Fergus Muirhead answers your consumer questions
I'm Fergus Muirhead and I'm here to answer any questions you may have about any money or consumer issues.
Please drop me a line here at email@example.com with your questions.
You can also read more on money and consumer issues on my own blog.
Q I am in the process of selling my car and got in touch with my insurance company, RAC, to ask about cancellation fees and was told that it would cost me £27. As it is due to run out soon (within the next two months) I said I would just let it run out and then not bother to renew it. I was told "it is against the law to have insurance on a vehicle that you no longer own" is this true? Robert Smith
A The people I spoke to about this could not imagine why it would be "against the law" to insure a car that you didn't own, although they did point out that it may make things difficult for you if the car, owned by someone else, was involved in an accident after you had sold it on. The company concerned in this case didn't have enough information to make a comment on the specifics of the case but made the following general comment that might be useful for other drivers in the same or similar situations. "If a customer isn't likely to buy a new car in the near future, it is probably better that they cancel their policy so that they avoid being liable for any claim by the new buyer, should they not insure the car. However, some customers may wish to keep a policy open for the benefits it offers over and above the car itself - for example, for driving other cars or if they have legal expenses cover. In essence, there are no hard and fast rules. It is not 'against the law' to insure a car which you no longer own so we can only apologise if this customer was misinformed. However, the customer will need to bear in mind that if a policy remains open, a claim could be made against it, which could affect their future NCD."
Q I'm probably the 100th lawyer who has contacted you following your spot on Reporting Scotland at lunchtime regarding wills. Certainly any publicity given to the public about the wisdom of making wills is very welcome. You gave an indication on the programme of the likely cost of having a will drawn up by a solicitor or professional will writer, but what I thought would be useful for people to know as well, is that many firms such as ours (and this is honestly not a plug for Ritchie Neill) do provide a free will-writing service. So it may pay people to ask around various firms to see if they offer such a service. What we do here is suggest that people may wish to make a donation to charity. We send our donations to Macmillan Nurses and Cancer Research and last year raised around £7,000. As I say I'm sure I'm not the first lawyer to point this out following your programme but thought it worth e-mailing you anyway. Innes Cradock
A You are correct Innes, you weren't the only solicitor to contact me after the piece the other week. On the programme I suggested that an average will might cost around £200 to put together, and I got that figure after speaking with a number of practising solicitors. Since then I have been contacted by you and others to suggest that it might be possible to have wills drawn up more cheaply, and by viewers to ask me where they could get their wills drawn up form as little as £200. So I can't win! The point you make about the free will-writing service is valid and was pointed out by others as well. Thanks for taking the time to write to us with that suggestion.
Q I am wondering if a homeowner can give their home to a son/daughterin order to prevent it from being sold to pay for care purposes. June Connor
A You are perfectly entitled to give your home to your son or daughter, or sell it to them for a price that resembles the real value or is hugely discounted, whatever you prefer. If you do, and you are required to go into care thereafter then you are laying yourself open to a charge of "deliberate deprivation", which is the tem used by local authorities when they think that someone might have "offloaded" assets for precisely the purpose you describe in your question. So I suppose the answer is yes you can sell or gift your home but it won't necessarily mean that it won't be counted as part of your assets when any assessment is carried out by the local authority. And be wary of any sales campaigns that tell you they can set up a trust that your house can go into and that will protect it from being counted as part of your assets in the future. These trusts are still relatively new and don't come with any guarantees.
Q We are looking into starting to save for our grandchildren, aged seven and five. There are so many suggestions and it is very confusing to know which would be best for them. We are both in our 60s so our income is small. We are able to save £25 for each per month and of course that would be locked in until at least 18 years of age. Can you suggest something? Christine Chinchen
A As you say there are plenty of options, from a simple bank account that could be transferred into their names at 18 to the new junior Isas that are coming out later this year. Or for the really long term you could even consider a pension! The bank account is probably the simplest and is available now but if you choose that route then make sure you ask the bank for an R85 form so that interest can be paid without any tax being deducted first. Look for a high rate of interest and because you are saving for more than 10 years then you can afford to tie the money up for three or five years if it means a better rate of interest. The new Isas that are being introduced later this year will also give you the opportunity to invest in stocks and shares if you can take the extra risk involved. If you go down this route then be aware of exactly what you are investing in since different funds and companies will carry different levels of risk. You should also make sure you look at the charges for the funds you are looking to invest in. the pension was a bit of an "off the wall" idea. It is possible to invest in a pension for a child but they won't be able to access the money until they are 55. It is very tax efficient but probably not what you're looking for at the moment. Remember too that there are a range of national saving options that are useful for children as well. Have I given you too much choice now?