My Personal Finance Blog

The recent credit crunch has had a major effect on the secured loan market.Several Lenders have pulled out and many have tightened their criteria, which means that it is now more difficult to get a secured loan, especially If you

are looking to Self certify and have no proof of income.There are several reasons for this, as has been widely reported, the American Market has had major problems with the sub-prime market. This has led to many banks and institutions having to foreclose on loans made over the last few years. One of the culprits, it would seem, is the self cert market, with several authorities suggesting that the loans made, were made without proper

checks on income and affordability. This has led to high levels of debts and arrears and ultimately foreclosures on an unprecedented level.

The American credit crisis has had a knock on effect in the UK, with several banks/ lenders within the secured loan market either closing their doors or tightening their criteria. This is due to the fact that several lenders have been backed by American / foreign investment companies. For the self employed /self cert market the situation is worse, because their are now only a few lenders that offer secured loans to the self cert market and generally only upto 75% loan to value ( LTV ). There are lenders that will lend to higher LTV but the criteria can be quite restrictive.

The UK secured loans market is going through a transition, with changes occurring almost daily, opinions are divided as to the possible outcome, but general consensus is that the sector will ride the storm and over the next few months the market will stabilise, and once the confidence has come back into the market, we should see a relaxing of the criteria and possibly new lenders

entering the market.

Alan Reed writes for the following websites, http://www.chrysalisfinance.co.uk, http://www.e-securedloans4you.co.uk and http://www.debt-consolidation4you.co.uk

Pension’s Tips: It is said that people either “live too long or die too young”, and nowhere is this more typified than in the Construction Industry, where up to recently, both the safety record and the Pension planning record had been nothing short of appalling.

On the one hand, the fatality and injury record of workers in the Irish Building Industry was one of the highest in Europe (in 2001, 28% of all workplace fatalities were Construction Industry related), while those who were lucky enough to have survived working on Irish Construction sites faced a very uncertain future as they neared retirement.

While the authorities have made some strides in addressing the Construction Industries safety record in the recent past, there is still considerable scope for improvement with regard to adequate and proactive Pension Planning (in an IAPF survey dated October ,2005,it was found that nearly the entire Irish population was dependant on the state pension)While a recent IMPACT Trade Union report found that in Ireland, there are currently 5 people of working age for every person aged over 65, but that figure will fall to 2 to 1 by 2050,causing a huge funding crisis.

The lack of Pension planning is a symptom of a larger Irish malaise, namely their totally reactive nature to nearly everything. This especially applies to Construction Industry Pensions, where despite extensive publicity on the need for adequate Pension planning, the Pension expertise available and the negative effects of no Pensions being in place at retirement, excuses still abound for doing nothing. In an effort to be seen to do something, the Government is even rumored to being looking at making Pension funding compulsory.

In over 25 years of Pensions planning, here are the 7 most popular excuses I’ve come across in the Construction Industry for not planning a Pension.

* I can’t afford it

* I’m too young/old

* “Someone else” will provide for it

* I’ll do it “later”

* There’s a state pension

* I don’t want to think about it

* I’ll be dead by then

I can’t afford it — expansive pension ……ask yourself can you afford NOT to? Waiting until you can afford it will never happen. The minimum monthly premium for a self employed Pension is €25 gross, or with tax relief at 20%, €20per month ……that’s €1.00 per day. Given that the minimum Lottery ticket price is €1.50 per go, and there are absolutely no guarantees whatsoever with that, €1 is a small price to pay for securing your future and security of mind, isn’t it?

Insurance go first! I’m too young/old ….you’re never too young, or old for that matter, to start to proactively secure YOUR future. The earlier you start, the longer your funds have to grow and appreciate in value, while even starting much later in life will give you tax relief and help you to exercise SOME power over your finances.

A plan for my Pension? “Someone else” will provide it …………who, precisely? And why should they? While an employer may contribute to your Pension Plan, ask yourself how much of a benefit you’d expect to get, would it be guaranteed, and if so, for how long? Would you be happy to have “someone else” pick your clothes, choose your car or have any other say in your life – but if you don’t plan for your Pension, “someone else” WILL be deciding your future.

I’ll do it “Later …… look at the cost of delay – to provide a pension of €2,000 per month, a 20 year old would need to pay €270 per month into a pension plan, while a 40 year old saving for EXACTLY the same amount would need to pay €951 per month – FRIGHTENING, isn’t it??

There’s a State Pension …….there is alright. As of Jan, 2007, that stands at the princely sum of €209.30 per week. Now ask yourself, given the ever increasing cost of accommodation, transport, food, communications, entertainment etc., if you were relying on the State Pension ONLY, would you be LIVING or EXISTING?

I don’t want to think about it…….fair enough, that’s your prerogative, but burying your head in the sand on the Construction site won’t make planning for your future go away. Can you imagine a Builder deciding they didn’t want to think about something on a Construction site……would you be happy to work there?

I’ll be dead by then …perhaps you will, but suppose you’re not? Can you imagine HAVING to continue doing manual labor out of dire economic necessity? Or what if you’ve worked all your life and in spite of your best efforts, face 30 years of retirement?

Another alternative the Irish Government are looking at, as pointed out in a recent IBEC report in Feb 2006, is that they may increase the minimum retirement age to 70 or 75.Can you imagine the potential effect this would have on the Construction Industry? So, as an Irish Building worker, why don’t you take control of your future, ignore the 7 most popular excuses outlined above, and make your Pension THE KEYSTONE of your financial future……and if you need another incentive, try living on €209.30, and nothing else, for a few weeks!!!

For general pension’s information, please visit the website of the Irish Pensions Board or for Information relating specifically to Pensions visit Irish Construction Industry Pensions.

Ireland’s premier supplier of Pension and Retirement planning for those contractors, suppliers and sub-contractors who work in the Irish Construction Industry

Anthony Woods T/a Keystone Insurance