We have created a savings challenge to help you to kickstart your savings. Did you know that 1 in 10 people in the UK have no savings at all and a third have less than £1,000 saved? While these statistics may seem alarming, we believe that saving is a habit that has to be learned, not something that you just 'happen' to be good at.


It takes 21 days to build a habit and 90 days to create a habit. With that being said, this savings challenge helps you to build up this habit by putting money away each day. Unlike other saving challenges, we have created three different levels - beginner, intermediate and advanced. These levels are to cater to different financial situations allowing it to be more inclusive.




Here are the amounts you'll end up with:

- Beginner: £56.25

- Intermediate: £112.50

- Advanced: £225


If you are going to take part in this challenge, it may be good to do it alongside someone else. Get a friend or family member involved who can act as an accountability partner as well as save up alongside you!


You can either choose to make the deposits daily yourself, set up a standing order or use apps to help you set aside your money, read here.


We have also created FREE resources for you to use during your challenge too, download yours here.


Be sure to use the hashtag #P2PSavingsChallenge so we can see how you're getting on and give you the necessary motivation!




Chip is a savings app that uses AI technology to set aside money to save on your behalf. Chip is now launching interest accounts to its customers allowing them to put their money into a trust account. Find out more about how Chip works as a savings vehicle in our post here.


Chip has partnered up with Flagstone, an online deposit marketplace, to be able to offer these accounts. Flagstone's services are typically offered to high net-worth individuals with large deposits however Chip customers are able to benefit from their services and negotiate the best interest rates.


All money saved in a Chip savings account is protected by FSCS, Financial Services Compensation Scheme. This is a government guarantee that your money is protected up to £85,000, should the company go bust.


The Chip savings account will currently be one of the market leaders in terms of the interest rate. There are plans to add more accounts to their catalogue meaning that this is the first of many. This is an easy-access account which allows you to withdraw your money without any prior notice. The interest rate at present is 0.9% AER although this is subject to change and you will be notified if that is the case.


Interest is paid daily by the Chip partner bank, Hampshire Trust. The interest will be added to your balance and is available for withdrawal as soon as it is added. The minimum deposit you can make is £1 and the maximum is £5,000. This cap will be increased to £85,000 for ChipX users (due to launch later this year).


ELIGIBILITY

Anyone who is a Chip saver and has a UK bank account that supports online banking will be eligible. These savings accounts will be open to all savers towards to end of the year but for now, early access is going to be given to the Chip investors community, ChipX. If you'd like to join the waitlist for the investor's community, join here.


To download the Chip app, click here.

Whether you are a first-time buyer or someone looking to move house, this loan is designed to help. The Help To Buy Equity Loan is a government-funded, low-interest loan.


HOW IT WORKS

  • You save up 5% of the property value for the deposit

  • The government lends you 20% of the property value (40% for properties within London)

  • You only need to apply for a 75% mortgage (55% for properties in London)

The Help To Buy Equity Loan is interest-free for the first five years and interest is charged on the sixth year.


LOAN FEE BREAKDOWN

YEARS 1 - 5 OF LOAN

  • The equity loan is interest-free

  • £1 per month as a management fee is paid via Direct Debit

YEAR 6+ OF LOAN

  • Interest is charged monthly at a rate of 1.75%

  • The interest rate rises each year in line with the Retail Price Index (RPI) plus an additional 1%

  • £1 monthly management fee is still to be paid

To purchase a property for £220,000 using the Help To Buy Equity Loan:

  • 5% deposit - £11,000

  • 20% equity loan - £44,000

  • Mortgage amount - £165,000

ELIGIBILITY

  • Must be a new build property

  • The property value must not exceed £600,000 in England (£300,000 in Wales)

  • Must be the only property that you own

  • You cannot sub-let or rent out the property once you own it

Repaying The Loan

The Help To Buy Equity Loan must be repaid in full after 25 years or when you come to sell your property. The amount that is repaid is dependent on the current property value. You are able to make repayments to your loan whenever you choose. The smallest repayment you are able to make is 10% of your property value.


EXAMPLE

If the value of your property has increased over time:

  • Original Property Value - £220,000

  • Increased Property Value - £235,000

  • Initial 20% Equity Loan Borrowed Amount - £44,000

  • New Equity Loan Repayment Amount - £47,000

The current Help To Buy Loan scheme is due to end on the 21st March 2021. If you have already reserved your home and want to apply for the loan, find your local Help To Buy agent here who can guide you on the next steps and check your eligibility.

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