Your mortgage should be your top priority debt over any other forms as missing or falling behind on payments could result in serious consequences.

What will happen If I can’t pay it back in full?

Most lenders will allow for 3 missed payments before they start taking action.

If you have taken out a mortgage and are now struggling to pay back the full amount then you could be in danger of being taken to court to have your property repossessed.

The mortgage lender will take possession of your property so they can sell it and cover the costs of your repayments with the value of the house. You will no longer own your house and could only buy the house back by making a lump payment

What you could do

• Ask your lender if you can pay your debt over a longer period of time.
• Talk to your lender if there has been a sudden, unexpected change in your household income.
• You could be allowed to have a pause on payments for a few months.
• You could switch to a cheaper mortgage

If you feel yourself often giving into impulse buying this could be hurting your finances and cutting off your savings. Most people give into impulse buying at least a few times a month and regret it quickly afterward. If you are trying to save, reducing your impulse buys could help you do this.

Avoid impulse buying by avoiding email reminders from retailers and deleting any shopping app you may have on your phone. By planning your purchases in advance you can avoid picking up unwanted buys.

Know how impulse shopping can trap you so you can avoid this.

The world of finance is, on the verge of a change, driven by the digital revolution in banking. It's more than moving from bank branches to online services; it's about completely reimagining how we bank in today's digital world. Leading this transformation is the field of banking software development, where technology and finance come together to offer efficient and personalized services. 

This shift is powered by technologies like intelligence, blockchain and cloud computing each playing a crucial role in reshaping banking in the 21st century. The outcome is a banking environment that not only caters better to individual customer needs but also adapts well to the evolving global economy. As digital banking progresses it aims to eliminate barriers make financial services more inclusive and promote knowledge and autonomy. It is not just change; it's a revival in the banking sector marking an era where digital empowerment is within reach, for everyone transforming how we manage our finances fundamentally.

The rise of banking

The rise of banking began with the introduction of the Internet. Its rapid expansion has been driven by recent advancements, in technology and changes in what consumers expect. Today customers want banking services that are not just digital but user-friendly, immediate and seamlessly integrated into their daily lives. In response, banks are using cutting-edge technology to create banking software that goes beyond methods. This push for innovation is not about keeping up with tech trends but about reshaping the nature of banking in the digital era.

Consequently, we are seeing the emergence of platforms that not only enable transactions but provide tools for financial management, investment guidance and personalized predictive analytics based on each user's financial habits. This transformation reflects a shift in the banking sector from focusing on transactions to becoming a holistic financial partner for clients well being. It's a journey that demands not only technological advancements but also a cultural change within institutions to prioritize user satisfaction, data security and ongoing innovation. The future of banking lies in building ecosystems that are both adaptable and user-centric while ensuring security—a sign of a chapter in financial empowerment, for consumers globally.

Cutting-edge technologies, like intelligence (AI) blockchain and cloud computing, have become elements in modern banking software development. AI is transforming the banking landscape by offering insights into customer needs and enabling tailored guidance. It drives chatbots for customer support. Utilizes advanced algorithms for detecting fraud effectively. In parallel blockchain technology is reshaping trust through its secure transaction capabilities expanding beyond cryptocurrencies. On the other hand cloud computing delivers the flexibility needed for banks to scale services as required, improving efficiency and reducing costs.

Customer role

Central to the evolution of banking is a dedication to prioritizing customer satisfaction. This shift towards customer-centricity is evident in the push for personalization. Through analytics and machine learning, banks can now provide bespoke solutions instead of relying on a one size fits model. Additionally, the seamless omnichannel experience ensures that customers can engage with their bank seamlessly across platforms. Whether, through applications, websites or voice assistants. Without any disruption. This comprehensive approach goes beyond convenience; it demonstrates an understanding of modern consumers' lifestyles and preferences.

By integrating services into everyday digital interactions banks are not just offering a service but enhancing the customer's life with valuable financial advice and solutions that are timely and relevant. This shift, in approach, is reshaping how customers view banking setting standards for customer service and interaction in the age. This leads to a banking experience that's more connected, intuitive and essential to life paving the way for a future where banking is not only necessary but seamlessly integrated into everyday living.

However, this journey comes with its challenges. The digital banking landscape faces cybersecurity threats with institutions constantly targeted by cybercriminals. This underscores the need for security measures to protect customer data and ensure transactions. Additionally, banks must navigate frameworks to comply with laws aimed at safeguarding consumer rights and promoting financial stability.

Wrap up

Despite these obstacles, the advantages of banking are clear. It holds the promise of making financial services more accessible to people from all backgrounds enabling access, to banking services. It also fosters a financial sector where banks innovate continually to meet customer demands and preferences.

The evolution of banking is transforming the industry propelled by progress, in banking software technology. As financial institutions venture into this territory they face the challenge of striking a balance, between innovation, security and regulatory adherence. The overarching aim is to establish a banking environment that's digital and also safe tailored to individual needs and seamlessly woven into daily routines. By achieving this goal the financial sector can anticipate surpassing the demands of customers in today's era.

HSBC data shows that 54% of people in Britain have had the same current account for over a decade and 2 in 5 remain at their same bank for over 15 years.

This is despite 64% of people reporting they receive no benefits at their current bank.

So, is switching bank accounts a good idea or not?

Switching your bank account is a personal decision and many people are happy to remain with their existing account for the simple reason of convenience. If you want better interest rates so you can earn on your savings then it could be beneficial to shop around for better deals.

Be careful not to switch too many times as this could affect your credit score!

Reasons for switching banks

• Many banks offer rewards to new customers, you could receive a cash, travel, voucher rewards if you switch
• A new bank could offer better interest rates than your existing one.
• You may have had some issues with your existing bank account e.g. fraud issues or service and need a switch.
• You may want to open a savings account with better interest and need to have a current account with the same bank first.
• You want to open an appealing junior account for your children and you need your own current account at the same bank.
• Your local branch shut down so you need to move to a bank with a branch nearby.

Does Switching banks accounts affect my credit score?

When applying for new bank accounts they will run a check on your file which leaves a trace on your credit report which other lenders later on could see.

With multiple checks on your file leaving a mark this could reduce your chances of being accepted.

When applying to a bank they will either run a hard or soft credit check, make sure to avoid too many hard credit checks as these leave a noticeable trace on your file.

If you plan on taking out a loan e.g. getting a mortgage within the next 12 months then you should wait before you switch bank accounts as the file will not have recovered from the credit check yet.

What is Inflation?

Inflation is when the price of an item increases over time and the cost of living becomes more and more expensive.

Inflation will mean than the worth of a £1 decreases the more inflation goes up and this is why it becomes difficult to maintain a standard of living when prices go up overall.

High inflation means prices are rising quickly and low inflation means prices are rising slowly over time.

So despite Inflation rates falling, unfortunately your weekly shops won't cheaper, the supermarkets are experiencing a decrease in inflation and prices are still rising but slower than before.

There are many causes of inflation including rising productions costs and rising wages.

For Example…

If a carton of orange juice cost £1 and then a year later the same orange juice cost £1.05 this would be an inflation rate of 5%.

When inflation happens this means that you could have £50 to buy a new microwave, but if you wait a year to buy it you could need £60 to buy the same microwave as the prices have increased and your money needs to be stretched further.

Who is most affected by inflation?

ONS reported that those on a lower income will experience higher than average inflation rates and will be more affected by the high food and energy costs than those from a higher income household.

In a survey from February and March 2024, it was found that 46% of adults reported an increased cost of living compared to previous months.

Trussell Group food charity found they had provided 1.5, emergency food parcels in April-September of 2023 which is a record for that period,

Citizens advice reveal that in February 2024 they had helped 46,640 people with debt advice.

The Office for National Statistics have released their data and revealed that inflation rates are falling slowly and have reached the lowest level since November 2021 at 3.2%

What does this mean?

Inflation levels falling does not mean items will be significantly cheaper when you go into the shops, just that they are rising slower than before.

Prices in the supermarkets are driving this inflation drop.

Most items of food have had the rate of inflation fall between February to March with items such as, chocolate, biscuits and other bakery items falling the most. There have been smaller increases in bread and cereals too.

The price of meat, particularly pork leading the way is having a big contribution to the falling inflation which fell by 0.5% between February and March compared to 1.4% the year before for meat.

Will the UK be better off?

With the rate of inflation slowing down this could put us on the right track towards meeting the Bank of England’s target of 2%. Once this target is met and stable, the Bank of England will be able to cut inflation rate from their current 5.25%. This has pushed the mortgage interest rate up and made borrowing money too expensive to many households.

As well as the rising prices of mortgages, the price of fuel has also been slowly increasing. So with decreasing inflation in some areas this doesn’t mean costs are being cut.

With the rate of inflation slowing just below the predicted 3.1% and the Bank of England’s hope to bring inflation down to 2% we can hope for more changes to come and prices to start rising more gradually.

When you are trying to save money it is best to find the right type of account to keep it safe and this could be a savings account or an ISA.

ISA

An ISA is an effective way to save large sums of money and be a secure account to keep the money from being used daily.

There are different forms of ISA’s including, Cash, Stocks and shares and lifetime which you can set up depending on what your purpose is.

Pros

• A tax efficient way to save money
• Your money will be passed on to a spouse or civil partner if you die.
• Option of a lifetime ISA where the government will give you a 25% bonus to buy a house.
• A great option for saving larger amounts where you can earn more.
• Investment opportunities.

Cons

• Annual deposit limit- usually £20,000.
• Limited on when and how much you can withdraw from your account.
• Some will have exit fees.
• You can only open one type of ISA a year.
• Must be over 18.

Regular savings account

Having a savings account is essential for savers and the most common way to save. This could be with a bank of your choice and will give you an easy way to put money away.

There are different forms of savings accounts including, easy access, fixed term and notice accounts.

Pros

• You can easily withdraw money making this a more flexible option.
• Easy to set up and transfer money with no limits on deposits.
• Junior accounts are available for over 11 and a great way to teach financial responsibility with supervision.
• You can open as many savings accounts as you need

Cons

• You could be taxed on your interest earnings.
• The interest rate fluctuates and so you could have to change your bank.

Opening an ISA is popular for longer-term savings such as for buying your fist home whereas a regular saving account is great for short-term savings when you need flexibility.

Often you will be able to earn better interest rates with a regular savings account as most people don’t reach the threshold for paying tax on earned interest.

You could also open both an ISA and regular savings account to help you save.

No matter what stage of life you are in at the moment, saving money is always beneficial, even if you are saving small amounts at a time.

There are so many ways to start saving money that can help you begin including, budgeting apps,  learning the 50-30-20 rule and more. You will be able to find a method that works for you and your finances.

It is important to have a separate savings account before you start so you can keep your savings safe and you could even earn interest.

Why you should save...

The amount of fraud cases has been rising and with digital banking becoming the new norm there are many ways someone can get access to your account. It is important to stay aware of scams so you can protect your accounts.

 The Guardian reported that fraud cases in the UK more than doubled in 2023 to £2.3bn.

Bank can help you prevent fraud as well as claim refunds if you are a victim to fraud. Some banks such as, Monzo have a high fraud rate as well as being rated poorly for reimbursing their customers which could be a factor to consider when choosing your bank account, especially if all your savings are there.

If you are a victim of fraud, you can report this and seek help from your bank.

If you are trying to save money and need some extra tips then the 50-30-20 rule could be super helpful to create a budget.

With this rule you will be splitting your income up and assigning each pot of money to a selected category.

This rule will work best if you have a separate savings account so you can keep that away from your spending money and visualise what you have left.

50 - Needs

50% of your income will be spent on your needs and necessities throughout the month.

This includes rent, house bills, car payments, grocery shopping, childcare and anything else that you absolutely need to pay. It would be best to be strict about this section and only put things you couldn’t live without in here, don’t be tempted to pay for any hobbies from this pot.

30 – Wants

30% of you income will be spent on your wants.

This would include any hobbies you have, gym membership or streaming subscriptions. Any days out or social events should also be paid from this pot of money. Also included would be any shopping that is not necessary such as a new dress or watch.

This will help you budget how much you can spend on your wants throughout the month and not be tempted to over spend. This would help you if you have a habit of impulse shopping. You will have a visual of how much you can spend and what will have to wait until next month.

20 – Savings

20% of you income should go into a savings account or an ISA.

Trying to save whilst on a small income or when you have other obligations can be challenging. Using this rule will help you put away a small amount each month and by budgeting like this you will know it can be done.

If you need to change the percentages to fit your situation, say if you have a long list of needs then increase this to 60% and only put 10% in you savings. This still allows you to save whilst not being super low on money at the end of the month.

For example...

If your monthly income is £1,700 and you followed the 50-30-20 rule then you would have,

£850 to spend on your needs list, £510 to spend on your wants and then £340 to put into your savings each month.

The PSR conduct research to discover which banks were subject to the most fraud as well as the rate at which reimbursement was provided to customers.

UK Finance has found that APP fraud in the first half of 2023 came to a total of £239.3m and there was £152.8m returned to the victims.

APP fraud

This is when a customer is tricked into authorising a payment to an account controlled by a criminal.

APP stands for authorised push payment.

What is being done about bank fraud?

PSR are introducing mandatory reimbursement for victims of APP scams meaning banks will have to abide by these rules to help their customers further. They rules will be introduced later in 2024.

You bank should help you if you are a victim of fraud, if they don't you have the right to push for it.

Keeping your money safe is a top priority and customers expect their accounts to be secure. This is why when picking your savings account you may want to consider the banks which have a reimbursement policy.

The banks with the highest fraud rates

Using a finance app can often be a helpful way to keep on track of your money wherever you are and in a specific way for your needs. Tracking your money shows you how much your are spending and can support you in making a change.

There are many options for free budget apps as well as paid for ones which can help you keep track of your spending and get control of your finances.

Hyper Jar

This app is free to use and download and includes a physical card to use. Upload money onto the card and use it to budget.

The app uses a system of ‘jars’ to budget, you create your categories and how much you put in each one. For example, your grocery jar could have £100 in it and your fuel jar will have £50 so you know this is all you’re supposed to spend on these things.

Hyper Jar includes a feature of linking specific shops to your jar, such as Aldi to your grocery jar and the money will automatically come from this jar when you spend here. You can earn interest when you commit to certain brands too!

You can use their shared Spending jars feature to help balance your finances with a partner or housemate. This also works if you wish to track you kids finances and help manage them.

Using this card allows you to travel without having transaction fees.

There is no option to withdraw cash from an ATM using the Hyper Jar card.

Emma

The standard version of this app is free.

This will link your banking apps so it can analyse the information and patterns to determine and suggest where you could make cut backs.

You are able to set up a monthly budget with Emma and the app will remind you to stick to it.

With the Emma Plus version, which costs £4,99 a month you can link 4 accounts, and have a fraud detection feature, bill reminders and a balance feature so you are reminded how much you have left to spend in your budget.

With the Emma Pro option, which costs, £9.99 you can link unlimited backs, track your net worth and any changes along with create custom categories for your spending patterns.

With Emma Ultimate, which costs £14.99 you can include any business accounts your might have and are able to become more specific with your needs. This is a great option if you have business finances to organise as well as other business finance apps.

Snoop

The app is free however if you want to try out some more features the cost will be £4.99.

Snoop will track all your regular bills and alert you when they are higher than usual and offer your cheaper options to switch to.

The app will also keep an eye out for insurance policies and cheaper phone deals. Once the app knows your routines and where your shop it can suggest discounts and voucher codes for those places saving you money wherever you go.

If you pay £4.99 for Snoop plus this will give you more features such as, tracking your spending from each payday and then create unlimited custom spending ports as well as refund alerts.

Snoop will be helpful for offering cheaper options for your regular items and spends which will save you money each month.