ESB increase electricity prices by 12%

If your starting to get Deja Vu your not the only one. Like a set of Dominoes, the ESB has announced that its electricity prices will rise by 12% from October 1st, just weeks after Airtricity and Bord Gais did the same.

So the idea of opening up the Electricity and Gas markets to competition simply means that we get to hear the same press statement by three companies instead of just one.

This cartel is so cosy, and Irish, it give you a warm feeling inside.....unless they have already cut off your heat and light.

FS

Michael Noonan to outline three years of cuts in October

The Sunday Business Post is reporting that the minister for finance will outline the next three years of budget cuts and tax increases this October as part of a pre budget 'assessment'.

While it will be unpalatable to listen to no doubt, it will be a positive for tax payers and the markets alike as it will give people some measure of certainty going forward. Consumer confidence has been hit hard over the last 4 years with people being afraid to spend as they didn't know what burdens the next budget might hoist on them. We are well used to ministers refusing to answer what future budgets might hold, simply saying that 'all shall be revealed' on budget day. This policy of silence was an insult to tax payers and basic principles of democracy.

While we never want to take a reduction to our income, if we at least know what we are facing, we can cut our cloth accordingly. Hopefully the policy of 'Glasnost' will feed through to all aspects of our governance.

FS

EBS increases its Standard Variable rate by 0.25%

EBS will increase its standard variable interest rate by 0.25% in October. This will bring their rate up to 4.93%

They blame the increased cost of borrowing for the building society.

FS

Starting a family? Plan the financial side in advance

Itsyourmoney.ie have put together a great guide and budgeting tool to allow you plan the costs of any new arrivals. Unfortunately there is no plan you can put in place to ensure you get your eight hours every night!

http://www.itsyourmoney.ie/iym/children

FS

Mortgage Lending down 52%

Figures released by the Irish Bankers Federation show that the total value of mortgage lending by banks has dropped 52% in the last quarter compared to the same quarter of 2010.

First Time Buyers made up 42% of borrowing with lending for investment property at a paltry 4% of the market.

The average new residential mortgage now stands at just €200,000, the lowest level since 2005.

We are in a bit of a chicken and egg situation at the moment, if the banks wont lend to good buyers, property prices will continue to fall which will mean that the banks become even more reluctant to lend!

FS

Cards overtake cash for the first time

According to the Irish Payment Services Organisation we withdrew €3 billion less from ATM's last year.

The total amount of cash withdrawals amounted to €22.3bn compared to card based (credit/debit card) transactions of €22.8bn. This is the first time card transactions outstripped cash transactions. This is a positive sign, Ireland have long been the most cash reliant society in Europe, finally we are breaking free and embracing debit cards and online banking transactions. These methods of payment allow us to budget easier as we can monitor our transactions and resist some of the impulse purchases we all do when we have cash burning a hole in our pockets.

FS

Airtricity announces Gas and Electricity price increases

Airtrcity has followed Bord Gais and announced prices rises from September 1st. Gas unit prices will rise by 21% and Electricity by 12%.

They blame the wholesale price of energy which has dramatically increased over the last year.

No word yet from the ESB but it seems likely that they will be following the price rises of its competitors in short order.

Keep an eye on www.bonkers.ie if you are thinking about making a switch in the coming days.

FS

'Springboard' at Dublin Business School

DBS (in conjunction with the Higher education authority) are giving access to a number of courses for free to the unemployed, information can be found here.

FS

MBNA to close its Irish Credit Card Operation

Bank of America today announced that it would be exiting the UK and Irish credit card market. The future of its UK and Irish loan book of $19 billion and its 4000 staff is uncertain.

More when its announced.

FS

Bank of Ireland increase interest rates

Bank of Ireland have announced that they will be increasing the interest rate on their standard variable mortgage's by 0.5%. They did not increase their rates after the ECB rate hikes in April and July but have announced that they can no longer afford to absorb the cost of providing the lending facilities. Tracker mortgage customers rate would have automatically risen in line with the ECB rate. A increase of 0.5% adds €31 to the monthly repayment for every €100,000 owed.

Interest rates on overdraft facilities, personal and business loans will also increase by the end of the month.

In what could be positive news for mortgage holders, experts are now not only expecting the ECB to keep interest rates steady well into 2012, they are actually tipping that there could be a rate reduction on the cards. This is due to the fact that sluggish growth rates have meant that the risk of high inflation in the Eurozone has abated somewhat.

FS

Best value i Phone contracts

Over the last couple of years you cannot escape the fact that it seems every second person is tapping away at the latest Apple gadget. Now i cant recommend the i phone either way, people far more qualified then myself are discussing the pluses and negatives of it right now on some other blog, but  it does make sense to ensure that you are getting the best value contract that suits your needs.

When the i phone was originally launched in Ireland it was only available on the O2 network. A few years (and 4 i phone iterations later) on it is available from Vodafone, Three, Meteor and E mobile networks. This is great for choice but it also means there is a bewildering amount of price plans and options available.

I found this handy price comparison which should make it a bit easier to make your decision should you decide to take the plunge.
i phone plans

FS

Make sure you are receiving your Tax relief

While most property related tax reliefs have been abolished over the last few budgets, a number still remain. Its important to take some time to make sure you are aware of what qualifies for relief.

Some of these reliefs are available to be claimed back at the end of the year and some are TRS (Tax relief at source).

• Pension contributions
• Income protection policies
• Mortgage interest relief
• Rent relief
• Private medical insurance policies
• Medical expenses
• Service charges (Bins etc)
• Trade Union Subscriptions (up to 01/01/2011)
• Tuition Fees
• Interest relief (Unsecured home improvement loans)
• Rent a room scheme
• Childcare services (in your own home, up to €15k)

Details on all the current reliefs are available on the Revenue website.
FS

Recession 2, the sequel?

Stock markets have fallen to their lowest level since August 2009, the price of gold is booming and the talk of 'double dip' recession is on the lips of every media minded economist. So whats going on, we thought this was all behind us?

In the recent days:

• Rating agency Standard & Poor's have downgraded the US credit rating from AAA+ to AAA, the first time America has dropped from the top credit rating since 1941. They site the reason of the possibility that the US could re-entre recssion in the coming months. They were also less than inpressed on the political stalemate and point scoring between Reuplican's and Democrat's during their recent debt ceiling negotiations.
• China is taking the opportunity to criticise the US economy as they try to get the Yuan named as the new global reserve currency. Seeing as China holds one Trillion dollers of US debt, what they have to say carries some weight. 
• The cost for Italy and Spain to borrow money by selling bonds on the international market went up past 6%, this is unsustainable. The EU began buying the bonds of the two countries today, this has reduced the cost somwhat but is this a solution or just a sticking plaster? Spain and Italy's economies are far to big to be bailed out. The ECB will have to act decisvly if the Euro is to remain in place.
• Investors are fleeing the stock markets in their droves, the Irish ISEQ index dropped 4.4%, the French and German indices dropped 4.7% and 5% respectively today alone. This is having a major effect on pension funds and investors who are exposed to the stock market directly or through life insurance companies investment funds.
• There is a flight to quality, Gold is seen as a safe haven during market turmoil, this has increased the price to €1700 an ounce.
• In Ireland the tax take is 1% up on expectations, thats good right? Well yes and no, the increase is due to corporation tax, exporting multinationals based in Ireland are booming . VAT take (a sign of consumer confidence) is low and getting lower. Expect to see VAT figures drop dramatically in the coming weeks, now that the scrappage deal is finished.
• The live register figures indicated a further 1500 people out f work in the last month.
• Morgan Kelly, UCD economist thinks that property prices still have some way to fall and this will mean that by 2015, Ireland will have a national debt for betweem €240-250 billion.

Its not all doom and gloom though, the cost of oil has dropped in the last few days, and due to the recent Erozone troubles we can fairly safey say that there will be no interest rates hikes coming from Frankfurt untill 2012 at the earliest.

FS

Motoring costs rise at twice the rate of inflation

The AA today reported that the cost of motoring has risen by 5.8% in the last twelve months.
The bulk of this is made up by the rise in fuel prices.

According to the report  ''It now costs €11,817 to run a small family car in the 'Band C' tax category (typical engine size of 1251 – 1500cc) for a year; up by €646 on the figure for 2010.''

The full report is available here.

Some of the costs can be offset by driving more conservativly, click here for tips on reducing your fuel usage: http://irishmoneysavingtips.blogspot.com/2011/05/efficient-driving.html

FS

World Collapse Explained in 3 Minutes

Some of their figures are somewhat suspect (Ireland does not owe 800 billion!) but it does make a good point.

FS

'Home Payments' closes its doors

Home Payments Ltd has stopped trading. They provided budgeting and bill pay service since 1963.

Customers would use them to help manage their money and forward on payments for bills, they also provided savings services. The company stated that the fall in property value had badly affected properties it invested in and they were taking this step to protect their customers deposits.

The National Consumer Agency has urged their customers to cancel any direct debits they had with the company. They also took the opportunity to call for the regulation of the private budgeting industry.

I spoke about this back in May:

For a lot of people however they may feel overwhelmed with their situation, they don't even know where to start to put themselves on the path to recovery. Luckily there is an agency which can help you, the Money Advice and Budgeting Service will help you take control again. They will budget your money, work out a payment plan for your debts/utility bills and there is no cost involved.

Contact them http://www.mabs.ie/ and they will schedule a meeting for you. As you can imagine they are extraordinarily busy at the moment and you may need to wait a few weeks but it will be worth it. There are a number of private budgeting services who promise to renegotiate your debt but please tread carefully, they do charge fees.

FS

Saving and Investing for Life eBook

Permanent TSB has published a free guide to saving and investing. This can be viewed online or you can ring them and they will send out a hard copy. Naturally it will slant towards their own products but it does provide some good practical advice.

Click below to have a look.

https://www.permanenttsb.ie/whatweoffer/savingsandinvesting/saving-and-investing-for-life/saving-and-investing-for-life-ebook/
FS

ECB keep rates steady at 1.5%

This months ECB meeting in Frankfurt has kept the main interest rate steady at 1.5% which will be welcomed by everyone with a mortgage, and cursed by people with money on deposit!

The growing concern over the borrowing costs of Spain and Italy and sluggish growth figures worldwide have allowed them to bypass their inflation phobia for a time. The ECB have recommenced their controversial policy of buying Eurozone member states bonds in an effort to reduce yields which have risen to unsustainable levels for both Spain and Italy, whose economies are literally 'too big to fail'.

The EU commission president have admitted that the re negotiated bailout deals for Greece, Ireland etc did not go far enough to provide the stability that the bond market have been seeking, he urged governments to go further in providing funding other troubled countries, this idea was swiftly rebuffed by EU economic superpowers Germany and the Netherlands.

FS 100th Post :)

€3 Travel tax to stay in place.....for the time being at least

Budget 2011 reduced the travel tax from €10 to €3 in reaction to the constant braying of the airline industry (one in particular.....you know who i mean) that the tax was hurting tourism and sending people elsewhere.

The new Government has always said that they would remove the tax altogether if the airlines reinstated axed routes and generally drove more tourists to our shores. 9 months on and Leo 'the Lion' Varadkar has called their bluff. The tax raises €30 million per annum and he is unlikely to remove it until the airlines come good. Ryanair have recently announced that they will be cutting routes during the winter off season, this is not what the Department of Transport wanted to hear.

In the mean time Leo will be taking matters into his own hands, half of the €30m haul will be spent on advertising Ireland overseas.

FS

Children are being priced out of the market when it comes to education: Barnardos

In a report released today, Barnardos have found that lack of access to back to school allowances and a rise in the general back to school costs are affecting families countrywide.

The survey of 500 people show the average costs involved:
* School specific tracksuits - €35
* School specific jumpers - €40-60
* School specific coats or blazers – over €100
* School shoes - €50-70
* Books for junior infants - €50-100
* First year secondary school student’s books - €250
* Voluntary contributions – €70-100
* Additional contributions sought by schools for photocopying, stationery etc. - €40-50
* Extra curricular activities such as swimming - €75-100
* Transport for primary school - €50 (up to a maximum of €110 per family)
* Transport for secondary school - €350 (up to a maximum of €650 per family)

The full report can be found here.

FS

'Dealz'

Poundland (which describes itself as Europe's biggest discount retailer) is set to open up 6 stores in the Republic over the next year, with a potential to raise that figure up to 50.

In the UK the retailer (as the name might suggest) sells everything for a pound. They are going for a slightly different strategy here, by naming the stores 'Dealz', they can be somewhat flexible in their pricing.

While the announcement of 180 new jobs is great news in anybodies book, it serves to illustrate how far we have fallen, compare it to 2008's announcement of a John Lewis 'flag ship' store on O'Connell street.

FS