Money

How to save money with gift cards

by

Back in December 2023, I wrote about why you shouldn’t give gift cards as presents in the run-up to Christmas. I still stand by that, but wanted to expand on the last section of that post about when it is appropriate to buy gift cards. Because, it turns out, buying gift cards can actually save you money.

This is all about exploiting the difference between the actual cost of gift cards, and their value. Go to any supermarket, and there’s usually a display at the end of an aisle full of gift cards for various other shops, restaurants, cinema chains, subscription services and the like. When you buy one of those cards, a small percentage of what you pay goes to the shop (otherwise they’d be selling them at cost price). To give an example, when you buy a £10 gift card, 50p of that £10 may be kept by the shop, and the gift card supplier gets £9.50.

What we can therefore do is find places that, instead of pocketing that 50p, they pass some of that on to you as a saving. It’s a bit like cashback sites like Quidco (referral link), where they share some of the money they get as commission with you. I’ve listed a few options below:

Pluxee and other employer schemes

I work for an employer who is signed up to Pluxee. This means that I can buy online gift cards, usually at a 3-5% discount, for many stores. The ‘big four’ supermarkets are included, as are the likes of M&S, Boots, and many online retailers. It also handily keeps track of how much money I’ve saved – we’ve had it for close to ten years now and collectively I’ve saved over £100.

You can use it for big ticket items – back in 2020, I bought our LG TV mostly using Curry’s vouchers. At the time, the discount was 8% (I think) and at present it’s 6%. Ultimately it knocked around £25 off the cost of the TV.

The big advantage of Pluxee is that you can buy the gift cards and be able to use them almost straight-away. So, say you’re in a supermarket, and you’ve used one of those handheld scan and ship gizmos, so that you know exactly how much your shopping will cost. You can then quickly buy a gift card for that amount, go to the checkout, and use it to pay for your shopping.

Costco

Another place to buy gift cards at a discount is Costco (something I didn’t mention in my overview last year). As with most things from Costco, you have to buy in bulk. For example, you can buy five £20 Pizza Express gift cards, collectively worth £100, for £85 – that’s a 15% discount, and better than the 7% I get with Pluxee. You can buy the cards both in-store and online, and the online prices include postage.

Bear in mind that these are physical gift cards, and so you will need to actually buy them from the shop, or wait for them to come in the post. You can’t just buy one whilst waiting for your bill in a restaurant, for example. And you’ll need to be a Costco member to take advantage.

Sprive

I did a more detailed overview of Sprive last April. Sprive is an app for managing mortgage over-payments, but it includes a feature called Sprive Rewards for buying gift cards. It works in a similar way to Pluxee, except that the discount goes towards over-paying your mortgage. So, for example, if you buy a £10 M&S voucher through Sprive, it’ll still cost you £10, but Sprive will add another 40p onto your next mortgage over-payment for you.

The discount rates on Sprive tend to be lower than other apps – most supermarkets are only 2.5% for example. But it’s also the only place I’ve seen that offers Amazon gift cards, albeit at only 1%. However, one could argue that, because the savings are taken off your mortgage, you’ll save more in the long run due to lower interest payments.

If you do decide to sign up to Sprive, use my referral code HTWH65PM for an additional £5 off your mortgage. Incidentally, in the year since I originally wrote about Sprive, we now own 63% of our home, up from 55%.

Obviously, Sprive is only of use if you have a mortgage, Pluxee is only available to people who work for certain employers, and Costco also requires a membership. So, for everyone else, there’s Snip:

Snip

If none of the above options are available for you, then you may wish to consider Snip. I haven’t used it myself, but it allows you to buy gift cards in a similar way to Pluxee. The catch is that there is a monthly (£3) or annual (£30) membership fee. Now, if you use Snip regularly, you will easily save more than the monthly membership fee – assuming that a typical supermarket gift card has a discount rate of 4%, then one £75 shop per month would be enough to cover the fee.

Whilst savings of 3-5% may not seem like much, they do add up over time. This is why I like the tracker on Pluxee – saving a few pence here and there may not seem like much, but over the course of a year, it’s enough to pay for a trip to a cinema and a restaurant (which you could probably also pay for with gift cards). I will admit that it’s also a bit of a faff – I remember spending ages at a self-checkout in Ikea trying to get a voucher for 5% off, and struggling to get the payment to go through. It would be nice if things were just cheaper, rather than having to use workarounds like these.

Cheques, postal orders and the DVLA

by

If you want to change your name and photo on your GB driving license at the same time, then, as I write this in November 2024, you have to pay the DVLA by cheque or postal order. You can’t pay online using a credit or debit card.

Indeed, there’s a number of reasons that you may need to pay money to the DVLA, and can currently only do so by posting a cheque or postal order. You may have passed your driving test in another European country, and now want a GB driving license. Or, you may need to get your license back after being disqualified from driving (for the absolute avoidance of doubt, no, I have never been banned from driving and have a full clean license). In all of these situations, it’s not possible to pay online.

As I mentioned in my blog post a couple of months ago, frustratingly there’s still a need for paper bank statements, and, it seems, cheques. Sure, almost every bank, including online-only ones like Starling, Chase and Monzo let you pay in cheques by scanning them into their apps using your phone. But what if you need to write a cheque for someone else? Online-only accounts do not seem to offer any way for their customers to pay by cheque.

It’s not a much better situation even if you do bank with a ‘traditional’ high street bank. I switched to a new bank account earlier this year, and whilst I got a new debit card through the post, I wasn’t issued with a chequebook as standard. And that should be fine – the last time I remember writing a cheque myself was about nine years ago. Most places accept bank transfers by BACS if they don’t accept credit/debit cards or cash. Sure, I can request a chequebook, but then the bank will need to print and dispatch it to me by post.

Postal orders

Thankfully, the DVLA also accept postal orders. In my 22 years of adulthood, I have never needed to request or send a postal order, but they have been around for years. Originally, they were a way for people without bank accounts to send money by post, in a way that means that only the named payee can use it.

To get a postal order, you go along to a local post office, tell them who you are paying and how much the postal order is for, and then pay cash, plus a fee. For £10-£99, there’s a 12.5% fee, and a fixed fee of £12.50 for postal orders of £100-£250. They’ll then print you a postal order which you can pop in your envelope to the DVLA, or whoever else you need to pay.

It’s certainly a solution if you don’t have a chequebook, but, as mentioned, you have to pay an extra fee on top which you wouldn’t pay using a cheque. Plus there’s the cost of getting to a Post Office if one isn’t local to you.

Ideally, the DVLA will drag itself fully into the 21st century, and enable more tasks to be completed online with card payments. But until then, some of us are stuck using cheques and postal orders.

The Current Account Switch Guarantee

by
A screenshot of the home page of the Current Account Switch Guarantee web site.

Until this year, I had never changed my bank account. I was still using the same account, with the same bank, that I opened when I was 18, shortly before starting university. But with the account no longer meeting my needs, and incentives to open a new account, I switched back in May, as mentioned last week.

Most UK banks are signed up to the Current Account Switch Guarantee, and this means that the switching process should be relatively painless. It’ll take about a week, during which your new account will be opened, everything moved across, and your old account is closed. You only have to interact with your ‘new’ bank – they take ownership of the process and will handle the closure of your old account for you.

What gets transferred

As part of the switch, the following will get moved across to your new account:

  • Any money in your account. You may also be able to switch if your account is overdrawn, but check your new bank’s terms and conditions.
  • All Direct Debit payments.
  • All Standing Orders.

Plus, any payments made into your old account will be automatically redirected to your new account. Payees should be notified of this and payroll systems may be able to update to your new bank account details automatically. When I logged into my employer’s payroll system to check my details, my new bank account number and sort code were already there.

What doesn’t get transferred

Basically, anything paid for using recurring card payments, or Open Banking, won’t get automatically transferred. When your old current account is closed, your old debit card will be deactivated and so any payments using this will fail. So any subscriptions that use recurring card payments will need to be amended to use your new card details.

Similarly, if you make payments using Open Banking (for example, to app-based savings accounts like Chip (referral link) or Zopa), these will need re-authorising using your new account.

Incentives for switching

Banks often offer incentives for switching your account – I got a low three figure sum as a reward for switching my account. MoneySavingExpert tracks the current deals on offer – £175 seems to be the going rate, but such incentives come and go. Also, I was able to get a little bit more by initiating the switch using Quidco (referral link), which gave me around £10 cashback in addition to the switching incentive.

Just be aware that whilst almost all banks are signed up to the Current Account Switch Guarantee, not all of them are. If they aren’t, then you may have to manually switch over your payments, which is a major disincentive to switch.

Frustratingly, paper bank statements are still a necessity

by

Earlier in the year, I changed my current account to a new provider. I’ll probably talk about the process in another blog post another time, but when it came to choosing a new bank, I decided to stick with a bank that still has high street branches.

When we moved to Sowerby Bridge in 2010, there were still two banks left in the town. HSBC and Yorkshire Bank had recently upped sticks, but Halifax and (the then) Lloyds TSB were still there. But Lloyds left a few years ago, and then Halifax shut up shop more recently.

Now Sowerby Bridge essentially flows into Halifax (the town), and most high street banks still have branches there. This includes Halifax (the bank) – indeed it wasn’t long ago that there were two branches, including the original branch of what was then the Halifax Permanent Building Society. That’s now gone, but there’s still one branch remaining. Barclay’s have also closed their branch, but we get a van for ten hours a week instead. But, on the whole, Haligonians and those living nearby are still reasonably well-served by banks.

Banking hubs

That’s not true for some other places. Elsewhere in West Yorkshire, the towns of Ossett and Normanton are now the home of ‘banking hubs’, run by the Post Office to provide banking services where no other banks remain. Almost all UK banks are signed up, and allow customers to pay in cash and cheques, and withdraw cash. Representatives from the main banks then visit at a set time every week for more complicated queries. It’s better than nothing, but many banking hubs lack printers for printing off paper bank statements.

And that’s a problem. For the most part, I’m happy to go paperless with my accounts, including my current account. But there are times when a paper bank statement is a necessity. When we re-mortgaged the house a couple of years ago, we needed paper bank statements that were certified by a solicitor. And if you need a DBS check, to work with young or vulnerable people, then you have to provide paper documents. Simply printing a PDF statement from your online banking app isn’t sufficient – it has to be a proper paper document. Bank branches can provide paper statements and put an official stamp on them where needed.

As much as online-only banks like Starling, Chase and Monzo regularly top customer service charts, they don’t make it easy to request paper statements. You normally have to contact their customer service team and wait for them to be sent through the post.

Now, this is arguably a problem for DBS and solicitors, rather than the banks themselves. For example, the DBS doesn’t support the government’s own GOV.UK ID check app. And I’m sure that the banking industry could work with organisations like the DBS to develop a way of sharing identity without relying on paper documents, a bit like how drivers can share their driving license details using a share code. But until something like this happens, I’ll be sticking with a mainstream bank.

Speaking of cheques: sure, you can scan cheques using most banking apps, but I’ve had this fail on more than one occasion. Indeed, one cheque that was rejected was issued by my own bank. Admittedly that was a few years ago and technology has moved on a bit, but I’d want to be able to take my cheque somewhere to pay it into my account – especially if it was for a large amount.

Ethical investing

by
A screenshot from the Nutmeg app, showing where my ethical investment ISA is invested

In last week’s blog post about investing in Stocks & Shares ISAs, I mentioned that all my investment accounts are so-called ‘ethical investments’. This generally means that my money is not invested in companies which develop weapons, produce oil and gas, produce cigarettes or alcohol or are involved in gambling.

This should mean that your money isn’t being used to prop up companies that are actively making the world worse. But should is the key word here, and what an Exchange-traded fund (ETF) manager considers ethical may not match my ethics.

My Nutmeg LISA is invested in a number of ETFs, which are in turn invested in companies and bonds. However, it does offer a list of the top 10 companies that your ETFs are invested in. I’ve included the list of mine in the screenshot; although this was taken last week, the data is correct as of the 29th February so I’m guessing it’s not updated often.

Microsoft, nVidia and Tesla

Almost 3% of my money is invested in Microsoft. Okay, so they’re not an oil and gas company and don’t make weapons, but they’re investing heavily in AI. AI needs a lot of energy and their investment in AI means they’re polluting more now than in 2020. Similarly, nVidia is doing well because its chips are optimised for AI.

Tesla is third, and, urgh. Sure, they’re making electric cars which are quieter than petrol or diesel and produce no tailpipe emissions, but its boss is a human bin fire who is opposed to worker unionisation.

Coca-Cola and PepsiCo are in there too, both of which are best known for manufacturing sugary drinks.

Whilst I still think ethical investing is the right thing to do, I am concerned that they’re a form of ‘green-washing’. Just because a company isn’t actively destroying nature or ruining people’s lives, it doesn’t make them ‘ethical’. I’m sure there are funds out there which focus on companies which are actively doing good in the world – maybe one that only invest in B Corps, for example. Maybe I need to spend more time looking into alternatives.

Investing in Stocks & Shares ISAs

by

Back in 2021, when Britain was under its third major Covid-19 lockdown, I opened some Stocks and Shares ISA accounts:

  • A standard Stocks & Shares ISA with Wealthify (backed by Aviva)
  • A Lifetime Stocks & Shares ISA with Nutmeg (backed by JP Morgan Chase)
  • A Junior Stocks & Shares ISA, also with Nutmeg

A Stocks & Shares ISA is a type of investment account, which means that the money that you put into the account is invested in company shares, government bonds, and other investments. An ISA (Individual Savings Account) just means that you don’t pay income tax on any returns, but you’re also limited to how much you can pay in.

I decided to dip my toes in investing because, at the time, the Bank of England base rate was historically low, meaning that most regular saving accounts paid minimal interest. Meanwhile, investment accounts seem to offer much better returns, and I had inherited money from my grandfather which wasn’t earning much interest.

A warning about investing

Putting money in investments, rather than cash savings account, always comes with a warning, and for good reason. The value of any money that you invest can go down as well as up, and you can lose all of your money. You should never invest money that you cannot afford to lose.

Both the accounts I opened are covered by the Financial Services Compensation Scheme (FSCS), which means that your money is safe if the provider goes bust. But this doesn’t protect you from investment losses.

None of what I write here should be considered financial advice, and investing may not be right for you.

Lifetime ISA

One of the accounts I have with Nutmeg is a Lifetime ISA. You can only open such an account if you live in the UK and are aged 18-39 (inclusive), and can only pay into the account between the ages of 18-49. There are also strict limits on when you can withdraw the money; you’ll pay a 25% penalty on any withdrawals unless:

  • You are buying a house for the first time and want to use the money for a deposit
  • You are aged over 60
  • You are terminally ill with less than 12 months to live

However, the government will top up any contributions paid in before you turn 50 by 25%. So my initial investment of £500 was topped up to £625, and you earn interest on the whole amount.

We already own a house, so I’m using it as an additional retirement fund, alongside my state and employer pensions.

Junior ISA

I also set up a small Junior ISA for our eight-year-old, which I manage for them. Most of the money in there is from cash gifts from birthdays. Once our child reaches 16, they’ll be able to take over the account management, and can withdraw the money at age 18.

Investment performance

The accounts have varied in their performance. Both Nutmeg accounts have had a positive return; 10% in the case of my Lifetime ISA (and that’s on top of the 25% government contribution). However, there have been times where the value of my investments has been less than my contributions – the start of the war in Ukraine, for example. It’s only really been in the last 6 months that I have had a consistently positive return, and there’s been a wobble in recent weeks.

The Junior ISA, opened later, has a lower positive return of around 6%.

My Wealthify ISA hasn’t performed so well. Overall, it’s worth less than my contributions. Some of that money comes from a sign-up bonus, which means that I am still ahead overall. However, since interest rates have gone up, this money may have performed better in a good cash savings account instead.

It’s also worth noting that a small amount will be deducted from the value of your investments as a ‘management fee’, to cover the costs involved of buying and selling your investments.

Appetite for risk

Both Nutmeg and Wealthify include questionnaires when you open the accounts. These ask you about your appetite for risk, and how you intend to use the money. They will then suggest an investment style – lower risk, but lower potential returns, or high risk, with higher potential returns but a greater chance that you’ll lose money.

Both my Nutmeg accounts are at the highest risk setting. This is because the money is there for the long term – I can’t access my Lifetime ISA penalty-free for another 20 years. My Wealthify ISA, which I can access more easily, is at a middle-of-the-road risk level that they call ‘Confident’.

All of these ISAs are ‘ethical’, which means that the money shouldn’t be invested in companies who work in the oil and gas industries, arms manufacturing or tobacco.

Referral links

If you want to try Wealthify or Nutmeg yourselves, here are my referral links:

But please, don’t take excessive risks. Cash savings accounts offer much better interest rates than they did three years ago, and as long as the provider is part of the FSCS, you don’t risk losing your money. I suggest that you only consider investing for the long term, and for money that you can afford to lose if things go wrong.

Paypal Hiatus

by

I’m on an enforced break from PayPal. As you may or may not have realised, the old blog has deceased, due to a hack attempt which saw almost all of the data on the host server being deleted. It’s also deleted my account information, so I have no FTP or email access to that account. And my PayPal account was with that email address.

What’s more, it wouldn’t accept my password. I’m sure it’s correct because it’s worked before, but PayPal was having none of it (I’m hoping that didn’t get hacked too). But, there is hope. I’ve gone through the password recovery system, giving over my Switch card number, and a new password will be sent by snail mail. Unfortunately, being based outside the US means that the password will take 10-14 days to arrive, and it will be sent to my home address, so I’ll have to phone my parents when it arrives.

It’s annoying, but I am relieved that even if you can’t remember your password and have a duff email account, there’s still a way out.

Money to burn

by

Yay! I finally have a bank account!

This time, I went with my mum to the bank from which my parents have several accounts. And, despite having to wait a few minutes until one of their staff was available, the process was quick and easy – I was approved instantly.

So, I now have an account with £50 sat in it, and my chequebook and other stuff on its way – I don’t get a debit card until I cash in a further £50. I’ve also sent off the form for my student loan, now that I have the bank details, so hopefully I’ll have nearly £3000 in there shortly.

While in town, I also picked up both CD1 and CD2 of “Alone” by Lasgo, which is better than “Something” in my opinion. It comes with a good selection of remixes, too 🙂

Back home, and I’m doing an experiment. After falling in from pressure from others, Mozilla is now my default browser, replacing IE6. And actually, I kinda like it. Okay, so its Java support isn’t so good (I’ve actually turned off Java… I can always load IE if necessary), and some pages won’t display properly (those which use over-complicated, non-standard compliant DHTML or that block any Netscape browser). But it’s quick and stable, and doesn’t impact the system as much as IE does (I have a lot more free memory than usual).

It’s now only 3 days until my results come out… help me…