Renting, Mortgages and other things that remind us how old we all are

[Shorty]

Yeah used the right way credit cards are great. Don't buy something unless you are 110% certain that you will have the money for it well in advance of any interest being tacked on and you're sorted. When I started my job I couldn't buy an iPhone 3GS from Carphone Warehouse because I had no credit rating. Now I'm golden, bought loads of things but never paid a penny of interest.

 

Good credit cards are also an extra layer of security in certain purchases (you can claim a refund through your bank if you get ripped off). I actually have two, my second one - Post Office Platinum - has no fees on overseas purchases, so I use it to buy things I don't want the bank to charge me conversion fees on, or when I go on holiday.

 

I can pay both cards off through my online banking so I don't even wait for the bill to come in.

 

I can't really advise anyone to get credit cards though, because used wrongly they're a huge financial trap.

[Rummy]

I'm sure they have thought about this but what happens if its unfurnished?

 

You do it as a tax return/regular income - no tax break. You can actually opt for that instead of the rent-a-room scheme too; and I think there's offsets and stuff(income vs expenses). So if you end up £7250, under rent a room you'd end up paying tax on the excess £3000. However if you took £7250 but ended up with allowable expenses of like £4250, it'd be equal either way. I think. I saw an example once, but I forgot it - essentially I think if you can excess allowable expenditures of the £4250 you end up better off doing a tax return for it(though there's then the hassle involved with that, of course).

 

Coming back to point, you could of course just pretend it is furnished, of course. Only a problem if you have one with your lodgers and they dob you in for tax evasion, no idea how serious that'd get taken on what might be a relatively small case.

 

(re the offset, from the guidance on Odwin's link)

If your gross receipts are more than £4,250 you can choose between paying

tax on:

• your actual profit (gross rents minus actual expenses and capital

allowances), or

• gross receipts (and any balancing charges) minus £4,250 – with no

deduction for expenses or capital allowances.

Rent a Room relief applies to a tax year and the

 

I live in London. I'm screwed on all fronts. I have some savings but to get a mortgage it will wipe me out and I would be in a crappy studio flat or something tiny that costs 200k. Me and the missus can rent bigger quite comfortable at the moment and spend our moneys doing fun things like Holidays. Would like to own of course but just not doable for us down here unless you want to live in a stabby area. We could live slightly out of London which is fine but both work in London and the train costs are ridiculous. Would rather spend that money living closer in and cutting down commute time.

 

Some of the house prices you guys get 'up north are ridiculously cheap though.

 

*packs bags*

 

See this is one of the benefits of renting, especially around the london area - you've some more flexibility and it's still somewhat viable an option compared to buying. I'm however totally gonna be taking a compromise and settling for one of those stabby areas.

Edited September 3, 2013 by Rummy
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[Mr_Odwin]

I can't really advise anyone to get credit cards though, because used wrongly they're a huge financial trap.

 

I feel the same way, but mine works well for me so I find it hard not to! I have a card that gives me 1% cashback on all purchases. It doesn't sound like much but for the last couple of years I've been getting about £70 back per year. No interest and cashback, yes please.

[Shorty]

Before you suggest it to anyone, ask yourself if they've ever bought anything really, really stupid :p

[Sheikah]

Setup a direct debit so that your credit card purchases get paid off automatically. That way you don't have to remember.

Edited September 3, 2013 by Sheikah

[Charlie]

Before you suggest it to anyone, ask yourself if they've ever bought anything really, really stupid :p

 

Absolutely! :p

 

Last night I used my AMEX to buy £30 worth of diesel. I have the money in my main account but there isn't much until I get paid on Friday and deposited some cash today. Didn't want to risk getting charged if a payment came out I'd forgotten about. Nice and simple, knew I had the money, no interest on the payment. Collect some reward points, done.

 

Just turned 25,000 AMEX Reward Points into £125 of House of Fraser vouchers. Lovely!

[Ashley]

When I was signing up to my business account they threw in a credit card and I said "I'll never use it but if you really want to, fine". Got a letter saying "please sign and return this by 4th August otherwise we won't send it", so I ignored it. Got another saying the same but the date changed to August 21st and again ignored it. Eventually they sent me the card.

 

Responsible banking at its best!

[Ellmeister]

Can anyone suggest a good credit card? I'm using tesco mainly to collect points but a decent cashback one sounds more advantageous.

Edited September 3, 2013 by Ellmeister
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[MoogleViper]

Can anyone suggest a good credit card? I'm using tesco mainly to collect points but a decent cashback one sounds more advantageous.

 

Check here.

 

It depends how much you wanna pay per month/how much you want to spend.

[nekunando]

I'm checking out a place for rent on Thursday, having lived at home for the last 26 years The thought of moving out on a very tight budget and having to be even more careful with my finances is a little frightening, though

[Fierce_LiNk]

Not going to lie, I feel pretty good. In the past year and a half I've managed to save £20,000...and I took six months off in the middle.

 

 

I don't think I would even have earned that much after tax, nevermind saving it.

 

I can't wait to get my own house one day. Although, getting that first one is going to be tough. I almost bawled when I saw the house prices in Manchester when I was last there. Hu hu hu. I almost went to Uni in Lancaster before choosing Brighton, so I bet if I had gone there I would have ended up staying around and maybe would have looked into getting a property by now...or something.

[jayseven]

I did do that during the order process. My mum's boyfriend pointed out since I've never used a credit card it's probably because I don't technically have a credit history. Seems surreal but makes a sort of sense for today's society.

 

Anyway, my mum's going to pay for it and I'll pay my mum so it's all gravy.

Yeah it can be just that you've got no proven history. If you've never been on the electoral roll in your addresses then, to the financial institutions, you don't exist.

 

Thrip coming up shortly. No idea what it'll be about.

 

Sorry to ALL for any confusion - I'm sure most people didn't even notice - I read ashley's suggestion of thrip, then just assumed when I got home that there was no thrip yet and went about from the bottom-up trying to do some thrippage, only to learn @Shorty was on the ball and had done it all already. I did wonder why I couldn't find half the posts I was sure I'd seen...

 

Actually I think there's a big part of inflation due to buy-to-let investors; knowing many folks can't get on the ladder those with money buy and rent out etc. Many many many properties I see on the market for sale(smaller/cheaper properties that I'd be after) seem to be vacant and/or chain free already - suggests to me they've been rented out.

 

I'm totally with you though, I want to buy rather than rent(something I've never done) and almost did earlier in the year. It's just, as you say, very hard without two of me unless I make some heavy compromises in what I go for.

 

Student housing has really impacted not only property values but also the available space for non-students. Landlords would buy up a 3-bed house and 'convert' it into a 5-bed student property that no family would ever want to live in. It means that existing properties are sized up by studenty-landlords and snapped up for above-rate because they know after a few years they'll make the difference back - plus students are easy to cater. Essentially after a year you are faced with a) gut the place or b) replace half the stuff. More money more cheap. Sigh. I'll stop now, it was pub quiz and Im not sober again.

[Daft]

I don't think I would even have earned that much after tax, nevermind saving it.

 

I got a one-month long freelance job that I've now had for over 18 months. It was a fluke. Sadly it won't last much longer, but understandably I've milked it for all its worth; I've only not worked three days this year (that includes two half days).

[Charlie]

I got a one-month long freelance job that I've now had for over 18 months. It was a fluke. Sadly it won't last much longer, but understandably I've milked it for all its worth; I've only not worked three days this year (that includes two half days).

 

That's the thing about freelance/contract positions - the lack of holidays and other benefits fulltime employees get. Sure, you can take a holiday if you want but if you're not in work you're not getting paid.

 

I'm actually quite tempted to become a career contractor. There's great money to be made, you get to move around work places regularly and do loads of different sorts of things depending on the contracts. The downside is obviously is that you are continuously looking for your next contract as most of them are 3-6 months. There are no paid holidays, no paid sick leave and you have to manage everything in terms of taxes yourself.

 

My current position is a 12 month contract however I'm employed through an agency (the company's own agency actually) and therefore I am on PAYE. It works well for me right now.

[Ashley]

The downside is obviously is that you are continuously looking for your next contract as most of them are 3-6 months. There are no paid holidays, no paid sick leave and you have to manage everything in terms of taxes yourself.

 

Better than the creative world as jobs can be a few days to a few years

 

My friends that have been going at it for a few years have managed to find a groove though. Once you become known then its easier to do things on your terms (e.g. organise holidays for yourself). Yeah you won't be paid while away, but if you do it right the amount you'd be earning extra when you are working (compared to working for someone else), it's negligible.

 

Just get Ellmeister to do your taxes. That's my plan

[Daft]

That's the thing about freelance/contract positions - the lack of holidays and other benefits fulltime employees get. Sure, you can take a holiday if you want but if you're not in work you're not getting paid.

 

I'm actually quite tempted to become a career contractor. There's great money to be made, you get to move around work places regularly and do loads of different sorts of things depending on the contracts. The downside is obviously is that you are continuously looking for your next contract as most of them are 3-6 months. There are no paid holidays, no paid sick leave and you have to manage everything in terms of taxes yourself.

 

My current position is a 12 month contract however I'm employed through an agency (the company's own agency actually) and therefore I am on PAYE. It works well for me right now.

 

Once you get going, looking for work isn't that big a deal. The more you work, the more you network, everything just gets easier.

 

I can hire an accountant to sort my taxes. I might not get paid days off or sick days but you get paid so much more, it's not a deal. I said 18 months, it's closer to 14 months and I took 6 months off in between. Also, I can claim things on expenses including lunch and travel.

 

Most importantly I can take time off to work on my own stuff. If I can help it, I'll never not be freelance.

[Rummy]

I've got a credit card for this reason. Build up a good rating by purchasing only things I would otherwise on it and then paying off on time every month.

 

It's also useful to have in case there are any emergencies.

 

Best advice I can give to anyone planning to buy a house who've never had credit - get a credit card asap and pay it off in full every month. I'd always been all 'nooo credit it bad!' then found out what Charlie said - credit cards = credit rating. Tbh it's essentially just replaced my debit card, so it was no lifestyle change at all.

 

Student housing has really impacted not only property values but also the available space for non-students. Landlords would buy up a 3-bed house and 'convert' it into a 5-bed student property that no family would ever want to live in. It means that existing properties are sized up by studenty-landlords and snapped up for above-rate because they know after a few years they'll make the difference back - plus students are easy to cater. Essentially after a year you are faced with a) gut the place or b) replace half the stuff. More money more cheap. Sigh. I'll stop now, it was pub quiz and Im not sober again.

 

Slumlords! Definitely a good point though. It does get cracked down on in places at least, but it's still a big business.

Edited September 4, 2013 by Rummy
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[MoogleViper]

Best advice I can give to anyone planning to buy a house who've never had credit - get a credit card asap and pay it off in full every month. I'd always been all 'nooo credit it bad!' then found out what Charlie said - credit cards = credit rating. Tbh it's essentially just replaced my debit card, so it was no lifestyle change at all.

 

Same here. I find it annoying that me never having needed credit means I have a bad/no credit score. But I understand that the credit companies don't know whether I'm good with money, or have had a parent pay for everything.

 

Got a cashback credit card (only about £30-40 per year, but better than nothing) and set up a direct debit to pay it off.

 

if you have a current account that pays interest then it's even more fruitful.

 

 

That said, credit card companies can be douchebags to deal with. I think they deliberately make things more confusing. The statements look like they were put together by an idiot, and it was a ball ache trying to set up the debit.

 

Custome service guy: "I can set up the direct debit to pay off the minimum payment, or to pay off a set amount."

Me: "I'd like to just pay it all off."

"OK, how much will you be spending a month."

"I don't know."

"Well if you give me the amount you think you'll be spending and I can set it to pay that amount off each month."

"Can you set it to just pay the full amount?"

"Yes."

"Do that then."

"OK."

[Rummy]

Same here. I find it annoying that me never having needed credit means I have a bad/no credit score. But I understand that the credit companies don't know whether I'm good with money, or have had a parent pay for everything.

 

Got a cashback credit card (only about £30-40 per year, but better than nothing) and set up a direct debit to pay it off.

 

if you have a current account that pays interest then it's even more fruitful.

 

 

That said, credit card companies can be douchebags to deal with. I think they deliberately make things more confusing. The statements look like they were put together by an idiot, and it was a ball ache trying to set up the debit.

 

Custome service guy: "I can set up the direct debit to pay off the minimum payment, or to pay off a set amount."

Me: "I'd like to just pay it all off."

"OK, how much will you be spending a month."

"I don't know."

"Well if you give me the amount you think you'll be spending and I can set it to pay that amount off each month."

"Can you set it to just pay the full amount?"

"Yes."

"Do that then."

"OK."

 

Lol, tbh I just went with the one my bank was offering - simply cos I can pay it off how/when I like through my internet banking - having my spend on that next to my account balances and stuff makes it a bit easier to track that I'm not getting too crazy/out of hand.

[Eenuh]

Hmm I might have to look into getting a credit card then, as I currently have no credit history here if debit cards don't count. Don't think Jim has any credit history either, which might explain why Kia had trouble with our credit check when we bought our car.

 

 

As for houses, I have been looking at houses in different areas. Up north is so much cheaper than here, it is quite depressing. For half the price you can still get a 2 or 3 bedroom house. Over here it is mostly overpriced flats. =(

 

I guess that might mean someday we'll move up north, maybe somewhere near Manchester, Bristol, Birmingham... don't know heh.

I wouldn't mind living close to Bath, but the prices there are still quite high. Plus we need to find a place that has jobs.

[Charlie]

 

Once you get going, looking for work isn't that big a deal. The more you work, the more you network, everything just gets easier.

 

I can hire an accountant to sort my taxes. I might not get paid days off or sick days but you get paid so much more, it's not a deal. I said 18 months, it's closer to 14 months and I took 6 months off in between. Also, I can claim things on expenses including lunch and travel.

 

Most importantly I can take time off to work on my own stuff. If I can help it, I'll never not be freelance.

 

Yeah you're right. You'll get to know people in the industry and these people are likely to be regularly looking for contractors to come in. You just have to make sure you budget so that you always have a least 3 months worth of pay in the bank in case you can't find anything.

 

As you said, you get paid so much more you can do this quickly. I reckon that if you found a contract worth £200 a day (which there are a lot of) you could easily, after a month, be able to live without a contract for a month. If you wanted a more luxurious lifestyle then after 6 months of living well off you could have 3 months of money to live well-off on.

 

When I thought my current postition wasn't going to be PAYE I looked into the best way to do it. By far the best way is to start a limited company and do it through that. I was sent calculations by various accountants/organisations that explained the 3 ways you can do it (sole trader, umbrella company, limited company) and for what I would have been earning a limited company was by far the best way to go. You can take home up to 85% of your earnings AFTER paying the accountant.

[Daft]

Yeah, I'm under an umbrella company as part of a limited liability partnership. For all intents and purposes I work like a limited company, and if I submit enough time sheets they also do my books, which is awesome.

 

That's my current day-rate and I started as a junior, so the only way is up as far as I can see. But then it's a two way street, part of the reason this contract has kept on rolling is because my day-rate is relatively low.

 

Being freelance is kind of strange. There's so much opportunity both financially and, in my industry at least, creatively.

[Charlie]

That's my current day-rate and I started as a junior, so the only way is up as far as I can see. But then it's a two way street, part of the reason this contract has kept on rolling is because my day-rate is relatively low.

 

Being freelance is kind of strange. There's so much opportunity both financially and, in my industry at least, creatively.

 

The other thing is you can essentially be got rid off straight away with no bureaucracy. In my line of work if you're working as a contractor (more widely used in my industry than freelance but the same thing I think) you need insurance because if you balls something up and it costs your employer money then you are liable for it.

[Daft]

I can't really fuck up. There's a process. Multiple rounds of a project. I can be a bad copywriter, and unreliable one (which thankfully I'm not) but it's nigh on impossible to be the one at fault. There would have to be systemic errors...and if a project is going that poorly, it's usually either the client being difficult or a project manager screwing up (and it's rarely the PM).

 

They can terminate me with a week's notice but I don't find that to be an obstacle as long as you are good at communicating.

[Mr_Odwin]

Hmm I might have to look into getting a credit card then, as I currently have no credit history here if debit cards don't count. Don't think Jim has any credit history either, which might explain why Kia had trouble with our credit check when we bought our car.

 

 

As for houses, I have been looking at houses in different areas. Up north is so much cheaper than here, it is quite depressing. For half the price you can still get a 2 or 3 bedroom house. Over here it is mostly overpriced flats. =(

 

I guess that might mean someday we'll move up north, maybe somewhere near Manchester, Bristol, Birmingham... don't know heh.

I wouldn't mind living close to Bath, but the prices there are still quite high. Plus we need to find a place that has jobs.

 

Yes. Move to my town. You, Jim, me, my wife; we can all be friends. Jim can teach my kids. So, that means him getting a job at the local school. We have cheaper houses than Brighton, and everyone round here supports Manchester United. You'd love it.

Edited September 4, 2013 by Mr_Odwin
Important comma