Go grab your purse or wallet. You need it next to you during the five minutes it’ll take you to read this. However, it should be lucrative. Our wallets are a treasure trove of financial information.
One of my party tricks is to take a look at someone’s and save them £100s in minutes – and now I want to do it for you. This is my wallet workout, a self inspection of contents to save you cash.
1 Pull out your debit card – do you have a winner?
A debit card reveals where you bank; and mistakes there are a plenty.
Do you pay a monthly fee? If so, work out its annual cost (£15/month = £180) and then ask yourself if the ‘extras’ the bank gives are worth this. If not, cancel it. Plus, if you were flogged it or told you had to have it, you may be able to reclaim all packaged bank account fees (see www.mse.me/reclaimpackagefees).
Does your bank make you happy? If not, then www.FirstDirect.com is worth considering switching to. It’s a fee-free account (as long as you pay in £1,000 a month), pays switchers £100 and has a linked 6% savings account. It’s won every service poll I’ve ever done, with 92% of its customers rating it ‘great’. Or www.Co-operativeBank.co.uk is giving £150, plus up to £5.50 if you qualify for its Everyday Rewards scheme, and 70% of its customers rate it ‘great’.
Are you overdrawn? Debit cards can be debt cards too, and sometimes costlier than credit. For small overdrafts, you can switch again to www.FirstDirect.com which gives a £250 0% overdraft, and the £100 switch bonus will help clear some of it. Or the www.Nationwide.co.uk FlexDirect gives a 0% overdraft for the first 12 months. For larger amounts, you can use special 0% credit cards to clear it - see www.mse.me/moneytransfers
Do you have savings? If so, use your bank account to max the interest, as some now pay by far the highest interest on savings. The top picks are www.Santander.co.uk’s 123, which pays 3% on up to £20,000 and www.LloydsBank.com’s ClubLloyds, which pays 4% on £4,000-£5,000. There’s also the www.Tsb.co.uk Classic Plus, which pays 5% on up to £2,000, plus up to £5-a-month cashback on contactless purchases.
2 Pull out your photo driving licence – is it valid?
A whopping 2.2 million licences have a picture that’s out of date. To check yours, look at section 4b on your photocard licence, it’ll show the expiry date. If you don’t and it’s expired, you risk a fine of up to £1,000. You can renew it online at www.gov.uk/renew-driving-licence or at the post office.
3 Got a credit card(s) that you pay interest on?
Stop. It’s possible to save £100s or even £1,000s a year by getting a 0% balance transfer credit card – that’s where the new card pays off debt on old cards for you, so you owe it instead, but at 0%. This means more of your repayments clear the actual debt rather than just paying the interest, making you debt-free quicker.
There’s up to 40 months 0% available with a fee, or 24 months 0% fee-free. My full best balance transfers guide at www.moneysavingexpert.com/bts includes a free eligibility calculator which gives card-by-card odds of which you’re most likely to get – so you can home in on your winner.
Savings can be huge, as Victoria tweeted me: “I got my fiancé to transfer his credit card balances to a 0%, saved £1,500 interest.”
4 Do you have a donor card?
It’s a big decision, but joining the Organ Donor Register could mean you save or improve up to nine lives. If it’s for you, sign up at www.organdonation.nhs.uk or call 0300 123 23 23.
5 Got a credit card and always repay in full.
Make it pay you. Every time you use a card, the retailer pays the card firm a transaction fee. With a cashback card, you effectively get this put back in your pocket. As new regulations have cut these fees recently, cashback’s been cut too, yet Amex cards are mostly exempted, so still pay a good whack.
The fee-free www.AmericanExpress.com Everyday pays 5% cashback (max £100) for the first three months, then tiered up to 1.25% after. The best non-Amex is http://money.asda.com Mastercard which pays 0.5% cashback (1% in Asda). As Anna tweeted me: “@MartinSLewis Glad I read about Amex cashback card: I’ll get over £200 paid.”
Yet only do this if you’ll set up a direct debit to repay IN FULL each month or you’ll pay 22.9% (Amex) or 18.9% (Asda) rep APR interest, which more than wipes the cashback gain.
6 Sign up for a myWaitrose card for FREE daily tea and coffee
Get the www.waitrose.com loyalty card – then in most stores you can get a totally free takeaway hot drink, every day from the self-service machine without buying anything.
7 Not got a credit card… You’re less protected.
Pay using a credit card and you get extra protection under the ‘Section 75 law’ – which means buy something costing between £100 and £30,000 on a credit card, and pay for any of it (even 1p) on it, and the card firm’s jointly liable with the retailer for the entire amount.
This get-out-of-jail-free card is hugely powerful if the retailer goes bust or won’t play fair, as Michelle found. She tweeted: “Successful Section 75 credit card claim, refunded £125 for non-delivery of phone order, used template on your website, thanks.”
PS: If you’ve been burnt with credit cards in the past, or have little financial discipline, then ignore this point. Better safe than sorry.