Those with bank accounts and loans are over-estimating their balance by £70.73 concludes research from a top UK bank.

Barclays discovered that when customers with accounts and loans thought about what their balance was, most could not accurately say how much money was there at any one time and, on average, over-estimated the figure by £70.73. This was the average amounts for Brits in general, but the research goes even deeper, suggesting that Londoners are even worse. Those living in London overestimate their balance by about £91.62. The research compiled a list of areas of the country where the most out of touch with their bank account live. The top ten included Leicester, Manchester, Edinburgh, Newcastle and Portsmouth.

So why this lack of knowledge when it comes to our bank balance? Barclays’ research indicated that customers only check their bank balance four times a month. To solve this, Barclays’ research suggests that mobile and text banking may be the answer. 57% of people questioned believed that using mobile and text banking would be a way of keeping more on top of their balance.

This is backed up by more of the survey’s findings: 84% who currently used mobile banking were more accurate in estimating their bank balance. Compared with the 83% of bankers with no mobile banking capabilities, only 17% of those with mobile banking admitted they didn’t know what was going in and out of their bank account on a regular basis.

“Being in control of your money starts with knowing how much you’ve got and where it is being spent. Online and telephone banking made that easier and now mobile phone banking is taking it a step further. Mobile phone banking is still a relatively new way of doing your banking but the number of users is growing at a phenomenal rate and simultaneously more features and functionality are being added. It’s really encouraging to see the positive impact it is having on helping people stay in control of their finances in a quick, easy and convenient way,” said Sean Gilchrist, Barclays Digital Banking Director.

Keeping on top of bank accounts and loans is important to ensure you are not overspending and to get a good idea of things such as day-to-day budgets. The Barclays research suggests that things such as mobile banking can be a great help in keeping on top of your finances.

Guest Article by Neil Camp 

Two of the UK banks are changing chiefs.

Banks Barclays and HSBC will shortly have new faces in charge as Bob Diamond comes in as the new chief executive officer at Barclays and Stephen Green, chairman of HSBC, takes a coalition government brief to become a trade minister.

Barclays Diamond is well-named, being one of the world’s highest paid bankers who has made around £100 million as head honcho at the group’s investment arm, Barclays Capital. He will replace the current chief executive officer at Barclays, John Varley. Mr Varley is credited by many as being the safe pair of hands that steered the ban through the financial troubles of the last couple of years.

Mr Green ends a 28-year career at HSBC, one of the world’s biggest banking groups, to help the coalition government. During his tenure at HSBC, he held the post of chief executive officer for three years and the top job of chairman for four years.

BBC business guru Robert Peston said of the Green appointment, that it “…will doubtless be heralded as a coup by the prime minister, even though the record of business people in government has been patchy.” Commenting on the Barclays appointment, Mr Peston ventured the opinion that the appointment of Diamond confirmed the view that Barclays sees its future firmly as a global investment bank.

The chairman of Barclays Bank, Marcus Agius, was quoted as saying that Diamond was “…superbly qualified…”, complete with “…a proven track record as a business leader…”.

Mr Diamond responded with:
“I am honoured by the board’s confidence in me and greatly motivated by the challenge of leading Barclays during the critical period ahead. As a leading global universal bank, Barclays has the right model, the right strategy and above all the right people to deliver for all our stakeholders.”

Mr Diamond is said to be on a base salary of £1.35 million, with a bonus scheme taking his total take-home package to be nearer £12 million.

As if to ward off any criticism over Mr Diamond’s remuneration package, a Barclays spokesman said:
“The compensation arrangements have been benchmarked against a peer group of global universal banks, industrial companies and financial services institutions.”

Which proves that the banks still have some money to throw around.

Guest Article by Neil Camp

Banking group Barclays has conducted research which shows that many consumers do not fully appreciate the ISA changes which come into effect at the start of the new tax year on 6 April, 2010.

Last year’s budget saw Chancellor Alistair Darling raise the amount people could invest in an ISA from £7,200 to £10,200, and of that, some £5,100 can be held in a cash ISA. And because of that, says Barclays, people are potentially going to lose thousands through not fully exploiting their tax free ISA allowances.

The Barclays research revealed that just over 40% of people were not aware of the changes and what’s more, some 75% did not know that they could invest in a cash ISA from the start of the new tax year.

Andy Gray, head of savings for Barclays said:
“It’s surprising to see that the plans to increase ISA limits across the board haven’t really registered with UK consumers yet. We would urge people to review their savings to ensure they don’t miss out on their tax-free allowance for this year and from 6 April 2010 when the new limits apply to everyone.”

The research went on to break down the towns and cities where people lived who did not know about the changes.

The most ‘ISA aware’ locations turned out to be Cheltenham, Colchester, Derby, Edinburgh, Newport, Portsmouth and Worcester. Some two thirds of people living here were aware of the changes.

Contrast that with people living in Blackburn, Bradford, Brighton, Manchester, Newcastle and Wolverhampton. Here, over half of the people were unaware of the ISA changes.

As to the change in limits – from £7,200 to £10,200 – it came into force, for people born before 6 April 1960 on 6 October, and for all others over the age of 18, it will come into effect on 6 April, 2010.

No doubt the Government will hope that the increased tax allowance levels will stimulate saving, but it appears that it will be up to the financial sector itself to make people in the UK fully aware of what those changes are and when they will be effective.

Guest Article by Neil Camp