Starting off on saving money can feel difficult. Maybe you picture having to go through reams of paperwork, or spend hours online comparing the minutiae of different services. But, that's not true at all. One of the easiest, and most effective ways to save straightaway, is to check your bills and statements, as recent problems from phone provider Vodafone may attest to.
A new billing system at Vodafone has ended up in thousands of people airing grievances such as double charging, or payments being taken even after they've cancelled. Credit agencies may have also wrongly been told customers are missing payments.
Vodafone customers should check their bills and their bank statement to make sure that everything is how they would expect. Money Saving Expert suggest checking you're on the right tariff and also that you're getting your bills as expected.
Checking all of your bills and statements should be something you do regularly – it helps you keep tabs on your money management and the more you do it, the more attuned you will be into spotting mistakes.
Money management tips
We would suggest picking a day every month, and using a calendar or app to make sure you don't forget. That way you are making a habit of it and once you make a habit of something, it becomes second nature to do it.
Another good thing to do is to choose the right payment method. Direct debits are usually the cheapest and easiest way to pay your bills, but there are other ways. You may choose to post a cheque, for example, or pop into the Post Office. Don't forget though that some of these alternatives rely on you remembering to go in and pay – forgetting to do so could land you in a spot of bother.
There are also lots of ways you can cut the costs of your household bills. There's always lots of talk around switching your energy supplier – and for good reason. You could chop hundreds off your bill in as little as 20 minutes. There are also ways you can cut your home phone and broadband bill, and your mobile phone.
One question mark over Vodafone's billing issues is whether this has affected customer's credit ratings. When you apply for credit, lenders will check your credit report to give them an indication of how well you've managed your credit in the past – have you always paid your bills on time, for example.
Items such as missed or late payments can stay on your credit report for up to six years, so it is very important that you check everything is as it should be, as lenders can refuse you credit based on your credit score.
If something doesn't seem right, contact your credit agency and try to get it fixed.
Don't wait until you need to apply for credit to view your credit record – do it now so you know where you stand and can deal with any disputes. When applying for credit, you give the lender permission to view your record, so it makes sense to view it yourself first.
You can access your record via any of the main credit agencies in the UK. By law, all the credit agencies are required to provide you with a one-off copy for just £2 so don't be hoodwinked into signing up to pay a monthly fee.
Your report shows what credit accounts you've had and whether you've made repayments on time and in full. According to Experian, items such as missed or late payments stay on your credit report for at least three years, while Court Judgments for non-payment of debts, Bankruptcies and Individual Voluntary Arrangements stick around for around six years.
Your credit report shows the current address at which you are registered to vote as well as details of other addresses you've been linked to in the last six years. Another section lists people you have a financial connection with, such as a joint mortgage. When you apply for credit, lenders are able to look at their credit history as their circumstances could affect your ability to repay what you owe.
Scrutinise your record to make sure there are no mistakes. Even a minor error such as an incorrect address or wrongly linked account could hinder your chances of being approved for credit so make sure all your details are correct and that all your borrowings are on record. If there is a discrepancy, contact the three main credit agencies to get it corrected.
A default notice is note that a lender puts on your credit file if you fall behind with your payments. It is a warning sign to future lenders about your reliability to repay credit and could mean that they will be less likely to lend to you or will increase the interest rate.
If the default notice is incorrect, perhaps because you have repaid the loan in full or did not take out the credit and suspect that you have fallen victim to fraud, you can apply to have a default notice removed. A default notices will only be removed if it is factually incorrect – not simply because you are embarrassed by it.
Start by writing to the agency asking it to either remove or change the entry that you think is wrong. It will investigate the matter and find out whether you have been the victim of ID theft or a bank's mistake.
Within 28 days from receipt of your letter the agency should tell you how the bank has responded. If the bank agrees to change the entry, they will authorise the agency to update their records. They should also send updates to any other credit reference agencies they use.
You can also contact your lender directly to query a mistake. If the lender agrees to the discrepancy, ask them to confirm this in writing on their letterhead and send a copy to the agency, asking them to update your file.
If you are unhappy with the response or would just like to explain a missed payment on your file you can send a Notice of Correction. This is a statement of up to 200 words that will be added to your file. Although lenders don't have to take this information into account, it at least gives you the chance to tell your side of the story.
Experian states that agencies will also help you escalate the dispute to a third party arbitrator if necessary, such as the Information Commissioner's Office.