While the MP would be responsible for recruitment and allocating tasks – technically the staff would be employed by a central commons human resources facility – which would take the burden of human resources issues from the MPs. That central office would also supply all the furniture and equipment – and utilise central purchasing to hopefully keep costs down.
• Second home allowance. We require our MPs to work both in London and in their constituencies, so I’ve no problem with them having two residences. A flat living allowance given to all MPs outside of London constituencies would be a simple way to do this.
• Travel allowance. Again as we expect them to travel between parliament and constituency we should pay for this – an allowance based on mileage and travel convenience of the constituency (a relatively easy piece of work to do).

If we did that, and an MP chose to live in a bedsit paying £50 a week rent, fair enough – keep the difference – the same for the travel budget. The only one this shouldn’t work on is staff and office allowance, but central purchasing would stop that.

MPs can travel 1st class

While of course there’s been rightful outrage over duck ponds and moats, we need to put this in perspective. We entrust our politicians with spending £650,000,000,000 a year of our money.

One small minor mistake can cost hundreds of millions of pounds – the entire expenses bill of all MPs added together is a tiny fraction of that. To get this right, it’s time to stop punishing those who’ve made mistakes (the worst of whom are either being prosecuted or have sensibly decided not to stand again) and instead build a sustainable political system.

We actually have one of the least corrupt political systems, MPs pushing expenses isn’t good, but it’s much better than taking legitation impacting illegal bungs as has happened in some legislatures or the financial political patronage system of the USA.

If we want MPs to improve and act like grown ups, we need to treat them as such.

Link their pay to equivalent professionals

While it isn’t necessary to make the system above work, I think it’s time we linked MPs salaries to another relevant profession. They’re paid less than GPs or judges and I think we want a similar caliber of people. One easy route would be to link their salary to district judges which is about £120,000 – nearly double what MPs currently earn.

And before anyone suggests it – I promise I have no intention of ever standing. It was something I once wanted, but I swore off it years ago. I couldn’t cope with the stress levels and my skin isn’t thick enough.

I know many think, “they should know what some of the poorest feel like and how hard it is to live on benefits.” Well that’s right, they should know what it’s like, and they should be in the community talking to people, reading places like the MSE forum and taking part in social experiments like the brilliant tower of commons program on Channel 4.

However its time to make a decision do we want MPs to be ‘representative of society’ or ’society’s representatives’. If we choose the first option then we pay them the UK’s average salary about £25,000.

On the other hand think about a court of law, and who you would want ‘representing’ you there – personally I’d hope for an extremely well educated, experienced competent barrister who is best qualified to argue my point of view and support my stance, in which case if we want to attact those people we need pay them a salary commensurate with those skill levels.

If we didn’t have such entrenched parliamentary seats (there are some constituencies where a donkey with the right coloured rosette would win) I’d suggest we give MPS a pay rise each time they’re re-elected as it would indicate their constituents are happy with them.

Most of the MPs I’ve met work hideous hours, are dedicated to their task and run a gamut of balancing parliamentary commitments and trying to deal with the individual problems of their constituents.

The viscious circle of vilification

The shame is MPs have been vilified and aren’t trusted; which they must take their fair share of the blame for (especially bigoted comments like Sir Winterton’s). Though the media and the public share some of that – for focusing on bad boys in the headline and tarring all with the same brush.

The sad consequence of this is we will end up with poorer representation because of it. There’s still a queue of people wanting to stand for parliament, but I can’t help thinking the calibre must be poorer because of the dire reputation and that’s not good for any of us. We want politicians we can respect.

Comment and Discuss

We've got your number!

This is a message to pun-meister comedian Tim Vine…. we’ve got your number! Mrs MSE and I are going along with Jeremy Vine (Tim’s brother) and Mrs Vine to see a gig soon, and luckily someone has just sent me this denofgeek article.

Here’s a quick cut and paste of the offending paragraph…

On your last DVD, in the extras you showed you getting your dad on stage to tell a joke. Are you bringing any family members along this time to do the same?

[Laughs] I think my brother’s coming along to one of the London gigs, so I might do an impression of him! And I think Martin Lewis is coming too, from Money Saving Expert. I shall probably take the mickey out of them! Maybe I should get my brother up on stage?!”

So we’re prepared – watch out (erm… how being prepared is actually going to help I’m not quite sure… but we’ll think of something).

Will you be using one of m’jokes?

Having said that I must admit I’m stoked at the thought one of my jokes may be used in the act.

Prior to reading this article I got a message from Jeremy who’d read my Tim Vine joke contest blog.

It seemed Tim liked the following that I wrote and asked if he could use it…

“I was in a shop the other day, they put the heating on full blast, I complained to the manager ‘it’s over 90 degrees in here’ he said ’stop being so obtuse!”

It’d be a privilege to hear that delivered in true TV style and make up for any taking the Michael that’s done (and surely Jeremy is a far funnier target than me anyway!).

Comment and Discuss

Snowboard Cross

I love the Olympics, and I’m glued every evening to my TV set, watching bizarre sports on white backgrounds…

One of my favourite discoveries has been Snowboard Cross – a motorcross race done on snowboards, with people gliding through the air as often as on the snow, and full of thrills and spills.

If you don’t know what I’m talking about you may remember Lindsey Jacobellis, in 2006, miles in the lead and pulling an unnecessary trick at the last moment, falling and losing gold (watch the 2006 Olympic womens snowcross final video). The poor woman crashed out again this year; this time in the semi-finals.

What’s the point of consolation finals?

Now the most bizarre element of the whole sport to me is the fact that the four snowboarders who lose in the semi-final compete in a consolation final, also called the B final or small final.

I don’t really get it, there’s no medal! Admittedly it may have something to do with the ranking but the last thing I would want to do, having failed to qualify in the semis, is race again to see if I can come fifth overall.

Do other sports have that?

Comment and Discuss

Youths and social networking

Mid-lurgy (the noro-virus isn’t fun and takes a long time to go) over the weekend, I caught one of the BBC2 Virtual Revolution programmes. It was quite interesting, although far too Americo-centric for me – I was surprised to find it was a money programme production at the end as it felt like a US show which’d had a couple of UK clips dropped into it…

Will the mistakes of youth haunt us later?

While not the core content of the programme, the small section that resonated most with me most was a small thought from presenter Dr. Aleks Krotoski. She made a worrying comment about the permanency of social networking content and its longevity.

To me it conjured up the image of a responsible parent trying to discuss behaviour with a potentially wayward teen, who after a quick google search found evidence of their own adolescent boasts about how they “drank till they puked, shagged everything and everything, and got off their face on some tablet or other”…

In the past this was perhaps the prerogative of the wealthy and media covered (I’m thinking about ageing rockers who sang “I hope I die before I get old”). Yet now with the mass casting media it’s surely something that many will face.

Is social networking a virtual tattoo?

It may be that these hardcoded memories are a leveller, something that reminds us of who we are, what we were and where we came from, but I’m not convinced that’s always good.

At its extreme you have the unfortunates who’ve had pictures taken of them knickerless, drunk in the street, which have then become worldwide viral successes (never mind Big Brother contestants and bottles); yet far more widespread is the entire wealth of chat and information many people voluntarily place on social networking sites.

Does that make social networking the modern tattoo? Here I’m partly thinking about the MSE forum, but am especially focused on Facebook type sites where you post without anonymity. Giving yourself an image in a way that seems good when you’re younger, can be a dangerous decision that can be more significant than you realise on the long run.

Comment and Discuss

Most annoying tv ads

This week’s poll is all about which of the current crop of financial ads is the most annoying. The runaway winner so far with 54% of the vote is GoCompare (see annoying ads vote).

In the linked forum discussion there are a number of people complaining that ad people must’ve been paid good money to come up with something so annoying.

Is an annoying ad actually bad?

Perhaps annoying means memorable which means brand building.

How many people now instinctively start singing the tune, and therefore cementing GoCompare, a relatively new company, into the nation’s consciousness (not too bad a thing as it’s one of the top comparison sites in the car insurance and home insurance guides).

Certainly the compare the meerkat ads which started the latest comedy trends worked, and the company saw a massive upturn in business. Of course that’s rated far less annoying but isn’t advertising partly about how memorable something is?

Now the ‘funnies’ are everywhere and it’d be interesting to know if they’ve closed the gap on the brand building power of Mr. Orlov.

So to those who find GoCompare annoying (which is the majority) the real question is does it make you more or less likely to visit it (ignoring the fact that I hope you’d check out the MSE guide on the relevant subject and use that)? And while your instinctive answer may be “I wouldn’t go near it” are you sure the name recognition wouldn’t actually power through at the right time?

Comment and Discuss

Bargain engagement rings, is there a catch?

We’ve recently created the new Amazon Hidden Discount Tool which finds large reductions on Amazon. It enables you to create your own bespoke pages of hot discounts. We generated a few example links yesterday, and I ended up looking at the engagement rings 90%+ off* search.

I was blown away by the discounts – a number of rings were originally priced at £14,000 but reduced to under £1,500. The shock comes not just because of the size, but these are products where a substantial proportion of the cost comes from the raw material.

Assuming probity, there are two most likely explanations for this (note these are usually not Amazon products direct, but Amazon Marketplace products – i.e. third party sellers).

• The initial price is deliberately over-inflated. Has this been done just to make it look like there’s an enormous reduction or even to target the type of search the tool does? Is it a ridiculous intitial retail mark-up.
• They’re under priced for speed sale – meaning the diamonds & platinum/gold could be sold at a profit. If the reductions are real, it should be possible to buy the rings, and sell the constituent parts for profits – though please don’t think for a second I’m advocating that.

Checking out the listed value – a £6,000 profit is too good to be true

To test this theory very roughly (and I am no diamond expert so my notes are as rough as an uncut gem) I took one ring as an example.

It is listed as a 1 ½ carat, H color, SI1 clarity, certified, round cut, diamond ring on a platinum base, priced at £1,460 reduced from £14,000.

I then put that diamond into this diamond search tool (not one I know, just one that popped up on Google) – which told me I could buy it for £8,100.

So therefore it’s easy to jump to the thought there’s a £6,000 profit to be had. Yet of course let’s be realistic, that’s a retail price to purchase: so halve it due to mark up, then take more off for VAT and tax and say you could only sell it for £3,000. That’s still a profit of £1,500.

So what’s really going on here? No business can run that way, so something surely is up. Can any jewellers shed some light on this?

And please DON’T think I am in any way suggesting anyone buy these to make a profit – the intention of this blog is only to mull ideas about what’s going on here.

Comment and Discuss

Are women afraid to poo at work?

Forgive me for blogging about a vernacular unrelated to MoneySaving, but while it may look like a light hearted blog, this is actually a genuine social issue and as I’m not sure it’s been covered elsewhere (and am worried what’ll happen when googling it), I thought I’d blog.

The Background…

In a break between meetings, the other day, I was working in a coffee bar; my back to a group of four women. Unintentionally eavesdropping, I heard as they started discussing how they never used the toilet at work to poo.

One of them admitted she often feels ill during the day because she forces herself to wait until she gets home to do a number two. The others admitted to similar feelings ranging from “I wait until no one else is in there” to “I find another loo not near where I work”.

I found this a complete shock. After all our bodies need to evacuate, so while there may be a bit of noise, surely it’s nothing to be too concerned about, we all do it?

It’s more widespread than that

I mentioned this discovery to a few people, and it seems this isn’t an isolated incident, it’s been confirmed again and again and again (the only ‘regular’ thing about this) – always by women, though I’ve no doubt some men feel the same too.

The Japanese factor

The coffee break conversation wasn’t the first time I was made aware of this problem. When I was in Tokyo, the toilets there, as well as having heating seats and a remote control panel for various accoutrements, start making a flushing sound as soon as you sit on them.

At first I thought the loo was broken, then later I found there was a button on the remote control to turn this off and on. When I asked about it I found out it was developed as Japanese women used to continually flush the toilets when on it to disguise the noise. It was such a waste of water that in the end they developed a button to replicate the sound.

A stigma that should be exposed?

It’s easy to snigger about this, yet while I’m not a doctor, it can’t be mentally or physically healthy that some people wait hours after their body’s request.

I mentioned the problem at GMTV the other day and suggested they should do a story on it (though obviously more for Dr. Hilary than for me) as with any problem that has a social stigma, exposing it makes it easier for everyone.

After all there was once a time where people were scared to buy or mention condoms and the desensitising of that has doubtless stopped many STIs and unwanted pregnancy.

So in the meantime at least maybe this blog will start it off for a few people.

Comment and Discuss

The Power of Yes

The National Theatre kindly invited Mrs MSE and me to see David Hare’s new play, The Power of Yes. It’s a first person narrative tale of his meeting with the big players in the financial collapse as they explain what went wrong.

A meeting that ran on meant we arrived a few minutes late, but thanks to the NT’s TV screens outside showing the play, we didn’t miss too much until we were allowed in the theatre.

As we sat down the entire crisis was blamed, only somewhat tongue in cheek, on people who worked at Goldman Sachs or went to the London School of Economics (LSE).

As a proud LSE graduate and Governor of the Uni, my eyebrow raised each time that line was repeated and I wanted to jump to the institution’s defence. Then again, as a huge proportion of LSE graduates end up in the City, there’s probably a grain of truth in it.

An anti-City polemic or expose of the system?

The tone of the play did feel like an anti-City political polemic, and perhaps at some times was over complex.

Either it, or I, got a wee bit confused at one point. I’m not quite sure whether it was trying to blame those involved because they thought they could beat the market’s risk when of course they couldn’t – or because they couldn’t control the market’s risk.

Yet it did expose the deep underbelly of misunderstanding. The feeling you get is no one truly understood what was happening, but as long as they kept making money during the fifteen year record bull run no one really wanted to ask questions, not regulators, Governments, or even bankers themselves.

My favourite lines….

”In politics spending that you approve of is called investing.”

Definiton of a bubble, “intelligent people invest first, stupid people follow” (quite similar to the greater fool theory)

Where it packs a punch…

The play could be summarised in one line… ‘we geared up the world due to slicing and dicing, and split the debt so everyone feels the pain’. The whole crisis was laid firmly at the foot of the debt markets.

In the old days if you borrowed money, it was the cash someone else had saved in the bank. The profit came from the difference between what the interest depositors were paid and what borrowers were charged.

Yet here, debts were sliced up and sold to many different institutions who in turn sliced and diced again and again and again. In the end every debt was a TV screen of pixels each owned by someone else – yet with no real substance. And of course when the crunch came the whole thing went kaput.

Worth seeing?

The play was a brave attempt to turn a terse, complex subject into an obtainable piece of theatre art. Overall it succeeded, it was entertaining if a bit complex in parts, but told the story well so as, I suspect, to keep both those in the City and interested generalists happy.

So if you’ve an evening free and like high brow theatre, it’s worth a trip. And if you’ve seen it I’d love to know what you thought.

Comment and Discuss

Should service charge be included?

I’ve just spent a couple of days in France, where in many places there’s no service charge, the price you pay is what it says on the menu.

This made me think about the pricing in UK restaurants. By and large it splits into two…

• Service included. Here 10% or 12.5% (up to 20%) in the extreme is added at the bottom of the bill.
• Service not included. Here you’re usually expected to tip 10% to 12.5% – though it varies

If service is part of the bill why split it out?

If service is included then it forms a part of the cost of every dish you order.

So typically the bill at the end currently looks like this

Total:                        £45
Service (12.5%):       £5.65

Total:                        £50.65

Wouldn’t it be more clear and more accurate if it were instead:

Total:                        £50.65

That way the price on the menu would actually reflect what we pay in the end.

This is only a change of presentation of course so the extra money should still be divvied to staff in the same way, and should still be voluntary.

Would it work?

As stated at the beginning I’m not totally wedded to the concept. There are certainly some problems with it…It would make it more difficult for people who didn’t like the service to exclude it, and a change like this could be inflationary. Would the restaurant really charge £6.75 for the Chocolate pizza or just round it up to £7?

But that makes the food look more expensive, and as a result we may move back to the voluntary service proposition where you choose how much you actually tip.

So I thought I’d blog my mulling to see what the consensus around this is.

Update Note: Having read some of the forum discussion – I think there’s a wee misunderstanding that I’m suggesting this as a preferred option. I’m not, like most people I would prefer service NOT to be included, and you can tip if you choose to.

My thought is if restaurants want to include the service automatically, which is semi-coercive, then it’s worth considering making them do it this way.

Comment and Discuss

P.S. And if you use a 2for1 restaurant voucher should you tip based on the pre or post discounted cost?

Not easy to ditch 'n' switch PMI

It’s not revelatory to say insurance renewal costs are a charge for apathy: if you don’t take the time and trouble to requote at renewal (see the car insurance and home insurance guides), you will almost always pay more.

In fact as many often discover, get a quote as a new customer from the company that provides your existing cover and it will often be cheaper.

One easy way to demonstrate this would be to oblige insurers to put the old cost next to the new when they send a renewal document (I wish I’d included it in the 50 words manifesto).

My sneaky insurance hike

Recently I got a renewal through on my private medical insurance policy. While I’m a believer in the NHS, timing and scheduling are crucial in my career, and if I suddenly need treatment, this is easier.

Intuitively I thought the price seemed to have jumped, and lazily, rather than searching for the paper work I called up (don’t worry it was part of my inclusive minutes) to ask what the premium was the prior year.

The jump was 12% – and that simple stat brought it home to me that printing the prior price would have two simple benefits.

• People would be shocked into ditch ‘n’ switch action

  If you saw in black and white the increase, it should help make people realise they’re paying over the odds and get the impetus to change.

• Insurers would limit their rises

  The publishing of last year’s figure would disadvantage insurers as they’d know if they push prices too high they’d lose, so it should act as an incentive to stay competitively priced.

In my case with PMI it’s sadly not as easy to ‘ditch and switch’, as new policies exclude pre-existing conditions; so it’s possible to lose out quite severely.

Even so as I haven’t made a claim in the last year, I was rather put out by the fact that the main justification for the cost increase was my age (jumping from 36 to 37). After all I’ve aged by 3%, but my policy costs are up 12%.

I told them that, and their counter was the ‘ongoing increase in medical technology’. There is some truth to that, but at current levels of inflation my thought is it’s simply the ongoing ‘premium rise’ profit technique of most insurers.

So I stuck to my guns and tried the haggling approach and after two days they got back to me offering a month’s free cover – which is effectively an 8% discount – bringing back some of the increase.

Comment and Discuss

How much can you save in a day?

Last Thursday night I did an ITV1 Tonight called ‘Can you save a grand in a day?’ (watch it here). Thanks to all those who sent great comments and feedback, though in the midst a few have commented that the family were wrong – and that we should’ve looked at a family with more severe debts.

Here’s an example email:

I watched your program yesterday on ITV1 at 7.30. While it could have been interesting I’m afraid the family that was highlighted do not represent the true debt real people are suffering.

For instance, the family has 3 cars & 4-5 motorbikes! If they were truly in debt they would have sold these items. (please see footnote on this – ML)

I would request for you to talk to families in real debt such as me & my husband. We have no cars to sell-no motorbikes to sell & no-one to help us.

We are in true debt & I think it should be highlighted to give some encouragement to ‘real’ people actually suffering from debt & not people that just can’t go on holiday or have their nails done.

Many thanks for your time. Nicola”

In many ways I find this slightly frustrating, as I’ve done many programmes on families with far more severe debts in the past, but you can’t do every one that way, and in many ways I think they are actually not good to focus on (I’ll explain in a moment).

On ITV1 the story was that of a lovely family who work hard and have got progressively more worried about their money. They had already started to cut back, but I went in with the team to see what more we could do.

Yet I understand why some feel frustrated about the story, so I wanted to try and explain to Nicola and the others who’ve been in contact why we sought that type of family. These things aren’t made up on the spot; there’s a lot of good reasons why they happen this way.

• This is a prime time ITV1 programme

It’s important to think of the context here and understand that I do not have carte-blanche to do whatever programme I want. This is ITV1 Tonight; it’s a prime time programme on a non-public service broadcaster. Frankly it’s a fight to get a slot on there anyway; to do so you need to be sure that it’ll get decent ratings.

To get a show on air talking about money is difficult enough, it has to be sexy and direct, and appeal to as many people as possible to get commissioned. As such the concept of ‘how much can we save in a day?’ works. The resources and rating for a ‘follow someone through their long term debts’ simply aren’t available to me.

In the past some of the ideas I most care about have not made it to air, but that’s cool as it’s the nature of the beast, and it’s my job to pitch ideas like anyone else.

• MoneySaving is not only for those in debt

Since I first started, I have always maintained the first aim is to cut your bills without cutting back. There’s nothing wrong with helping those who have money to spend it better – you don’t need to be in debt to be a MoneySaver.

So I disagree with the view that ‘you should focus on those in the most trouble’. This family are just as valid to help as others, and by helping them and generating an overall saving of £7,000 I hope it inspired others to look at their finances.

In fact as I write this we’ve a poll on the site saying the majority of users of this site have more assets than debts.

• This family ARE representative – fortunately debt crisis isn’t


MoneySaving isn't just for those in debt

The idea that ‘real’ people are all in debt crisis simply isn’t true. In fact there are more savers than people in debt in the UK. So when doing a makeover programme like this, the aim is to get a family who represents the situation many see and ensure the issues focused on reflect those that are ‘usable’ to most people.

– The average non-mortgage household debt in the UK is £9,000; the average UK personal income is around £24,000 (from memory)

– This family had non-mortgage debt of £13,000 and dual earner combined income of a little over £40,000

So the family focused on are in fact very typical.

They have what I’d define as ‘debt problems but not debt crisis’ (where you can’t meet you minimum repayments).

Add to this the fact that the techniques used for saving money are the same for everyone except those in debt crisis; it means this programme appeals to the 95% of society.

When in debt crisis, as you’re effectively opting out of the system (see debt help for an explanation) the solutions are almost diametrically opposed and therefore don’t relate to most peoples’ situation.

• This is a January money makeover programme

While I do many programmes, January is a ‘back to basics’ sort your cash month, as that’s what everyone is doing. So the aim here is to go through the big ways people can save and show the methodology for doing so.

• A one day visit isn’t the way to tackle debt crisis

I’m a massive fan of non-profit debt counselling agencies for those in debt crisis (see the debt help guide). That’s because I don’t think you can do justice or genuinely help someone in tremendous debts in a day – it needs to be an ongoing long-term process. Hence why whenever I’m broadcasting or am asked about severe debt I refer people to them.

And they are the experts at debt crisis – not me. So to do a programme on it actually doesn’t really fit too much (though in the past, out of necessity over discovering much more serious debts than I thought, it has happened).

• Remember this is an on TV makeover

While many people want a makeover, very few still remain once they realise they need to expose their finances to the public and have their lives discussed in it. The family we used did, and even though I don’t think they’ve done anything wrong, I’ve seen a couple of scathing comments about them – even the question above does that.

So imagine the same for a family £50,000 in debt on a £20,000 salary. The public can be harsh and many don’t want to do it – it is very difficult to find willing volunteers for TV debt crisis makeovers.

• I can’t work miracles

When people have no income and have already stopped spending on everything, there is nothing more than can be done. It’s a long-term rehabilitation process of working through creditors and the systems available.

I make no bones about the fact that in that case there’s little that MoneySaving can do to help (with a slight exception for MoneySaving Old Style and frankly that doesn’t make good TV and doesn’t inspire others to sort out their finances.

• I’ve done many programmes for people in hardship and hope I’ll do many more

This is just one programme. In my work I try to focus on a mix of topics (though I don’t have a choice, the broadcasters pick what they want).

Examples of Tonight programmes that resonate for people with less cash include ‘thrifty tips’, ‘bank charges reclaiming’, ‘PPI reclaiming’ and many more specifically on debt (I’ll never forget the Cancel Christmas one of the family £140,000 in debt and on the edge).

Plus on other broadcasts, I’m constantly doing subjects such as payday loans, debt crisis, tax credits, benefit help, loan sharks, financial education and many more.

• TV isn’t the only game in town

It’s interesting that many of the comments about this come from the forum. I hope it doesn’t sound churlish to say but I hope that the fact the forum and this site exist with areas like debt free wannabee in itself helps.

The other advantage of this site is we’re in control of the content – so we can put up what we want whether it’s bank charges compared, debt help, IVA guide or (hopefully soon – it’s taken far too long – the guide to mental health and debt, something that’s a nightmare to get TV to cover).

Now please don’t take this to mean I never want to do programmes about the debt nightmare in the UK, I have my MSE charity to help, I’m very passionate about the subject and have many tricks up my sleeve to make some excluded financial subjects televisual.

Yet I need to work within the realities of the medium, and when it comes to makeovers debt crisis as opposed to debt problems doesn’t fit so well.

Comment and Discuss

Footnote: It is worth remembering that what you see on screen is a half hour representation of a full day. For example it turned out three of the bikes were given free and were being done up to be sold on to help supplement income – and the family has two cars (the screen shot included their neighbours) and four drivers.