Every year I go cycling for charity – various distances, different challenges, all great causes.

The other thing these events all have in common is the encouragement I get from the rest of the Logic team…like

should you really wear lycra at your age?“,

try and get through fewer Mars bars this time” and

don’t forget to update the website before you go!“.

So with the latter in mind, here it is, my occasional column containing titbits of interest I’ve seen in the media recently.


Property news

New rules to hit Buy-to-Let – new rules due to be introduced by the Bank of England  at the end of September could make it harder for Buy-To-Let owners to obtain mortgages, according to The Telegraph. These will require lenders to assess the viability of the whole portfolio if someone owns more than four properties. The change comes on top of restrictions to BTL owners’ ability to claim tax relief on mortgage interest, and there is also uncertainty about how lenders will interpret and apply the rules, so brokers are urging owners to refinance before they take effect.

Keep on borrowingthe number of mortgage borrowers aged over 70 has soared by 75% in the past five years, says the Mail. Many have obtained new loans because their existing mortgage lender won’t  extend the repayment term of their current loan.

Let’s all go to uni – there has been a rise in the amount of student housing  owned by private landlords, says the Financial Times. Southampton, Leicester, Liverpool, Exeter, Brighton and Hove are among the cities that have seen the largest increases. Letting agents say one reason is the higher yields available on student lets, though costs of management are also typically higher.

Pension news

Millions at a loss on pension funds – millions of savers have no idea whether the fund in which their pension savings are invested is any good, says The Times, citing recent research. This showed that many insurers are among those whose funds are in the doghouse, having earned consistently poor returns. The difference between the dogs and better funds is equivalent to tens of thousands of pounds at retirement.

No big changes on pensions – a statement by the government minister in charge of pensions was interpreted by many, including the Financial Times, as signalling there would be no major changes to pension tax relief in the next few years. Reforms to the tax relief system had been considered by the previous Conservative government but such a major upheaval now looks very unlikely.

Insurance news

There has been a sharp rise in the number of young drivers using telematics – black boxes fitted to their cars – to cut the cost of car insurance. The Mail cited the case of two 19-year-old sisters who got cover for their small car for £1,600 with telematics after being quoted premiums of up to £7,000 by other insurers. The Mail journalist who tried the black box found it slightly disconcerting – it constantly measures your speed – but confessed that it would probably improve her driving.

Family news

Three quarters of graduates will never repay their loans – analysis by the Institute of Fiscal Studies shows that three-quarters of students will never repay their student loans, reports the Financial Times. One reason is the very high interest rates applied to student loans (RPI plus 3 per cent), which mean the average graduate accrues as much as £5,800 in interest even before they graduate. The result of high interest rates is that the debt rises too fast for repayments to keep pace. Taking into account the write-off of loans that aren’t repaid adds £5 billion to the bill paid by the government – about half the cost of abolishing tuition fees entirely as proposed by the Labour Party.

The cost of education – parents in the UK who pay for private education for a child at primary, secondary and tertiary levels spend on average £128,600, says the Financial Times, citing research by HSBC. That is ten times the average cost of state-funded education and is second only to average spending in Hong Kong out of the 15 countries in which it conducted its research. A quarter of parents wish they had saved more, but  only Chinese parents seem to be good at planning ahead, with most parents still paying the bulk of costs out of current income.

Fewer divorces, but more silver ones – the number of divorces fell by 9 per cent in 2015, in line with a long-term trend. But the average age of divorcees keeps rising, as it has done since 1985  – it is now 45 for men and 44 for women, reports the Financial Times. The result is more complex financial settlements, say lawyers. Older people have more assets and more pension rights, which are themselves increasingly valuable – for example, a £30,000 a year pension entitlement is worth over £1 million. The home, say lawyers, may not be the biggest asset that has to be divided.

For more on any of the above, or if you would like to speak to someone about your own financial plans, get in touch with us via this link.