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Online Banking – Who is winning in the Irish Market

Over the last few years there have been huge advancements in online banking in Ireland and there will definitely be more to come as banks adapt to the changing needs of Irish consumers.
It is interesting to study the Irish market and see that some banks have clearly adopted online banking more than others with some players’ miles ahead of others.

AIB has introduced several new features to its online banking such as its personal finance platform my money manager, emortgage portal and online personal loan facility.

The AIB my money manager is a very useful personal finance tool that allows users to create budgets and track spending in your AIB accounts against the budgets you have set while also categorising your spending into entertainment, rent, food etc.

AIB also has introduced an emortgage portal that allows users to get sanctioned in principle online for their mortgage before meeting with an adviser.

Another feature AIB has introduced is an online personal loan facility that allows AIB account holders to get online approval and drawdown of personal loans in less than 3 hours for amounts between €1,000 – €30,000. Once approved the money is transferred immediately into your account without any need to visit a branch or talk to an adviser.

Permanent TSB has also introduced an online personal loan facility that allows account holders to get online approval and drawdown within minutes of amounts ranging from €1,500 – €15,000 once you are a Permanent TSB current account holder and you have your salary paid into that account. Once approved for the personal loan you can transfer into your account at any time over the next 90 days.

Permanent TSB have introduced a cashback explore current account where you can get cashback for using this account – however this is capped at a maximum of €5 a month which isn’t much considering monthly bank charges are €4.

Ulster Bank have introduced a quick quote online system that allows consumers to get a quote for a personal loan online for amounts from €2,500 to €40,000 in minutes however to draw down the loan the customer will have to meet with an adviser.

KBC also have a facility to start a loan application for personal loan amounts greater than €5,000 however to draw down you will also have to talk to an adviser.

As you can see from the above some banks are adapting to online banking more than others though the Irish market is definitely lagging the more advanced US, UK and Australian markets.

Home Insurance

House Insurance – is something that most homeowners will be paying for every year so any savings made on house insurance can really add up over the years. Most people leave it too late to find the best quote on the market and simply renew with their current provider for convenience sake.
There are several providers of home insurance on the Irish market and quotes can vary significantly so it is important to compare quotes across as many providers as you can to make sure you save as much money as possible.
You can either do this by contacting each provider directly or by using an online broker. The advantage of an online broker is that they can compare different providers for you or they may be able to provide deals that aren’t available directly to consumers.
In the page here we have listed the main providers with some details and a sample quote for insurance for a 4-bed semi-detached house in Cabinteely with a rebuilding cost of €230,000 & contents worth €70,000 and is not liable to flooding. This information comes from a survey completed by the Competition and Consumer Protection Commission in 2015.

Motor Insurance

Motor Insurance – is something that every driver will have to buy every year so any savings made on motor insurance can really add up over the years. Most people leave it too late to find the best quote on the market and simply renew with their current provider for convenience sake.
There are several providers of motor insurance on the Irish market and quotes can vary significantly so it is important to compare quotes across as many providers as you can to make sure you save as much money as possible.
You can either do this by contacting each provider directly or by using an online broker. The advantage of an online broker is that they can compare different providers for you or they may be able to provide deals that aren’t available directly to consumers.
Also consumers need to be aware of the increase in charges they will face from most insurers if they opt to spread payments for insurance across the year they will be charged up to 20% extra.
In the table here we have listed the main providers with some details and a sample quote for comprehensive insurance for a 25 year old teacher driving a Nissan Micra. This information comes from a survey completed by the Competition and Consumer Protection Commission in 2015.

2 New Things about Moneybags.ie

As a graduate in my first professional job in Ireland I found that there was no where I could turn to get adequate information on everyday financial decisions and what steps I should take now to achieve my goals such as buying a house, making investments for the future or joining the company’s pension scheme.

I have built moneybags.ie so that others have enough information to make informed financial decisions and enable them to achieve their financial goals.

So we are pleased to announce 2 cool and useful new features on moneybags.ie which I hope our users will also find useful!

1) Clickthroughs to providers of financial products. There is so much information on banks websites that it can be hard to find exactly the area you are looking for. So –now if you click on the name of the provider you will be brought to relevant area of that banks website.

2) Live currency exchange rates provided by currency fair. There is now a live online currency calculator on our currency page that provides accurate rates and calculates how much you would save by using currency fair for foreign exchange.

Hope you find these useful & would love to hear your thoughts – email us at moneybagsie@gmail.com

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SME’s getting the Best Loan out there

Having recently gone through the process of finding the best business loan on the Irish market I understand there is  a lot of information out there – which makes it very hard to know which bank to approach.

In Ireland there is definitely a feeling that you are lucky if your business gets approved for a loan and that you should take whatever terms the bank offer – but why should you pay more than you have to?

Below is a comparison of the business loans available to SME’s in Ireland.

Provider Product Name Information Interest Rate
Bank of Ireland Secured Small Business Loan Up to €300,000, available to new and existing customers 5.74%
Bank of Ireland Unsecured Small Business Loan Up to €300,000, available to new and existing customers 6.74%
AIB Standard Business Loan   6.50%
Ulster Bank Secured Small Business Loan All Loans are subject to a 1% arrangement Fee of the Loan Limit payable when loan is drawn down 5.76%
Ulster Bank Unsecured Small Business Loan All Loans are subject to a 1% arrangement Fee of the Loan Limit payable when loan is drawn down 8.76%
MicroFinance Ireland Directly Unsecured Micro Enterprise Loan Business must employ less than 10 staff & have  Turnover of less than €2m 8.80%
MicroFinance Ireland through local enterprise office Unsecured Micro Enterprise Loan Business must employ less than 10 staff & have  Turnover of  less than €2m 7.80%
Permanent TSB Term Loan Up to €250,000, available to new and existing customers 6.50%
SBCI SBCI Loan SBCI Loans are offered through on lending partners AIB,BOI & Ulster Bank at a discounted rate to the Banks standard rates if you meet certain qualifying criteria. 4.50%

3 Reasons for buying Life Assurance

Life Assurance is a topic that no one wants to talk about but is something that almost everyone has to pay for at some time in your life. Below are 3 of the main reasons for buying life assurance and the types of life assurance you will need.

3 Reasons for buying Life Assurance

  1. Buying your own home – Mortgage Protection.
  2. Starting a family – Life Assurance.
  3. Becoming self-employed – Income Protection.

 

Buying your own home – Mortgage Protection

When you buy your own home most people will go to the bank for a mortgage in order to afford the home – one of the banks conditions of getting a mortgage will be that you have taken out an adequate mortgage protection policy.

Mortgage protection is a life assurance policy that will pay off the mortgage outstanding on your home if you die before you have paid off the mortgage. So if you die with €100k left on your mortgage – the policy will pay the €100k directly to the bank.

When getting a mortgage the bank will try to sell you mortgage protection however there is nothing stopping you from buying mortgage protection from a different provider – often this is the cheaper and better option as banks in Ireland don’t compare the market for you only offer products from a single provider such as Irish Life. Independent financial advisors are able to compare market for you for cheaper more flexible policies than offered by your bank.

Starting a family– Life Assurance

Having your first child is often the main reason why people start considering taking out life assurance policies – so that their family is looked after if anything should happen to the parents.

Life assurance provides a lump sum for your dependents if you die which can be used for many reasons such to provide an income for when you’re gone or to pay for college fees etc.

The cost of life assurance will depend on the type of policy you choose, the amount you choose and the term of the policy. Other factors that will affect the cost will be your age, health & personal circumstances.

 

Becoming self-employed – Income Protection

Becoming self-employed is a big step and you need to consider what will happen if you are unable to work.  In Ireland the self-employed are not entitled to anything if they cannot work due to health reasons unlike PAYE workers who are entitled to social welfare disability benefits.

Income protection will pay you up to 75% of your income if you can’t work due to illness or disability. It will start paying out once you have been out of work for a certain amount of time – the amount of time will depend on the policy you take out.

Tax relief is also available on the cost of income protection policies at the highest rate of tax you pay so this will lower the cost.

3 Tips for First Time Buyers

Buying a first property is the biggest financial decision that a lot of people make and can have a huge impact on your financial well being both now and for many years into the future.

Putting in some spadework now will save you a lot of hassle in the future.

  1. Do your research

Find out as much as possible about the areas you are looking at. Use online resources such as daft.ie and google maps to do some preliminary research. Also google the area to see if there are any future developments planned in the area that you should know about.

One useful website is propertypriceregister.ie that contains details of all properties sold since 2010 – if you know how to use excel you can even download a spreadsheet to do some useful pivot tables to chart the movement of house prices since 2010 in the areas your researching.

  1. Consider the downside

Anything can happen in life so it is important to consider the worst case scenario when buying a property. Compare your monthly mortgage repayments to the current monthly rents that similar properties in the area are commanding – is there any margin of safety? If rents were to fall and interest rates rise would there still be a margin of safety?

This is important to consider as you may need to move in the future but the value of the property may have fallen. By having a margin of safety between the possible rent and the mortgage repayments it will allow you to avoid selling when the property market has crashed. Also it will allow you to cover any extra costs such as tax and repairs that come with becoming a landlord.

  1. Consider the future

Is there room to expand the property in the future? This is an important consideration if you are planning on having a family in the future.

What is the BER rating? If it is low make sure you build the costs of upgrading the BER into your costs.