Money News - Spring '16

The latest money related news from McCarthy Stone.

Rewards for caring

Grandparents are often called upon for childminding duties when the parents go back to work. Now they could be paid to help out. Chancellor George Osborne confirmed in the Budget that he will press ahead with plans to allow working grandparents to receive paternity leave benefits if they take on childcare for newborns so that the parents can return to work. Up to 52 weeks of leave can currently be shared between mums and dads, 39 weeks of which are paid at either £140 per week, or 90 per cent of weekly earnings. The new plans would be extended to include grandparents.

The Chancellor has already acknowledged grandparents’ contributions, saying, 'Research shows two million grandparents have either given up a job, reduced their hours or taken time off work to look after their grandchildren. Allowing them instead to share leave with their children will keep thousands more in the workplace, which is good for the economy.’ Most parents will welcome the move. In research last year, 66 per cent said that if they didn't want to use all their paid parental leave, they should be able to share it with a grandparent who was helping with childcare.

The end of the free TV licence?

For 15 years it’s been a nice little perk for the over-75s. But the days of the free TV licence could be numbered. In a financial deal between the BBC and the government, the TV company agreed to take on the cost of the free licence. It was a question of survival for the Beeb, but the bigger question is how can it afford to absorb the cost – an eye-watering £700 million? Now it has hired a consultancy firm to look at options, including raising the age threshold, limiting it to households where everyone is aged over 75 (rather than just one person, as presently) or asking over-75s to pay the £145.50 annual charge on a voluntary basis.

Did you know?

The Financial Services Compensation Scheme (FSCS) has reduced the amount of savings it guarantees, should a provider go bust. Covering organisations such as banks and pension funds, the upper limit is now £75,000 per person or £150,000 held in a joint account – down from £85,000 and £170,000. The limit is set by an EU directive that fixes the level of protection across the European Union at €100,000 or its equivalent. When the level was agreed in 2010, that figure translated to £85,000, but it was decided to reduce it because the euro had fallen against the pound.

And do remember that the protection limit is often shared between banks – eg, if you have a Halifax and a Bank of Scotland account, you are only covered up to £75,000 combined. So, if your savings are close to, or over, £75,000 with one bank or group of banks, you should start thinking about moving your cash around. However, in the six months after depositing cash, if you can prove it came from selling a home, divorce or other major life event, it will now be protected up to £1 million.