I was rather tickled this weekend to see that the Bank Charges Reclaiming intro video guide I’ve done, topped the UK Google Video download charts. Considering the next ten were…
2. Woman’s dress gets torn off
3. Lesbo
4. Karate Lesson! Hilarious
5. Internet is for porn
I went to the BBC ‘Talent’ party on Thursday, which is a thank you from the BBC for its on-air staff. It’s an interesting do, with more famous faces than OK. I always feel a wee bit of a fraud at these things; and as you’re not allowed a plus one walking in is always very scary. Luckily after a few minutes I saw Jeremy Vine, Julia Bradberry and Kate Silverton talking in a group and as I’ve worked with them all and get along well with them - it was a great start.
After that I realised I knew more people than I would of though; impressionist Jon Culshaw was there (he’s one of the MSG’s best friends) so we had a chat; quite ironic as many of the first group I met are currently ‘being done’ on his show Dead Ringers. There were also lots of the Newsround team and lots of journalists to say hi to.
Then I saw Angela Rippon, who I’ve not seen for a couple of years. I started my Money Saving Expert having left the BBC as a producer/reporter in the Business unit, and joined small Sky channel Simply Money (now long defunct) as a reporter. As I was the only one who knew his ISA from his elbow (all the rest had much more TV experience, but no money experience) I was made ‘Business Correspondent’ after a week. Then I was offered my own show and asked what I wanted to do in it, my suggestion was that I wanted to try and do MoneySaving things, the programme was then named ‘Deal of the Day’ and the Money Saving Expert title followed a few months later.
On Simply Money, Angela and Jan Harvey (ex-Howards Way and also Family affairs amongst many others) shared the main presenting job and both were fantastic to work with.
Watching Angela especially on TV is a lesson, she has amazing focus, poise and concentration; and back then I was very green and still trying to find my style and she was always helpful, friendly and constructive. After about nine months, I started to think about the future, and how I could develop MoneySaving. So of course when you’re working with a broadcasting legend - she’s the person you ask.
In fact she’s the reason I got my agent. Newbie broadcasters often struggle to find an agent, as it’s not likely they’ll generate much commission for them. I remember the conversation with Angela very well.
Martin, “Do I need an agent, is it a good thing to do?”
Angela, “Absolutely, you need the support and someone with contacts to nurture you through and help”
Martin, “So how do I get a decent one”
Angela, “Like this…”
She then picked up the phone in the dressing room, called her Agents Knight Ayton who have an amazing client list and only deal with serious broadcasting grown-ups and said “Hi Sue, it’s Angela. I’m standing here with a wonderful guy, Martin Lewis, he knows everything about saving money and it going to be very big, you should add him to your books.”
She put the phone down and said, they want you to go in and see them. And Knight Ayton have been my agents ever since.
Thanks Angela.
I’ve just watched the budget and Mr. Brown. Interesting stuff politically - an obvious push to set the agenda towards the next election. Many of the announcements come into effect not this April but the April after. From a MoneySaving perspective the cash ISAs allowance going up to £3,600 (and overall ISA limit to £7.200) is interesting, but doesn’t happen until 2008. There’s also the decrease of VAT on nicotine patches.
Otherwise apart from some petrol duty tweaks, most of it was tax, benefit, public purse and macro-economic changes. Of course this is no surprise, but I’ve spent much of today and yesterday saying “no, I’m sorry” for interview requests on the budget. Not that it isn’t interesting, but the general impact on MoneySaving (as opposed to money itself) is very limited. The media is a voracious beast; I’ve spent many years building up my credentials, so that thankfully I’m now asked to be ‘the expert’ on many occasions. Yet it’s then stretched to assume I can do many other subjects such as “macro-economics” or “business punditry”, “investing” or “tax credit assessments” - yet actually these aren’t my subjects. While I may present on those subjects, I wouldn’t want to ‘expert’ on them.
Even when I say no I often get “yes but we want someone lively who people understand” and it’s easy to get tempted. In the past as I was building up my career, and the demand wasn’t as high, I’ve done so - spending days genning up on subjects outside of my usual comfort zone. Yet this year my basic decision is to avoid the budget. Having watched the brilliant Evan Davis and Nick Robinson on BBC2 giving the split second analysis, I’m very glad I did. Of course on the MoneySaving issues, I’m happy to talk, and if asked, in passing I’m happy to give a generalised view (and I’m doing the Wright Stuff this week, which is a general ‘gob on a stick’ job on all subjects including sexually transmitted infections this morning, so I’m sure I’ll mention it there), but otherwise this year my budget punditry shall be kept to a minimum.
The MSG and I were having lunch out, at a nice bar near Little Venice, over the weekend. After ordering, I was asked to ‘give me the credit card’ (it’s a cashback card of course) so it could be held over lunch. I asked why and was told “some people tend to leave without paying.” I refused to do this. It’s interesting while many people are worried about giving cards over the internet, it’s letting someone I dont know take my card away that worries me. Actually at most reputable e-retailers you’re pretty safe (as long as you’re sure it is genuinely them).
It’s not very difficult for any Tom, Dick or Harry holding your card to simply write down all the numbers and the security code at the back. Card not present transactions account for one of the biggest fraud categories. This is why I refused. The waitress was a little taken aback and didn’t know what to do, as it broke their policy. So I simply suggested that I pay up front for our lunch (without the tip obviously).
I’ve been reading a thread about the murkier side of eBay in the Forums, and I’m interested to see some MoneySavers are starting to cunningly take advantage of people’s ‘peccadillos’. It seems slippers get a lot more money for some if they’re ‘used’. Interesting how this tiny bit of marketing can make such a price difference isn’t it? While “second hand worn out slippers” barely raise a penny, “womens slippers, well worn” seem to raise rather a lot more.
Funnily enough at the start of the thread I thought it was all quite amusing, yet as I read on a bit (by no means the whole way) it becomes a tale of caution. When selling something simple on eBay, even childrens clothing, it’s worth remembering that people can value things in a different way and being aware of the consequences.
When bank charge reclaiming publicity was at its most frenzied, I had requests to be interviewed by US radio, Hong Kong TV, NZ papers, Irish radio and Australian magazines amongst others. I did a few of them (e.g. this interview for US public radio), though it wasn’t a priority. It seems the world has been interested in the Consumer Revolution to take on the banks here.
Now thanks to an email from MoneySaver Sally, it seems what’s happened here has even sparked an investigation in New Zealand. So maybe the collective work done by all the campaigners over here may start to have a knock on effect elsewhere! Though it’s interesting to note no one there has tried to reclaim their cash yet…. anyone got New Zealand relatives?
If you haven’t started the process yet, do read Bank Charges: Reclaim up to six years worth.
Having worked at home this morning to meet my Sunday Times column deadline, I fortuitously got a call from BBC Spotlight (South West Regional TV) wanting an interview, no fee, as is the way of these things. Now rather luckily BBC TV centre is roughly mid-way between my house and MoneySaving towers; so I said ‘certainly’. It sent a car, which picked me up, waited for ten mins while I did the interview, then took me to MoneySaving Towers. Hoorah!
I was doing a quick interview for a Tonight with Trevor last week (sometimes I present, sometimes I’m the in-house expert) presented by the very cool Johnny Maitland. Part of the issue was about SAMs (shared appreciation mortgages) a complex mortgage product which has left many in misery. The producers were unsure they’d calculated the APRs right so I did a quick calculation in my head, taking about 20 seconds, which was similar to what they’d worked out; so we were all happy.
Doing this is always greeted by a gobsmacked reaction, after all many people are so scared of numbers the thought of mentally calculating compound interest seems astounding. So of course, I milked it, but now let me tell the truth: it’s all about a simple trick called ‘the rule of 72′, which is elsewhere on the site, but let me explain it in this context. You need to understand how interest works first, if not read my (cunningly named) how interest works article.
How the rule of 72 works
Divide 72 by the interest rate to see how long it takes to double. For example at 12% interest save £1,000 and you’d have £2,000 (ie. double) in (72 divided by 12 equals 6) six years. At 5% interest save £1,000 and it would take (72 divided by 5 equals 14.4) around fourteen and a half years. This holds pretty true for all percentages under 20%. -
So on to the sum I worked out:
I’ve forgotten the exact amounts, but it was something like “what is the APR, ie annual interest rate, if you borrowed £80,000 and had to repay 200,000 six years later?” As part of SAMS, no repayment is made in the meantime (or its a different type of sum, still do-able though, see my past ‘calculating personal loan interest in your head‘ blog) so its just a simple piece of compound interest.
This was the logic process I followed…
A. 200,000 is 2.5 times 80,000 - so in six years the amount owed has increased by 2.5 times.
B. As it takses six years to increase 2.5 times, it doubles roughly every 4.5 years. This is a crucial estimate, and its important to remember than the growth isn’t linear (in other words, doubling means the amount the debt increases every year grows. E.g it doubles once and you’ve 2 times the original amount (ie 1 more) , it doubles again and you’ve four times (ie 2 more in that period), it doubles again and you’ve 8 times (ie its increased by 4….. and so on - so when you estimate you need to factor this in).
C. Then using the rule of 72, simply divide 72 by 4.5 which is 16.
Therefore the APR rate is around 16%. Right now let me go check that in a calculator….. and the actual answer is 16.4% - close enough!
Discuss this blog.
Last week the MSG interviewed Coleen McLoughlin for Five News. Now the MSG, as you’d expect (it stands for MoneySaving girlfriend to the uninitiated), is a good MoneySaver, she shops at Primark, generally eschews buying designer clobber (not a problem as in my eyes she looks gorgeous in anything of course - and when she needs posh frocks for do’s is lucky enough to get them lent sometimes) while Coleen is famous for shopping everywhere and anywhere, mixing Primark bags with Chloe and Balenciaga.
So I was very pleased that the MSG spotted that Coleen is the new face of Asda and asked her if she’d be wearing a ‘George at Asda’ dress for her wedding (see the MSG’s blog or interview on Five News’ site)
Don’t worry I haven’t been tripping to number 10 for tea with Tony. I’ve just re-read the complete Yes Minister and Yes Prime Minister books from the BBC TV series of the 80s. Frankly it is the most beautifully written, funny, insightful comedy. Yet it was also intuitive about today’s political system; some of the stories, based in the 80s, have now become real. Stories include ID cards, freedom of information and the environment, which all resemble the current politicial discussions. Better still was a prediction of the parental choice in education, where parents can choose within local authority boundaries where their children can go to school, at least ten years ahead of its time.
These books have so much resonance now, I heartily recommend it. Beautiful stuff. I perhaps preferred the Yes Minister book, though Yes Prime Minister is more predictive. To help here is the Book Brain results to find the cheapest: Yes Minister , Yes Prime Minister
I’ve just seen an ad for Fairy Liquid, which talks about how the higher concentrate and cleaning power of Fairy liquid makes it a better buy, subtly implying this works even at a higher price. I was mulling this over, and I have to congratulate it for sheer marketing genius.
It reminded me of the probably apocryphal story of the toothpaste factory meeting where they were discussing how to increase sales. The problem was everyone already used toothpaste, so how do you sell more, other than simply grabbing market share from your competitors? One bright spark came up with the idea of making the toothpaste tube hole 10% bigger; this way you sell the same amount of toothpaste yet it’s used quicker, so people re-buy more quickly, and you make more. Clever innit?
My guess is selling concentrated washing up liquid works a very similar way: as correctly stated you need very little of the liquid to get enough suds for a sink-full. Yet does this mean we only squeeze a little? Human nature means that if we’re used to squeezing one big squirt, and now we’re told to use a quarter of that, we’ll never cut down that much – it doesn’t seem right. Maybe we’ll just use half what we did previously.
Thus by selling concentrate, while it may be more powerful (I’m no suds expert so I have no way to validate that claim) we now use quite a bit more than is needed, so the bottle runs out more quickly, and is likely to mean we get less sink-fulls per penny - and thus need to buy more liquid. Of course I’ve no scientific evidence (and I have a dishwasher!) but it wouldn’t surprise me if those clever Proctor and Gamble product people had carefully calculated all this.
I am so proud to be an LSE graduate for one very important new reason.
I went to the LSE and last night was chairing their annual ‘focus on entrepreneurship’ a bit like Dragon’s Den, in front of an audience of 300. It’s the fifth year I’ve done it - and its always fun - its one of the ways I like to give back. After the meeting there was a reception. As part of that there was wine, orange juice and crisps. One of those crisp bowls were PICKLED ONION MONSTER MUNCH. I love the fact that at an official reception they served these, they’re great crisps - but how cool is that! (Regulars will know I love my crisps) Pickled onion monster munch. Fantastic.
I have to say this is one of the most bizarre e-mails I’ve received, after one MoneySaver read my Mortgage Fee Reclaiming Guide
“Martin,
I owe you a beer !!
Glancing through the latest e mail I noticed the item about mortgage charges and followed the link to the draft letter. I honestly did not even read nor really understand the content of it but having re-mortgaged over a year ago simply filled in the blanks, entered my old mortgage account number and posted the letter.
I’ve just opened the mail today and have a cheque for £100
and I still don’t know what the refund is for !!!!!!!!
Brilliant”
Now of course I’ve mixed feelings, it’s great he got his cash back, though I would’ve preferred he understood why. Yet I suppose the important point is he was ripped off (remember unlike bank charges, even the regulator has said banks have sneakily overcharged) and he got his money back.
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