Troubleshooting money scams:

Did you know about money scams or swindles? It is more like a scheme that will drag out all your money. This causes what is better called a ‘drain of wealth’. Are you a victim? Even if you aren’t spread the word. Here are some healthy tips that can tackle this issue.

The first question that comes to our mind is how can we detect a money scam? A simple way is not to believe in false promises where you are made to believe that you will reap a lot of profit. It has been seen that many forms often will ask you to disclose your personal account information. Never do that. If the company is genuine, they will ask from you only certain details after going through a standard security process. These scammers are always in haste. They will never give you time to take a decision. They usually will pester you by forcing you to make a decision by saying things like “if you don’t act now, you’ll miss out”. You might also get a phone call, email or letter from some strangers that will force you to think over it again and again.

These money scammers get an access to your details through your discarded documents like receipts or account statements. There is another way for these scammers. It is called Email ‘phising’ and fake websites. They will try to deceive you into giving away your details for websites you use, such as Paypal, eBay and Amazon, or even official organisations such as the Financial Services Authority (FSA), Financial Ombudsman Service, or the Office of Fair Trading (OFT). Whether debt consolidation or debt management, people search on the web for information. It is here that often they get misguided. Scammers are all over. They even collect personal information from social networking sites Facebook, Myspace and LinkedIn very attractive to fraudsters. Even just your email address is enough to add you to future phishing scams lists.

Well, there are ways to protect you from these scammers in UK. If you are heading for a firm, just check out for its registration with the Companies House and also do some online research. Stay alert when surfing the web as fraudsters can easily set up an authentic-looking website. Whether you are opting for negotiating credit card debts, Card Watch website can give you full information on card frauds in UK.

There are reports from FSA that every now and then new scams are suspected. There are numerous forms that start up and are also shut down in no time. So if you suspect any scams, you can report it:

• If you have any account and card-related concerns, ask the advice of your product provider.

• You can report online and email scams through the Bank Safe Online website.

• If you’ve been have been subjected to any kind of fraud you should report this to your local police force.

• If you’ve been contacted by an overseas firm trying to sell you or buy your shares, use our online reporting form.

• For other, non-financial scams and swindles, contact Consumer Direct for advice. Or if you just want to provide information about a scam, use their online reporting form.

Money Magic: Seven Simple Steps to True Financial Freedom (Quick Reads)

The insolvency service have released figures for the third quarter of 2009 showing that 35,242 individuals became insolvent in this period which is a rise of 28% on the same period in 2008.
These figures represent 18,347 bankruptcies (up 20.9%), 12,390 Individual Voluntary Arrangements (up 27.4%) and 4,505 Debt Relief Orders which were introduced this year.

Many of these cases will be the main breadwinner for a family so the number of people personally affected by these proceedings is likely to be at least double the 35,242 individuals mentioned.

All these families will have been devastated by what has happened and in many cases will have struggled for some considerable time to maintain the repayments on the home they were buying thinking they were improving their lives and the future for their children.

Many of these families will now be dependent on the state and the local authority to rehouse them and help them move on with their lives which will cost the local authority money and reduce the number of homes available for other people who need housing.

Goodness only knows how many other families are hanging on by their fingertips as they struggle to keep up with repayments on mortgages or rent and debts they have accumulated when things were easier.

In some ways those made bankrupt are the lucky ones since they will no longer suffer the stress and depression brought on by frequent phone calls and letters from debt collectors demanding immediate payment of the outstanding amounts and sometimes the whole debt. They will not have to suffer from constant worries about how to find the money to pay their debts while the finance companies and banks make life ever harder by with the addition of charges and fees added to the debt and increases in interest rates.

There are many reasons why people fall over the edge and become swamped by their debts. Few people take out debts with the intention of not paying but circumstances can change and suddenly what seemed simple to manage in the past can become an overwhelming debt burden. Once you slip over that fine line between managing your debts and missing a payment things can snowball out of control very quickly.

The way the financial companies operate means that as soon as you miss a repayment you are likely to suffer additional penalties and a possible rise in interest rates which makes it harder to meet the repayments the following month and more charges are added, more payments are missed and you find yourself on a slippery slope that is very hard to get off unless you can suddenly find a significant amount of cash to get back on track.

These figures for insolvencies are released in the same week we have heard that the government have decided to invest a further £33.5bn into RBS. This figure equates to, approximately, an additional £558 for every man, woman and child in the UK. This week we also heard that the Bank of England is to make an additional £25 Billion available under the quantative easing scheme and this is an addition to the £150 Billion already produced out of thin air equal to something like £2,500 for every man, woman and child in the country.

Remember that this is for every single person so for a typical family of two adults and two children this is £10,000 from the quantative easing and a further £2,000 for the additional investment in RBS.

We should surely question whether this is the best use of this money. While many thousands, perhaps millions, of people around the UK are struggling to survive their own financial credit crunch the government have chosen to put this money into the hands of the financial companies.

The sums of money involved would lift many families out of debt completely and if they were able to clear their debt burden many people would require less, and perhaps no, support from the local authorities and the state.

We are told that the economy thrived on people consuming and buying goods and the majority of that was funded on credit but now people are struggling to pay the debts incurred and cannot afford to start spending again even if they wanted to. The result of that is that while the financial industry in the city benefits from all this additional money sloshing around the system, our high streets are a depressing display of empty stores and large and small businesses are struggling to find customers and pay their own bills.

There are questions to be answered about whether we should have a society so dependent on consumer spending and debt and we may need to rethink our behavior in the future but for now millions of people are struggling and get little help while banks and the stock market are enjoying a recovery.

If instead of boosting the bankers bonuses and helping the stock market enjoy a remarkable rise, given the state of the economy in general, the money had been made available as a financial bond given to each taxpayer and only able to be used for financial payments many people would have been lifted out of debt for the first time in many years and other people could have invested the bond in a pension or other saving scheme which would benefit them and their families now and by reducing the costs of pensions and support in the future benefited the country.

All these repayments and savings would have benefited the financial industry by reducing risky debt that might otherwise never be repaid and boosted the reserves of the banks but it would also have helped countless UK families.

It is hard to see why big business gets so much assistance while the ordinary workers and families, who are said to be so important to our economy, get ignored and left to their own devices. Let us hope that the figures for the next quarter of insolvencies do not continue the rising trend but there seems little likelihood of any support for individuals and families. It looks like we will all just have to manage as best we can.

Money Magic: Seven Simple Steps to True Financial Freedom (Quick Reads)

We have all heard more than enough about bonuses over the last year. The numbers are astonishing and to the vast majority of people who may be struggling simply to pay their bills the amounts of money paid out by financial companies in bonuses is offensive.

I don’t think people object to the principle of bonuses as a reward for exceptional work but many of these huge bonuses seem to be paid out just for turning up at work and doing the job these people are paid to do.

It is often argued that large bonuses are essential to retain the highly qualified staff these companies need. We are told they are the best people in the world and they need to be rewarded to keep them working in the UK. To which I say, if they are the best people in the world how come we suffered so badly from the financial crisis? It seems they were just following the herd and investing in what everyone else was investing in and they all got burned and took us all down with them for their foolishness.

Are bonuses essential?

Let me tell you a story of success and how bonuses are not always what drives people to great achievements. For those not familiar with Formula1 motor racing let me tell you about Jenson Button.

Jenson has been racing karts and cars for twenty years. In his early career he was  racing on a shoestring budget largely supplied by his father and a few helpful sponsors. He achieved success regardless and was eventually offered a drive for the Williams F1 team where he demonstrated his skill in his first year coming 8th in the world championship.

He moved to a different team but had little success driving a car that wasn’t good enough but he had occasional flashes of brilliance but invariably the car was letting him down and denying him the chance to shine.

Next year he moved to another team where he has stayed ever since. The team was taken over by Honda who put a lot of money into the team over several years but the team struggled to provide a car good enough to win and after a few years Honda decided that because of the recession and the huge costs involved in motor racing they would pull out of F1. The team was put up for sale but no buyers could be found and the team looked like it was finished. Jenson Button could so easily have retired from the sport after ten years of struggle.

When the new year dawned there seemed little prospect of the team surviving. The team principle by now was Ross Brawn, a man with a remarkable success record for building strong teams and achieving success and he was determined to find a way to help the team survive.

Through the winter the team struggled to find the huge amounts of money needed to run a formula one team and eventually they succeeded and the team to be known as BrawnGP appeared out of the ashes of the old team. The new team needed to be run on a shoestring budget compared to previous years and they had to they laid off over two hundred staff and do anything they could to reduce costs.

Contract details are obviously confidentialbut it is rumoured that Jenson Button took a 50% pay cut to help reduce costs and stay with the team for the 2009 season. He could very likely have got a drive for another team and earned a lot more money but he wanted to achieve success for the team that he had worked so hard with for several years.

Now, Jenson Button is Formula1 World Champion. He wasn’t driven by getting big fat bonuses, he was driven by a hunger for success for himself and his team.

This is what commitment means and it isn’t earned by bonus payments. Would Jenson Button wish he had driven for another team and got a million pound bonus for every race he won this year? I don’t think so. In his travels around the globe for the race meetings this year he has paid his own fares and has apparently flown Easyjet more than once.

This is not a story of someone living the rich, flamboyant lifestyle of the rich and famous. This is a story of determination, ability and hard work. It has all paid off for him and he is a worthy champion and a credit to British sport.

So do we need to pay big bonuses to bankers and financiers to achieve success? No, we need to motivate them to want to do well for themselves and for the company they work for. Give people the opportunity to achieve success and be proud of themselves. Bonuses make people more interested in the money than they are in any loyalty to their company.

Congratulations Jenson Button, World Champion and an example to us all.

Money Magic: Seven Simple Steps to True Financial Freedom (Quick Reads)