Top Tips To Survive The Recession

Experts say we are now in a recession that is likely to last for two years.  As a result, we all need to be careful and watch the pennies.  Here are our top tips to help you survive the recession:

  • Ask your lender to keep payments the same when interest rates fall.  It may feel hard, but it will protect you against house price falls.  If the interest rate on your mortgage falls, ask your lender to keep your payments the same.  In effect, this means you are overpaying on your mortgage.  When it comes time to remortgage, that means you will have more equity in your home so you can consult with a mortgage advisor to get the lowest rates possible and get yourself one of the better mortgages available.  Otherwise, you may find remortgaging difficult.  Most mortgages allow overpayments of up to 10% per year, but check with your lender
  • Employment Rights.  If you do get made redundant, then you should receive payment for your notice period, but if you’ve worked there for more than 2 years, then you should get one week’s statutory redundancy pay for each year you have worked up to 20 years, and extra for each week that you were aged over 41.  Up to £30,000, this is tax free unless it is part of your notice period, and so long as it was a redundancy payment
  • Energy prices.  Experts advise not to fix your energy bill as prices are expected to drop this year.  It is better to shop around to find the cheapest price than to fix the deal
  • Try to get a cash buffer and make sure it is earning the most it can.  If you do have any savings, make sure they are liquid in case you need them and use an ISA, where you can save up to £3,600 per year tax free.

Right now, we all need to take precautions, but be careful not to save money if it is not going to be cost effective.  We will cover this tomorrow.



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