Weekly Round-up, 8th July, 2016.
Place for study.
New research published this week by the AIC suggests most parents considerably underestimate the cost of university.
Whilst last year’s graduates from English universities left with an average of £44,000 debt (source: Sutton Trust), parents, on average, expect their children to leave university with £23,000 debt. Students are closer to the mark, predicting an average debt of £35,000. And whilst students expect, on average, to take 17 years to pay off their debt once graduated, research from the Sutton Trust suggests three in four graduates will be paying off student debts into their 50’s. Even though a substantial number of parents (61%) seem willing to help with the financial costs of university, rising to 73% for Londoners and a low of 47% in the South West, a significant proportion (78%) of these will be relying on their own cash savings.
62% of parents say they will use some of their cash savings, the research suggests tha 20% will be putting themselves potentially at financial risk, saying they or their child’s other parent will use all or most of their cash savings. 9% of parents said they or their child’s other parent would take out a bank loan in their own name to help fund their child’s university costs, something that seems particularly drastic. Some 8% of parents said they would sell shares/financial investments.
While many will have us believe that older people are blocking up the housing market by owning large family homes, new analysis from Saga Home Insurance shows that the number of people over 50 living in rented accommodation has been on the rise over the last five years.
Age of Rent.
A third of people aged 50 and over currently live in rented accommodation, this is up from just over a quarter (26%) in 2011 according to Saga. The reasons for renting are usually down to a change in family circumstance; more over 50s are getting divorced than ever before, perhaps accounting for the fact that 20% of renters over 50 are single as they try to get back on the housing ladder 2nd time around.
There has been a significant decrease in the number of widowers living in rented accommodation, this has decreased by 10% in the last 5 years, perhaps because they are remarrying or moving in with family.
Unexpectedly when it comes to the age of people living in rented accommodation, there has been an increase in the number of people under 70 who are renting, with the biggest increase amongst those aged 50-54, while the number of people renting aged over 70 has decreased, this again points to the fact that divorce is creating the demand for renting as silver splitters have to divide the family home.
Over 55 interest.
Up to one in 10 over-55s homeowners across the UK are still paying interest-only mortgages and facing the prospect of clearing their debt when the deal runs out, new research from retirement property experts Homewise suggests.
Its independent research among over-55s paying mortgages suggests that 10% of the 1.4 million over-55s homeowners who are still paying mortgages – the equivalent of 143,500 2households – have interest-only loans and while the majority are confident of clearing the debt substantial numbers fear they will not be able to.
The study by Homewise shows 17% of interest-only borrowers aged 55-plus – equivalent to 24,300 – admit they will be unable to clear the debt. The average amount owed by over-55s with interest-only mortgages is around £91,000 with one in seven owing more than £150,000.
For families, the impact of the main earner suffering from critical illness, disability, or even worse, can be devastating. A survey by Zurich across eleven countries reveals a significant discrepancy between perception and reality, major gaps in awareness and significant variations by region. The good news is that many seem to overestimate the cost of income protection and that employers can contribute to tackle this challenge.
Income can be a fragile thing, especially if a household is hit by disability, severe illness or premature death. Zurich conducted research in eleven countries on four continents to find out how aware people are of the risk of losing their income, why and how they seek to protect themselves, and the role of the state and the employer in dealing with this global challenge. For this survey, Zurich worked with the Smith School of Enterprise and the Environment at the University of Oxford.
The research shows a clear knowledge deficit: Overall seven in ten people know little or nothing about how they can protect their income against disability. People seriously underestimate the risk of being unable to work due to illness or disability. Of those surveyed, 42 percent stated that they knew a family that suffered a premature death, and more than half (54 percent) also knew someone who could not work due to a serious illness/disability. However, 38 percent of those surveyed believe that their personal risk is less than 10 percent while it is actually closer to 25 percent.
Do I not like that?
A Florida burglar who posted a Facebook video bragging about a $500,000 jewellery haul has landed himself and one of his accomplices in jail, police said on Thursday. Officers from Pinecrest, Florida said they arrested Raderius Glenn Collins, 18, after he uploaded the video to Facebook on May 27. His friend, Marcus Terrell Parker, 27, was arrested after another burglary on June 9, police said.
They are still searching for a third suspect, who is seen in the video in the passenger seat of the car flashing $100 bills to the camera. The video, which runs more than seven minutes long and has over 3,000 views, showed the men bragging about their illegal earnings, exclaiming: “We got a safe” and “Can someone say check please?”
The man in the driver’s seat makes sure the traffic light is still red and proceeds to proudly reveal his bag of cash to the camera while the other two men cheer. The burglars stole a safe from a home with jewellery valued at more than $500,000. Police say Collins and Parker later burglarized a second home and stole jewellery valued at more than $10,000 and a screwdriver that would later tie one of the arrested men to the burglary.
Michelle Hammontree, communications director for Pinecrest, told Reuters that the Facebook video helped police establish a link between the burglary and the jewellery store, where the suspects pawned their ill-gotten goods. The bag featured in the video is the same one given to the suspects at the store. “It was just one dumb decision after another,” Hammontree said.
HLPartnership appoints Gavin Earnshaw to its Senior Management Team.
HLPartnership is delighted to announce that Gavin Earnshaw is joining the Senior Management Team as Compliance Director.
Earnshaw joins from Sesame, having previously held senior compliance function roles at organisations including Mortgage Force and LSL. Earnshaw has worked hard to build a solid reputation within the industry. This is the latest senior appointment at HLPartnership to further strengthen the management team with this depth of experience.
Chris Tanner, HLPartnership Chief Executive Officer, comments:
Gavin arrives with us at a time of continued Network growth and our Partner Advisers need the best backing that we can possibly provide. Gavin has a depth of knowledge obtained over an impressive career focused on Compliance in the real world and delivery of exceptional service. We are glad to have this opportunity to appoint Gavin and continue to fulfil our promises to the Network. We still have a number of planned enhancements to our partnership offering and Gavin is key to ensuring that we continue to deliver on our promises.
Gavin Earnshaw comments:
I know some of the Partner Advisers at HLPartnership and have observed how they are enjoying the support and services of a proactive Network. Helping to provide that support, within a safe and well informed working environment, will be pivotal in my role and I genuinely relish this opportunity. There has been substantial Investment in Technology at HLPartnership and harnessing this to ensure the environment is one that both Adviser and client can safely engage. The remainder of 2016 will bring another raft of challenge to our industry and I look forward to meeting those challenges at HLPartnership.
Our priority remains to focus on providing quality solutions for partners that adapt to the changing face of financial services. We launched our new Customer Relationship Management solution which reacts to the demand of meeting customer needs and will continue to improve this with additional function and integration. Existing Partners remain our core whilst new firms are welcomed, as they value our consistent approach to improvement. We have seen the Partnership turnover increase tenfold from 2008. It is clear that our strategy is coupled with that of our Partners, to deliver both safe year on year profit and a culture that adapts quickly to change. We learn from Adviser firms, as we work together. This has led to a robust and successful Network model.
Weekly Round-up, 17th June, 2016.
Consumer organisation Which? have reported that almost three in 10 buyers have seen their house purchase fall through after making an offer – typically leaving them almost £3,000 out of pocket as a result.
A survey by Which? Mortgage Advisers of 2,000 homebuyers – each of which bought their home in the previous two years – found that among that group it takes over four months on average, from starting a property search to having an offer accepted. Within the sample 28% of purchases fell through after that point.
The main reasons for a property purchase falling through were the seller decided not to sell their home after all (accounting for 27% of fall-throughs), the buyer pulling out as their own property sale had fallen through (21%), the buyer finding somewhere else to buy (21%), or being gazumped (again 21%). Of those who had lost money and knew how much they were out of pocket, the average loss was £2,899. This included conveyancing, survey, mortgage valuation or brokerage fees; these could not be recovered after the fall-through.
Damp but not raining.
The Council of Mortgage Lenders estimates that gross mortgage lending reached £18.2 billion in May. Lending was 4% higher than April (£17.6 billion), and 14% higher than May 2015 (£16 billion), and the highest May figure since 2008 when gross lending reached £23.7 billion.
It appears lending continued to be somewhat dampened in May, reflecting the earlier rush in the first quarter to beat the stamp duty change on second. The EU referendum decision is expected to affect sentiment and reduce activity below levels that would otherwise be expected in the near term, as both buyers and sellers wait for the dust to begin to settle. Market fundamentals underpinning house prices still look sound, and the CML do not expect significant house price falls, especially given the current supply demand imbalance.
More than three quarters of people (76%) plan to take a break this year, but one in four (25%) will take their main holiday in the UK, according to the latest research from Halifax.
More than one in five (22%) of those holidaying at home feel the UK is a safer alternative to going abroad. This is particularly true for the over 55s, with a quarter (25%) opting to stay in the UK as they feel safer. Almost a third (30%) are staying on home turf to see more of the UK, and almost two fifths (38%) to save money. The popularity of the staycation seems to be growing, with three per cent more Brits choosing to take their main holiday in the UK than last year.
Although there are a variety of ways Brits can spend their money when they take a break, buying currency in advance remains the most popular option for those travelling abroad (53%). Travellers cheques are on the demise, with only 2% of those travelling abroad using these as their main payment.
Take extra care.
Friends Life, now part of Aviva, has enhanced its extensive Protect+ critical illness cover with the addition of a valuable, market-first benefit called extra care cover.
Offering a new standard in critical illness cover, extra care cover provides additional financial support to those customers whose critical illness or total and permanent disability is severe and life-changing.
A lump sum of £50,000, paid in addition to the main sum assured, will be provided for those customers who are left with severe, permanent symptoms as a result of their critical illness or total permanent disability. It’s also in place for customers who are diagnosed with certain conditions at a young age.
Recognising that some customers with a critical illness go on to experience severe changes to their health and lifestyle which can affect their finances, the £50,000 can provide further financial support to help with installing a ramp to access the home or doorway widening, professional help around the house, costs involved with further treatment, lost income or specialist care.
To the Batmobile.
A kite surfer who got into trouble at sea was rescued by a pair of friends dressed as Batman and Robin.
In a scene straight out of a sitcom, David Schneider and Derren Guile, both 40, were kayaking in their costumes for a Superhero Paddle when they spotted the victim being dragged across the beach and into the English Channel.
The pair paddled over as the surfer was struggling to take control of his unruly kite at Shoreham Beach, West Sussex, and found that he was “gobsmacked” that he was being rescued by the two superheroes.
A bit of quick thinking by the Caped Crusader and his Boy Wonder potentially saved the surfer’s life as “it became obvious no one was coming. I would have though another kite surfer might have helped him because they normally do,” said David.
Derren and David, Batman and Robin respectively, helped the stunned man back to shore, before collecting his surfboard. The surfer, reportedly, “wasn’t drowning” but “unless he got his kite back up he was going to struggle, and the south-westerly wind was dragging him across”.p>
Friends of the pair have been drawing parallels between the couple and Only Fools and Horses characters.
David said: “Lots of people have been having a good laugh, there’s been quite a bit of mickey-taking as you’d expect.”
However, not everyone found it that funny as David added that the kite surfer “quickly disappeared” after his board was returned, saying that he thought “he was a bit embarrassed” about being rescued by the crime-fighting duo.
After all, as the pair remarked: “it’s not every day Batman and Robin come to save you, is it?”