Monthly Archives: July 2015

A Summer Holiday without Headlines: The Holiday Challenge

This is a version of an article I read recently which struck a chord with me.

Did you read, listen, or watch the news in the last 24 hours?  If so, you probably came across one or more of these headlines:

  • Grexit remains the likely outcome of this sorry process
  • Carney hints at move in interest rates
  • Commodity prices head for 13 year low
  • Dollar rise threatens US growth.

Any one of these items could keep you up at night. But they shouldn’t, because you can’t do anything about any of them. These events, and others like them, are completely out of our individual control. However, that won’t stop the 24/7 news channels from trying to convince us otherwise.

That’s why I’m suggesting something sort of radical for your summer holidays of 2015: go on a ‘media fast’.

Specifically, you should ignore the top headlines and the breaking news for the period of your holidays. Instead, read something interesting – something that you really want to read.

If you’re feeling really crazy, go outside. Play with your kids, or grandkids. Go on a walk or spend time with your partner. But whatever you do, avoid anything that’s ‘trending’ for those vital weeks.

For some of you, I know this fast will be really difficult. I, for example, will still look at the football gossip every day. You soak up news like a sponge – you probably can’t imagine going without it for more than an hour or two, never mind a week or two! If you fall into this camp, you should ask yourself one question: does knowing what just happened make me any happier, or does it just increase my stress?

If we’re being honest, I suspect it’s the latter for 90 per cent of the time. We have no control over these events, yet we’re encouraged to devote attention and energy to things that make us feel bad.

Let’s hit the pause button for a short time and see how it feels. How do we feel during a day when we focus on what’s right in front of us, versus what’s happening halfway around the world?

To be clear, I believe there’s a huge different between being well informed about current events and staying glued to news channels. I think we’ve got into the bad habit of confusing one with the other. This media fast will help us do a better job of separating the two and identifying the situations we really care about as opposed to the steady stream of nonsense masquerading as ‘important news’.

I think this summer should be memorable for a lot of reasons, but I’m hoping it’s because of the memories we choose to make, instead of what we happen to read or see on the news.

Now, I’m off on holiday for two weeks, so there won’t be another blog until 11 August. I will practise what I preach, with the exception of the football gossip…..

 

First they cut the rates, and now the protection!

Last week, it was announced that from January 2016, the amount of standard savings protected if your bank, building society or credit union goes bust will fall from £85,000 to £75,000.

This cut means that savers with cash holdings close to the current £85,000 limit should start to think about how to redistribute their money soon.

Under FSCS rules, if your deposit holder goes bust, you currently get up to £85,000 per person, per financial institution within seven days (or £170,000 for joint accounts).

The €100,000 Europe-wide limit is not changing, but the legislation states that the Euro-Sterling exchange rate must be reviewed every five years.  The strengthening pound means that €100,000 is now roughly £72,000 (down from £86,000 in late 2010); hence, from 1 January, the limit will fall to £75,000 per person, per financial institution (£150,000 for joint accounts).

Whilst this is a reduction, it is worth remembering that the £85,000 limit started in December 2010, prior to which it was £50,000.

The FSCS says the move “will still protect more than 95% of all consumers, as the majority tend to have £50,000 or less in savings because the pound has got stronger”.

So, what if my savings are locked into a fixed account?

The Bank of England has launched a consultation on proposals to extend the higher protection for people who are “contractually tied into products” such as those with a fixed term.  The consultation runs until 24 July and the Bank of England hopes the proposals will take force from 1 August.

Is anything else changing?

Alongside today’s news, the Government is introducing temporary £1 million cover for lump sums attained under specific circumstances.

This cover would be for a period of six months after depositing cash, as long as you can prove it came from selling a home, divorce, personal compensation or other major life event – thus allowing investors plenty of time to decide what to do with the money they have received.

If you would like further information on these changes, please contact us on hello@carpenter-rees.co.uk