This week, personal finance expert John Rennie shows you how to play your cards right… demonstrating how to take your credit card debt to zero and keep it there. And, amid stock market turmoil, he suggests three safe havens for your cash – so prepare for some fresh ideas. To contact the show email walletwatcher@btpodshow.com .

• Gartmore
• Jupiter
• Aberdeen
• Neptune
• JP Morgan
• ETFS Physical Gold fund
• Investec Global Energy fund
• Schroder Alternative Solutions Agriculture Fund
• Fidelity American Special Situations Fund

On this weeks episode of Wallet Watcher is brought to you in association with GoDaddy and offers you great discounts on hosting and domain names. Use the following Wallet Watcher go daddy codes to save you money – wallet1 gets you 10% off domain name purchases and wallet2 gets you 20% off orders over £25. Some restrictions may apply, see the GoDaddy web site for more details.

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One day they’re up … the next they’re down.

Fears that problems in the American mortgage market will spill over into the wider economy – precipitating a global credit crunch – have seen a series of alarming falls in the major western stockmarkets.

On Friday the 10th of November, London’s FTSE 100 had its worst one-day fall in four years, down 3.7%, while markets in Germany and France also fell significantly.

Meanwhile, the US Federal Reserve had to step in twice during the day to add $38bn to the banking system – basically ensuring there was enough cash to fund deals, loans, and keep the whole system moving.

So … if the regular markets unnerve you … what are the current good homes for your cash?

1) Past weeks have seen investors piling into emerging markets as offering more solid prospects for growth.

We’re talking Turkey, Russia, Brazil and the like.

Critics would say they’re riskier than blue chip UK investments … but then they’d have said there was nothing safer than a UK bank a few months back.

I wouldn’t advise you to invest direct. Too risky, too complicated. There are some excellent funds from specialists such as Aberdeen, Gartmore and Jupiter.

2) Consider the new global giants. China and India are not simply competing abroad with UK and US companies, they’re building demand at home.

The construction of dozens of new airports, major infrastructure projects, and the increased consumer demand as citizens get more money to spend, will see these economies powering ahead.

China, of course, also has the Olympics in 2008.

Specialists fund managers in India and China include Neptune and JP Morgan.

3) Go for gold. It may seem old fashioned but it’s the traditional safe haven in risky times and prices have hit 28 year highs recently.

Predictions are it will go higher.

We don’t suggest you go out and buy an ingot of your own – the easiest way is via a vehicle such as the ETFS Physical Gold fund.

4) If you’ve filled the car recently, you know all about the price of petrol.

With tension in the Middle East and increased demand from the China and India, prices are liable to rise further.

Bad news for drivers but good for investors … check out the Investec Global Energy fund.

5) And, after decades of decline, prices of foodstuffs such as beef, wheat and coffee have been steadily rising too.

Specialists include Schroder Alternative Solutions Agriculture Fund and the Fidelity American Special Situations Fund.

We’ve all have heard about the shortage of credit in the money markets – the most visible victim was Northern Rock of course.

Most of us don’t need bailing out by the Bank of England for £32 million, but we’re suffering in other ways.

Banks are refusing record numbers of credit card applications … and for those WITH cards, interest rates and terms and conditions are changing all the time – and not in our favour.

Research by moneyfacts.co.uk published this week revealed 125 recent increases in fees and rates over the last weeks.

Credit cards can either be a mug’s way to borrow money … or the cheapest loan you’ll ever have. That’s because they charge eye wateringly high rates of interest.

I’m looking at my Amazon credit card statement here and am APPALLED that they want me to pay 15.9% each month on outstanding balances.

Remember the interest rate set by the Bank of England is currently 5.75% … so Amazon can make a lot of money out of me every month.

They don’t of course, because I pay the full balance OFF each month.

But first … do you REALLY know how your credit card works? This is the deal. Effectively, the card issuer lends you money to buy goods and services.

You then have up to 59 days interest free credit, depending when your purchase was made. Pay off the balance in full before the due date and you pay no interest.

Leave a balance outstanding … and that’s how the lender makes their money. Not the only way of course … they make money from annual fees, they charge you for late payments, for overreaching your credit limit, a little extra for buying goods abroad …

As for withdrawing cash on your card … that’s a very bad idea – my lender now hits me with a charge of nearly 23% for cash advances.

For those of you unfamiliar with compound interest … it’s a device to make the lenders richer and keep you racking up debt. Here’s how it works on credit cards.

I run up £600 on my card this month and elect ONLY to pay off the minimum amount … let’s say £100 to keep things simple.

That leaves £500 on my card, running up interest at 15.9%.

A scary figure, but at 1.24% a month it doesn’t sound so bad and the balance only edges up a little … to £506.

Even if I don’t buy another thing, the next month I’m paying interest on the £500, AND interest on the interest.

so it goes on, and over a year my debt has risen to £580.

Many of us are simply SERVICING THE INTEREST DEBT EACH MONTH.

So if you HAVE fallen into the trap … here are my tips for climbing back out.

1) First switch your balance to one of the cards offering 0% interest.

Now the repayments each month help clear what you owe, rather than battling a rising tide of interest.

Watch out though … your existing lender probably WILL charge a percentage of the balance to make the transfer, but it will almost certainly still be worth your while.

2) Watch like a hawk for when the interest free period ends – Typically it’s for the first three months, as they’ll be relying on you to start running up interest AND DEBT again.

3) When the deal is over … Set up a direct debit to pay off your FULL amount each month.

4) Better still, switch to another interest free deal.

By hopping from card to card you can whittle down your debt over time … while enjoying interest free credit on your purchases.

The one thing YOU have to bring to this is financial discipline.

Don’t use it as an excuse to run up ever bigger debts, and NEVER be running more than one credit card at a time.

This week, money guru John Rennie looks at buy-to-let, windfall payments and profiting from the weak dollar. And he shows you how to save hundreds of pounds a year by switching your service providers – all with just a quick phone call. If you need any financial advice then email walletwatcher@btpodshow.com .

• Money Supermarket price comparison
• Switching service providers uSwitch and Simply Switch

Wallet Watcher is brought to you in association with GoDaddy.com and offers you some great discounts on domain names and hosting. Use the Wallet Watcher godaddy coupon codes to save you money – wallet1 gets you 10% off domain name purchases and wallet2 gets you 20% off orders over £25. Some restrictions may apply – see the GoDaddy web site for more details.

[DOWNLOAD MP3] | [RSS FEED] | [SUBSCRIBE IN ITUNES]

Service providers call it inertia – the terrible habit we all have of sticking with the tried and trusted even though switching companies could save us a fortune.

In the past there was an excuse for this, as the tariffs from the confusion of electricity, gas, broadband, home phone and mobile phone services could be horribly baffling … and who wants to plough through hundreds of price charts?

But the good news is, you don’t have to.

There are now a number of excellent price comparison sites that will do the job for you, the likes of uswitch.com and simplyswitch.com, and they couldn’t be easier to use – in fact it’s quite fun seeing how much you can save.

Simply enter the details of your current provider; type in how much you spend on power, phone calls or whatever … and these websites will give you a tantalising ‘you could save’ figure.

You may not EVEN have to switch suppliers. Try this one. I rang up my current gas and electric provider, Npower told them I was on the Standard tariff and would like to be switched to their considerably cheaper Sign Online 8 tariff.

I was told by the (extremely helpful) sales person that ‘as you have become aware of this tariff … we shall of course switch you’. Some five minutes later I was £200 a year better off by my reckoning – probably the easiest couple of hundred quid I’ve EVER earned.

Why don’t you try it … and then reward yourself with the afternoon off! Better yet, put it towards that trip to New York!

Now the point is … they won’t come to you with these deals, you have to find them. And we cannot shout loudly enough that you must NEVER sign up to a new deal from the power companies’ doorstep sellers – they are there to bamboozle you with figures and you WON’T get the best deal – GO ONLINE.

And why stop with power? You should regularly check the cost of all your financial products, right down to your mortgage and bank account, as deals change ALL the time.

Ask yourself when you last looked at what you pay and what you owe … you’re definitely not getting the best deal right now.

Now I don’t expect you to do this on a weekly basis – no matter how much you love a bargain, life is DEFINITELY too short for that. But an afternoon spent every three months could rack you up hundreds, maybe thousands over a year.

‘I’m scared of switching you say.’ Don’t be. These sites make it so simple, and the switchover is invariably seamless.

In fact, with gas and electricity, the providers are legally required to maintain a continuous supply – no chance of the lights going out – the only thing you’ll notice is that your much reduced bill will come from a new provider.

You don’t even have to speak to a person from your existing provider (some of us feel uncomfortable telling the man from British Gas that, no, we don’t want his gas anymore).

The people from uswitch or simplyswitch will do the whole job for you.

Any more questions?

How do these people make their money and are we really getting the best deal when we switch.

These sites do take a commission for switching you over, but the information is there for you to access and check for yourself. They have to be whiter than white and we’re very confident that you will be sold the best deal.

Stuck midway between the summer holidays and Christmas and fancy a quick break away?

A weekend in the States has rarely been cheaper, with the pound at a 26-year high against the dollar.

There’s a double bonus for UK visitors, as consumer goods are already much cheaper in the States than in Britain, so do your Christmas shopping while you’re there.

Actually, you don’t even need to fly to the States to do your shopping.

Buy goods direct from US rather than UK sites (bypassing amazon.co.uk and going to amazon.com) means the savings you make will more than make up for a slight delay and increase in shipping charges.

As house prices stall, this week I show you how to use your savings to make money from private property. Forget ‘get rich quick’, this is the tried and trusted method of ‘getting rich slow’.

It’s no secret that the ten-year surge in private property prices is well and truly over. According to the Halifax, November 2007 saw the biggest fall in UK house prices in a year. And with that 1.1% drop coming after half per cent falls in both September and October, even the optimists have to say the market has turned.
But, staying with optimism, it’s not bad news for everyone. First – if you’re a first time buyer, then property is that bit more affordable.

Second, if you’re trading up to a larger property – say you’re selling a £200,000 flat to buy a £300,000 – then the fall in prices ALSO benefits YOU. If prices fall 10% (and that would be a very pessimistic take), then you’ll get £20,000 less for the flat you’re selling, but pay £30,000 less for the property you’re buying.

Which brings us neatly to how you make money from buy-to-let properties. There are lots of companies around running workshops and promising to teach you how to get rich from property … for a fat fee of course. Avoid them like the plague. The principles are simple, though that doesn’t mean it’s either quick or easy to build a property portfolio. The two words here are gearing (or leverage if you’re American) and compound growth. Let’s imagine you have £10,000 in savings. Don’t get too fixated on the figures here, they are just for illustration.

You can leave that money in a high interest savings account earning a solid 5% a year. After a year you have £10,500. Now say that instead you use that £20,000 as a 10 per cent deposit to buy a £200,000 flat. We’ll disregard rental income for now, as it’s capital growth we’re interested in. We’ll assume you’ve done your homework on the property you’re buying, and the rental income more or less covers the mortgage payments.

After a year, house prices have also gone up 5%. Meaning your £200,000 apartment is now worth £210,000. Your £20,000 investment is now worth £30,000 – a return on investment of 50%.

That’s why it’s called gearing – using a small sum to ‘turn’ a much larger one. When it gets really interesting is when compound interest gets going. Compounding is ‘interest on your interest’ and it hugely multiplies the value of your savings. Take our savings account. We never touch our cash, and year 1 pays £500 interest, year 2 £525. By year 10 our £10,000 is worth £16,300. A nice increase.

But let’s look at the apartment. Growing at a steady 5% a year, a conservative estimate when you look at UK property over the last half century, the flat is now worth £325,000. Our £10,000 investment has become £135,000. 63% growth or 1350% … your choice.

There are a few provisos here. The first being that you have to have the money to invest in the first place. I also talked about ensuring that the rent covers the mortgage, but in the first year your expenses will far outstrip any income as you fit out a flat for tenants. And you have to have a healthy contingency fund for decorating, repairs, for ‘voids’ – periods when you don’t have tenants.

But if you have that cushion of cash you can ride out the problems. Which brings us to the last point about property – it’s a long term game. Buying the property and selling the property are the horribly expensive bits. At one end you have setup costs, at the other you have tax to pay … it’s the years between that make the money.

So playing it long is where the real gains come. The way investors build property portfolios is this. Your £200,000 flat is now worth £230,000. So you remortgage, releasing £20,000 of equity and use that to buy another apartment of £200,000. You now have £400,000 worth of property growing at 5% (or £20,000 a year) all from that initial £10,000.

Is it risk free? No. Property prices go down as well as up – that’s where we came in. And of course gearing works to your disadvantage in a falling market. If your £200,000 flat fell in price by 5% in year 1, then your £10,000 investment would now be down to £5000 – a 50% loss rather than the nice solid 5% gain in the savings account.

You’d be crazy to see the housing market a year at a time though, as the long term gains far outweigh the short term falls. Stay in for the long haul and there are few better ways to turn a small fortune into a large one.

Recent takeovers and demutualisations of building societies such as the Portman, Leeds and Newcastle have seen the professional cartpetbaggers rubbing their hands in glee.

But many many more of us have dormant accounts that we haven’t touched for years.

If you have an account with one of these, you could be due a windfall of hundreds of pounds.

Dig out that old passbook, Google the name of the lender and see what you’re due.

Smart investors often reckon the best time to get into a market is when the crowds are racing the other way.

As fears grow for the UK housing market, with falling prices and a shortage of credit, many buy-to-let enthusiasts are moving back into the market.

The Association of Residential Letting Agents reports strong rental growth, as fewer people opt to buy.

And as interest rates are probably close to their peak, there should be fewer future shocks for those taking out buy to let mortgages this winter.