Protect Your Finances – Insurance, Savings, Wills, and More

Family sorting finances on laptop next to money box

Managing your finances can be tough, particularly in a year filled with such uncertainty due to the global Coronavirus (Covid-19) outbreak.

That’s why we have created a one-stop guide to protecting yourself, your finances and your loved ones this year, covering the following topics:

Making the most of your savings
Taking out the most useful types of insurance
Writing a will and planning ahead
Saving money on day-to-day bills
Checking your credit score and reviewing credit cards
Taking a break from paying your mortgage

Make the most of your savings in 2020

Savings are a fundamental part of being able to build a stable and secure financial situation for yourself and your family, whether you’re saving for your first home, retirement, or simply setting cash aside for a rainy day.

It’s therefore important that you choose the right savings accounts for your needs and make sure that you earn as much tax-free interest as possible.

The best savings accounts in the UK

The type of savings account you choose depends on your preferences and your goals, but there are some that can be particularly useful, including:

Easy-access savings – for general savings with accessible withdrawals.
Fixed-rate savings – lock your cash away and receive better interest rates.
Individual Savings Accounts (ISAs) – earn tax-free interest.

For more information, be sure to read our guide: Save Smart with UK Savings Accounts

Maximise your ISA allowance

Due to the tax benefits and flexibility of ISAs, anyone looking to save or invest their money should seriously consider them.

All adults in the UK currently have an ISA allowance of £20,000 – an amount that they can put into an ISA during a tax year without being subject to tax.

Every year, you should aim to put in as much of your ISA allowance as possible, which means you may want to prioritise your ISA savings before regular savings accounts, in order to avoid your interest being subject to income tax.

There’s a wide range of ISAs to choose from, including:

Cash ISAs
Lifetime ISAs
Stocks and shares ISAs
Innovative finance ISAs

You can deposit money into one of each kind of ISA each tax year, so it’s certainly worth considering all of the above.

Interest rate cuts in 2020 due to Coronavirus

Interest rates on savings have been slashed in the UK as a result of the Coronavirus pandemic, with some accounts paying as little as 0.01% interest. There are, however, still some reasonable deals on the market, you just need to know where to look.

Experts have warned savers not to simply accept it if their savings’ interest has been cut drastically, but to switch to a more competitive account with a better return rate.

Remember that the interest rates have dropped, but they will rise again in the future. It’s still worth putting money aside in savings if you can afford to do so.

Take out insurance to protect yourself, your loved ones and your assets

Insurance is one of the most important purchases you will ever make – whether it’s life insurance to provide for your family when you’re no longer around, home insurance to protect you against any damage done to your property and/or its contents, or car insurance to cover you against theft or any damage done to your vehicle.

The benefits of life insurance

Taking out life insurance allows you to provide a cash pay-out to your loved ones in the event of your death, providing you with peace of mind in knowing that they will be financially protected in the years following your passing.

Here’s a full list of the advantages of purchasing life insurance:

It provides peace of mind
Your family will be financially secure
It can compensate for any lost earnings for your family
It can help cover funeral costs (some policies will pay for the cost of your funeral)
Debts left behind (such as mortgage payments) can be paid off
There are optional add-ons such as critical illness cover

For more information on life insurance, be sure to browse our related articles:

Other important insurance policies worth having

With so many insurance policies on offer, it can be difficult to determine which is worth your hard-earned money.

Here at Compare UK Quotes, we have guides on all the most useful and most popular insurance policies on the market, providing you with the information you need to make the right choices.

Whether you want to know what the best car insurance companies are in the UK or how much home insurance costs – we've got you covered. Browse our site for more useful articles, reviews and guides related to insurance and money-saving.

Put plans in place for the future: Write a will

Writing a will is a must-do task for all adults with any sort of assets or dependants, as you are essentially protecting both your loved ones and your estate.

It’s crucial that you put plans in place for the future, and making a legally binding will is the best way to do so.

Within your will, you can:

Explain how you’d like your assets to be distributed amongst family members and loved ones
Provide plans and preferences for your funeral
Set up a guardianship order to protect your dependants
List sentimental items to be handed down to certain individuals

While this may be something you might not want to think about yet, it is important to know that if you died without a will (known as dying intestate), your estate would be distributed in line with the UK’s intestacy laws. The rules of intestacy will not consider your personal wishes, which could lead to family disputes at a time where your loved ones should be grieving in peace.

Head over to our useful library of articles on wills and probate for more information and free advice.

Save money on every-day bills

We all have to pay bills to get by, from TV subscription fees and mobile phone contracts, to utility bills like gas and electric.

It’s easy to become lazy with these bills and simply accept any rises in costs, but here at Compare UK Quotes, we are always looking for the best deals and ways in which you could save money on all of your expenses.

You should, for example, always renegotiate with Sky TV for a cheaper deal whenever you feel that you may be paying too much for your subscription.

While haggling may not come naturally to you, it’s a legitimate way of getting yourself a better deal and therefore, saving money.

Look After My Bills: Getting cheaper utility bills

One of the most straightforward, hassle-free ways to get cheaper utility bills is to sign up to Look After My Bills.

They will quite simply do all of the work for you and find you cheaper deals on your energy bills whenever they become available.

The service is free and you will be automatically switched to a new provider when you’re paying too much for your energy bills (unless you reject it, of course).

Read more in our full Look After My Bills review.

Review your credit cards and check your credit score

Your credit score has a significant bearing on the deals you are offered when you apply for credit, as those with a better credit rating often receive more competitive loans and better interest rates when borrowing money.

Check your credit score today with Check My File and find out whether you need to improve your credit rating before borrowing – it could help you access far more affordable deals from lenders.

There are many straightforward ways to improve your credit rating, including:

Registering on the electoral roll
Building a credit history as early as possible
Making repayments in-full and on-time
Closing bank accounts that you do not use
Ending unneeded connections with people who have poor credit scores

Improving your credit score will take time, but there are things you can do immediately to help (as listed above).

Once you have a better credit rating, you should become eligible for more competitive credit cards, loans and mortgages.

Make use of payment holidays if you need them

What is a payment holiday? In short, a payment holiday is an agreement offered by certain loan, credit card and mortgage lenders that allows customers to miss some monthly payments.

Millions of payment holidays have been granted by mortgage lenders during the Coronavirus pandemic to give those who are struggling financially a brief respite from the repayments they would otherwise be required to make.

If you’re finding it difficult to get by this year, be sure to make use of the payment holidays being offered by your lenders – contact them directly, as well as your bank, to see what help they can provide.

Note: The payment(s) you miss may affect your future repayments as a payment holiday does not give relief on any interest, and you are likely to end up paying more than usual in order to account for that.

If your finances have been affected by the Coronavirus, be sure to read our guides for both employees and the self-employed.

Free insurance and personal finance advice at Compare UK Quotes

Here at Compare UK Quotes, we are constantly updating our website with brand-new articles on all-things related to insurance and money-saving to help you get the most out of your finances.

Our advice is free and impartial, and we’re always on the lookout for new ways you can save.

Browse our categories and take a look at some of our articles for more information on any of the topics that relate to you, and be sure to Like our Facebook page to keep up-to-date with the latest news and tips.

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