He shared some tips around bank accounts on his BBC podcast
Martin Lewis has imparted some crucial advice on managing your bank account and household finances. He offered several tips on handling daily expenses on his BBC podcast
The consumer champion invited listeners to share their ideas for managing daily finances as a couple. Mr Lewis observed that trends have changed over time in this respect, with people now often pairing up later in life when they already have established independent financial arrangements. Mr Lewis emphasised the importance of getting this right and ensuring you adopt the best strategy for your circumstances. He said: “The way that people operate their finances together is absolutely crucial.”
One listener said she manages a joint account for herself and her husband, taking responsibility for all financial matters as she is “financially savvy”, unlike her spouse. However, Mr Lewis issued a warning about this one-sided approach to money management.
He suggested the potential pitfalls can be encapsulated by “three Ds”: death, divorce and dementia. Mr Lewis said: “The problem with one person doing it is, if they are not communicating with the other partner, if there isn’t a good financial factsheet list of details of who every provider is and why the decisions were taken and made, then if one of the three Ds were to hit the person who is in charge of the finances, it can leave the other partner in the lurch terribly.”
Mr Lewis conducted a survey of his followers, with 50 per cent of participants saying that one individual in their relationship manages the finances. The expert said he had spoken to numerous people over the years who have suddenly confronted this issue, particularly women in their 50s, whose husbands had died.
‘Incredibly important’
Given this risk, Mr Lewis made a “plea” to the listener and anyone else where it falls entirely to one partner to manage the bills. He explained: “It’s fine for you to be the lead financer in your family, as long as your husband who you say isn’t good with money, understands the decisions you’re making and you have enough details and explanation, that in the event something were to happen to you, he would be able to take over relatively seamlessly.
“If not, the gift of looking after the family finances can be a curse.” Another listener to the programme said they and their partner hold an informal meeting around every six months to review their finances together.
Mr Lewis praised having a regular conversation like this. He said: “I think those meetings are incredibly important. Kitchen table financial budgeting meetings – especially if family finances are tight – are really worthwhile doing.
“So you’ve got somebody to pass the information off, and check that everybody is happy and everybody understands what is going on.” Mr Lewis emphasised there is no definitive rule about how you approach this.
He explained: “There is no right or wrong way to do this, I wouldn’t want to be prescriptive.” Mr Lewis was particularly impressed with advice from one person, who said they put together a ‘monthly net worth statement’ to get a picture of their financial position.
‘Stand out’ bank account for couples
One query was sent in from someone who was moving in with her partner. She wanted to know if there was a bank account Mr Lewis would suggest for them, ideally with some additional benefits.
Mr Lewis indicated there is a “stand-out account” that might be worth considering here. He initially directed her to the accounts where you can receive some bonus money for switching.
Currently, you can be paid £200 from Lloyds Bank for switching to Club Lloyds or £500 for transferring to their Premier Account; as well as £175 from First Direct, £200 from Santander and £100 for moving to Co-operative Bank.
Mr Lewis said his “top pick” from these providers for this listener was the Santander Edge account, since you can secure the £200 for your switch, plus a 6 percent easy access savings account up to £4,000.
You can also receive one percent cashback on bills paid by direct debit from your current account, with up to £10 monthly in cashback available. This covers the £3 monthly fee for the account and nets you £7 a month, or £84 annually.
Mr Lewis said: “For joint accounts, if they are bill-only accounts, that would be your winner.”
