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Penny-pinching Brits are turning to the lottery to make their fortune in the time of the credit crunch, as figures reveal a £181million increase in National Lottery ticket sales during the past 6 months alone.

In a bid to avoid debt, 70% of British adults now play the lottery on a regular basis, spending an average of £3 a week on scratch card and lottery tickets, even though there is statistically only a 1 in 14 million chance of becoming a winner.

Even though the chances of winning the lottery are slim, players can be pleased to know that over £350 million has been raised towards the Olympic Lottery Distribution Fund. Camelot Group chief executive Dianne Thompson commented that: “The National Lottery has now created more than 2,200 millionaires and has raised over £22bn for the good causes.”

The global credit crunch has has a great impact in the way that we spend our money, and it has even changed what we are searching for. Which? have reported Google statistics showing that more Brits are searching for credit crunch terms such as vouchers, budget meals and sewing classes in order to help their debt management skills.

It seems that more of us are looking reduce holiday debt, as there has been a decrease in city break searches by 20% and homes in Spain by 28%.

Although perhaps one good thing about this economic downturn is that more of us are actively searching for ways to keep our savings secure. Which? report that an increasing number of us are wanting to keep better grip on our savings, as the search for safe savings is up by 900%, compared to 2007.

Elan Dekel, product manager at Google, said: “This is a fascinating snapshot into how Britons are reacting to the current economic situation.”

Did you check our all of our Part 1 in the One Advice Simple Ways to Save series? In part 2 you will learn another three simple ways to save your money, and there is also a part three to look forward to next week!

Can you think of simple ways that you are saving money?
Share your money saving tips with readers, just comment on this post.

Simple Ways to Save: Tips 4-6

4: Don’t Skip Breakfast: Not only are people who eat breakfast slimmer (according to a well know cereal brand), eating breakfast could also be saving pounds on your waistline as well as your pocket.

Eating breakfast means that you won’t be tempted by a naughty and expensive treat later on in the day, such as the costly shop bought coffee or ready-prepared sandwiches. If you really do not have time for breakfast, then prepare a fruit salad the night before to snack on when you arrive at work. (more…)

The credit crunch is hurting the pocket of many Brits as personal loan interest rates continue to rise.

This increase could add hundreds of pounds to monthly repayments, and this news comes at the same time that the cost of fixed-rate mortgages and credit cards continues to rise sharply.

According to uSwitch, the average cost of a Black Horse loan has risen to 36.9% in the past month. Before the increase a borrower could expect to pay £632 on a £2,000 loan over a two year repayment period. But as the interest rate figure has risen by nine points, the same loan today would have an interest figure of almost £860.

There is further bad news for those who are looking for a loan to deal with their debt management issues, as uSwitch also reveal that other lenders have increased their interest rates. Even though there has been a decrease in the Bank of England base rate, a total of eight providers have put up their rates by an average of 7.85%.

Personal Finance Manager, Louise Bond said: ‘Personal loan “best buys” are changing every day which demonstrates just how unpredictable and volatile the current climate really is.’

Eight out of ten renters worried about their utility bills, according to a new report by the Department of Communities and Local Government.

The average UK household will pay the equivalent of 20% of their rent on their utility bills. But many private renters feel as though their landlord doesn’t care about energy efficiency, which is leading the renter to forfeit the inflated bill.

The Government is set for change as this month sees the start of Energy Performance Certificates (EPC) required for all new tenancies after 1st October. The EPC means that landlords will have to provide their tenants with information about energy efficiency and carbon emissions, in a simple rating of A-G.

Communities minister Iain Wright commented that this new move should be “welcomed by tenants who are looking for better value and more energy efficient rental properties, as well as landlords who are, more than ever, keen to attract responsible and committed tenants.”

Confused British credit card holders seem to be unaware about the true costs of making a credit card withdrawal, meaning that we are paying £161 million on interest for these transactions alone.

uSwitch.com report that many may need some form of debt help, due to withdrawing cash to pay for costs such as mortgages, loans and household bills, while over 700,000 make cash withdrawals so they can afford to make their credit card payments.

69% of consumers are unaware of the high interest rate and charges being added when making these withdrawals. The average annual percentage rate now stands at 29.97%, up from 21.22% in 2005. This rise in interest rate should be cause for alarm, especially as 16% of the population are getting cash through credit card withdrawal.

Personal finance manager at uSwitch.com, Louise Bond, commented:”People who use a credit card to withdraw cash may already be struggling under the burden of debt and are forced to resort to this method of borrowing to make ends meet.”

The credit crunch means that many people are reevaluating their outgoings, and many may be shocked to know that the annual running costs for an average family car have now soared to £2,435, this represents a 19% increase since 2007.

This may mean that more families will struggle to manage their debt as, according to the RAC Cost Index, average car running costs have seen a year-on-year increase of £277. Average weekly costs are now at the equivalent of £47 a week or 20.3p a mile.

Although many people rely on their vehicles, 36% of drivers are considering buying a car which will be cheaper to run than their present model in order to cut back on their future car running costs.

Adrian Tink, the RAC motoring strategist commented: “With the credit crunch hitting motorists hard in their pocket, we encourage UK drivers now more than ever to take all potential financial implications of car running costs into account to better manage their budgets.”

3 Ways to Reduce Car Running Costs

If you are looking for simple ways to save money, then these following tips should help you reduce your car running costs: (more…)

Falling house prices and an unstable housing market means that up to 2 million borrowers could be facing negative equity by 2010, according to predictions by analysts Standard & Poor.

There are currently 335,000 home owners who owe more on the secured debts against their home, such as a mortgage, over the value of the property. This figure is four times that of just four months ago.

These latest figures coincide with new reports that certain mortgage lenders are aggressively pushing forward with repossession orders, even for homeowners who are just a few hundred pounds behind on their mortgage payments.

The CML (Council of Mortgage Lenders) report that almost 19,000 homes were repossessed in the first half of 2008 alone. They predict that this figure will hit 26,000 in the second half of the year.

New reports suggest that one in three gas and electricity consumers are being over-charged due to their utility bills being based on an inaccurate estimate.

According to Consumer Focus, estimated bills are based on the latest charges, although they relate to energy which was used when the prices were at a lower rate. A third of all bills are based on this estimating scheme, meaning that 16 million people could be paying more than they should do.

You can check if your utility bills are based on estimated readings by checking your bill for the letter “E”, which means that the cost is estimated. Spokesperson for the group, Robert Hammond, said: “It’s in the interest of consumers to make sure bills are based on an actual meter reading.”

Representative for the power firms, The Energy Retail Association,  deny any profiteering from this and urge customers to send regular meter readings.

As debt becomes a great burden for more people throughout the UK, almost tenth of British borrowers have missed repayments to one or more of their debts. As economic problems hit home, it seems that more and more people are having problems controlling their debt management issues.

According to MoneyExpert, almost 11% of people with a mortgage and unsecured debts, such as a credit card or unsecured loan, have missed these debt repayments within the last six months alone.

It appears that our unsecured debt is causing us the biggest worry, as credit cards and unsecured loans are offering us the biggest debt problems. Almost four million credit card holders admit that they have missed a payment to their credit card debt during the past six months, and over one million have missed payments to their unsecured loan.

Even more worryingly, the number of people who are missing payments to their credit cards equates to around 9% of the adult population in the UK.

Director of MoneyExpert, Sean Gardner, commented: “Interest rates may have been pushed down through 2008 but increased pressures from rising food and energy bills mean consumers are struggling to keep their heads above water.

The current economic climate has lead to calls for financial lessons to be put on the Scottish School curriculum.

According to an article by the Times, Fraser Smart, a director of human resources company Buck Consultants, has urged the Scottish government to introduce finance lessons to schools, in fear that this my not happen at a UK level.

Smart believes that the global credit crunch turmoil makes the need for financial education a matter of urgency, and that it should be introduced for everyone. These lessons should cover all financial areas, including debt management, mortgages and loans. “I believe that we could and should introduce a change to the school curriculum very quickly indeed to begin addressing the most basic financial needs.”

This new change to repossession law, contained in the Tribunals, Courts and Enforcement Act 2007, could allow creditors to speed up the repossession process. As this change will cut the time needed for creditors to pursue a repossession claim against a borrower who finds themselves with mortgage arrears and debt problems.

The current repossession law means that creditors can only apply for a charging order, which will secure unsecured debt against an asset, after the debtor has had a CCJ issued against them, and has further fallen behind on payments. The new repossession law,  would allow the lender to secure the debt when the first CCJ is issued, speeding up the process.

More than a million CCJs were issued in 2006, meaning that the change in the repossession law could lead to a huge increase in the number of applications for charging orders which could, in turn, lead to a rise in the number of debtors who face repossession.

Many couples are now without a joint current account, because of worries about their partners financial patterns. 39% say that they do not trust their partners capability of spending responsibility, but this means that many could be missing out on a number of additional financial benefits.

Lloyds TSB said 27% of couples are missing out on joint current account advantages, such as preferential credit interest rates and increased financial security.

Almost all (90%) of those surveyed who have a joint current account, believe that it has helped them with their finances, such as paying for household bills, joint expenses and controlling their debt management issues.