Whirlpool recalls 55,000 more washing machines at risk of catching fire

Whirlpool recalls 55,000 more washing machines at risk of catching fire

New warning issued over Indesit and Hotpoint washing machines

Brean Horne
Thu, 04/30/2020 – 13:30

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Whirlpool is to recall an additional 55,000 UK washing machines after identifying 21 more models at risk of catching fire when used.

It comes almost five months after the white goods brand announced a recall of more than half a million units in UK homes which are also a fire risk.

Around 510,000 appliances sold under the Whirlpool-owned Hotpoint and Indesit brands between October 2014 and February 2018 are at risk of combusting due to manufacturing faults. 

Some 210,000 affected machines on its original list have been located and 177,000 of those have been fixed so far.

How do I know if my machine has been affected?

Customers can use the online Whirlpool check my model tool to see if their machine may be compromised.

They can also call the free helpline on 0800 316 1442.

Whirlpool is asking all owners to check if their appliance has been affected, even if they have previously done so.

What happens if my machine is recalled?

If your washing machine has been recalled, you will be entitled to a free replacement or repair, but not a refund.

Customers are being advised to unplug their affected machines until they can be repaired or replaced, where possible.

If you have to do a wash before an engineer inspects the machine, only do so at 20 degrees Celsius or cooler.

This is because wash cycles above this temperature could cause the machine to overheat and catch fire.

Will engineers be visiting during the lockdown?

Whirlpool have confirmed that their engineers and delivery teams have been supplied with protective equipment during the coronavirus outbreak. Engineers will also stick to the social distancing rules during their visits.

Customers can also choose to have the washing machine delivered to a secure location, such as a garage or garden, to avoid engineers entering their homes. But those picking this option will have to fit the machines themselves.

Jeff Noel, vice president of Whirlpool, says: “We remain committed to this recall in spite of the global coronavirus pandemic.

“With people spending more time at home under the current social distancing measures, it’s more important than ever that this safety issue is tackled swiftly.”

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Monzo attracts the most current account switchers for the first time

Monzo attracts the most current account switchers for the first time

Nationwide gained just 14,000 net customers, its worst performance in five years

Stephen Little
Thu, 04/30/2020 – 11:53

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A near-record number of people are switching their current account, with Monzo attracting the most new customers for the first time.

The digital-only bank had 20,843 switchers between last October and December, taking the top spot away from Nationwide, according to the most recent figures from the Current Account Switch Service (Cass).

Nationwide came second with 14,959, then Lloyds on 13,243 and Starling Bank with 9,247.

Nationwide had its worst performance since 2015, with the number of people switching to it up by just 6,000 on the previous quarter.

This may be because it was one of the first high street banks to hike its overdraft rate from 18.9% to 39.9% in November last year, ahead of regulatory changes to these fees.

It was also a bad quarter for Halifax, which lost 22,130 customers, its worst performance for six years.

Halifax’s sister lender, Lloyds Bank, had its first quarterly net gain since the switching figures were first published in 2014. This is likely to have been caused by its generous £125 incentive to swap current accounts, which launched on 1 October 2019.

Cass says there were 113,037 switched accounts last month, the most since March 2016 and the third-biggest month on record.

Challenger banks such as Monzo and Starling are becoming increasingly popular with people looking to switch their current accounts.

Both banks are good for spending and cash withdrawals abroad and are well rated for customer service by their users.

New overdraft rules

Andrew Hagger, personal finance expert at Moneycomms, says the surge in switching was a result of the banks bringing in new overdraft charges that can top 49%.

Hagger says: “This increase in people moving accounts will have been fuelled by the banks announcing massive hikes to their overdraft charges. Their first quarter figures for 2020 will make interesting reading and show which banks have suffered the most for charging rates of up to 49.9% for agreed overdrafts.”

New regulatory rules mean banks must charge a simple annual interest level for overdrafts, without additional fees and charges.

Fixed daily or monthly charges, and fees for having an overdraft facility, have been banned in a move to make overdrafts simpler and easier to compare.

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Retirees may be missing out on state pension payments during lockdown, former pensions minister warns

Retirees may be missing out on state pension payments during lockdown, former pensions minister warns

Just 27,000 people have been contacted directly about alternatives to getting benefits in person

Stephen Little
Wed, 04/29/2020 – 16:10

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Pensioners and benefits claimants could be running out of money because they do not know about alternatives to collecting their cash in person, a former pensions minister has warned. 

Around 900,000 retirees and those on benefits get their payments in cash at a Post Office counter using a Post Office Card Account. But the coronavirus lockdown means many of this group have to stay at home.

The Department for Work and Pensions (DWP) launched a scheme to send these groups cash instead, but this only launched last week and has directly contacted just 27,000 people.

What does this mean for vulnerable people?

Thousands of vulnerable and elderly people may feel they must pick between running low on cash, chance contracting coronavirus by going to the Post Office or use riskier methods to get hold of their cash, according to Steve Webb, partner at pension consultants LCP.

Some pensioners could also be increasing their risk of being scammed if they give their card and PIN number to someone else to get cash on their behalf.

Webb says that while more people are using contactless payments than cash at the moment, pensioners who use Post Office accounts and are reliant on physical money could be struggling.

What solutions are there?

Webb wants the Government to offer more alternatives to pensioners who are having trouble getting their cash safely.

He says: “It is good that DWP has special schemes to help people obtain cash in these difficult times.  But with nearly a million people normally getting pensions and benefits in cash via a Post Office, it is worrying that less than 30,000 have been contacted directly by the DWP to discuss alternatives. 

“There must be a concern that some pensioners feel they have no choice but to break shielding rules in order to get cash from a Post Office, or that others are simply going without.” 

Steve Cameron, pensions director at Aegon, says: “While the Government has taken action to support the most vulnerable pensioners with a solution to access their state pension, there are many more who aren’t able to access payments without venturing out to the Post Office which of course comes with health risks.

“The state pension is often an individual’s main source of income in retirement, and for some their only source. An alternative payment method needs to be in place as soon as possible to protect this group.”

Caroline Abrahams, charity director at Age UK, also says more needs to be done to help elderly people.

She says: “We know that older people rely on cash to pay for things in a safe way, especially if someone is doing their shopping or they need to pay a tradesperson for an emergency repair.

“It’s important that the Post Office continues to identify ways their older Post Office Card Account holders can receive their payments to ensure that no older person is left without the cash they need.”

Government reaction

But the DWP hit back and said it is doing enough to help.

A DWP spokesperson says: “This is an unfair and inaccurate interpretation of the Government’s swift action to support the most vulnerable. 

“We are committed to supporting people through these challenging times, working closely with the Post Office and National Shielding Service, to ensure everyone is protected.

“We’ve contacted tens of thousands of pensioners who have no alternative payment arrangements in place, and a range of other payment options already exist for hundreds of thousands of Post Office card account holders.”

How is the Post Office helping pensioners?

The Post Office is delivering pensions to vulnerable people who are unable to leave their homes because of the coronavirus pandemic.

Around 1.5 million people who are considered ‘extremely vulnerable’ have been advised to stay at home for at least 12 weeks because they would be most at risk of hospitalisation if they caught coronavirus. 

When pensioners request their cash they will get it delivered directly to their door by 9pm the following day.

Pensioners who can use the scheme will be contacted directly by the DWP which is working in partnership with the National Shielding Service.

How to make alternative arrangements for payments

If you have a Post Office Card Account and have not been contacted by the DWP it is possible to make alternative arrangements.

Appointees – An individual can be authorised by the DWP to act on a customer’s behalf if they are incapable of managing their own affairs. You can find out more here.

Permanent agents – You can nominate someone you trust to become a permanent agent on your account who will be given their own card and PIN to collect cash on your behalf. To nominate a Permanent Agent, you have to complete a ‘Permanent Agent access form’ (P6163), available from most Post Office branches.

Changing method of payment – You can change your payment method to a standard or basic account. The DWP has been writing to Post Office card account users since 2015 to request that they change their payment method to a standard account.

The Payment Exception Service – This is a way for people who do not have a bank account to collect benefit or pension payments via PayPoint outlets.

Where customers require urgent assistance they will be contacted by a DWP Visiting Officer, who can – in exceptional circumstances – arrange for payment to be made via Royal Mail Special Delivery.

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Coronavirus: Nine in ten pension funds suffer losses and annuities hit record lows

Coronavirus: Nine in ten pension funds suffer losses and annuities hit record lows

Recent stock market drops caused by the pandemic have hit pensions hard

Stephen Little
Wed, 04/29/2020 – 12:25

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The coronavirus pandemic has had a devastating impact on pension funds, leaving many savers wondering what the future holds.

Pension savers with private and workplace pensions have seen significant falls in their funds during the coronavirus crisis, while annuity rates are at an all-time low.

Pension funds

Most workers in the UK have a private or workplace pension scheme which holds investments in the stock market. As a result, they have seen the value of their pensions tumble in recent weeks because of volatility caused by the coronavirus pandemic.

Defined contribution (DC) pensions build up a pot with contributions from you and your employer which are then invested to give you a return when you retire.

A record number of people saving into a DC scheme suffered heavy falls in their retirement pots during the first quarter of 2020, with only 11% of pension funds avoiding losses, according to Moneyfacts.

The average pension fund value fell by 15.2% in the first quarter of 2020. This is the worst quarterly performance on record, even beating the falls seen during the global financial crisis of 2008.

Many popular pension fund sectors posted even heavier losses, with Association of British Insurers’ UK Smaller Companies (-31%), UK All Companies (-29.8%) and UK Equity Income (-28.4%) pension funds hit the hardest.

Richard Eagling, head of pensions at Moneyfacts, says: “The hope is that these will prove to be short-term shocks, but for those planning for retirement now and looking for a retirement income immediately, they present unenviable challenges.

“UK pension policy has increasingly moved towards placing more onus on individuals to take personal ownership of their retirement finances in recent years and take on the risks associated with this, but unfortunately recent events have shown how vulnerable they can be to major world events.”

Retirement incomes

A growing number of people entering drawdown have been hit by the performance of their pension funds.

For many savers the drop in fund performance will be the biggest fall they have seen since the introduction of pension freedoms five years ago.

Pension freedoms were introduced in April 2015 and allow anyone over the age of 55 to take some or all of their retirement pot as a lump sum, with the first 25% paid tax free.

Not all pension funds will have fallen by the same amount. If you are in a fund with an appropriate level of risk, falls should be lower if you’re closer to retirement.

This is because people nearing retirement usually have their savings switched out of risky assets into safer investments.

Younger pension savers are usually in higher risk investments as they are able to ride out short-term fluctuations.

Annuities

Annuities, which can provide a guaranteed income in retirement, are also at record low rates.

The average annual standard annuity income for someone aged 65 – based on a single life £10,000 level without guarantee annuity – fell by 6% in in the first quarter of 2020.

This leaves the average annuity income 1.7% lower than its previous record low in October 2019.

Falling pension fund values and lower annuity rates have had a severe impact on those looking to annuitise.

An individual who had saved £100 gross per month into a personal pension for 20 years would have built up a final pension fund of £41,388.

Moneyfacts calculates that using this to take an income through an annuity at 65 means they will receive just £1,663 per annum, down by 18.7% on the start of the year, and 14.4% lower than the previous all-time low in October 2016.

Helen Morrissey, pension specialist at Royal London, says: “Deciding to switch investments or stop or reduce contributions could actually make things worse as you risk crystallising a loss and making it harder for your pension to recover.

“Similarly, if you decide to annuitise now then you are locked into low rates. Things will improve and so where possible defer making decisions that have a long-term impact on your finances– a financial adviser will be able to take you through your options.”

What about defined benefit pensions?

Defined benefit (DB) pension schemes – sometimes called a final salary scheme – pay out a guaranteed income for life.

The amount they pay is linked to the number of years the recipient worked for a particular employer or the amount they earned.

They are calculated on your final salary so are not affected by the current market turmoil.

If your employer does not have enough money in the scheme to pay you in retirement, you are covered by the Pension Protection Fund.

Pension savers are being warned against transferring their retirement funds out of final salary schemes in the wake of stock market falls caused by the coronavirus pandemic as they could lose thousands of pounds.

Anyone looking to transfer from a DB to a DC pension during the COVID-19 crisis will get a letter from trustees telling them it is not in their best long-term interests.

Pension funds have a taken a battering with the coronavirus pandemic.

To find out more about how your retirement savings could be affected, check out our comprehensive guide on how to rebuild your pension.

 

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Coronavirus: savers warned against risky pension transfers

Coronavirus: savers warned against risky pension transfers

Trustees to send letters to members shifting pension schemes during the outbreak

Brean Horne
Wed, 04/29/2020 – 11:35

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Savers looking to transfer cash from a defined benefit (DB) to a defined contribution (DC) pension scheme will be sent warning letters during the coronavirus pandemic.

New guidance from The Pensions Regulator (TPR) orders pension trustees to step in in this situation in case DB pensioners make hasty decisions due to the outbreak.

A DB pension scheme is one where your pension payout is based on how many years you have worked for your employer and the salary you have earned.

DC pension schemes allow you to build up a pot of money that you can then use to provide an income in retirement. Unlike DB schemes, under the DC system your pension pot is not a guaranteed fixed sum. 

The amount of retirement income you get will depend on how much you contribute and the performance of the pension scheme’s investments. 

Since 2015, pension freedoms have given savers with a DC scheme more flexibility in how they can access their money. In 2019 around £9.4bn was withdrawn in cash from DC pension pots. 

Savers with DB pensions have tried to take advantage of this flexibility, and last year alone £34 billion was transferred from DB to DC schemes. 

What is the problem?

Market volatility and economic uncertainty caused by the coronavirus pandemic mean that savers could put their money at risk by making hasty transfer decisions.

Charles Counsell, TPR’s chief executive, says: “A decision to transfer a pension pot that’s taken a lifetime to build is a very serious one and we’d urge members to be very, very careful making any transfer decisions at this time.

“That’s why for the foreseeable future, anyone who is looking to transfer their benefits out of their DB scheme should be sent a new warning letter to make them stop and think as well as point them towards free, impartial guidance available from The Pensions Advisory Service.”

Experts warn that transferring from a DB to a DC pension scheme will only work for a few people.

Ian Browne, pensions expert at Quilter says: “The guaranteed income from a defined benefit scheme should not be downplayed and a transfer will only be in a members best interest in the minority of cases.”

Savers who are seriously considering a transfer should be prepared for the impact the current economic climate might have on their pension pot.

Browne adds: “If members are still leaning toward a transfer, they must remember that in doing so they take on the investment risk, which is particularly challenging in the current market uncertainty.

“Even if members have a professional adviser, who carefully selects and monitors their funds, the volatility within the markets will have an impact.”

Beware of pension scams

Pension scams are devastating and can cause savers to lose all their retirement pot.

The most recent figures show that victims of pension fraud lose £82,000 on average.

Trustees are the first line of defence in protecting retirement funds and have a key role in ensuring members make informed choices.

To guard against scammers, TPR is calling for trustees to follow the code of good practice set out by the Pension Scams Industry Group.

The guide contains practical steps for carrying out due diligence and assessing transfer requests.

Trustees should direct their customers to the ScamSmart website to learn how to protect themselves from pensions scams.

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