The best rates for financial products. In black and white.

Not knowing what to do about your own finances can make you feel powerless and confused, and it often feels like too big a mountain to climb if you want real clarity on your financial options. If you recognise that feeling, we might be able to help. 

When you understand your financial situation, the options available to you and the products that are right for your circumstances, you open up a world of financial freedom and clarity. This knowledge allows you to make choices that benefit you, not large corporations or banks. 

And it’s not small sums either!

While taking care of the pennies and making small decisions every day can make a big difference in some situations, the right setup for your finances can change your relationship with money in an incredible way!

Free, Independent, and Unbiased Financial Information – How Does Finance Rate Work?

We’re a completely free-to-use service. 

We’re independent and not owned or funded by any of the big hitters in the industry.

That also means we’re unbiased, and will never push certain providers or products on you.

To sum up, Finance Rate offers clear, comprehensive and unbiased information on almost any financial product you can imagine, with new guides, calculators, studies and articles coming all the time.

Pick the Right Loan Options for You

There are many different loan options out there, and we’re here to help you find the right one for you. It’s important to receive further advice and guidance from financial advisors before applying for a loan. However, once you’ve gained a deep understanding of the various options, loan lengths and interest rates that may apply to you, you’ll be equipped with the knowledge needed to make a decision. 

Please bear in mind that all loans have eligibility criteria that you must meet before being accepted for any financial assistance. 

The Main Types of Loans Available to You

When you’re looking for a loan, it’s easy to get overwhelmed by all the different options. Generally, there are two main types of loans.

Secured Loans: These are loans that are backed by an asset. For example, if you need a car loan, you could use the car as collateral, and if you don’t pay back the loan, then the lender can sell your car to cover their costs. Collateral lowers the risk for the lender meaning they can offer higher loan amounts regardless of credit score.

Examples of some secured loans include:

• Bad credit loans: An individual with bad credit is unlikely to be approved for a personal loan due to their financial history. As an alternative option, it can be possible to obtain a secured loan with any assets they might own. This is an option for homeowners and those with valuable assets that can be used as security. Bad credit loans are a good way to improve your credit rating as you begin making repayments.

• Vehicle loans: When you take out a vehicle loan, the collateral is your car. You can borrow up to 100% of its value and repay the loan over several years. If you default on your payments, the lender can repossess your car. To get a vehicle loan, you may still need to have a good credit score and proof of income.

Unsecured Loans: Also known as personal loans, this method of borrowing enables you to obtain small amounts of money. These are not backed by any assets for collateral and therefore may feel like less of a risk. However, it is unlikely you will be accepted for an unsecured loan without a high credit score. In most cases, interest rates are fixed and lenders will agree on a repayment plan with you over the course of so many months or years.

Examples of some unsecured loans include:

• Personal loans: A personal loan is a loan that you take out to finance an individual purchase.  Personal loans are typically unsecured and carry higher interest rates than secured loans. Personal loans can be used for any number of reasons: buying a car; paying off high-interest credit card debt; consolidating your other debts into one payment; taking a holiday; buying a home; starting a business; or making home improvements. 

• Debt consolidation: Debt consolidation loans are another kind of unsecured loan. If you have multiple debts from credit cards or student loans, for example, debt consolidation may be one way to get them under control. You can usually consolidate your debts into one payment at a lower interest rate than individual credit card companies would offer. It’s important to note that this kind of loan will not settle any existing debt – it simply puts everything together into one payment plan so that you can make regular payments instead of juggling multiple bills each month.
• Credit cards: Despite credit cards being a means of ongoing borrowing, a credit card falls under unsecured loans due to the similarities in conditions and terms. Because credit cards are easy to access and use, they have high interest rates and can be difficult to pay off and stay on top of.

Protect Your Assets and Choose Insurance That is Right for You

Insurance is a great way to spread the risk of loss across a larger pool of people. It’s important to protect your assets so that you’re prepared for any situation. From home and auto insurance to life and health insurance, there are many different kinds of insurance options available to you. 

When you purchase insurance, you’re buying protection against the financial consequences of an accident or disaster. For example, if your house is broken into, your car is written off in an accident or you experience some other kind of major loss, an insurance policy will help make up the difference between what it would cost to replace a home or property and what your assets are worth.

The most important thing when choosing an insurance policy is finding something that fits within your budget while still providing adequate coverage on all fronts.

How Does Insurance Work?

Insurance companies work with their clients to figure out how much coverage they require for each possible situation, and then they assess their eligibility and ensure it fits their needs. 

Payments are made to the insurer regularly when you buy a policy. These payments are called premiums. You will be compensated by your insurer for any loss covered under your policy if you file a claim.

The money you pay won’t be refunded if you don’t make a claim; it will be pooled with the premiums of other policyholders who have taken out insurance with the same company. The money you receive from a claim comes from the pool of fees paid by other policyholders.

You should think about the following things before talking to a broker:

• What you need insurance for and why you need cover
• Everything you need to include in your plan
• How much you can afford to pay on a monthly or annual basis
• The term length of the insurance policy
• How many people your cover needs to protect (family cover, for example)

How are Insurance Premiums Calculated?

An insurer uses risk data to determine the probability that the event you are insured against will occur. Your premium is calculated based on this information. Generally, the higher the likelihood of the event occurring, the higher the insurer’s risk and, consequently, the higher the premium.

When calculating a premium, an insurer will consider two elements.

1. What is the likelihood of someone having to make a claim in general?
2. Are you a greater or smaller risk than the average policyholder when you want to take out a policy?

If you have a history of claims and accidents, your premium will be higher than someone else who has never had any claims or accidents.

There are also personal characteristics that will be used to determine risk. For example, your age, credit score, health condition or anything else that may relate to the insurance type you’re taking out.

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Pensions & Retirement Planning

Planning for the future can be hard – there’s no knowing what is on the road ahead, after all, and pension policy is often changing!

For so many people, pensions get forgotten about until retirement is looming! However, the best time to make the most of your pension savings is much earlier, which is why it’s vital you’re as informed and proactive as possible when it comes to a pension plan.

Not to mention, the world of pensions can be a minefield of different terminology, with hundreds of pension providers and pension plans all vying for attention, so it can be really difficult to find the right kind of pension for you.

Should you take out a private pension? How do employer pension contributions work? Where does your state pension come in? Should you have multiple pension pots? What happens to the money invested in your pension?

With everything pensions laid out in black and white, Finance Rate is here to help answer these questions and many more!

Private pension schemes vs your state pension

There are many different types of pension fund, but in the UK they come under two key umbrellas: your state pension and private pensions.

State pensions are relatively simple to get your head around – it is a government benefit and the amount you receive is based on how much National Insurance (NI) you’ve paid throughout your working life (NI is automatically deducted from your PAYE payslip, or is included in your regular tax returns if you are self-employed).

You are usually eligible for state pension payments as long as you have worked for around 10 years, which is the minimum level of NI contributions.

The age at which you are eligible for a state pension does change and is different for men and women, and those at different stages of their working life.

Private pension schemes are not related to your state pension. They can be used to supplement your state pension money or to retire earlier than your state pension age. When people talk about retirement savings, they’re usually talking about the pot of money in a private pension, rather than your state pension.

There are a wide range of options when it comes to private pension types, which makes them a bit more difficult to get your head around than your state pension, which you generally won’t need to give much thought to until you are nearing retirement age.

There are a few key types of private pension systems: 

Workplace pensions

Workplace pensions (also known as occupational pensions, works pensions, company pensions or work-based pensions) are those that are paid into by both you and your employer.

Workplace pension schemes are a legal requirement as long as you earn above a certain threshold, and you will likely be automatically enrolled into your employer’s workplace pension scheme when you start a new job.

All employers have a minimum amount they need to contribute to your occupational pension scheme, and you will automatically pay a contribution straight from your pay packet too. While you can unenroll from your personal pension contributions, this is generally inadvisable, and you should consult a financial advisor before doing so. You will also receive tax relief contributions to your workplace pension.

You can choose to pay more into your workplace pension, and this is deducted pre-tax from your payslip. Not only does this help improve your retirement planning, but it can also have positive tax implications in some cases.

Employers will usually choose the pension company they work with (the company that holds the pension pots for all employees). This may change from employer to employer, but you won’t ever ‘lose’ the money you’ve put into a pension pot. When you change jobs, the money in your old employer’s pension scheme will sit in the account until you use it, or you can consolidate your pension into one pot with your current pension provider. Some workplace schemes can help you with this, or you can speak to a financial advice service on the best way to consolidate your pensions.

Personal pensions

As well as your workplace pension, there are a few different options available to you if you’re looking for a personal pension. Personal pensions are a pot that you invest money in, entirely separately from your state or workplace pensions.

Standard personal pensions

When you invest in a personal pension, the money you put in will be invested by your pension provider in order to help grow the pot faster than simply sitting in savings would. There is capital at risk when you put into a personal pension, however, the length of the investment means that for the vast majority of people, a personal pension is a better way of growing your retirement fund, despite the higher risk profile.

There are also a few different types of personal pensions (including stakeholder pensions and SIPPs) which means that you can choose the level of risk vs. chances of higher reward when you invest in a personal pension. There are both low-risk and high-return options on the market, depending on the pension arrangements you choose.

Stakeholder pensions

Stakeholder pensions are money purchase pensions provided by banks, building societies or insurers. When you put your own funds into a pension scheme, the pension provider invests them for you. The value of your pension fund will be based on how much you have contributed through regular payments or lump sums, and how well the fund’s investments have performed. Generally, stakeholder pensions take a low-risk approach to investing.

Once you’ve reached the retirement stage, you can use the funds you’ve saved to purchase an annuity. This is a regular payment, payable for the rest of your life which you can buy through a private insurer.

SIPPS (Self-invested Personal Pensions)

If you’re comfortable making investment decisions yourself and want more freedom and choice over how your pension savings get invested, a SIPP might be a good option for you. With a SIPP, you get greater control and flexibility over which investments make up your retirement savings, as you have a wider choice of investment funds compared to a stakeholder pension.

What you can invest in will depend on your SIPP provider. However, some SIPPs allow you to invest in a wide range of assets, including:

• UK and overseas company shares
• Collective investments like unit trusts and open-ended investment companies (OEICs)
• Investment trusts
• Commercial property and land

In order to successfully manage a SIPP, you’ll need to be comfortable making, taking and managing your investments over the lifetime of the account. Alternatively, you can hire a financial adviser to manage the SIPP investments on your behalf. 

Of course, this is just a small overview of the different types of pensions available to you, and the level of pension wealth you accrue over the course of your working life can be affected by hundreds of different factors.

The number of pension choices available can be overwhelming, but at Finance Rate we are here to help. Whether you’re looking for the most tax-efficient way to save for your pension, want to understand your pension details, avoid pension scams, or maximise your investment returns, we want to help give you the information you need as clearly as possible.

You can learn more about private pensions on our Retirement and Pensions hub, as well as compare types of pension schemes and personal pension plans.

Grow Your Business with the Right Business Finance Options 

Starting a business is a high-risk, high-reward game. For entrepreneurs, whether it’s their first time owning a business or they’re a seasoned professional, there will always be pitfalls. Experience can help you avoid some of these, but you can’t ever smooth all the bumps in the road!

However, the rewards that starting a business can have are immeasurable! As well as the obvious markers of financial success, the sense of responsibility and accomplishment that comes from building your own livelihood and bringing others on this journey with you is incomparable! Not to mention the flexibility that working for yourself can have in helping you build the life you want.

Managing money in a small business or as a self-employed sole trader is a whole new kettle of fish compared to your personal finances. That’s where Finance Rate comes in. 

What you need to do when starting a business and becoming self-employed

Creating a Business Plan – Do you Need a Business Loan?

So, you’ve got your big idea, you know you can do it, you’re registered on companies house! But what comes next?

A business plan is something that business owners need to have in place before they start looking into their business finances. A business plan can help you secure business partnerships, grants and funding, business premises, or get a business loan.

Business plans lay out your objectives in starting a business, as well as how you/your business is going to achieve these goals. A business plan contains information on your business processes, competitors, marketing and positioning, as well as your business financials, of course.

Taking out business loans is always a risk, but it can be the thing that sparks your business growth and takes you where you need to go!

If you’re looking at getting a loan to fund or grow your business, you’ll need to ask a few questions beforehand, including:

• How long have you been in business? 
• What do your finances look like right now?
• How is your business credit score? Are you confident your organisation will be able to pay off business debts?
• What kind of loan are you looking for?
• Do you know if you qualify for a loan? Are there certain types you qualify for, or certain types you don’t?
• Do you have a business loan provider in mind? Have you compared different loan providers?

If you’re not sure of the answer to some of these, Finance Rate can help. We offer unbiased financial guides and tips to individuals and businesses in the UK, to help you improve your financial literacy and make the right financial decisions for you and your business. 

Paying Taxes as a Business

There are a range of taxes you’ll need to pay as a business that you wouldn’t as an employee, but there are also some that stay the same. Professional accountants can help you with business advice, and also help you keep on top of your tax strategies, business assets, business budget and overall business capital, but you can also do it yourself if budgets are tight. Be aware though, there is lots to learn if you’re planning on managing your own business taxes, and the consequences of not paying the right tax can be heavy.

Some taxes you’ll need to be aware of as a small business include:

• Corporation tax
• Income tax
• VAT
• Employers’ National Insurance contributions (if you have employees)
• Capital gains tax
• Business rates (unless you are eligible for business rates relief, which many small businesses may be)

Do you Need a Business Bank Account?

If you’re registered as a sole trader, you may not legally need a business bank account. However, a separate account for your company finances can help you separate your personal and business finances, which is incredibly important for start-up businesses.

Limited companies, on the other hand, are legally separate entities from individuals, so need to have a separate bank account.

Banking for businesses is largely not that different to personal banking. However, business current account services can be quite different when compared to personal accounts, so it’s important to be aware of all the different options available to you to get the best possible business banking experience.

Like individuals, businesses can have a range of accounts, including business current accounts and business savings accounts. You can also choose from a range of different current account providers and savings providers, each with their own pros and cons!

Business Credit Cards

Just like in your personal life, businesses can have credit cards, and many do. Credit cards for businesses can help manage and track expenses more accurately, improve cash flow and build lines of business credit, which can help you get loans for your company in the future.

Again, just like your personal finances, choosing a credit card provider with good credit interest rates, quality service, any additional services (like points, cashback schemes and travel perks), and improved costs on money transfers and inter-currency exchanges can be incredibly beneficial for your business.

There are hundreds, if not thousands of business credit card providers out there, each with advantages and disadvantages. When used properly, business credit cards can do a whole lot of good for your business accounts. However, you should always be aware of what your business expenses look like and ensure you never overspend on your company card to avoid damaging your personal or business credit score.

Personal and Business Insurance

Just like in your home life, things can easily go wrong in business. Even the best intentions and strongest business plans can be knocked back by things out of your control, which is why the importance of business insurance cannot be understated.

Some types of business cover are a legal requirement. If you employ staff, for example, employer’s liability insurance is a legal requirement for your business to have. There are some industries in which insurance is also a legal necessity, or it may be required by key industry bodies.

As well as traditional industry insurance (such as builders insurance, contractor insurance, retailer insurance, restaurant insurance, cleaning insurance and many many more), you might find you need other types of cover too, like public liability insurance or professional indemnity insurance.

Business Money Advice with Finance Rate

Whatever your business needs, if you have questions about your finance options and providers, we have the answers. To learn more, visit our business finance hub and check out the guides and tools available to help you on your business journey.