Fergus Muirhead answers your consumer questions
I'm Fergus Muirhead and I'm here to answer any questions you may have about any money or consumer issues.
Please drop me a line here at email@example.com with your questions.
You can also read more on money and consumer issues on my own blog.
Any idea why Lloyds TSB are sending out emails to account holders 'confirming' their request to switch to online statements when no such request has been made? Les Bruce
The short answer would be no I'm afraid. But I would add it may be that they have emailed you to say they will be switching to digital statements unless you responded by a certain date to say that you didn't want them. And I have to say, as a true convert to digital banking, it's a great way to keep tabs on what's happening to your account. You can check payments, pay bills and keep an eye on up-to-date balances very easily. I would have a close look at it before dismissing it.
We have an interest only repayment mortgage, and I have concerns about being able to repay the capital at the end of the mortgage period, given that we will be using two ISAs to repay some of the capital. Fiona Johnstone
This is a very popular question at the moment since there are tens of thousands of borrowers with interest-only mortgages and no visible means of repayment. The upside of an interest-only loan is that your monthly repayments are low; the downside is that you never repay any of the loan and in a time of flat prices where you are not making any capital gain in the value of your property, you are in a sense renting your house. You have to either convert your loan to repayment to help reduce the amount outstanding, or organise more savings so that you can use these monies to prepay your loan at some point in the future.
It is all well and good relying on rising property values but the way the market is at the moment, you need to have a more secure way of repaying your borrowings. Of course the downside of changing from interest-only to repayment is that your monthly payments are going to increase, perhaps substantially, and it may be that you have to look at the term of loan that you have. The longer then term you look at when you remortgage then the lower the monthly payments you will face. But be careful here - you don't really want to have a mortgage that goes beyond your normal retirement date.
Is it possible to have more than one ISA in a tax year? My bank says it is. And is it true that all of the money paid into an ISA is tax free? Len Ironside
You are able to have a Cash ISA and a Stocks and Shares ISA in the same tax year but not more than one of each. This year the overall limit for an ISA is £11,280, and of that amount up to £5,640 can be invested in cash. If you prefer, and if you are happy with the risk involved, all of the £11,280 can be invested in one Stocks and Shares ISA. When you ask if 'all of the money paid into an ISA' is tax-free, I presume that you are asking if the interest you receive is tax free, and the answer to that is yes. All of the proceeds from your ISAs will be tax free and do not need to be disclosed on your tax return if you have to complete one. The money that you pay into an ISA presumably comes from savings or salary that you have already paid tax on, so in that respect the payments are not 'tax free'. Unlike payments into a pension, you won't get the tax back when you invest in an ISA. Remember that interest rates from cash ISAs and returns from Stocks and Shares ISAs can vary greatly and you should take your time and ensure that you are choosing one that is suitable for your circumstances.
Like many soon-to-be retirees I would welcome advice on how to invest my lump sum when I receive it. About £60,000-£80,000 is the likely sum. I am looking for a safe low-risk investment - preferably not in a single investment. I am a concerned about the fees attached to advice - for example 3% from the capital at the initial investment point. This seems excessive given the poor rate of interest these days. Robert Gardner
A few good questions here. First, you have to define what you mean by 'low risk'. If you don't want to take any risk with your money then you need to look for the best possible interest rate that will let you have access to your money when you need it. For instance you might be able to find interest rates of 3% at the moment, but it might mean your money is tied up for five years! You then have to consider your overall tax situation and whether you are investing to take an income from the money or purely for growth over the longer term. You then need to think about the fees you are paying and why you are paying them. Are you paying for 'advice' or because you have 'bought something'? It should be the former, and you should be looking for an advisor that will provide an ongoing service that is tailored to helping you achieve whatever it is that you need to do with your money. That will probably involve a spread of investments across a range of fund managers. I think 3% is a bit excessive as an up-front fee and you should talk to which ever advisor you decide to use and make sure that you are clear on all of the fees you are likely to be paying, and what you can expect as a service in return for these fees.