My 2013 secret to a frugal life

Thinking of pursuing a more frugal lifestyle? Anyone can do it but there’s more to it than just having an eye for a bargain. This week I’ve been pondering some of the personal qualities we need to develop.
It’s easy to believe that the secret to a thrifty lifestyle is to be tight-fisted and mean. Titles of TV programmes such as Superscrimpers – while they are useful shows in themselves – don’t help the cause. So far in my own experiences I’ve learned that this is a pretty simplistic view. There’s a lot more to frugal living than not standing your round in the pub or giving your mates your unwanted Christmas present for their birthday. These are some of the personal tools I’ve had to try to develop to help me along the way:

Learning to say no

For many of us, our natural instinct is to please others, but the ability to say ‘no’, sometimes even shout it, is vital when trying to save money. You have to say no to the marketeers at the big corporations, to the door-to-door salesmen pressurising you into changing your energy provider, and the cold-callers wanting to sell you the latest credit card or loan.

This bit can be easy – especially if, like me, you hate these people bothering you anyway! The tough part is saying no to friends and family when they want us to spend money on something we can’t afford or no to our kids who want the latest gadget. It’s not always simple but it can be the difference between sticking to our budget or not.

Having self-control

We can learn to say no to others, but it’s even harder to say it to ourselves. When money is short or we’re saving for something special, it can be hard to deny ourselves that little something. Advertising has taught us that if we’re feeling blue we should treat ourselves ‘because we’re worth it’. But to stick to a budget we sometimes have to wait for something we want instead of having it instantly. It’s not easy but it can mean we appreciate that special purchase more.

Thinking smart

While self-control is important, there’s little point in making yourself miserable living on cold baked beans. Few people can live like that for very long and it’s not what frugal living is all about. I’ve also learned that frugal living is about being smart and deciding on the most effective ways of achieving your goals. It’s about going for the easy wins first. Examine your outgoings and decide which changes to them could produce the biggest bang for your buck. For example, could simply ditching your cable TV subscription save you more money than switching to value food brands? If you make sensible choices you’ll achieve more in less time.

Being brave and asking for a discount

It makes sense always to ask for a discount on a major purchase. I’ll be honest – I’m not always been good at this but I’m working on it. Yes, it can be awkward or nerve-wracking to ask for money off something. We might feel tight. But it costs nothing to ask and the only downside is that the shop may say no. They may also say yes. My other half DJ and I recently got 10 per cent off an important purchase simply by asking at the point of sale. It’s always worth having a go. In the same way, you should also always complain about poor service (and ask for a discount) and take faulty items back to the shop to get your money back.

Having an open mind

Lastly, something else I’ve learned is to keep an open mind and to listen to other people’s advice. By doing that I’ve picked up countless tips on saving money from all kinds of people. Being open to new ideas will also help you come up with alternative uses for unwanted items, or different ways of doing things you hadn’t considered. When DJ first began making his own wine I thought it was a pain and took up a lot of space, but now I appreciate how much we save on our supermarket bill. I also don’t think twice about foraging for wild foods – something I would never have considered doing in my twenties!

What do you think are the most important qualities required to pursue a more frugal lifestyle? Leave a message and let me know.

Why we are poorer than our parents

In July, a renowned financial guru Alvin Hall hosts the first episode of a new four-part series on Radio 4 called Poorer Than Their Parents. Its premise, according to the blurb accompanying the series, is to examine “whether today’s youth will be the first for generations to be worse off than their parents”.

Our parents’ generation, the so-called ‘baby boomers’, have taken a lot of flak over the past year. Conservative frontbencher David Willetts’ 2010 book The Pinch estimated that, of Britain’s £6.7 trillion pile of personal wealth (including property, investments and pensions), the baby boomers were worth £3.5 trillion. And the over 65s were worth £2.3 trillion. All of us under 45 own just £900 billion.

Now, you might argue that there is an obvious disparity between the wealth of older people compared to younger generations. They’ve worked longer (so have bigger pension pots), they’ve paid off or are close to paying off their mortgages. But, in this case, the wealth gap actually looks like more of a chasm.

How the baby boomers benefitted
And if we look at some of the things that the baby boomer generation benefitted from – massive house price inflation, generous final salary pensions, free education – it’s clear how they’ve accumulated all that wealth. I know of retirees who earn almost as much from their pensions as they did during their working life.

Now look at Austerity Britain 2011 with its high house prices, reduction in pensions and massive increase in student tuition fees and it’s clear to see why this disparity exists. That’s not to deny that many baby boomers are helping their children and grandchildren out, for example with savings to fund education or part of a deposit to help them onto the property ladder. But debt seems to come as a given in the financial lives of anyone born from the 70s onwards.

“We cannot just fold our arms and let improvements in technology discharge our obligation to future generations,” Willetts wrote in response to criticism of his book by Boris Johnson. And that hits on an important point – while technology invented by that generation has improved much of our lives and, crucially, our life expectancy, it will not pay for our futures. Or indeed our present.

So I would argue it doesn’t take a four-part radio series to uncover why we’re poorer than our parents, the answers are plain for all to see.

Start saving for your future today

With advances in health and medical care and improved living conditions life expectancy has increased. A baby born in 2013 is eight times more likely to reach the age of 100 than a person born in 1931.

The latest Principality Saving and Spending Survey show that the people of Wales suggest that the ideal age to start planning is 25 – that’s three years younger than the average age of a mortgage first time buyer in Wales.

Addressing the reality of increased life expectancy means being better educated about what’s available to you. To find out more about planning for your retirement you should seek advice from a financial planning expert. However, it’s never too early to start saving.

Savings accounts are a convenient way to start saving. Especially, with internet savings accounts one of the most significant advantages is convenience. Money can be transferred between accounts and payments can be made to service providers at any time of day or night. You can manage internet savings accounts without having to step inside a bank or building society. You can save as much as your budget allows and top up your savings accounts if and when you have extra money. You can use savings accounts to save for a number of reasons; an emergency fund, your retirement, a deposit on a house, a new car or your education.

One of the other types of savings accounts is referred as Notice Accounts. These are high interest savings accounts and require you to give notice when you want to withdraw funds. It is important to compare high interest savings accounts to ensure you get the highest return on your investment. Whatever your age and whatever ever the stage your planning is at, it would be wise to start saving for your future now.

Which improvements add value to your home?

Right now, friends are talking a lot about whether to buy, sell or stay put at the moment. The ones who are going to stay put for a while are thinking of using the time to make some home improvements so that when they do sell, they can bump up the price a bit.

I think this mirrors what is happening across large parts of the country. Home insurer LV= has done some research which shows that almost one million homes are being renovated or revamped over the coming 12 months rather than sold because owners are worried about the effects of the credit crunch.

But home improvements can be a bit of a minefield as your idea of a ‘must-have’ is a potential buyer’s ‘so what’. Making ‘improvements’ which are completely out of proportion with your property will be pointless. But knowing what is in demand in your area and making the most of what you have can pay dividends. So what exactly are home improvements which add value to your home and which are a waste of money? I have trawled various sources to come up with a hit list…

Adding value: Creating off-road parking – but at the side, rather than the front of your home
Landscaping the garden
Painting and decorating
Bathrooms and kitchens – updating suites and fittings
Installing/updating central heating
Insulating your loft and cavity walls – energy efficient homes are become more sought after
Increasing natural light
Loft conversion
Conservatory
Updating the exterior of the property

No guarantees: Replacement windows – generally a plus for looks and energy efficiency but beware anything too fancy or not in keeping with the property.
Reinstating original chimneys and fireplaces – period features are great but may not add extra value.
Installing a swimming pool – if you are happy to shell out purely for your own pleasure then great but don’t expect it to be a selling point.

Just don’t: Botched DIY – anything that looks unprofessional, such as a badly fitting kitchen or uneven plastering will get buyers wondering and asking questions
Ripping out period features such as fireplaces
Textured plaster or woodchip
Creating windowless rooms
Adding plastic double-glazing or windows that don’t open
Adding stone cladding.
Laying new carpets – unless yours are in a bad state
Laying cheap wooden flooring

Sources: RICs, B&Q, Knight Frank, National Association of Estate Agents

My blog has moved

Hi,

 

My blog has now moved to the main MSN Money site, so if you want to read my latest entries, please go to 

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If you have my blog bookmarked, please update your bookmarks with the new address.

 

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Best wishes,

Sarah

Time to end doorstep selling?

Ding dong. I’m not a fan of strangers turning up at my front door. Unless I have invited you to my home then I’m probably not going to be excited about whatever you’re selling.

 

Door to door salesmen are not exactly high-tech but I have been reminded this week that not everyone is online and some customers seem to like ‘seeing the whites of their eyes’. For some, it seems, face-time can often highlight products and services in a way that leaflets or TV adverts cannot.

Unfortunately, doorstep selling is also a golden opportunity for a rip-off. You could end up dealing with distraction theft, a scam or a legitimate salesman who is trying to flog something you don’t need. These days you’re more likely to find the salesman wants to switch your energy supplier rather than sell you some tea towels. However, the silver-tongued chat often remains the same.

Mis-selling
Energy watchdog Ofgem is currently investigating NPower, Scottish Power, Scottish and Southern Energy and EDF Energy for sharp doorstep tactics and mis-selling of their power deals amid claims that they confused customers into signing up for deals that leave them out of pocket. Ofgem said it had received information that doorstep and telephone sales people, who work on commission, are persuading households to sign up for tariffs that are more expensive than their current deals.

This is particularly worrying as it comes just eight months after new rules were introduced to protect customers from energy mis-selling. Ofgem introduced new rules in January forcing doorstep salesmen to provide a written estimate before a sale is concluded. The idea was for the customer to have written proof of what they’d been offered and then use this information to check whether they will be better off switching supplier or not.

At the time, research from watchdog Consumer Focus found that eight out of 10 people with first-hand experience of being door-stopped by an energy representative described it as a “negative experience” and more than a third of respondents said that they had been intimidated by the salesperson.

But customers are still being talked into switching suppliers and signing up to more expensive deals by salesmen working on commission. Around 2.5 million people switched supplier last year after being approached on their doorstep, over the phone or in a public place such as a shopping centre. Citizens Advice said it was dealing with cases of pressure-selling involving many elderly or vulnerable customers. It said: ‘this includes misleading information about "savings" where people end up with much higher bills and being transferred to a different supplier without their knowledge or consent.’

Npower was fined £1.8 million by Ofgem in 2008 after its doorstep salespeople were caught making misleading statements to potential customers in a bid to get them to switch supplier.

Richard’s story
MSN Money user Richard got in touch with me after a doorstep energy salesman switched his provider claiming that one company owned the other and he would get a better deal by moving across. This was a complete lie and the deal was no better. When challenged, the new supplier had the cheek to say there would be a cancellation charge of £30. This was waived after I intervened.

Organised crime
Just last week, Consumer Focus and trade body Energy Watch issued a warning to customers about organised criminals selling illegal electricity meter top-ups across Britain. At least 85,000 prepayment customers (who pay for their electricity in advance through a key, or card, they put into their meters) have already been conned into handing over £25 each in the doorstep scam which seems to offer half price electricity meter top-ups but just ends up with customers paying twice. The con man appears to top up the meter but the energy company can tell that it has been obtained from an illegal source and so does not recognise it. This usually transpires when the customer next tops up and finds the ‘cheap’ credit disappears.

The problem is affecting customers of all of the leading energy companies (British Gas, EDF Energy, E.ON, Npower, Scottish Power and SSE). And as the scale of widespread illegal sales of electricity top-up on the doorstep is revealed, energy companies have launched a national campaign – ‘Top up Safe’ – urging electricity prepayment meter customers to buy top-up only through official channels.

There are concerns that as we head towards Winter and people start to worry about their fuel bills that they will be even more vulnerable to rip-offs.

Doorstep selling: your rights

• Doorstep selling is where a salesperson calls at your home, or stops you in the street or shopping centre, for example, to sell you goods or services – it doesn’t have to be literally on your doorstep. The salesman might be offering anything from double glazing to home improvements or a gas or electricity supplier. If you buy from a doorstep salesperson you have the same rights under the Sale of Goods Act 1979 or Supply of Goods and Services Act 1982 as you would if you bought from a shop plus some additional protection (see bellow).
• The seller must show ID and give accurate information about products and services.
• If you sign a contract made during a sales visit to your home, the Doorstep Selling Regulations (DSR) give you a seven-day cooling-off period during which you can cancel. Any credit agreement you took out to pay for the goods or services would automatically come to an end when you cancel too. Whether you have a written contract or not the salesperson must tell you, in writing, about your cancellation rights.
• To cancel a contract made at home, write to the company within seven days of signing it, saying you want to cancel, the company should then return any money you have paid. If you said you’d pay by credit agreement this will be automatically cancelled, as it’s up to the company to notify the finance company rather than you. Make sure you keep a copy of the letter and send it via recorded delivery if you can. If the supplier does not respond to your letter, won’t let you cancel your contract or you think they have breached the Doorstep Selling Regulations in any other way then contact your local Trading Standards(or DETI in Northern Ireland).
• Be aware that the Doorstep Selling Regulations do not apply to goods or services that are worth less than £35 (a fact which made it easier for the £25 electricity top-up scammers), insurance, credit and investment agreements or to perishable goods.
• If the salesperson or organisation you’re buying from is a member of the Direct Selling Association, you normally have a 14-day cooling-off period during which you can cancel your order and get a refund of any money you’ve paid. Before you take out a credit agreement to finance your purchase though, check whether you would need to cancel within 7 days to ensure that this is also automatically cancelled.
• If you’re being sold an energy deal the Association of Energy Suppliers’ Code of practice also applies.

 

Is it time for all doorstep selling to end? I contacted the six main energy suppliers to ask if they planned to stop selling on doorsteps. British Gas – which is not being investigated by Ofgem – told me it "remains an important sales channel" and that it welcomed the Ofgem investigation into the other suppliers, hoping they would raise their standards.

Scottish Power said that it "remains one of the best and only methods for certain customers to access better deals" and is "committed to promoting responsible practices across all of our sales channels at all times."

EDF Energy told me that it "currently has no plans to stop its doorstep sales activities" and is "committed to offering an honest, transparent and professional sale to all potential customers."

E.ON said "We respect and follow guidance from Regulatory bodies such as the Office of Fair Trading with regard to doorstep selling and have no plans to stop this form of selling."

Npower and Scottish & Southern Electricity did not respond.

Weighing up the potential benefits against the known pitfalls, I do struggle to see that there is any justification for anyone to sell anything on your doorstep. I realise that it’s harder to those without a computer but most libraries provide free internet access and assistance now. Mis-selling and fraud is a worry but even legitimiate sellers don’t seem to be able offer cheapest deals. Recent research from Confused.com reveals that those signing up to energy deals on the doorstep pay as much as £167 more than they would online with the same supplier. In other words, you’re paying for the doorstep seller’s commission.

I’d like to hear your views…

Have your say… have you ever been ripped-off by a doorstep seller or landed a great deal? Would you miss doorstep sellers if they were no longer around? Please share your experiences with others and leave a comment below…..

If you have been ripped off, have a complaint about a company or product or just need to know your rights, then contact me: consumerchampion@hotmail.co.uk

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Beware mobile tariff rip-offs – top tips and what to avoid

 

Last week I looked at how proactive (or not) mobile phone providers are about keeping customers on the most cost-efficient tariffs.

I promised that I would be back this week to bring you tips and tricks on getting the best deal for yourself in the absence of any help from your mobile phone company. I also asked the five main network providers – 3 Mobile, O2, Orange, T-Mobile and Vodafone – to share their tips.

My tips for getting the best tariff and saving money:

• Work out exactly how many minutes and texts you actually use each month. Look back at your last three bills and find out how much you’ve been using. If you are signed up to a deal where you receive a large amount of inclusive minutes and texts each month but you only use a fraction of them – or not getting enough –  then it’s time to act.
• Make a note in your diary so that you know when your contract expires. You can usually begin shopping around and negotiating up to two months from the end of it.
• Check out comparison sites such as BillMonitor, uSwitch, moneysupermarket and OneCompare. These sites will find you the best contracts for your specific needs.
• Ofcom has a useful leaflet on getting the best deal. And before you switch to a new network, you can check the coverage in your area by visiting the Ofcom site and using the coverage maps provided.
• If you’re unsure about signing up over the phone, ask for the information to be posted to you.
• Switching to online billing can help you save money.
• Don’t settle for the packages you see online or in mobile phone shops. Ring a service provider and haggle prices down or deal up.
• Be prepared to say you want to close your account and switch to another network. This seems to be the key to being offered the ‘secret’ deals which are not usually advertised but are brought out as incentives to keep customers who threaten to quit. Of course you may really want to quit.
• Whether you’re threatening to quit or really making the switch, ask your provider for your Porting Authorisation Code (PAC) code – the number you need to switch networks and keep your existing number. The mere mention of it should spark some action.
• Switching to a new network should be painless because mobile providers are obliged to switch your old number over to your new network within five days and many do it much quicker. In the meantime, you’ll get a temporary number so that you’re not left without a phone.
• Once you have switched networks, don’t forget to follow-up on any refunds due from your old provider. Check final balances carefully because some phone providers will not make an automatic refund if the account is in credit – something which is more likely if you pay by direct debit. Some companies, such as Orange, send customers a cheque automatically. T-Mobile refunds the balance automatically, but only if it is more than £20. If it’s less than this, customers must call a number to request the money. Vodafone customers must also call to request a refund.

What to avoid

Cashback – If you’re tied into a cashback system then you’re certainly not guaranteed to be better off. For instance, your mobile provider may offer you a deal of £15 a month, but in order to claim it you will have to pay £30 a month up-front and then send off your bills at the end of your contract to get the refund. Last year consumer campaigners Which? called for a ban of cashback deals after receiving hundreds of complaints from mobile phone customers who failed to receive their money. Ofcom – which was also flooded with complaints – has now introduced regulations but you might want to avoid cashback deals altogether.

Insurance – Most mobile providers will try and sell you insurance, but if even if they offer you a policy which is free for the first couple of months, the chances are that you will forget to cancel it and end up paying much more than you need to for the rest of the year. For instance, £6 a month may not seem a lot but it adds up to £108 over an 18-month contract. Worse still, you may also find that the policy you’re offered is full of exclusions and is no use whatsoever if you do need to make a claim. Accidental damage or losing your phone – the very things you’re most likely to claim for – are often not covered by rip-off phone insurance. It’s also worth checking whether your phone is already covered – often through household insurance or your credit card. Again, read the small print so you know what exclusions there are. If you break or lose your phone a lot then shop around for insurance on CompareTheMarket.com or try TalkCover.co.uk. You may find it’s much cheaper to insure several phones at the same time.

Freebies – It’s hard to ignore the lure of a free gift and these are increasingly popular and desirable. From GHD hair straighteners to a Wii or laptop, some providers will stop at nothing to entice you onto a certain tariff or contract. But will you really use the tariff you’re signing up to? According to research carried out by moneysupermarket.com in 2009, we waste over £250-worth of mobile allowance each year – more than 1,600 wasted minutes and over 1,800 wasted texts per person. So the extra cash you pay for the tariff you’re not using could have bought you the ‘free’ gift anyway.

What the big five mobile providers say:

3 Mobile:

• Know what you need from your phone – if you use email a lot, then make sure you’ve got an inclusive plan that includes free email. If the internet is your thing, then make sure you’ve got enough of a data allowance to fit your usage patterns – especially if you are on a smartphone and use all the different applications and programmes available. When we introduced The One Plan, the idea behind it was to offer the vast majority of customers all the data, texts and calls they would need every month at one simple price point – so there were no complicated bills with add-ons and access packages.
• Pick the right network – if you do more than just make calls and send texts (ie browse the internet, use social media or want to stay in touch with emails etc) make sure you’re on a 3G phone with a strong 3G network. Always use the coverage checker facility on the network you are considering to check you will have reception in the areas you use your phone the most.
• Don’t fall for ‘unlimited’ deals – there’s always a limit and make sure you look at what it is. We’re a firm believer in offering complete transparency – using the words ‘unlimited’ or ‘fair use policy applies’ as little as possible. Our first step in this direction was the launch of the One Plan (see below for more information).
• Do your research – not all tariffs are the same and, especially when taking on a long contract, it’s worth looking at what you’ll be getting and paying for each month. And check that the phone you are being offered does do the things you want it to do.

02:

• Don’t always think price. Think ‘what is the best value I get as a customer?’
• Do I get an early upgrade? Do I get value back?
• What extra experiences do I receive?
• Have I got a good signal where I am?
• What’s the Customer Service like?

Orange:

• Customers should look at what’s included in their talkplan allowance compared to their actual usage in any given month. It could be that overall customers are better taking a higher level talkplan which gives them more inclusive minutes, text, browsing and therefore helps to save money on their total bill spend. Customers could benefit from adding an additional bundle which offers a cheaper rate than if they just paid the standard rates. For example, for minutes, texts, mobile internet browsing, roaming, IDD and MMS.
• Also, make sure to check what extra benefits the operators offer you as deals like Orange Wednesdays and Magic numbers offer enhanced value.

T-Mobile:

• Work out what you want from your mobile contract – is a great phone the most important thing? Or are you looking for flexibility? Think about how you are going to use your phone – is it for texts, phone calls, internet or all of the above? You can do that yourself or talk to our expert advisors in store or on the phone and let them help you to find a great plan to suit you.
• We’ve made it much simpler for our customers with easy to understand and great value pay monthly plans and we’ve made sure that even our contracts are flexible. Our customers get a flexible booster included in their plan which they can change every month to suit how they want to use their phone. They can choose from unlimited texts, unlimited internet on their phone, international calling, roaming, unlimited calls to other T-Mobile customers or unlimited calls to landlines.

Vodafone:

• If you already have a phone, a SIM only plan might suit.  This allows you the flexibility to take a contract as short as just one month.
• Some devices are sold exclusively by networks.  For example, Vodafone is the only network to offer the HTC Legend.  It’s worth checking this out, if you want a particular phone.
• Consider customer service as part of your choice – Vodafone offers a variety of ways to get in touch – on the phone, on email, through our forums or on Twitter – @VodafoneUK.
• Finally, Vodafone offers great deals through its Twitter service – @VodafoneUKdeals.  Get in contact with them if you want to find out what’s hot at the moment.

Have your say…. have you suffered a mobile phone rip-off? Please leave your comments below…

If you have been ripped off, have a complaint about a company or product or just need to know your rights, then contact me: consumerchampion@hotmail.co.uk

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Want the best mobile phone deal? Threaten to leave

"I hate the way that my mobile phone company let me carry on paying way more than I needed to," writes MSN Money user Dan. He got in touch to ask if he was the only one who felt neglected by a mobile provider he’d been with for years.

"I spoke to them and they said they could improve my tariff but I then I shopped around a bit and it was only when I said I’d seen better elsewhere and said I’d be closing my account that they upped their game. It’s sad that we have to threaten to leave before they look after us," says Dan.

He’s not alone in having to instigate a better deal. I suddenly realised I hadn’t looked at my mobile tariff for about 18 months and when I spoke to my provider I managed to save a fortune, cutting my bill from £80 to £20 a month – a staggering 75% reduction. My only mistake was not doing it much sooner but it was a real shame they didn’t bother to get in touch, especially as I have been with them for about a decade.

Hollie’s story: I also heard from Hollie: "A couple of years back I decided to shop around as I’d been with O2 for a long time and was coming to the end of the contract. Rather than just call them up and negotiate, I put a bit of research in and found a really nice phone and competitive tariff on Vodafone that was definitely better suited to my needs. I called and asked to leave (at the time, genuinely intending to), but they promptly put me through to a different department and said that if I stayed for 18 months I could get unlimited calls and texts for £20pm, and get a new phone.

All good until it came to my last renewal period and I thought I’d just stay on that tariff. They said that was fine, but failed to explain I’d now be on the non-discounted version of the tariff going forward. Only once I’d signed up did I discover I’m tied in to 18 months at £30 a month and don’t really use it enough to justify it! They didn’t particularly seem to mention that on the phone but my fault for not checking exactly what I had. So that’s my tale but I have lots of friends who have tried to drive a hard bargain to get a discount. One friend actually got barred by Vodafone for haggling too hard!"

James’s story: A more positive view can from Orange customer James who told me that the provider has a  review system so that they take a look at your phone use every six months and see what tariff you should be on. He says: "In my case they sent this text: “Hi from Orange. Best Plan is our free service that reviews your mobile usage every 6 months to make sure you’re getting the best value. We’ve just completed your review and can confirm you’re already on the best value Orange talk plan for you.”. James points out: "It’s nice to know – but of course they’re only talking about their plans, not everyone else’s." You can make your own checks on sites such as BillMonitor.

Mobile Phone Customer Satisfaction Awards
In a recent customer service satisfaction survey, it’s interesting to note that ‘virtual’ networks Virgin and Tesco swept the board. Virgin won six out of the nine awards, including ‘Best Value for Money’ and ‘Best Customer Service’. Tesco Mobile won five pay as you go categories, including ‘Best Value for Money’ and ‘Best Choice of Handsets’.

3 Mobile had the lowest overall score in the pay monthly poll, despite being the runner up for ‘Best Value for Money’. The network came bottom in four categories and just 55% of those surveyed were satisfied with the customer support. This could be the result of some initial call centre and reception issues, or the need for technical support with new features such as Skype and Windows Live Messenger.

T-Mobile takes the bottom spot for pay as you go customers – coming last in three categories. O2 was rated ‘Best for Network Coverage’ amongst pay monthly customers. T-Mobile and 3 Mobile were rated worst for network coverage in the pay as you go and pay monthly categories respectively.

What do the networks say – and do?
You could argue that businesses want to make money and it’s up to us to look after our own interests. But it’s a shame that loyalty doesn’t count for anything with some of them. I decided to ask the top five mobile providers – 3 Mobile, O2, Orange, T-Mobile and Vodafone – whether they proactively contacted customers to offer more efficient tariffs or waited until the customer came to them.

I also asked them to share any tips they had on securing the best tariff and have added some of my own, which will be posted here next week, so stay tuned.

Do you get in touch with customers on a regular basis/or when contracts are due to expire to ensure that they are on the most cost-efficient tariff?
3 Mobile: Making sure our customers know about what they are spending and what their pricing plan offers them is really important to us. Every Three customer has access to our service called My3, which is free on every handset, and lets customers check and monitor their mobile use so there’s never any surprises. Answer: No.
O2: We regularly write to customers highlighting that, as a Pay Monthly customer, they are able to upgrade early (anything from 1 month – 6 months depending on the Priority List tier they are in). In addition, we proactively write to customers when they are looking to upgrade – we are very proud of the fact that we have the lowest churn in the industry. We also only offered iPhone 4 to our existing customers, proactively contacting those in and out of contract. Answer: Yes.
Orange: We do proactively contact certain customers to discuss their upgrade and talkplan requirements at the end of their contract term. Our customer services advisors can review customer’s usage. Customers can review their usage and bills online. Answer: We know they do contact customers proactively every six months – they just didn’t mention it here.
T-Mobile: We always make sure our customers are on a deal that best suits their requirements by gaining an understanding of how and what they want to use their phone for. Answer: No. I double-checked whether this meant they are proactive and they are not.
Vodafone: Did not respond.

Do you provide any special contract renewal incentives for existing customers? Are these offered automatically or does the customer have to ask?
3 Mobile: Special contract renewal incentives are offered on a case-by-case basis, and these are normally initiated by the customer.
O2: We give all of our Pay Monthly customers both Fair Deal (existing customers get as good a deal as new + a little bit extra) and an early upgrade as part of being in Priority List.
Orange: Existing Orange customers can upgrade up to 90 days before the end of their contract, when a sales advisor will review the customer’s previous usage and current or future requirements to tailor a their package. When customers re-sign and remain on current plans they can get a 10% discount on line rental and every time they renew they can save more – up to a maximum of 25%.
T-Mobile: We always try to reward our customers and repay them for their loyalty. Our Night In offer allows customers to rent a game and a movie or two movies for two nights and grab some snacks and a bottle of soft drink – all for just £5. We also believe that everyone should be able to afford smartphones, so there is always a top handset available when customers renew their contracts.
Vodafone: Did not respond.

Any incentives for pay-as-you-go customers to stay with you?
3 Mobile: Every time a customer tops up they get lots of free stuff with Three including free texts, internet allowance, Windows Live Messenger and free Skype to Skype calls. The more they top-up with the more free texts they get. Text and internet allowances last up to 90 days, giving customers extra long use of their top ups.
O2: We have just relaunched our loyalty scheme called O2 Rewards, offering those customers who have been with us for 6 months or more 10% back on their top ups (5% for all customers who are 0 – 6 months). Customers can spend their accumulated benefit immediately or save it and spend on tickets to The O2, money off a handset, high street vouchers.
Orange: With Orange Bright Top Ups customers can have a 1 in 3 chance to win a prize every time they top up. Magic Numbers means customers can chat with their favourite Orange friends for less. Orange Wednesdays give 2for1 cinema tickets and pizza and with the Phone Fund customers can earn money towards a new phone – every £10 top-up means £1 added to the customer’s Phone Fund, up £200. Plus lots of incentives for different plans.
T-Mobile: We are always adding new incentives. We’ve just introduced the new International Weekend deal for customers that like to call abroad. By topping up £10 customers get £10 credit free for use on International calls or texts that weekend – they can use credit to get up to 200 minutes to call 50 countries, or use it for UK calls & texts.
Vodafone: Did not respond.

My conclusion
Don’t wait to hear from your mobile provider; you may have a long wait. Be vigilant in ensuring you’re on the right tariff for your needs and always keep an eye out for great new deals. Next week I’ll be bringing you tips and tricks on avoiding mobile rip-offs and getting the best deal on your tariff. In the meantime…. I’d love to hear from you about your experiences, good or bad, with mobile companies. Please share them by leaving a comment below…

If you have been ripped off, have a complaint about a company or product or just need to know your rights, then contact me: consumerchampion@hotmail.co.uk

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The Cho Yung Tea Rip-off

As a nation of a tea lovers it takes a brave company to mess with our favourite drink. But the classic Pied Piper lures of the consumer world are always anything related to making money or losing weight. This latter aim is the selling point of Cho Yung tea.

A green tea, thought to have antioxidant properties, it is marketed at slimmers with claims that it boosts metabolism and purifies the body to ensure that it functions better and aids weight loss. And of course what could be easier than losing weight by having a nice cup of tea? No wonder it’s been popular. What is far less popular is the way that some of the dozens of companies that are selling the tea are attracting customers with condition-riddled ‘free trials’ and refusing refunds.

MSN Money user Valerie contacted me with her experience: "I participated in a 14 day free trial offer for Cho Yung tea. All you had to pay was postage and packaging of £5.75 but this was reduced to £2.75 if you entered the voucher code. I did this but was still charged £5.75 on my debit card. After a week I decided the tea was not for me. I logged onto the members area of the site I bought from and sent the company an internal message thanking them for the free trial, but stating it was not for me and requesting no further tea bags be sent to me. Next time I logged onto my internet banking I noticed Cho Yung had taken £54.00 out of my account. After several telephone calls they have offered me a refund of half my money back, which I have still not received. I was also informed that I should have returned the unused tea bags before the end of the 14 day trial in order not to be charged. If this is the case then how can it have been a 14 day free trial?"

I’m currently trying to help Valerie secure a full refund but she is far from alone as it seems hundreds of people have lost money the same way.

Look before you leap
The free trial sign-up process is the preferred marketing method of all sorts of companies from gyms to magazines so you need to look carefully before you agree to it. Usually, if you sign up for a free trial you may be asked to give credit or debit card details and because you give these voluntarily any subsequent problems are not viewed as fraud by card companies. By signing up you’re usually automatically agreeing to let the company ‘authorise’ a payment or a subscription.

What do other customers say?
The internet provides us with a golden opportunity to find out what existing or previous customers think about a product or service. Here’s what one review of Cho Yung Tea said on the Ciao website:

The actual tea wasn’t the worst mistake of my life. I didn’t put on weight, Nor did I loose any for that matter. You have to enter your bank details to pay for postage and packaging. It wasn’t a lot, I didn’t see anything to lose. All the tea bags were either ripped, had holes or the string came out. The site that I entered my details on actually withdrew a lot of money from my bank account.

What you can do…..

• Be very clear about what you are agreeing to before you sign up. Read the small print and check whether the free trial leads immediately and automatically into any payment and/or subscription. Better still, avoid free trials altogether.
• Look through all the small print and terms and conditions. This is where any tricks and traps are likely to be hidden. If in doubt, don’t sign up.
• If you’ve signed up but regret your decision then contact the company in writing immediately and notify your bank that you do not authorise any withdrawals from that firm. Many banks are advising customers to cancel their cards in these situations but that does not always work if a payment is pending.
• If you’re desperate to try a product, do your research and look for it offline if you want to avoid subscriptions. For instance, Holland & Barrett sells Cho Yung Tea and makes a point of distancing itself from the well-established financial rip-off that often accompanies the tea.

Have your say… Have you bought Cho Yung Tea? Had good or bad experiences? Were the financial aspects made clear to you? Leave your comments below….

If you have been ripped off, have a complaint about a company or product or just need to know your rights, then contact me: consumerchampion@hotmail.co.uk

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Letting agent renewal fees rip-off landlords

 

Last month I wrote about the pitfalls and rip-offs that tenants face with some letting agents. I promised to cover the landlord angle too and it seems this is a topic which affects many MSN Money users who got in touch with complaints and problems.

Here’s what MSN Money users have told me:

Amit said his agent was a complete waste of money: "They tried to ignore tenants and landlord issues regarding the property, never returned call, did not pay attention to the property and when I removed the property from their management they did not cooperate to complete the formalities with the deposit. I am still struggling to get my money recovered due to damage done inside the property by ex-tenants and deposit is just sitting with estate agent and they haven’t even reported to TDS. I tried to raise the dispute myself but since I do not have all the details, TDS are not ready to accept my request to raise the dispute on the deposit." I have now put Amit in touch with the Chief Executive of the agency he used in the hope that the matter will be swiftly resolved. I will keep you posted.

David told me: "There is one charge that irritates me. The agent insists on renewing the lease every six months and of course they charge for each renewal, even though I’ve had the same tenants for several years. Is this really necessary?" He also says: "As far as the letting agent treating tenants badly is concerned, we have never had this experience, but would drop the agent like a hot brick if it did happen.

Marisa also has a complaint about charges: "My agent takes 7% per annum for an unmanaged let. The only thing they do is send out a reminder once a year then send me a bill for their commission to be paid a year in advance."

The renewal fee rip-off
For landlords, the obvious charge is the commission. This could be anywhere between a third to two thirds of the first month’s rent, or higher. Watch out for terms which insist on the regular renewal of a contract, complete with fees each time of course. One landlord I spoke to was charged £80 every year for a new contract which just had a different date on it.

It’s always worth double-checking the small print and challenging anything that doesn’t seem right, rather than just paying up for a quiet life. Ask for 6-month renewal charges to be taken out of the contract. You could take your business elsewhere if they refuse. The good news for landlords is that the Office of Fair Trading has won a court case against one of the biggest agencies – Foxtons – to court to prevent renewal clauses in contracts. It expects the UK’s 15,000 letting agents to drop them. Watch this space.

Tips for landlords
TV presenter and property expert Sarah Beeny is the founder of Tepilo, a free platform for buying, selling or letting your property. She told me that landlords should always use a letting agent who is a member of an accredited body – that way you have someone to complain to if things go wrong. "You should also check how long you agent has been in business and whether they have been trained and qualified." she adds.

On fees, Beeny suggests landlords get quotes from a number of different agencies as they determine your rent level differently. She also advises landlords to haggle on fees, and try to go for a no let, no fee basis so that they don’t have to pay upfront. Finally, she advises landlords to know exactly what is included in the agency fee and to avoid being sucked into taking out an insurance or rent guarantee policy without doing your research on costs and what is included: "More often than not letting agents make a fee on this too," she says. 

Useful agencies

• ARLA – The Association of Letting Agents – is a voluntary trade body. Members are required to follow a code of conduct and must have a professional qualification. For problems with agents who are not ARLA members, talk to your local Citizens Advice and/or Trading Standards. 
• If a letting agent has signed up to The Property Ombudsman’s Scheme then it must follow a code of practice. The TPO can also resolve disputes referred by landlords or tenants.

Have your say… Are you a landlord who has challenged the 6-month renewal fee? Are you a letting agent who wants to defend it? Leave your comments below….

If you have been ripped off, have a complaint about a company or product or just need to know your rights, then contact me: consumerchampion@hotmail.co.uk

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