Should you ask for an early inheritance?

0:02Welcome to This Is Money podcast sponsored by Trading212. Download the Trading212 app today and open a cash eiser with promo code TIM to get the 12-month bonus promo rate of 4.51%. Terms apply. I'm Georgie Frost and joining me and Simon Lambert today is Helen Crane. And coming up, trillions of pounds are set to pass between generations in the coming decades. But if If your inheritance won't arrive until you're 60 plus, is it time to ask for it now? And how on earth do you do that? Also today, the Bank of England holds rates for now. So what does that mean for your money? And after much speculation, where will they head next?

0:44Also, good news for sellers. Prospective buyers could be fined if they pull out of a house purchase under a new Labour property shakeup. And Simon and SpaceX, the short love affair is over. Why sell out so soon, Simon? Don't be getting you still up to date with all the latest breaking money news. Just go to thisismoney.co.uk or download the app. But first, across much of the developed world, trillions of pounds, dollars and euros are set to be passed down from older, wealthier generations over the coming decades. It's been called the Great Wealth Transfer. In the UK alone, the estimate is put at 5.5 trillion over the next 20 years or so.

1:23But due to longer life expectancy, many won't receive an inheritance until they're in their late 50s or 60s or even older. Giving money away earlier can help younger generations when they need it the most, reduce inheritance tax and allow families to see the benefits during their lifetimes. But what is the best way to go about having that conversation? Is it ever acceptable to ask for your inheritance early? Well, this is Money, I've been speaking to the experts. Welcome Helen, And welcome, Simon. The great wealth transfer, eh?

1:57Simon Lambert: The great wealth transfer involves the baby boom generation and those sort of either side of it, but largely the baby boom generation, which has been dubbed the wealthiest generation ever to live, particularly in the West and the developed world. And we'll focus on the British generation because obviously we are a UK podcast, etc, etc. etc. Not everybody is sitting on large sums of money. Not everybody lives in an expensive house. And in fact, only one in 20 estates pay inheritance tax or incur an inheritance tax liability at the moment. That, however, is set to rise substantially, because unfortunately, as time progresses, more of this generation will die.

2:43Simon Lambert: And also because pension pots, unspent pension pots, are going to be pulled into the inheritance tax net from next April. We've talked about this in a great amount of detail in the past, but the Chancellor has decided that people are using their pension pots to pass on wealth free of inheritance tax, and that this must stop because people are gaming the system and they will now be pulled into the inheritance tax net. Now, largely, I think quite a lot of the financial planning industry is to blame for this, for all the times that they've trotted out this line in newspaper articles, etc. Because actually, I think this is massively overcooked.

3:22Simon Lambert: For a start, you only actually pass on a pension pot tax free, free of any tax whatsoever, if you die before the age of 75. The median age of death in this country is above the age of 75. So most people die after the age of 75. And if you die after the age of 75, income tax is incurred on it. And if the pension pot is any form of meaningful amount, that will be 40 % income tax, because when the money is taken out, it will push even basic rate taxpayers into 40%. It will push some into 45%. So the money is being taxed. But it will now be liable for inheritance tax. And that's going to drag way more people into the net.

3:59Simon Lambert: And especially as time moves on, and you shift away from the defined benefit pension generation who had final salary schemes that pay for their retirement, those aren't included. and into the defined contribution element where those are included. And basically all of the evidence is that people don't run their pension pots down to zero. And it's still not going to be everyone, but there will be a sizable chunk of people whose pension pot takes them over that million pound inheritance tax threshold. So you've got this great wealth transfer. You've got houses that have gone up in value over the years.

4:30Simon Lambert: You've got pension pots. You've got savings. You've got investments. And they are being passed to the younger generation. Except as you pointed out, the younger generation they're being passed to by the time they get it isn't actually usually that young. They tend to come 50s, 60s. So this is the great wealth transfer. And the reason why asking for an inheritance early benefits both the person who would get the inheritance and the person giving the inheritance is if there is going to be an inheritance tax liability. This means that you can try to avoid that 40 % tax rate. And whilst only a small number of estates pay inheritance tax, among those that do, the bills are really quite big.

5:15Simon Lambert: You're looking at bills that run into hundreds of thousands of pounds for families. So if you would like to avoid giving the taxman hundreds of thousands of pounds when you die, then you need to do something about it. Unfortunately, however, a lot of people hate the idea of inheritance tax and then promptly bury their heads in the sand and don't really do anything to avoid it. And the two easiest ways to avoid it are either spending your money or giving your money away early. Inheritance tax. We don't like inheritance tax. I don't think that's why you bury your head in the sand. I think it's because we don't really like to talk about our demise.

5:52But before we get on to the how to have that conversation, Helen, Simon and I touched on, I suppose, the benefits of giving money early and it can be beneficial for both sides. How would you go about doing it that doesn't sort of get you caught up in the tax net, as it were?

6:11Helen Crane: Exactly. That's a really big consideration. And generally, the advice is little and often. So start early. So the longer you have to gradually give your money to your children, grandchildren, the more years you can spread it across and the less likely you are to get hit by tax. So this is a seven year rule. Basically, you can give a gift and then if you survive for seven years after you've given that gift, it essentially becomes tax free. Obviously, the snag in that is that no one knows when they're going to die. But if you're financially able to, it makes a lot of sense to start early. So in the piece that we've got here, it said most people think the best stage to start estate planning is 44 findings from a survey by Octopus Investments.

6:57Helen Crane: That sounds incredibly young. And there'll be a lot of people listening to this who are over that age, not far from that age, who either actually haven't started thinking about any of this stuff at all. But the survey also found that 86 % of these people aged 45 to 49 have not started estate planning. So people know that they should do it, but haven't actually started doing it yet. I think it's one of those things, as you say, we don't like talking about when we're going to die, especially if you're in your 40s, you know, hopefully that's quite far off. I guess also people are starting their financial milestones later in life, right?

7:31Helen Crane: So a lot of people now don't get on the property ladder till they're in their mid 30s. You know, they might not have a big pension at that age. So I think it's a big generational issue, isn't it? You know, you should start, but people are kind of kicking everything down the road. And in part, that is why people are asking for their parents for these inheritances. people in my sort of age group sometimes almost expect an inheritance from their parents you know I'm in my mid-30s and I've got friends who say god my parents are on holiday in Machu Picchu again like what's happening to my when am I seeing any of this money spending my inheritance how dare they exactly no but I mean it's a joke but it's also sometimes not not 100 % a joke and I think that's because people of my age do think they've been dealt a trickier hand than their parents you know they've got big student loans, they've had to deal with high house prices.

8:23Helen Crane: I think the thing to say is though, like your parents don't have to do this if they don't want it. It's very much optional. They are free to spend their money however they like. Tip number one, don't go in saying, where's my money? So this is my slight discomfort with this whole conversation, is that inheritance tax should almost be sort of, yes, a gift passed over, not an expectation, not a, well, if you're going to do it anyway, you win, you pop your clogs, you may as well do it now. Just seems a little bit tasteless in my view. What I would just say is if you are giving money away, remember to keep the receipts, people.

8:58Make sure you keep notes of these just because it makes things so much easier when the time comes. But yes, Simon, I just feel I always say to my parents, spend it all. Don't leave us anything.

9:11Simon Lambert: You've worked hard for this. I agree with you. What I would say is that that is notoriously difficult to actually get them to do. There is an entire generation of people who are continuing to hoard cash in their retirement. and many of them who are in what's known in the financial planning industry as the decumulation phase where they should be running down their wealth are actually in the position of getting slightly richer every month. They don't actually spend all of their income and then some of it goes into a savings account, quite often into a savings account rather than even into investments.

9:51Simon Lambert: So actually their wealth is continuing to grow rather than to reduce. I've had this conversation with many people of that generation and try to encourage them to spend their money but they don't want to do things they see as wasteful and broadly speaking that's true of people it's like if you have lived a life where you didn't buy business class flights and expensive things and live high on the hog and you watched what you spent and you didn't go out to dinner all the time you didn't spend on taxis oh my god if ever there was a generation that needs to spend money on taxis rather than gambling with the drink drive laws.

10:25Simon Lambert: It's the baby boom generation. It's like, just pay for a taxi. If your estate will incur inheritance tax, we're talking about people who know their estates will incur inheritance tax. So add the equity in your property to the money that you have in your pension or your savings and investments. And you can do a very rough calculation if you are going to be over the£500 ,000, which is the total amount for an individual, £325 ,000 and then£175 ,000 extra if you pass your own home to a direct descendant. As a couple, you can double that up to a million. If you know you're going to be over that, then everything you spend is 40 % off because otherwise the tax man's taking 40 % of the money that's left.

11:05Simon Lambert: So actually the taxi is nowhere near as expensive as you think, but it's really difficult to get people to do that. And this goes back to Helen's point of the like, this sort of like, don't approach this conversation with it, I'm owed it. Because actually whilst lots of people in the younger generations feel that they have been dealt a hard hand, Most people in those older generations are also like, I had to do all this myself. I had to do all this without any help. I didn't get a property deposit off my parents. I didn't get to move back in and live with them rent free. I had to go out to work.

11:37Simon Lambert: I had to save my money. They don't feel like they got dealt an easier hand. In fact, often they feel like they got dealt a harder hand and it's through their own hard work that they have built up this money. Now there is an argument that says lots of this money is unearned because it's come from property price gains. But it's not the baby boom generation's fault that house prices went up by lots. And in fact, they endured the years of double digit mortgage rates. And, you know, they had to scrape together the money to buy those houses. They paid tax on the earnings that they used to pay the mortgage payments and everything like that.

12:13Simon Lambert: And they're also then having to put their hands in their pocket to help the younger generation get on the property ladder. So I really don't think we should be holding high house prices against them. But it's hard to get out of that frugal, minding the pennies, making your money work hard for you mindset and into the mindset of I just need to go out and spend some money. Or then also that actually I need to hand some of this money over because actually, like you said, it's a gift. It's a surprise. It's a whatever. but if you genuinely don't want to hand over 40 % of some of your money to the tax man you do need to have this conversation you do need to start early you do need to give it away early which brings us back to the whole how the younger generation can approach the conversation with their parents right and I'm my instinct is don't start the conversation it with you are the wealthiest generation you've had it so good we're slightly screwed i think just personally i i wouldn't go in with that approach but i'm not an expert here you have spoken to the experts what have the experts said well i mean you could start the conversation with after all the hard work you've put in in your life how would you feel about rachel reeves taking 40 of your money that's normally one way to get that generation going um gosh anybody listening to this i I apologise profusely to anybody listening to this from the baby boom generation who we are making sweeping generalisations about whilst also commenting on that they didn't have it easy and they did work really hard.

13:45Simon Lambert: Be practical. Back to the point. Focusing on the practical can make tackling an emotive topic easier. Start by asking, do you have an up to date will? Do you have lasting powers of attorney? What do you think you would want to do if you needed to go into care? That kind of thing. Rather than going straight to the give me the money. This puts the focus on their wishes and what they'd like to do and how they would like to do things. Then don't expect an answer on the spot. Give people time. Give your parents or your grandparents time. People need to allow these ideas to percolate. Maybe I should be doing it.

14:19Simon Lambert: How could I do it? What would be the best way to do it for me and for my children or my grandchildren? Ground rules. I think it's really good to have this as an open conversation because one of the things that is a major concern for people is if they give their adult children money, that they are in some way spoiling them in a way that means they won't have to work hard or they might squander the money. People are more happy to give money for property deposits because they can see what it's going into. But once someone's got a house and they don't necessarily need to move to a bigger house or extend it, it's like, okay, they could just spend this money that I give them.

14:57Simon Lambert: So what am I going to do? You could pay off some of their mortgage but then maybe it's good for people to have the financial discipline of having a mortgage you know how are you going to feel if you pay off some of their mortgage and then all of a sudden they start going to the Caribbean every year when they never used to go to the Caribbean before how are you going to feel if you give them some money and then all of a sudden the Porsche appears on the driveway I think talking about what you want to be done with the money and some ground rules and some you know I still want you to have to work hard and to earn the things that you get and I'd like you to take this money and I'd like you to save it or invest it or I'd like you to use it for x but not for y is really important and from that perspective also you know as the as the in the person in the younger generation it's really important to respect those wishes and and have that conversation and enter into that conversation thinking putting yourself in the other person's shoes rather than doing the thing that most of us do when presented with a conversation with our parents where however old we are we immediately turn back into teenagers so don't stamp your feet don't slam the door don't run upstairs to your room that they've now turned into a home office making a plan planning ahead don't be offended maybe open the conversation with a like I think we should talk about this honestly and I think we should both agree that whatever gets said none of us are going to get offended I'm not going to stamp my feet and run to my room and if you could try to avoid stamping your feet slamming the door on me and telling me that you're never speaking to me again and I'm not getting an inheritance that would be amazing and you know thinking about it from the perspective of like how this can be a mutually enjoyable scenario the older generation can enjoy helping the younger generation the younger generation can enjoy the older generation's money no the younger generation can enjoy the opportunity to then bring the older generation into their new home have them over to stay if we get a bigger house, you've got a spare bedroom, that kind of thing.

16:51Yeah, but make sure you don't move them in or they have some benefit from that gift, etc, etc. The problem, Helen, though, with money, and particularly with inheritance and wills, is it isn't just money, is it? Well, it is, but it often confers some sort of love or favouritism. I've left you this money because I love you. Which is why I think Warren Buffett always advises parents to show their will to their children while they're still alive, which I think is actually a really good thing to do so that there are no horrible surprises when you're gone. I mean, you're gone, you don't care, but the kids might.

17:32And that's not very nice, is it? So as much as Simon says, don't go storming off and don't get emotional about it, it's really hard to do. Because if you see your parents, And oftentimes it is only property wealth. They might not have ready cash to give you. You know, you might feel, look at you and your big house and me struggling to get on the property ladder. It is so loaded with emotion. How do you kind of almost separate yourself from that?

17:57Helen Crane: You're right, Georgie. And I think so many families have these horror stories, don't they? We have readers who write into us about things like this all the time. I thought I was going to get something in my mum and dad's inheritance. They left more to my siblings than me. You know, there's a huge range of grievances that can come about from this. And I'm sure we've all kind of seen it in our own families. The easiest thing to do, I suppose, from a parent's perspective is to split it fairly. I'm dividing everything I've got equal between my children, my grandchildren. But then that doesn't really reflect what people have done throughout their lives, does it?

18:34Helen Crane: One of the children might have looked after their parents when they're elderly and they might feel that means that they deserve more. I mean, there's no one right way to do it, of course. But I think being open about it and actually having these conversations is the best way to do it. And, you know, maybe even get the whole family around and say, look, this is what I'm planning. This is what I would like to do. What do you think about this? Make it a conversation. I mean, again, look, we're British. It's going to be incredibly awkward conversation. We all find talking about money awkward and talking about death awkward, obviously.

19:12Helen Crane: But I think anything you can do to kind of get it out in the open early on would seem to me to be sort of mitigate things and stop causing a massive family argument. I mean, there might be a family argument at the time that you say that, but I guess it's better to have the argument while you're still there to be a part of it than after you've gone and your wishes can't be respected. um but you know as seriously as well though what you know if this all happens when someone's already ill or someone's already kind of passed away and you get the will and it's a surprise people are not in a good way people are grieving people upset people are stressed it's surely it's much better to do it before a big emergency happens and you can all kind of talk with a level head but of course we all have families this stuff is much easier said than done I guess also as well Simon on the flip side of that how do you say no well that's a very very good question

20:10Simon Lambert: because what you want to do is you want to be able to say no without triggering a huge argument but I think what's important to do is just is to explain your reasons and to say actually no this doesn't work for me I don't have as much money as you think I'm concerned if I do this this could happen or that could happen or perhaps actually I'm not willing to do that but I am willing to do this it's basically about being open about being honest and about not avoiding the topic of conversation and also being you know willing to listen to the other side of it so for example if there is a scenario where you've drawn up a will in a certain way and one of your children or you know both your children say to you actually do you know have you thought about this this and this and actually that doesn't seem as fair as it could be going oh actually maybe you are right about that um but ultimately it is your money but as long as you're open and honest about it you don't have to be completely honest often people would like to not reveal all to their children and that happens when their children are adults as well as when their children are children and they should respect that But yeah, try not to fall out about it.

21:22Simon Lambert: In whatever you do, just try not to fall out about it, because that is squandering wealth of a completely different kind. Very good point. We'll leave this to one side now. Interest rates were held at 3.75 % this week, where they have been since December. It's the fourth time in a row the Bank of England sat on their hands, with seven members of the MPC voting for a hold, two for a 0.25 percentage point rise. So what does that mean for our money? And does that 0.2 percentage point rise for two people indicate that perhaps they are going up next? Tell me about the decision, Helen. Anything of note in the minutes?

22:01Helen Crane: Well, we're getting quite used to these interest rate holds now. As you say, we haven't had a change in the base rate this year. I think what's kind of brought this about is worries about inflation and the conflict in Iran. So it seems like that might be moving towards a resolution and resolution is maybe a bit of a strong word. But you know, things are kind of moving in the right direction on Iran now. And I think people maybe think the impact will be over. But obviously, if you look at the inflation spike that it's caused, that's going to go on for much longer. So I think that's why we haven't had the falls in the base rate that people were expecting at the start of this year.

22:42Helen Crane: Obviously, you know, keeping rates higher encourages households to be cautious, reining their spending, kind of squirrel cash away. And that kind of therefore should keep inflation down. We had the latest inflation figures earlier this week, 2 % in May, and that was the same as it was in April. So things are holding steady, but inflation still isn't falling and it's still above that Bank of England 2 % target. So I think the bank's just playing it safe, obviously trying to ward off inflation, but also on the other side of that, they don't want to risk economic growth slowing, higher unemployment, which can happen if they keep rates high.

23:26Helen Crane: So I think they've avoided hiking rates for that reason this time. If you look at the forecast now, most seem to be saying that rates will stay static for quite some time. I don't know if we would see a hike next time, but then, you know, depends what happens between now and then, doesn't it? Absolutely right. What does it mean for our money? Have we seen any movements in savings rates and mortgage rates or they just stay static? So mortgage rates have actually been falling over the past month or so quite interestingly at a time when the base rate is staying static. This week nationwide cut mortgage rates for the second time in a week so the cuts are happening and it's getting better for people who need to remortgage or move but I think the reason for this and I've said this before when events have happened that have sort spiked mortgage rates you know whether it's the around conflict or inflation lenders seem to hike quite dramatically and quite quickly and then they come back down much more slowly so you you know you get these big spikes everyone gets a bit scared and then the banks realize that oh we're not really getting any customers because we've just massively jacked up our mortgage rates and then they sort of slowly bring them down over a long period of time so i think that's what happened with us what's happening here.

24:44Helen Crane: I think they'll fall a little bit more, but I think they're going to have to reach a sort of status quo at some point soon unless we do see any falls in the base rate. So if you're looking for a mortgage, you know, do look at fixing in now. Normally, you can fix in before you need to remortgage and then you can change in the sort of weeks and months before you actually commit to the deal. So it's worth looking at.

25:06Simon Lambert: Simon? Savings rates are great. Savings rates have been on the up. Fixed rate savings particularly have become an even better deal. But easy access cash isis, that's that battle still going on. Rates are down ever so slightly, but you know, they're still high. So savers are benefiting from this. But then obviously, if inflation goes up, inflation is going to be eating into those savings even more. And also, we had some figures this week that show quite how many people are sitting on rubbish savings rates. And what you need to do is you actually need to watch out for that, Because that's the thing that will cost you the most money is sitting in a legacy account paying you rubbish amounts of interest.

25:46Simon Lambert: But the mortgage pricing thing is interesting. We talk about rocket and feather pricing with petrol prices, where petrol prices rocket up and then the feather floats back down very slowly. Mortgage rates, it does appear to be happening with. And actually, if you look at some of the bank's results, they show that since the start of the Iran conflict, they've been making a tidy little sum off the back of higher interest rates on mortgages. Yes, I'm surprised. Simon, I just want to ask you very briefly about what's happening over the bond. The Fed in the US held rates this week. Decision, I guess, wasn't really a surprise, was it?

26:22but it was the tone that caught investors' attention. So what does that mean for markets and what does it mean for us over here?

26:30Simon Lambert: Well, the US is in a tricky position. Donald Trump has made it abundantly clear that he wants interest rates to come down, referring to former Fed Chair Jerome Powell as a moron and things like that. The economic picture suggests that interest rates should not be coming down in the way that Donald Trump would like. And the economic picture suggested that before Donald Trump decided to start a war with Iran. After he did that, the economic picture suggested that interest rates should definitely not be coming down. There has been a change in the leadership of the Fed. And there was this sort of expectation that Donald Trump would manage to usher in someone who did cut interest rates.

27:05Simon Lambert: But the kind of economist or figure worth their salt who ends up becoming chair of the Fed, even in this high pressure scenario, is unlikely to be pushed into cutting interest rates by the Trumpiness of the situation in quite the way that Donald Trump would hope. So you've got this sort of strange situation where there was still this sort of vague hope that they might, you know, Kevin Walsh might manage to get the Fed to cut another time this year. But actually, the language coming out of the Fed meeting was that the Fed might need to raise interest rates, which is what almost all economic theory would suggest the Fed should be doing right now.

27:43Simon Lambert: But as we know, theory goes out the window when your president is Donald Trump. So who knows what's going to happen? But anyway, the expectation is that they might actually go up. The only other thing to mention on interest rates is that there is one other thing keeping those rates a bit higher in the UK, which is that guilt yields are that bit higher due to the potential return of the moron premium, which is the UK having to pay more to borrow money due to our seeming inability to maintain any form of stability or forward momentum due to political chaos that has been going on for a really long time now and the Andy Burnham, Keir Starmer, potential Labour leadership, lurch to the left stuff is not helping that.

28:30Simon Lambert: It doesn't directly feed through to mortgage rates but it's definitely keeping them a bit higher than they could be. All right, then. Crane is back on the case this week. It's a case of mistaken identity and a big energy bill. So EDF says I must pay a gas bill of£4 ,763.34 for a flat in London relating to a period between March 2021 and September 2025. The problem here is this person never lived in London or had an EDF account, but it seemed this person has the same name as me. I disputed the bill, but EDF doesn't seem to want to listen. I'm now being pursued by LCS, Debt Recovery, on behalf of EDF.

29:16I'm terrified. What can I do? Helen, this is a case close to my heart because long-term listeners to the show will remember that during sort of lockdown era, I was pursued by British Gas for a pretty sizable bill, a couple of grand, because basically they had me down as a business. The problem is the business department and the consumer department are totally separate departments and didn't talk to each other. So I was going sort of, it was Kafkaesque nightmare. In the end, they actually wiped the whole bill. But it took me months, hours on the phone and a heck of a lot of stress. It is so stressful, especially when you get a call from a debt company and they're like, do you know what this is about?

30:00And I'm like, I don't know who you are for a debt recovery. Like it's really clandestine. It was horrible. So tell me about this one.

30:07Helen Crane: I completely agree. I think this is actually much more common than people think, and especially people who rent. So I rented for years and it's so easy to end up not quite landed with someone else's bill to put us or almost be accused of it being your bill. I've had debt collectors turn up my door and you're right. They never quite tell you who they're looking for. The onus is always on you to prove that it isn't your debt rather than on them to get the right person in the first place. Which I get their debt collectors. They can't be cuddly little teddy bears. They have to do their job. But in this case, I think it's just outrageous how it was so obvious that this was the wrong person and they just didn't give up.

30:50Helen Crane: So this person has, I would say, a relatively common name. It's completely feasible that there's hundreds of people with this exact name across the country. So she gets a letter to her address. She lives in Northumberland. And this bill from EDF relates to a property in Camden in North London. so that's 300 miles away. She tells me she's only ever been to London four times in her entire life. And when you first get a letter of this, you kind of think, oh, this will be easy to sort out. It's so obvious that this isn't me. Surely there's some kind of record they can look up and, you know, they'll see who the tenants have been on that property.

31:28Helen Crane: And that's because she didn't realise at first that it was the name that was the issue. So she just thought, oh, this isn't me. I'll ring them up and edf kind of said prove it's not you so they asked her to send things like um this is the debt collection company they asked her to send proof that she lived somewhere else at that time which she could do so this was over a four-year period and she'd lived at a few different addresses during that time and she did some proof of summoning addresses but then and rightly i think she thought hang on so one of the places she'd lived was with her parents and she was like i I don't really want to give this debt collection company my mum and dad's address, which I think is completely right.

32:10Helen Crane: And that's one of the things that happens when I've had these letters through my door. You think, well, I could just phone them, but do I want them to have my phone number? If they don't believe that I'm not the person that's responsible for this debt, do I really want to give them an address where my parents live or my own phone number? So I think she's right. But it basically just went on forever and ever. and they just kept accusing this of being her bill. It's sterner and sterner, final notice demands. And in the end, she got in touch with me, but she also did a subject access request, which is where you can see all the data that a company holds on you.

32:49Helen Crane: And eventually we did manage to work out what had gone on here. So essentially debt collectors, they use these sort of third-party databases. So there's various ways they can get information. they look at credit uh school companies so like experian and equifax and your records with them so like credit cards you've taken out uh other borrowing etc they look at the electoral roll to see where you might live they also increasingly will look at like your social media and look at your online presence to to a sort of match you to this debt but also to work out how to find you but they also have these third-party companies that will kind of aggregate all of that data and to have access to this database.

33:26Helen Crane: So you'll look up an address and they'll give you all sort of people that might be linked to it. And essentially, they just made a mistake when looking at this database. You know, LCS got back to me with quite a lengthy statement about how this had happened. Essentially, they said, we'll look up the details and address and we should have done some kind of common sense checks to look at this person's other details and see that she couldn't be the person who'd run up this bill but it was kind of human error so they didn't do these secondary kind of common sense checks and that's how this all ended up happening but I think this reader said to me and I agree with her she was kind of willing to fight her corner and she was quite savvy and you know knew what to do need to ask for the the information to get in touch with me but what if this happened to someone who was sort of more vulnerable or wasn't able to kind of stand up to it in the same way that she did.

34:19Helen Crane: I think it could kind of get really frightening. So in the end, LCS paid her£1 ,000 in compensation and EDF paid her£125, which I think is completely deserved. You know, it's something really scary that happened to her. Also, she's had to go through a huge amount of stress and effort to try and prove that this wasn't her debt. So yeah, I think it's just, these companies need to be better at validating this, essentially, because it's a really scary thing to happen to you. 100%. So the only link was the name. There was no birthday the same? Literally the only link was the same name? Yeah. So I don't know if they would have had her birth date because I guess would your energy company have your birth date?

35:02Helen Crane: I'm not sure. But certainly they had access to things like her email address and her phone number and none of those were the same. So this must, I just did a bit of research while you were talking there, there are apparently about 12 ,000 people with the surname Crane. 40 plus people on LinkedIn called Helen Crane. So this sounds like I'm stalking you. It's weird. I also did Georgina Frost. I didn't have time to do Lambert. I did need to concentrate on what you were saying as well.

35:28Simon Lambert: But this must happen quite a lot. Right then, moving on. Buying or selling a home, let's go there, is stressful and expensive enough without the risk that even when you think the deal is done, it could fall through at the last minute. In fact, according to Zoopla, one in four sales currently collapses, often after months of waiting and thousands spent on surveys, solicitors and removals. But could that become a headache of the past Simon Lambert? Buyers and sellers who pull out late in the process could face a fine under new proposals from Labour. Firstly, just outline, I've mentioned there, one in four sales, it's estimated, currently falls through.

36:05How much money are we talking about? How close to the wire? How frustrating? This touch wood, etc. hasn't happened to me.

36:11Simon Lambert: Well, we can be talking about potentially large sums of money because people will then have to find, they might have committed to buying somewhere else. They might have to find a new buyer. They might have to take money off their property. They might have to take thousands off in order to get a new buyer. They might have sunk hundreds or thousands of pounds into surveys, et cetera, for their new home. There's all kinds of things. And also there's the emotional cost. People can end up not being able to move because of this. and I think there would be broad support certainly from like lots of people that I've spoken to for offers to become more binding you know beyond a certain point it's not like you've made an offer therefore you have to buy the house scenario it's not like buy it now on eBay or something like that but it's more like you've made an offer you've had the offer accepted you've had your cooling down period where you know a little bit of time away from it and you're like I definitely want to buy this house.

37:07Simon Lambert: Nobody's put any, you know, substantial sums into the process yet, but we are about to. And at this point, we are both going to sign something that says we're committed. I'm committed to buying from you. You are committed to selling to me. And I think it would improve the property market and it would reduce the number of sales that fall through. Strangely, though, me and Helen were talking earlier and readers don't actually seem to be that much in favour of this. I think it's potentially due to the fact that it involves the words labour and fine and sounding like labour's just found another way to get some money out of people rather than people actually thinking about the practical elements here and that it may be possible even for the most inept of governments to actually do something good.

37:51Simon Lambert: Look I personally think this makes sense. The problem is they've also wedded it to the revival of what looks a lot like home information packs which were a daft idea that got worse as they were diluted and then sort of came in almost by default in a sort of, oh, God, we've been talking about this for so long, we better just bring them in kind of thing, even if they've got none of the stuff that was meant to be in them to begin with, and then were scrapped.

38:19Helen Crane: Yes, quite. Helen, what do you reckon? Look, I think it's a really common frustration when you're in the middle of trying to sell or buy a house. You know, your buyers being a bit flaky. It's like relationships, isn't it? But, you know, they're not you're not feeling you're getting the kind of commitment that you're after from from your buyer. And, you know, sellers gazumping as well. You know, this, I think, is all early stages, but would apply. You were the seller and you decided to go with someone else who made a higher offer at the last minute. So just to be clear, it sounds like you would this fine, you would pay it to the other parties.

38:51Helen Crane: You pay it to the buyer or the seller. It wouldn't be some people in our comments were suggesting they thought it was like a tax that you pay to labor, which I don't think is the plan. Even for them, that would be a bit much. In principle, it's good. It depends when it comes in, though, because, you know, what if you get an offer accepted? That's the point that they're suggesting this would come into play. What if you get the survey done? It shows up something really awful. Surely there's got to be a clause where you can get out of it because of that. You know, there's going to have to be loads of caveats.

39:20Helen Crane: I think one thing that's interesting, though, that I was doing a comment for a lawyer earlier. that they kind of said, well, will this actually just increase the cost of selling your house through the back door? Because who's going to draw up these sort of contrasts? If it's estate agents, then they're going to charge more for their fees to do it. Do you have to hire a lawyer to do it? Is that something else on top for your sort of conveyance in fees? And these home information packs that Simon talked about as well are presumably going to cost money for someone to put together and it's going to be more admin.

39:48Helen Crane: So is it that everyone wants buying a house to be quicker? Everyone wants to get messed around less. But is it actually just going to make things more expensive? Because one of the things Labour is saying, this will make things cheaper for first time buyers because they'll have more information up front. I mean, I don't really know how that necessarily makes things cheaper, to be honest. The principle is good. But is it actually just going to lead to estate agents and lawyers charging people even more money for things that like perhaps they don't really need would be my concern. Right. A week on from its blockbuster IPO.

40:22No. SpaceX shares remain roughly how much higher than flotation price at the moment, Simon?

40:27Simon Lambert: As it stands, while we are recording this podcast, SpaceX shares closed yesterday about 37 % higher than their$135 IPO price. So they closed yesterday at$185. I'm glad you said that because I'd only got 30, Simon. So, you know, the latest up-to-date news from you. In the case, though, of our Simon, you've cut and run. But why? Especially when you've said that you reckon the price could keep rising. Simon, have you turned trader? You're a dark horse. You didn't tell us that. You didn't tell us you were going to. Well, yeah, I ended up buying some SpaceX shares in the IPO. Dirty secret. My name's Simon Lambert and I bought some SpaceX shares.

41:11Simon Lambert: Yeah, it's like a kind of SpaceX AA meeting type vibe. So basically, towards the end of May, The long-awaited SpaceX IPO was finally declared to be on. Filing was made to the SEC. It didn't put a share price in there, didn't put a price valuation on the business, but it soon became known that SpaceX was looking for a valuation of about$1.75 trillion and to raise$75 billion, which are colossal, bonkers, mind-boggling sums of money. The prospectus that backed this up went into some details on the business itself, which is made up of three bits. Okay, so you've got the rocket launch and space bit, which is absolutely exceptional.

41:54Simon Lambert: What they have achieved there is genuinely beyond what many people thought they could ever do. It is still loss making. There's the Starlink satellite business, which is dominant in its industry. That makes a profit. And then there's XAI, which is X, the artist formerly known as Twitter, combined with the AI business, which is best known for the grok chatbot that undresses people and got it into trouble. And that burns through vast, as well as getting into trouble, that burns through vast amounts of cash. So, you know, you look at it and you go, okay, is this business really worth this much? When I first looked at it, I just thought this is just complete madness.

42:34Simon Lambert: This is a great story, but it's total madness. This is massively overvalued. This is a sign of a stock market bubble that's nearing its peak. Will this be the bell that rings at the top of the market bubble? Who knows? But it's definitely a hallmark of us being near one. As time progressed, as the weeks went on very quickly, actually, in the course of about a week or so, it started to become clear to me that as mad as it sounded, Elon Musk might just be about to pull this one off. And he was very clever about how he did it. Instead of the usual kind of sewing things up for the big institutions, the investment banks, the hedge funds, etc., he made up to 30 % of the shares open to ordinary investors.

43:18Simon Lambert: It caught the imagination. It looked like it was going to be oversubscribed. You were hearing rumors of banks, investment banks and hedge funds piling in. And I thought this is going to do that thing. It's going to get a pop. The IPO is going to pop. It's going to land on the stock market and the shares are going to go up that day. nobody knows by how much but i thought conceivably these shares could go up by 30 and it got me thinking maybe i might take part in this especially when well when it emerged that in the uk we were going to get the rare opportunity to take part in a us ipo because normally you can't do that i thought maybe i might do this but i'm just i'm good literally i'm going to be in i'm going to be out i'm going to try and make quick money and this is not investing just to be 100 clear this is speculating those two things are completely different investing is a long-term game speculating is a short-term game where often you get your fingers burnt and i knew that i was definitely running the risk of losing money in this but i was like i'm gonna put a bit of money in i'm gonna see if i can make some money if i make some money i'm getting out and my in my mind i was like if i could make 500 quid that'll pay for me and my wife for some flights to go away for the weekend i was like if i could do that it's done i'm out the 500 quid and then that's what i'm using them for i must make sure i use them for that here's the plan so i applied for some shares i applied 1500 pounds worth i got 1413 pounds worth so i got 14 shares 135 dollars so i found out last it wasn't entirely clear whether you'd got the shares or not until last Friday morning I think and then I found them out and then obviously the market opened you didn't get a price through for a good few hours I spent way more time looking at my stocks and shares ISA investing app on way more occasions than I should have done on Friday afternoon you shouldn't be doing this you shouldn't be looking every five minutes it popped it went up at one point I was up just over 400 quid and it was down a little bit it was down a little bit and I was under 400 quid I hadn't hit my 500 quid target and it got to the end of the day and it closed and I think I closed ended the day up 390 something pounds and I thought over the weekend why didn't you just sell the shares to take the profit like not all the shares but just take out you know sell three shares to take out the profit and then you've just got the money you invested and you've taken the profit out so I thought I should do that on Monday and then Monday happened stock market opens space says shares go up and I'm like you start to watch it go up you know maybe I'll just wait a bit longer and i was like no no no no no no stick to the plan so so they've gone up to the point where i sold three shares and that got me just over four got me just over 400 pounds and then it went up a bit more and i sold one more share when i got off the train that evening see i was looking at this share price way more than i could have done i did it on the platform at the station um using my investment app and i'd made my i'd hit my target i've got a 515 pound profit and i was like right okay but then it was like oh what about the rest of the shares and i thought about this and i thought i should just i should just get out of them and i thought you're that you're at the risk of turning a short-term speculation into a long-term investment here you're at risk of getting emotionally involved with this and it suddenly becomes an investment not the quick in and out job so on tuesday market opened share price jumps again at one point it nearly hit 220 and I was like, do I, don't I?

46:52Simon Lambert: And at which point I thought to myself, do it, hit the button, pull the trigger, get out. So I hit the button, I sold the rest of the shares, I cashed them all in. At the end of the day, I made a£640 profit and I now no longer have a SpaceX shareholding. And do you know what? I don't need to be looking at that share price all the time. I don't want to be a long-term SpaceX shareholder. I think it could still go up. I certainly think that the price could still go up. It's come off the boil a bit since then, but there's still plenty of buying pressure from individual investors. The index funds are going to have to start buying in as it's being fast-tracked into indexes.

47:32So you'll probably hold some of it anyway.

47:33Simon Lambert: Yeah, I'd probably hold some of it anyway. I'm a Scottish mortgage shareholder, so I actually already do have a holding in it through that investment trust. And at the end of the day, spacex isn't my kind of investment i'm not saying it's a bad investment i'm not saying saying others shouldn't invest in it it's not my kind of investment you know at the point where it overtook amazon to become the world's fourth biggest you know listed company or whatever i was just like this is this is mad and i was just like job done i'm getting out mission accomplished maybe it will manage to do asteroid mining maybe it will manage to colonize mars and maybe i will just take the money and have a nice weekend away.

48:11Simon Lambert: Very good, Simon. Right, Simon, start of the week, please. £58.6 billion. That is the value of£20 notes circulating, according to the Bank of England. But there are also£18 billion worth of£50 notes in circulation, which is surprising, really because cash machines don't genuinely issue them they're notoriously difficult to spend and you don't really see that many of them so lee had a story this week some bank of england figures of a paradox that was described by the bank of england that shows there is more cash in circulation in the economy despite the fact that we're using less of it right uh that is it yes you can keep up to date with all the latest breaking money news just go to thisismoney.co.uk download the app if you have any comments or questions for the team or anything you'd like to look into simon uh you can email us at podcast at thisismoney.co.uk you can also come to thisismoney.co.uk for the podcast to join in the debate reader comments if you like our podcast why not rate us wherever you found us perhaps other people find us too