Money Saving Expert Martin Lewis says all Brits should check the outgoings on their bank statement as soon as possible. He's warned it could be 'dangerous' for your bank balance if you don't.
The finance expert said it's important to make sure you're not signed up for any recurring payments you won't realise are being taken from your account. During a recent interview, he explained how not to get caught out.
"Direct debits, standing orders and recurring payments all let money drip from your accounts without needing your approval. Your bank should be able to provide you with a list of the first two. Recurring payments are little known, and hidden. This is where you give firms permission to take a ‘payment’ each month from your debit or credit card."
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Martin warned finding these recurring payments will take "a little digging" through statements. He continued: “Once you’ve got the payments, decide if you still want the goods or service. If not and you’re out of contract, cancel.”
Someone’s bank should be able to provide them with a list of the first two. However recurring payments are are slightly different to direct debits and standing orders. Recurring payments - also known as a 'continuous payment authority' - happen when the company asks for the long number on one’s credit or debit card rather than their bank details.
People will need to either tell a company or their bank/card provider to cancel them. The Money Saving Expert website suggests people should look through their direct debits to see what they need, and do not need.
There are three types of regular payments, all of which let money drip from one’s accounts without needing their approval. On the website, it states: “That's dangerous, so you need to regularly check.” Over 1.2 million subscription payments have been cancelled since the summer of last year as people feel the squeeze of the cost of living crisis, research from Lloyds Bank shows.
Streaming services for TV, film and music, such as Netflix and Spotify, made up nearly half (47.1 percent) of items dropped. Marketplace subscriptions – such as eBay, where people buy or sell goods online – were also cancelled in large numbers, with 17.6 percent axed since June last year.
Additionally, another tip mentioned in the article was zero balance transfer credit cards. If people can't afford to clear credit and store cards in full each month, the money saving expert suggests a zero percent balance transfer.
He said: “This is not us advising you to borrow your way through the crisis. But if you’ve got existing credit and store card debt and are paying interest, it’s always worth seeing if you can save with a balance transfer card. These allow you to shift debts from old cards to a new one with zero percent interest, so every repayment cuts your actual debt."
