Why I’m proud to be a biased journalist…

In 1997-98 I took a postgraduate diploma in broadcast journalism at JOMEC which is part of Cardiff University. It was one of the best years of my life, and I made many friends. 

As part of an expansion of the journalism school they asked me if I would like to write a 250 word piece on my thoughts on journalism both here on MSE, in papers and broadcast. Having just written it, I thought some of you may be interested in a read…

I’m very proud to be a journalist, even though many often think I’m not. It’s a glorious profession that, done well, empowers millions. I admit I never (and never wanted to) wander into war zones, walk a local beat, or frankly even network for stories. Much of my research is done with data, spreadsheets, product information and thinking. It’s also true that my broadcast work is as much about enthusing as it is informing.

Now let me take this confessional a stage further. I’m proud to be a biased journalist. There, I said it. I don’t aim for balance. I am unashamedly pro-consumer. I don’t put the other side. My aim is to show people how to cut their bills and fight financial injustice. If the TV lawyers demand a firm’s given a right to reply on my show, fair enough, but I never voice it myself.  

Too often lip service is given to impartiality. Yet campaigning journalism has a truth of its own. An agenda can be a good thing – as long as it’s declared, not hidden.

The hidden reason Amazon is paying Clarkson & co so much for Top Gear

The papers have repeatedly splashed Amazon TV’s triumphant signing of “star turns” Clarkson, Hammond and May in a rumoured £160 million Top Gear deal. The obvious reason for doing this is the motoring show’s been one of the world’s most commercially successful brands, and Amazon hopes people will sign up to its service to watch it.

Yet dig beneath Amazon’s business model and this is about far more than just TV. It’s a much more interesting and commercial move than it first appears.

It’s all about Amazon Prime

In the UK, US and elsewhere, the main route to watch Amazon TV is by joining its Amazon Prime £79-a-year service – which also includes a ‘free’ next-day delivery service on Amazon-bought goods. While you can get a TV-only subscription, it’s only a fraction cheaper and is nowhere near as heavily marketed.

Amazon uses a free month-long trial to draw people into Prime. This is a proven technique across many industries that plays on what’s called the ‘inertia dividend’, which means people are naturally predisposed to not liking to lose something they already have (see my The real reason firms do free trials blog for more on that).

PS: If you’ve paid for a trial and never used it, our Amazon Prime refund story shows how to get your £79 back.

However, to really see why this all works, let’s take a step deeper…

Prime’s secret isn’t the fee, it’s the fact it locks you in to buying from Amazon

Research on the US market by Millward Brown Digital shows that Prime members tend to stick with Amazon. Fewer than 1% of Prime members are likely to consider another retailer during the same shopping session – whereas a non-Prime member shopping at Amazon is eight times more likely to shop elsewhere in a session.

Research from Consumer Intelligence Research Partners also shows that the average US Prime member spends $500 more annually with Amazon than non-members.

It’s therefore likely that Prime would be profitable for Amazon even if you ignore the subscription fee, just because it engenders so much more customer stickiness.

Yet this wouldn’t work without the subscription fee, as I suspect perversely the fact it charges works to Amazon’s benefit as people have an “I’ve paid for it, so I should use it” feeling, which keeps them entrenched within the Amazon empire.

That’s the genius of the business structure; the firm gets £79 and then because it’s charging, generates more sales.

So if the new Top Gear works, it should pay for itself many times over

Therefore if the new motoring show can increase subscribers to Prime, it’s likely Amazon not only gains revenue from the TV fee alone, it increases its domination in the retail space with a huge host of more consumers who feel locked into its marketplace and spend.

I’d love your views. Are you a Prime member? If so, do you think you shop there more because of it? Please let me know below.

Related Links:

What Brexit means for your finances in 2017

In June 2016, the day after the European Union referendum vote, I wrote an instant first impressions news analysis guide on what Brexit is likely to mean for your finances. Now for the start of 2017, I’m braving revisiting that guide – in the form of this blog, to see how well it stacks up and what has changed.

To make it easy to see, I’m going to do it as a quick commentary on the original text, with all the updates in this colour (blue)…

The UK has voted to leave the European Union, in a landmark referendum result – and many have questions and worries over their personal finances following the outcome.

Here MoneySavingExpert.com founder Martin Lewis attempts to answer queries on mortgages, savings, holiday money, flight delays, consumer rights and lots more in his Brexit Q&A…

What a monumental decision. This will be a very different Britain. And regardless of how you voted, we need to work together to ensure it’s for the better. There’s a risk there will be financial pain to get there, but if so, the country has chosen it’s a price worth paying.

Many of you have been sending me questions via my Twitter and Facebook feeds with queries and concerns about the personal finance impact, so I want to bash out some answers as best I can.

This isn’t easy. Brexit seems to have caused political anarchy.

And of course we’ve since had Donald Trump’s victory in the US presidential election, that has many similarities. In both cases the reasons will be mixed some will have voted primarily due to an issue or the candidate himself others’ votes will have been aimed at giving the political classes a bloody nose.

Yet a yearning for things to be different seems to be the driving force for both, and people were willing to vote for Brexit or Trump as the instrument of that change.

We have huge Labour and Tory splits. Some people are pushing to renege on the referendum by calling for a second one. And the union could potentially split.

Not much has changed on this since…

From this point on though, I’m going to assume that Brexit will happen as was voted for.

I still think that is the right assumption. The only major change is the High Court ruling that legally it must be Parliament, not executive power (ie, the Government), that does this (an appeal against this ruling is being heard in the Supreme Court). I don’t see that changing the big picture of Brexit, but it may influence its shape at the periphery.

The underlying political problem caused by the Brexit vote, though, is that we had a black and white question covering a rainbow of issues. Many, including the PM, have used the Brexit vote to impute many things such as ‘people want to leave the single market’, or they want a ‘crackdown on immigration’. And certainly there will be many who voted Brexit who this chimes with however not all.

And with a vote as tight as it was at 52% to 48% it only takes 1 in 25 Brexit voters to disagree on an element (eg, those who don’t want the EU but do want the single market) to potentially mean that the majority view is the other way. That of course assumes remainers are homogeneous too, which is equally wrong.

Yet a recent Twitter poll I did on the single market and people’s Brexit vote, while far from a representative sample, did indicate the possibility that more leavers are pro the single market than remainers are anti it.

The truth is, on a whole host of Brexit related issues, we don’t know what the majority of Britons actually want, nor what is best. All we know is that on 23 June 2016 most people chose for us to leave the EU. That was done by a national plebiscite ie, direct democracy, bypassing our usual system of representative democracy (where we vote for MPs then they decide).

I very much support referenda on vast scale issues of long-term constitutional change such as this, but the poor design of this one has left us in the lurch. We have bound our politicians to one outcome, but left it open to a vast range of interpretations a recipe for sloth, inconsistency and uncertainty.

Part I: What’s going to change and when will it happen?

Before I get into the nitty-gritty, it’s worth looking at the big picture. Brexit is a sizeable upheaval. Most of it won’t happen immediately you can say that again sister!, so it’s important to understand the timeline. I split the changes into three.

  1. Sentiment & market changes – already started, lasting a few years. These are changes caused by market movements and sentiment. That’s because the fact we’re leaving the EU will change some of the financial decisions people make. So anything governed by stock market, currency values and, to a lesser extent, interest rates could see change straightaway.

    Yet it isn’t just City sentiment either. Some people have told me their home-buying chain’s been broken by buyers pulling out, others that their income’s hit as companies are putting projects on hold, and yet more just retrenching from everyday transactions. I’ve even been asked: “I’m in the middle of changing bank account, should I stop?”

    Thankfully this fear factor has lessened quite substantially since the knee jerk initial shock. And people have got on with things, or for the pessimists, at least they’ve accepted the certainty of uncertainty.

    It isn’t to argue these changes aren’t or shouldn’t be real. After all, they’re not based on anything tangible, rather how people feel. Yet it is possible to talk ourselves into recession – as if people act in a way that it’s happening, it becomes a self-fulfilling prophecy.

    The most important thing to do is keep calm, carry on and act normal. If we can manage to do that collectively, the impact of this sentiment change will be minimal.

    I’m very glad I took this stance straightaway. In fact the video I did at 7am on the day of the result, see below, where I pushed for calm after being swamped on social media by panicked questions, was watched an outrageous number of times, hitting nearly one million views by the end of the day. I hope it did some good.

    Of course things like a drop in the pound do have a real impact – as has been much covered, it will impact holiday costs, petrol prices and other supplies. Plus it makes imports more expensive, though it does help exporters as it reduces their prices.

    However, it’s worth remembering the pound rate moves every day. The fact it’s dropped doesn’t mean it’ll stay there – it could rise, or, for that matter, fall further. Much of the coverage has acted as if this is a done deal, rather than an ongoing continuum of price change, which is more accurate.

    The pound is still in the doldrums, though far more against the dollar than the euro, and for the moment, until the next big change, this looks to be an ongoing revaluation.

    Of course the impact of that is pretty straightforward. Things are getting more expensive if either a) we import them or the constituent materials; or b) they’re supplied by a non-UK firm. The famous Marmite-gate is an example of this, but it has also factored into more significant areas it’s one of the reasons (the other being wholesale price rises) for the rapid increase in gas and electricity prices.

    Equally though, while the effect is smaller, it has boosted UK exports which helps some sectors of the economy, and the hope is that will trickle down to the population as a whole.

    Many people ask me how long the pound will stay weak. My answer is still ‘no idea’ if we knew where the currency markets were going they’d already be there, as people would’ve bought and sold based on that.

    While it may sound strange, last week we were uncertain over whether things would be uncertain. At least now we know they will be. And as we had to in the financial crisis of 2007, people will adapt and get used to that uncertainty. At the moment, some of the reaction, especially for those who voted remain, is just shock.

    Warning: Let’s not talk ourselves into a recessionhere’s a two-minute clip from Radio 5 Live on Mon 27 Jun, but better to listen to it in context of the whole programme.

  2. New Government changes – starts September 2016.

    Update Tuesday 12 July: With the uncontested Conservative leadership contest, this has happened much more quickly than expected, with Theresa May becoming Prime Minister on 13 July 2016.

    David Cameron has resigned as Prime Minister. We will almost certainly have a new Conservative Government in place by September. There is even an outside chance that a general election will be called, though that is unlikely, as it would require a two thirds majority of the House of Commons to vote for it.

    A new Government and Chancellor may have different priorities, though if it’s Conservative it’ll likely be on roughly the same track. It could change benefits policy for example, as there have been disputes within the Tory party over that. It could even see the bedroom tax repealed (that’s speculation, but we know it hasn’t worked and a clean start makes a U-turn easier).

    We’ll likely have a different course for budgets and legislation too. The main Conservative party divisions have not been over personal finance, however, so it’s unlikely we’ll see too much unplanned, substantial policy change in this area.

    I think this nailed the generality but sadly not the specific. We’ve already seen policy change on the back of the new administration. For example, the scrapping of the secondary annuities market, and it’s still early days. Theresa May’s Government has tried to distance itself from Cameron’s who knows where that’ll take us?

  3. Rule, trade and immigration changes – starts September 2018 at the earliest. The UK has not left the EU. For that to happen, the Government almost certainly has to enact Article 50 of the Treaty of Lisbon.

    David Cameron has said he won’t do this, so it’ll be for the new Prime Minister in September – and even when that happens, while there is a maximum two year formal negotiating period, many expect in practice it may last a lot longer, so we’re likely talking late 2018 at the earliest. Now far more likely to be early 2019.

    That means all existing rules and regulations that derive from our membership of the European Union – whether relating to mobile roaming, EHICs, the Mortgage Credit Directive or flight delays – currently remain unchanged due to the vote (though there may be other reasons for change). And they’re likely to remain that way for two years and quite possibly longer.

    There’s been much talk of workers’ rights and other rights changes when we leave the EU, but little has been mentioned about consumer rights. I’ve been pushing the Government to set up a Brexit consumer rights committee with all the senior people from organisations such as MSE, Which?, Citizens Advice, to be on it. It’s looking positive at the moment.

    This is also the timing for the change of our trade relationship with the EU. And it’s very important to understand this…

    It’s the trade changes that most independent economists were predicting would be the big hit on the UK economy – they haven’t happened yet – and won’t for a while.

    And of course the predictions may be wrong; there are some economists who argue it will be beneficial. It’s right for me to say at this point that I am one of those people who said the odds were it would have a negative impact on the economy (see my how to vote blog).

    Yet we won’t know who’s right for a good while, and regardless of how you voted, we need to work together to try to ensure problems don’t occur. I would be delighted to be proved overcautious.

    Of course, the knowledge that the rules will change may trigger some moves earlier. For example, companies have mooted leaving the UK as it may no longer access EU markets – our national aim now must be to try to attract others in to make up for it.

    I think the jury is still out here, little has changed, except perhaps the US election result, which is good or bad for a trade negotiation with Britain depending on who you believe until the Trump administration actually starts and puts policies into play we won’t really get a good idea.

    Overall though I think I am more positive than I was about this on the day of the vote. I still believe when we leave there’ll likely be continued shock in the short term, but let’s hope the road won’t be that bumpy.

Part II: Your questions answered

On the morning of the Brexit result, we initially saw huge drops in the pound and world stock markets – at the time of writing this update, on 28 June, there has been some recovery.

Where we go in future does, to an extent, require a crystal ball. I’ve written a plain-speaking attempt to answer your questions below, with a mix of knowledge and guesswork.

I’ve done it as so many are asking, but please understand at this point that nothing is 100% certain and all is subject to change – so see it as an indication, not cast-iron fact.

Q. What’s going to happen to interest rates?

A. That’s a very difficult one to call. There are at least two competing pressures here.

Normally, when the pound drops, you would increase the UK base rate. This makes people want to buy pounds with foreign currencies as they can get a better return, thus strengthening the rate. This is especially important as a weak pound makes imports more expensive, which increases inflation.

Yet there are also worries about an economic downturn. There are two main possible risks that this could happen. Firstly because of sentiment change now, and later on because of changing trade relationships when we leave the EU.

To try to prevent it, you want economic stimulus, and that means cutting interest rates – as then it encourages people to spend rather than save. And while it seems with UK base rates stuck at 0.5% there’s not much room to cut, some countries have even gone as far as negative interest rates.

Overall my suspicion (and this is pure guesswork) is that interest rates will remain roughly similar to as they are now, or perhaps be cut a touch if things go wrong. But this is an ever-changing scenario.

Well they did drop a smidgeon in August to 0.25%, and at that point the Bank of England put out pessimistic guidance that more cuts were likely to come soon. However, the fact the UK economy hasn’t tanked has improved things. Now, if anything, people are suggesting no more moves for a while, and if anything the pressure is upward.

Q. What will happen to mortgage rates?

A. This is obviously strongly linked to the interest rate question above, but there are more elements to it than that.

– Will fixes get cheaper? The rate at which fixes are set is based on complex ‘long term City swap rates’. And the markets’ Brexit gloom has pushed those down, so fixed rates could (there’s a lot of crystal-ball gazing here) trickle down further. This is balanced though by the fact that UK banks will want to keep strong capital reserves in such an uncertain time, which will discourage lending.

– What about variable rates?
That depends mostly on the UK base rate as explained above; my guess is limited movement for now.

Overall, though, it’s worth remembering mortgage rates are at historic lows already, with the cheapest two-year fix dropping under 1% for the first time (use the Mortgage Best-Buy Comparison to explore them).

If you can slash £1,000s off your costs (and that is not an exaggeration for many on standard variable rates), and get peace of mind that you can afford it (and if you’re worried about uncertainty, go for a longer fix), then do it. Yes there’s a chance it could get even cheaper, but if you’re bagging something that’s easily affordable, that certainty and safety has a value too. Playing the market is never guaranteed. For more help, see the Cheap Remortgage guide.

This has all roughly proved right. We did see mortgage rates drop a touch, especially longer fixed deals. Yet the Trump victory has now mostly reversed that, with a belief that he will pump the US economy. And as the US economy is the engine room for world growth, once it starts motoring the rest of the world should follow, including us.

So the long-term view of interest rates has shifted, and the momentum is very firmly upwards. Rates are still cheap right now, but cheap deals for 5- and 10-year fixes especially are starting to disappear.

I think there is a chance that 2017 could be the year that super-cheap mortgage deals end. That’s no guarantee, but it’s certainly worth every mortgage holder checking now to see if you can find a better deal (the links above should do that).

Now onto the Q&As – these are based on common questions I was getting at the time. Some of these questions are less prevalent/relevant now, but I’ll go through them anyway.

Of course, it’s very easy these days to frame everything with a Brexit narrative whereas in truth there are many other factors at play. However, where I have commented, due to the nature of what this blog is about I’ve mainly kept it within the EU sphere.

Q. How will this affect ‘mortgage prisoners’ due to the EU Mortgage Credit Directive?

A. I’ve been campaigning about the EU Mortgage Credit Directive’s impact on remortgaging. Sensible rules have been introduced to ensure that first-timers can afford their mortgages, but the same rules are also being applied to those just switching their mortgage deal.

This has led to the farce of some people being told “you can’t afford a cheaper mortgage”.

When challenged on this, the EU tells me that this is due to how our regulator the Financial Conduct Authority (FCA) interprets the directive, while the FCA says it has no choice and that it’s an EU rule.

I’ve met George Osborne on it and had some limited success (see ‘I was a mortgage prisoner but escaped thanks to MSE’) but there is a long way to go.

The UK will no longer be bound by this directive once we leave in a couple of years. Until then, the question is: can the FCA reinterpret? Watch this space.

I’ve continued working on this we put in an autumn statement budget submission, and there’s definitely sympathy to this view out there. However, most of the feedback still suggests that little can be done while we’re in the EU. I’m not stopping here though. We’re putting together an evidence and suggestion paper and have been told it will be looked at and scrutinised properly. So the work continues.

Q. What’s going to happen to house prices – is it worth me completing my purchase?

A. House prices are a funny thing. In most areas we worry about price rises, but for homes many celebrate it. And in some ways that’s right – increased prices can lower your loan to value, which means a cheaper mortgage is possible. Plus if you sell the property and aren’t moving to a bigger one, you can cash in. Yet for others, rising house prices stop them ever owning a property.

As for what’ll happen due to Brexit, that’s anyone’s guess. It’s possible there will be market uncertainty, and certainly initial reports show a few people pulling out of deals, which will lower demand and could impact prices – yet that could just be initial shock and within a few weeks it may settle down.

However, we still have an issue with undersupply in many parts of the country, which is a powerful factor in keeping prices at current high levels. See our Free House Price Valuations guide for more.

A number of people have been asking if they should complete on the house they’re in the process of buying. If it’s the house that’s right for you, it’s within your budget and you’ve a decent mortgage that you can afford, then I think the best human decision, if not financial, is to carry on and go for it.

The most important thing is to make a good decision based on the factors you know, but doing that doesn’t guarantee you a good outcome. For more on what I mean by that, see my How To Make Good Financial Decisions guide.

Not much has changed here.

Q. Will I still be able to get a Help to Buy ISA?

A. Yes. The Help to Buy ISA is a UK Government savings scheme, not an EU scheme. It allows first-time buyers to save for a mortgage deposit with the state adding 25% on top, up to £3,000 (see our guide on the top Help to Buy ISAs available).

While a new Government could change its mind, this was a Conservative policy, so it would seem a strange move. In the unlikely event it did change its mind, it would likely close it to new entrants, rather than cut the benefit to those who already have one (though again, nothing’s guaranteed).

Indeed you can still get it, and if you’re a first-time buyer it’s still worth opening one.

Q. What about Lifetime ISAs?

A. These savings and investment schemes are due to launch next April. This is a George Osborne policy to give a 25% boost to first-time home buyers and retirement savings (see how in our Lifetime ISAs guide). While it’s likely to continue, as it’s not launched yet, there is a chance a new Government could scrap it before it starts, as a change of policy direction. My guess is it’ll stay, however.

Lifetime ISAs should continue as planned in April, though there have been a few tweaks to the terms (most good), after an evidence session (that I was part of) at the Commons.

Q. Will savings rates drop?

A. It’s tough to see them get much lower – already the top standard easy access deal is 1.27% (see Top Savings for how to get 3%). Yet again, though, this one does depend on UK interest rate policy.

Grrrr. I was wrong here. They have gone lower. The top instant access rate is now down to 1% (see the link above), yet it’s mainly the high interest savings bank accounts that have borne the brunt of this. Santander 123, Halifax Reward, Club Lloyds and others have all cut (or announced plans) to cut their rates.

For those bank accounts that have already seen rate cuts, I think and hope that’s the end of it. Many of those cuts came on the back of August’s UK base rate drop, where the Bank of England guidance was hinting at further cuts to come.

It’s my view that these bank accounts were cut more than they otherwise would have been because of this (unlike normal savings where rates move all the time, bank accounts aren’t changed regularly so banks tried to take the hit in one go). However, UK base rates haven’t fallen further, so there’s no need for more cuts though I doubt they’ll increase things either.

Again one thing we have started to see in the last few weeks is small increases in the rate of long-term fixed-rate savings, mirroring what’s happening in the mortgage market.

Q. Are my savings safe?

A. This is a time of uncertainty and change, so I’m not surprised to have had a lot of people asking that question. UK banks and building societies are required to have much bigger capital reserves now than they did in 2007. Plus there are a variety of new measures in place to prevent savings collapse (for example, they’d try to move the savings to another bank rather than allow it to collapse and pay out).

One cause for concern for some of you is the fact that the underlying savings safety guarantee is an EU rule. However, the EU only dictates the amount of deposit protection we have.

The deposit protection scheme itself is UK-mandated, and is run by the UK’s Financial Services Compensation Scheme, meaning that savings up to £75,000 with a bank or building society (or banking group) are protected and will remain so, at least for the next couple of years while negotiations to leave are ongoing.

In fact, the protection UK accounts get recently dropped from £85,000 to £75,000 because of fluctuations in the euro’s value, even though many regulators here didn’t want it to. So it could be a positive that this protection can be at a set level in future that isn’t dependent on the value of currencies. More info on how the protections work in Are My Savings Safe?

Here we’ve seen what is arguably a Brexit vote boon the weaker pound means it’s been proposed the protection will be recalculated and hopefully return to the £85,000 level from 30 January.

Q. My savings are with an overseas-protected bank, eg, RCI or Fidor – what’s the situation there?

A. As we’ve always warned, a few savings accounts aren’t fully UK-regulated. In the unlikely event the bank providing such an account went bust, your €100,000 protection (equiv to the £75,000 on the UK scheme) comes from a foreign government, eg, RCI is France, Fidor is German. So you should only do this if you’re happy with the fact that it’d bail you out.

There is no change in that, until at least the point when we actually leave the EU in a couple of years’ time – what happens after that is one of those things that will need negotiating.

No new info.

Q. My savings are with Santander, that’s Spanish; is that a worry?

A. Don’t let the question confuse you. Most banks operating in the UK, even if their parent company is elsewhere, are fully UK-regulated banks.

The most famous one is Santander (and many MoneySavers have it due to the best-buy Santander 123). Yet this is a fully-regulated UK bank, and a big one at that: its funds are ring-fenced from the Spanish parent group. So don’t think of it as Spanish.

No change to the protection status. The only arguable change is my use of the phrase ‘best buy’ before Santander 123, due to its rate cut. It still is a winner for some, though: see my Should I ditch Santander 123 now it’s halved its rate? blog.

Q. Is this going to affect the rate at which I can get credit card or personal loans?

A. I think that’s unlikely. These rates are far less tightly linked to interest rates than mortgages. One consideration would be if the banks were concerned to keep very high capital ratios so became more cautious about lending. Yet overall I don’t see Brexit playing a big part in this (other changes of course, as always can change these things).

Certainly right now the credit card market for shifting debts is offering record deals, with up to 40 months 0% available – so if you’re paying debt on existing credit or store cards, just for safety it’s worth sorting now. See our top balance transfers guide for all details. For more on borrowing best buys check out the cards and loans section of our site.

If anything things have become cheaper since, with new cheapest personal loans and longest-ever 0% balance transfers deals. However, I don’t particularly see that as Brexit-related. This is just the same continued momentum that we were seeing beforehand.

Q. Has my private pension lost money due to the drop in the FTSE and other investments?

A. If your pension is invested in stocks and shares and you were to cash it in today, yes – you’d have lost money compared with before the referendum.

Although if your pension isn’t being cashed in today, it’s just a paper loss. The markets move every day (though current moves are a lot bigger than most days). It’s only when you crystallise that by buying or selling that there is an actual impact.

So the risk in an investment is the same as always. You hope it moves up, you risk it going down, it changes every day and the timing of when you do the transaction is what counts.

The only thing I can guarantee you about the future of shares is they will go up, go down, or stay the same.

Well, since then the FTSE 100 has bounced back very strongly then again, as most of the firms in that index are international companies that make money right across the world the pound’s weakness artificially inflates their profits so they benefit (in other words if they make money in dollars, when it’s converted into pounds to publish their profit figures, it looks bigger because a million dollars buys more pounds than it did).

Generally, smaller UK public companies fared worse in the initial post-Brexit world, but while not quite recovering as well as the FTSE 100 compared with before the vote, the other indices have bounced back to a decent extent.

For those wanting to know what happens next with share prices, I shall repeat my line from the time… “the only thing I can guarantee you about the future of shares is they will go up, go down, or stay the same”.

Q. As the market’s dropped, is now a buying opportunity for shares, or my shares ISA?

A. Ask me in a year or two’s time when I have the benefit of hindsight. No one can predict the markets. The rule ‘what goes down, must go up’ simply isn’t true. It may well turn out to be a good time; equally things could fall further. And if you’re investing in individual shares, they’re even more volatile than the rest of the markets.

Well it wasn’t a bad time. Yet to bag those gains you’d need to sell. But should you sell now or wait that’s the million dollar question. And one I’ve no clue of the answer to.

Q. Should I be buying my holiday money – euros, dollars, etc – now?

A. I’m afraid I can’t answer that without a crystal ball. There is huge volatility on the currency markets and they could move any way.

It’s worth putting the current rates (at the time of writing) in a bit of perspective though. Against the euro the pound was nearing €1.30 before the result and is now around the €1.20 mark. This time last summer it bought €1.43 at its peak. However, the summer before it was €1.20 and the year before that €1.15 – so this isn’t a historical anomaly.

Part of that is because the euro itself has also weakened due to the Brexit vote, so the relative change isn’t as much. The pound has faced a much bigger drop against the dollar, where it’s at an over 30 year low, hanging around the £1 buys roughly $1.35 mark.

If you’re worried, one option is to buy from a firm that allows you to order but with a cancellation right. So you lock in today’s rate, but if it improves you cancel and buy elsewhere (see my blog on Buying euros/dollars before the referendum, which is still relevant now as it’s about protecting yourself from volatility).

Or you could go for a top overseas spending card that gives you perfect exchange rates on the day you spend. More help is available in our 16 cheapest ways to get travel money guide.

Well, if you’d bought euros then, you’d not have gained or lost compared with now. If you’d bought dollars, you’d be up a little bit.

Q. My friend told me to wait to buy my euros as they’ll rise again, is it worth it?

A. Be wary of friends giving you definitive facts about the markets – be it shares, house prices or the pound. These things move, there are no rules.

Q. Will I still be able to use my EHIC?

A. The European Health Insurance Card (EHIC) is an agreement between countries in the EU and European Economic Area. The EHIC gets you free or discounted medical care in EU member countries but also in Iceland, Norway and Liechtenstein, plus Switzerland, which isn’t in either the EU and European Economic Area.

The vote may affect this in future but again, nothing is likely to happen for at least the next two years. For now travellers can and should carry on using the scheme as normal.

Remember the EHIC is free and you should never pay for it. Plus if you’ve got one, check whether it’s still in date. Full help is available in our Free EHIC guide.

No news on this yet still too early to tell.

Q. My passport says ‘European Union’ on the front – do I need a new one?

A. Although your passport says European Union on the front that’s just a branding thing – it’s actually issued by the UK Government, so it’s a UK passport.

What the vote result may mean for travel within the European Union is one of the bigger unknowns that will be part of negotiations, but until we leave the EU (which will not be for at least another two years) things should be mostly unaffected.

Q. Will I still be able to claim for flight delays?

A. If you’re delayed for more than three hours on an EU-regulated flight, where it’s the airline’s fault, EU regulation 261/2004 allows you to get fixed compensation of at least €250 per person (when we checked, this was about £200, but this figure’s likely to change).

However, as this regulation comes from the EU, it’s likely that when Brexit is rubber-stamped, this will stop. For that NOT to happen, the UK would need to launch its own flight delay legislation.

It’s important to note though that until we leave the EU, there will be no change. The Civil Aviation Authority has confirmed there will be no immediate change and says it will be working with the Department for Transport in the coming months as Brexit discussions progress.

But overall the best information is if you have had a delayed flight, make your complaint sooner rather than later. See our Flight Delay Compensation guide for full help and a free tool to do it.

No change or news on this as yet.

Q. What about mobile roaming in the EU?

A. The EU is set to ban roaming fees within the EU from June 2017, yet when we leave Europe we will be outside of this. The UK Government could legislate on roaming but it doesn’t currently do that for those roaming outside the EU, so why would it do it for roaming within? Although, of course, it may be politically expedient for it to do so, as a ‘see, you didn’t miss out due to Brexit’ policy. Only time will tell.

No change or news on this as yet.

Q. I’ve got a European travel insurance policy – will that change?

A. There shouldn’t be any change. Europe travel insurance policies are based on geography, not EU politics. Some actually even cover some North African countries around the Mediterranean basin.

When we do leave the EU we may see some mild policy changes, due to changes in ‘actuarial risk’ (especially if there are no longer EHICs to offset some costs to insurers of medical conditions). Yet of all the concerns, this one isn’t a big one.

Q. What will happen to the state pension?

A. There was much talk from politicians in the EU referendum campaign about the possible impact on the state pension. It wasn’t about the pension itself, but rather a prediction that there would be a huge economic downturn and the state pension would need to be cut to pay for it.

So for now the state pension stays the same. Whether there’ll be any change to it is a question of policy for future Governments, but there’s nothing definite planned currently.

No change or news on this as yet.

Q. Will there be changes to my benefits?

A. The benefits system in the UK is almost entirely governed by UK Parliament, not Europe (with some exceptions on benefits for those who aren’t UK citizens).

So benefits are unlikely to be directly impacted by the vote to leave the EU. However, it’s of course possible that a new Government will have a different stance on benefits and make changes when it comes in.

To an extent we have seen a small change with the new Tory administration slowing the momentum of cuts to benefits and disability benefits. Of course, that still means cuts, but the knife isn’t quite as big as before.

Q. Will my consumer rights be affected?

A. While many consumer rights are based on EU directives, they’re actually enshrined in UK law. So unless the UK Government decides to change the law, these rights will stay the same. It may take some unpicking though.

We’re pushing the Government to set up a working group on this with MSE, Which?, Citizens Advice and others.

Q. Will I still be able to play the Euromillions?

A. Not the biggest worry, but you asked, so we’ve answered. Camelot, which runs the National Lottery, has confirmed that we will still be able to play the Euromillions despite Brexit. Better still, you can save money and not bother!

Q. Will we still be in Eurovision?

A. Not financial, but I couldn’t resist answering it. Eurovision is done by the European Broadcasting Union, not the EU, so there’s no change there. I mean, come on – they allow Australia and Azerbaijan in.

And as a side note, interesting that we nearly had a Finnish winner of the UK X Factor this year, with Saara Aalto coming a very close second place. Who says the European project is over… (joke folks, joke!)

For wider issues such as migration and sentiment, see my EU In or Out? blog, which takes you through these.

We’ll be following developments over the coming weeks and months and will have all the latest in the weekly email.

Martin’s initial reaction video:

Martin posted the following short video at 7am on the day of the vote result, with a first reaction to the possible impact on mortgages, house prices, savings, inflation and the pound. It’s kept here as public record, though obviously as time moves on it will become ever more out of date.

Well that’s it. Looking back I think my notes have stood the test of time reasonably well. My biggest message among much doom and gloom from someone who voted for remain, was don’t panic, nothing has really changed (yet), and that still stands. Of course when we do actually leave the EU many more of my assertions above will be truly tested.

Retailers booed me for saying ‘don’t blame the delivery company, blame the retailer’

Retailers booed me for saying 'don't blame the delivery company, blame the retailer'

Retailers booed me for saying ‘don’t blame the delivery company, blame the retailer’

The internet revolution has turned the clock back to a 1950’s delivery culture, though these days it’s more often a (wo)man in a van, than a boy on a bike. Getting and receiving parcels has become a regular part of many of our weeks – yet this last mile of delivery has turned into a regular nightmare.

I spoke at the Retail Week conference yesterday, a gathering of many of the UK’s major and minor retailers, and discussing this issue got me booed!

My point was quite simple. I explained that when a parcel company is either:

  1. Inflexible eg, ‘you must be in at 2.40pm on a weekday afternoon’, or
  2. Mistreats you eg, – it bungs your parcel over a fence, leaves it in a wheelie bin when you’ve said not to, delivers late, fails to deliver, claims you weren’t in when you were etc…


THEN DON’T BLAME THE DELIVERY FIRM – BLAME THE RETAILER.


I then explained that my hope was that this would mean retailers, which employ bad delivery firms, suffer brand damage (that was the point they booed me on! Watch it here).

Yet it’s important to stir the pot. The point is quite plain, your contract is with the retailer, your consumer rights are with the retailer, your relationship is with the retailer – if it chooses to sub-contract its delivery to an incompetent firm then it must face the repercussions.

Of course if this is just an odd one-off, it won’t be a real issue, but if it is systemic then the repeat nature of it should hurt.

Many people complain about Yodel and other delivery firms (see our poll of the best and worst delivery firms) yet retailers still choose to employ it – in which case they need to face the brand consequences.

The system most companies use for delivery isn’t flexible enough for the modern world. Things are improving, but not quickly enough. If they want us to move online as it cuts their costs, they need to improve the last mile service.

I’d love your views below…

Related guide:

Now we’re getting closer to the referendum itself, I wanted to bash out an update,

The pound has tanked in recent months. Last year £1 bought you as much as 1.43, now it’s just 1.26. Against the dollar, last year’s high was $1.58, now it’s just $1.42. Some of this is on the back of the uncertainty about the EU referendum.

Back in March I wrote a blog responding to the huge number of questions about the impact of the referendum on holiday money. And since then, they’ve kept coming, such as these on my Twitter feed:

ncluding a possible trick to beat the system.

It’s first worth putting the current situation in perspective. While the current rates look poor compared with last year, actually go back two years and £1 bought €1.20, and the year before that, €1.15 would’ve been worth whooping about. So it’s low, but not anomalously so.

Much of this is about uncertainty

The EU referendum has caused uncertainty, and currencies are always hit by that. Yet trying to fathom the future isn’t easy. The only sure thing is that, until the vote on 23 June, there’ll be more uncertainty and the vote will have an impact, one way or the other.

However, as we get closer and the likelihood of an out vote looks more plausible, it’s not controversial to say,  if that does happen, the immediate impact is likely to cause the pound to weaken further (ie, a pound will buy fewer euros, dollars, etc), and possibly substantially.

I’m not making a judgement by saying that. An out vote would be a big change – for good or bad depending on your opinion – and the markets hate change. So in the short run, it will likely hit the currency (though there’s no certainty). If we vote in, as no change is likely, it is of course possible the pound will strengthen.

While many other factors can affect currency movements – such as general economics, speculation, relative interest rates – at the moment if you try to predict what’ll actually happen to the pound it incorporates a big gamble on the outcome of the referendum.

Even many professional currency speculators will get it wrong. Therefore, unless I find a cheap crystal ball somewhere, I certainly won’t be making predictions.

PS: Read my How to Vote in the EU referendum blog for help making your decision.

Ask yourself what rate is good for you?

Whatever happens to the euro rate, the future is out of your control. So forget trying to guess the market and instead ask yourself:

 ‘Would I be happy to get a rate of €1.26 for my holiday money…?’

If your answer is: “It’s a decent rate, I could have a reasonable holiday on that, and my real fear is it getting worse because that’d make things unaffordable” – then go safe and buy now. However if you do that and the pound strengthens, and in hindsight you’d have been better off waiting, don’t let the bitterness ruin your holiday.

For those stuck on what to do, there are a couple of halfway houses. To hedge your bets, simply buy half of what you’ll need now (using the methods below) and leave half until after the referendum. For another possible alternative, see the trick I’ve added at the end of this blog. (Or see the trick below for another halfway house.)

Personally I don’t do speculation. Instead, I just ensure I always get the best rates on the day.

The easy way to do this is with bureau busting, specialist travel credit cards. The two top picks right now are Halifax Clarity and Creation Everyday, which give near perfect exchange rates in every country, so just pocketing one means you know you’re getting a good deal. Though you do need to pay them off IN FULL each month to minimise interest.

Then if you’re really cool, funky and, ahem, down with the kids, like me, you can put them in your overseas wallet.

How to lock into the current rate

If you do decide you’d like the safety of grabbing some foreign exchange for your holiday now, in case things get worse, there are a few different and easy ways to do this:

  • Get yourself euro cash. To do this, use our TravelMoneyMax.com Travel Money Comparison, which shows you the best all-in rate for collection or delivery.

    However, be sure you’ve somewhere secure to put the cash. Some travel bureaux let you buy ahead and then send you the cash at the locked-in rate nearer the time, but if you do this and the bureau goes bust, you’d likely lose your cash as there’s little protection. So I’d avoid that.

  • Load up a prepaid card. These are effectively modern-day travellers’ cheques but used like a debit or credit card. You must load cash on them in advance, and the rate you get is the rate on the day you load. But don’t assume the cards are all the same – there can be huge differences in rate. See Top Prepaid Travel Cards for our top picks.
  • Get a UK euro bank account. This is only really worth doing if you often travel to Europe (perhaps you own a holiday home) – or spend substantial amounts. A few UK banks offer these, including CitibankBarclays and Lloyds Bank (monthly fees may apply, so check). They operate as a normal bank account, but in euros. If you’re depositing cash, the bank will usually do the conversion for you, but be careful as the rates are often awful – so don’t do it automatically, check in advance.

    You can often call the bank to try to negotiate a better conversion rate (especially for larger amounts). Alternatively use one of the international money transfer firms to deposit the cash there for you.

  • Send money to an overseas bank account. If you have an overseas euro account (again, likely for those with second homes in Europe), then sending money to it will do the job. However, watch the conversion rate. An international money transfer firm will often improve it for you.

A possible trick to beat the system

Big bureau de change Travelex has a ‘buy back’ promise on its foreign currency. So pay £4 when you buy, and you get a right to sell it back your currency at the rate you bought at, within 45 days.

Now, its rate isn’t usually as good as the top bureaux on TravelMoneyMax. Yet it does mean if you buy now, and the pound gets a lot worse, you’ve done well. If the pound strengthens, you can sell the currency back to Travelex at the rate you got it, and then buy your holiday money at the new better rate.

This on the surface is a good option, but I’ll be honest, we’re in the midst of checking it out (and some other firms have suspended this for the referendum); I’ve not dotted all the i’s and crossed the t’s, we plan to do detailed work over the next few days and will include it in the next weekly email.

What will you do?

So where do you sit on this? Are you ‘buy now to at least be sure it won’t get worse’?  Or a ‘play the best rate on the day’-type? Do let me know via the discussion box below.

End car insurers auto-renewal rip-off! 10 rule changes needed

End car insurers  auto-renewal monopoly! 10 rule changes needed

End car insurers auto-renewal monopoly! 10 rule changes needed

It used to be that you had to be insured to drive a car, but since 2011 you have to be insured to own one (unless you’ve a SORN). Car insurers have taken advantage of these continuous insurance rules to lock customers in by auto-renewing.

In itself auto-renewing isn’t a bad thing – continual cover is a convenience for many – and the new rules also have positive aspects. They were brought in to help cut the number of uninsured drivers and to create an insurance database so those driving without policies were easier to catch.

My problem is the the way the auto-renewal is structured. Insurers usually increase prices each year to take advantage of inertia, and their systems are set up to make it bureaucratically far more difficult than needed to switch.

And while many do successfully ditch existing firms to save cash (see cheap car insurance for how to cut costs), auto-renewing effectively locks more people than necessary into their policy.

10 rules to make auto-renewing fair

I’ve been banging on about this for a while now and we put together a 10 point plan in 2012 as part of a policy discussion with the Government. I realised today I’d never published it. So as I’ve seen others starting to mutter on this recently, I thought it time to dust it out.

1. Policyholders should have the choice of opting in or opting out of auto-renewal when a policy is bought.

Issue: Policyholders are automatically auto-renewed by most insurers. While this is useful for ensuring people remain insured, it’s bad for consumer choice and competition.

Change: When getting a policy people should be given a choice about whether their renewal is opt in or opt out. In other words at renewal time, if it’s opt in, they can be automatically renewed by default. If it’s opt out, they will only be automatically renewed if they approve of the renewal at that point.

2. More info on no claims bonus (NCB) transfers should be in the auto-renewal document allowing for easier NCB transfers.

Issue: To switch insurer if you have built a no claims bonus requires proving the length of that bonus. This can be difficult and is used by existing insurers as a disincentive to switch and a way to retain existing customers.

Change: The auto-renewal quote documents should include detailed no claims bonus information that can be used, without any further reference to your current insurer, to switch – taking out a block in the system.

3. Information on last year’s premium should be prominently displayed on the auto-renewal form.

Issue: Many companies use inertia based pricing to increase policyholders premiums each year. They don’t put the previous year’s costs on insurance documents so people can’t see the rise.

Change: Insurers are compelled to notify customers of their current rate and the percentage rise when it is time to renew.

4. The reasons for any premium increases should be fully explained.

Issue: Many policyholders may find that their premium has increased at renewal yet there is no listed reasoning behind the increase.

Change: Insurers are compelled to list any material factors, which may have led to the premium increase, explaining why this affects underwriting.

5. Policyholders should be able to cancel their cover using the same method they did to sign up.

Issue: While you can buy insurance online, face-to-face, or over the phone, cancelling cover can be much more restrictive. Many of the biggest insurers don’t allow you to cancel online even though they allow you to sign up online.

Change: Insurers are compelled to allow customers to cancel in the same way they signed up – so if they signed up online, they can cancel online.

6. Policyholders should have more notice about upcoming renewals.

Issue: Policyholders currently get around 28 days to auto-renew – if it is offered – but this may not be enough to assess the marketplace properly to find a new policy.

Change: Insurers notify policyholders six weeks before renewal with a further reminder two weeks before.

7. Cancellation fees for auto-renewal should be abolished.

Issue: Policies that are auto-renewed still attract a cancellation fee if the policyholder finds a better deal elsewhere and needs to cancel the renewed one.

Change: Insurers should be prevented from charging cancellation fees on an auto-renewed policies.

8. Insurers must ask customers about changes in circumstance before issuing new quotes.

Issue: Many people are driving with invalid insurance because they were auto renewed and didn’t notify the insurer of material changes such as speeding points.

Change: Insurers must ensure that they have all the updated information. The customer needs to actively verify this.

For opt in auto-renewal, this will ideally be before the renewal, but can be up to three months after. If there is no verification the insurer needs to formally contact the individual to suspend the insurance.

For opt out auto-renewal the verification would be part of the sign up process.

9. Insurers should not be able to take policyholders’ money before renewal.

Issue: Some insurance companies, including Swinton, take money from the accounts of their policyholders who pay by monthly direct debit, ahead of renewal as a deposit. Many policyholders are not aware that this will happen.

Change: Insurers are barred from using this practice.

10. Renewal fees should be abolished.

Issue: A limited number of smaller insurers charge policyholders if they decide to auto-renew. The fee can be as high as £50.

Change: Insurers should be barred from using this practice.

Auto-renewal poll

Also, back in 2012 at the time we were doing this policy work, we ran a site poll on your views of auto-renewing. 10,500 voted and the results are telling…

  • Ban all auto renewals – 3,914 votes (37 %)
  • Allow auto renewing only if premium not increase – 2,198 votes (21 %)
  • Allow auto renewing – 211 votes (2 %)
  • Auto renewing allowed only if people opt in – 2,930 votes (28 %)
  • Auto renewing allowed but must offer an opt out – 1,273 votes (12 %)

I’d love to know what you think of the ten points; whether you agree or disagree, if there are any you’d add that we’ve missed, and your auto-renewing experiences.

British Gas customers – there’s a hidden way to cut £130+ off your bill…

British (and Scottish) Gas is the UK’s biggest energy supplier, serving over 10m homes. And no surprise for a provider still benefitting from its past monopoly advantage, it ain’t cheap!

After all, why should it be – many of its customers stick with it, price hike after price hike, bill after bill.

Currently though, there is a way to stay with BG and hugely slash your cost, but you can’t just call it and ask. Any of its customers in the UK (not Northern Ireland) can do this, providing you…

  • Already do or are willing to pay by monthly (variable) direct debit
  • Use it for dual fuel (so electricity and gas)
  • Are willing to be billed online

What is this magical British Gas money-saving potion?

Quite simply it will sell you the same gas, same electricity, same safety etc as you get right now, but charge less for it and it’ll guarantee it won’t hike the rate for over a year.  Yet you can’t just call British Gas and ask for it.

It’s a new tariff called British Gas All Online January 2019 and it’s only available via comparison sites (we’ve no indication of how long it’ll last, so it could be pulled at any time). So to make it easy, just quickly plug details from your bill – guesstimate if you don’t have it to hand – into our special Cheap Energy Club ‘My Current Supplier’ comparison.

This filters out all but British Gas’s tariffs. Then you can see your exact saving (it depends on where you live and how much you use) and then click the button to turn that tariff on, and pay less.

PS: While this should save you decent money, you can save far more if you’re willing to switch provider. So when you’re looking at the results page of your British Gas comparison, why not play with the filters on the side, to see how much you can save elsewhere too?

The new tariff is a fix, which means you’re guaranteed no price hikes until January 2019 (unlike the normal British Gas tariff, which can be increased any time), though of course if you use more, you’ll pay more. If – as is unlikely if you’re doing this – you want to leave British Gas before then, you’ll pay a £40 early exit fee.

Those who don’t already have a British Gas smart meter will need to book installation for one by 31 July 2018. These automatically send meter readings to your supplier, so you get exact bills and pay only for what you use (for more on that, see our Smart Meters guide). And you’ll need to join the free British Gas Rewards loyalty scheme, but that just earns you things such as free movies from the Sky Store.

PS: If you’re wondering why it’s only available via comparison sites, it has likely done this so it can target switchers from elsewhere, but thankfully it has allowed existing customers to get it too.

How much cheaper is it likely to be?

Someone with typical usage (defined by regulator Ofgem) currently on a British Gas standard tariff (as most with it are) currently pays £1,100/year.

On the same usage, the new tariff will cost you on average (it depends where you live) £995/year. Plus, switch via our Cheap Energy Club and you get £25 cashback, making the saving a typical £130.

Though obviously if you’ve higher bills you’ll likely save more than that, lower bills less than that (yet the cashback is always £25 regardless).

It is worth noting on the same usage the very cheapest deals from elsewhere would save you about £300 (hence the big bold writing in the box above).

Why is there a Sainsbury’s Energy deal in my ‘British Gas only’ results?

Sainsbury’s Energy is just British Gas in disguise – it’s the same company, just selling its wares under a different name. And there’s a new Sainsbury’s deal out at the same time which for some will top the new British Gas deal – it depends on where you live and how much you use.


It’s called Sainsbury’s Price Freeze November 2018, and as the name suggests it’s also a fixed tariff, though the price guarantee is shorter than British Gas’s. If this is cheaper for you, you may decide to plump for it instead. Frankly, it’s a very similar deal, though doesn’t require you to have a smart meter.

How come MSE pays cashback on this?

Like all energy comparison sites, if you can switch through us, we get paid. Though unlike some we still include all tariffs, whether they pay us or not (unless you choose to filter them out).

Yet we aim to give you about half of what we’re paid in cashback. Just to be clear, you get exactly the same deal as you would if you went to the firm (but in this case you can’t do that) plus the cashback on top that you wouldn’t get otherwise.

The rest helps cover our costs and hopefully makes us some profit. We’ve had to drop the cashback from £30 to £25 recently as suppliers can give us less – for more see MSE Jason’s blog.

The secret of how to pick your new energy provider from a list of firms you’ve not heard of

Comparing energy tariffs is easy. Yet as I’ve learnt over the last year, it’s picking your new supplier from a list of unknown names that is putting many off. So I wanted to bash out a quick blog to show you how to navigate through that.

The majority of people in the UK are overspending on energy by 30%, often £300+ a year – simply due to being on the wrong tariff. If you’ve not switched in the last 12 months and are with one of the big six – British Gas, EDF, E.on, Npower, Scottish Power or SSE – almost invariably that means you’re one of those people, as you’ll be on their very expensive standard tariff. If you’re with anyone else, you could still be overpaying too, so the right thing to do is check.

The easy way to check is using a comparison site. That’s necessary as who your cheapest is depends on where you live and how much you use. It’s best if you have your bills to hand to do this, but even if not, most comparison sites will estimate for you and the sin of inaccuracy isn’t as big as the sin of doing nothing. Yet many people find, or at least perceive, switching to be complex.

I’ve always found this difficult to understand, as when even newcomers to my Cheap Energy Club have tried it, the comparison process is completed in an average of around five minutes. And changing itself is no biggie – it’s the same pipes, gas, electricity and safety, and you don’t lose supply. The only difference is price and customer service.

However, when over the last year I’ve observed people switching at my TV roadshows, my eyes have been opened to the real problem. It’s not doing the comparison. It’s picking who to switch to that’s the real problem for many.

Too many small firms you’ve not heard of?

The huge encouragement given for new entrants to the energy market is actually putting many off switching. And to an extent, there’s good reason. The energy market is swamped with new firms, and often at launch they offer super-cheap deals to build a customer base. Yet the customer service feedback on these firms is either limited or worse poor, as they can’t handle the number of customers flooding in.

If you do a comparison right now, almost invariably the first five cheapest providers on the list are those you’ve never heard of – and for many that’s enough to put them off and stop the process.

The simple answer is SCROLL DOWN to a name you know, or one – small or big – which has a good customer service rating.

In fact, with so many new providers, you could scroll down a couple of pages of names and still only find it’s £10/yr or £20/yr more than the very cheapest, still saving you nearly £300/yr on typical usage. To make it easier use this good customer service only comparison energy club link, which automatically selects the service filter.

What if I just want a name I recognise though?

In that case, even though many of the big six have hideous tariffs, they can also offer some good ones too. At the time of writing, the cheapest big six deal for most people on average is a one-year fix with Eon, saving £230/yr compared to the average big six standard variable tariff. Yet always do a comparison, as the cheapest does depend on your situation. Again, to help use this big names only comparison energy club link, which automatically filters out smaller firms.

And remember most cheap tariffs are fixes, meaning you’re guaranteed no price rises for a set time.

What if I just don’t want to switch firm?

Many people ask me questions like: “I’m with Npower – is it cheap?” I can’t answer that, as what you pay depends on which of a firm’s tariffs you are on. Npower, for example, has one of the most expensive standard tariffs – for someone with typical usage it’s £1,161/yr – yet right now it also offers a relatively cheap fix at £969/yr.

In fact, EVERY big six provider has a cheaper deal than its standard tariff. So through gritted teeth, let me say: if you won’t switch as you’re loyal to your existing firm, at least ensure you’re on its cheapest tariff. Call them up and ask them. (Or better, use the what’s my current provider’s cheapest comparison energy club link, which filters out all other firms.  Though if it has tariffs under another name – eg Sainsbury’s Energy is really part of British Gas –  they’re included.)

What if I’m on a prepayment meter?

If you pay by a key or card meter, as many of the country’s poorest and most vulnerable do, then outrageously there’s nowhere near as much competition, and you pay more – though prices have been capped, which has helped a touch. If you do a prepay comparison there are often savings to be made, but often less than £100/yr.

If you can, try and switch to a billed meter. It’s free to do with one of the big six providers, and you’ll usually be credit-scored to check you’re capable of keeping up with payments.

Is comparing safe though? Isn’t it all about energy comparison sites making money?

Comparison sites, including my Cheap Energy Club, do get paid roughly £50 to £60 if they can switch you. Yet the price you pay is the same as if you switched direct with the energy firm. It comes from their marketing budgets, and if not paying a comparison site they tend to be paying advertisers.

In the case of Cheap Energy Club, we roughly split what we get paid with you (our share goes towards the pretty high costs and hopefully makes us a profit too). So on a dual fuel switch, if we can switch you we give you £25 cashback (£12.50 single fuel). That actually results in you getting a better deal than if you went direct to the energy firm (so we have a filter that enables you to factor this into the saving you make).

You have to be careful with some comparison sites as they are now allowed to only show you tariffs that pay them, which means you may not see the whole of the market. For the sake of transparency, Cheap Energy Club always defaults to the whole of the market – obviously if you click a link with a filter on as explained, then that cuts some providers, but not based on whether they pay or not.