Finance Worcestershire

By Worcestershire Life on January 31st 2011

Love and Money

Money can’t buy you love, but thinking about your finances can help in the long run, says finance expert Adam Aiken.

Valentine’s Day is traditionally a day for popping the question. Talking money will be the last thing on the minds of those swept up in the excitement of the occasion. Indeed, if finances really are top of your list at this time, you could do with taking another look at your priorities. But while money doesn’t guarantee happiness, being open with your future spouse or civil partner can help you make the most of your situation, as well as engendering a feeling of trust.
A recent study suggested that one person in six has a secret bank account.
This is not a new phenomenon; a few years ago, one high-street bank even coined a name for this type of account – ‘Cashflo’, or Current Account Secretly Hidden From a
Loved One. If that’s the way you want to play it, that’s fine. It’s your money and your business. In fact, it’s not necessarily a bad thing – lots of people have secret savings simply to maintain a sense of independence rather than for anything sinister.
But even if you’re building up a stash without your partner’s knowledge, it’s important to share responsibility for at least basic finances. It could save you money, too.

Joint protection

Under the Financial Services Compensation Scheme, each saver’s first £85,000 in any authorised institution is guaranteed by the government should that provider
go under.
So if you have £115,000 in Bank A, you could consider moving at least £30,000 of it into Bank B.
However, that might mean some
of your money earning a lower rate
of return, so instead you could leave
all the money in Bank A and
transfer £30,000 of it into your
other half’s name.
Another option is to open a joint account. By having two names on the account, the government protection is automatically doubled to £170,000. Of course, having a joint account can effect your tax planning, so it’s worth taking advice if you’re unsure of the tax implications.
Sharing the benefits

Some of the best credit cards on the market offer rewards for loyalty, but only with a minimum spend. American Express, for example, has a generous cashback scheme, but it only pays out if you spend more than a certain amount each year. It might make sense for you to pool your resources and take out a joint credit card in order to give yourselves a better chance of reaching the minimum annual spend.
This might all sound a bit unnecessary, but every little helps – particularly if you have an expensive wedding on the horizon. And why not put all the bits and pieces you save over the years into a fund that could pay for the holiday of a lifetime to mark one of your big anniversaries in the future?

For more personal finance news, views and analysis, visit www.mymoney24.co.uk

MyMoney24

ADAM AIKEN

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