Simple Pound

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How many old mobile phones have you hidden in the bottom drawer of your desk, top shelf of your wardrobe or in an old box under the bed? Honestly? I found two - and I wasn’t even looking properly. Chances are you’ll find at least one old phone knocking around somewhere, especially if are (or have been) on a phone contract that promises you a new handset every 18 months.

Have you ever thought what to do with the old one? At some point the option of “I can give it to my sister/Mum/Dad/brother-in-law (delete as appropriate)” doesn’t really work anymore and the old handset will soon be forgotten. Why not get some free cash for recycling your phone instead?

The website envirofone.com will help you with exactly that. Head over there now to see what your old phone could still be worth! It’s simple, fast and absolutely no hassle at all. When you register with them, you will automatically receive a “trade pack” consisting of a delivery card and a jiffy bag for you to send your phone in. Once you agree to trade your phone for either cash or an Argos voucher (whose value will be slightly higher than the cash value you’d receive otherwise), all there is left for you to do is to put your (old!) phone into the envelope and drop it in the nearest letter box.

The envirofone website has a “My Account” section that lets you monitor the status of your trades. Once the trade is agreed, it will show up under the “View Trades” tab where the status will say “Awaiting Receipt”. You agree to send the phone within a time frame of 10 days at most and once you have done so the trade status will soon change to “Received” indicating that the envirofone team has received your phone and is currently testing whether it is in full working order.

The quote you got when the trade was initially submitted assumes the phone is functioning properly, but you’re still encouraged to send your phone even if it is not as you might receive up to 90% of the originally quoted value. If a fault is detected by the envirofone people, you will be contacted with a new (lower) quote which you can choose to accept or refuse. If you refuse to trade for the specified amount, the phone will be returned to you. If you decide to accept the lower offer (what else are you going to do with a faulty phone??), you will receive your cheque or Argos voucher in the post within 7 days.

My old phone has been received as of this morning, so I’m waiting for my voucher as we speak. I’ll keep you posted on how long it actually takes, but their overall process seems pretty streamlined and I expect only the best So if you possess one of the 80 million mobile phones that have been forgotten about in the UK, then I think it’s time for you to act…

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A year ago I wrote about Zopa, a (then) new loan concept that wanted to bring people together in order to facilitate a lending and borrowing market that wouldn’t require banks. The concept is remarkably easy - on the one hand we have people with spare cash looking for a good and (reasonably) safe return while at the same time we have people out there who are looking for some spare cash (i.e. a loan). Why not make these people talk directly, instead of forcing the former group to deposit their savings into a bank account with a mediocre interest rate and subject the latter to bank’s exorbitant fees (exceptions apply)?

After I had been watching the Zopa site grow for quite some time, I decided that it was time to join the fun and have a go at it myself. With the house purchase one of my major short-term goals at the minute, I didn’t want to tie up a lot of capital for a long time, hence the amounts I’m allowing myself to use at Zopa are fairly small (£ 25 in total at the minute, increasing by about £ 10 a month). Nevertheless I figured I had seen enough to share my experience with the site so far…

Signing up: Ideally this should have been a fairly easy process, especially since I was intending to become a lender, not borrower. However, due to money laundering regulations Zopa is still required to verify your identity and address. Since we’ve moved to our current flat only a few months ago, this identity check could not be carried out online and I had to submit the usual proof of identity and address documentation. This is nothing unique to Zopa and I’ve encountered the same issue several times before with banks, credit card and loan companies. In the end it took only 2 days for them to process my documents and I could sign up successfully! Overall impression: good.

Customer Service: Apart from the registering process I’ve had several other encounters with the Customer Service department relating simple queries as well as a functionality problem at one point. The usual way of contacting them is by sending an email and the response time is always within the promised 1 - 2 business days. All requests were dealt with swiftly and the team is very helpful and always friendly. Overall impression: excellent.

Transferring money: There are three major ways you can transfer money into your Zopa account: Debit card by phone (for instant transferral) or online (for transferral within the same business day), standing order (similar to the way you’d set up the standing order for a savings account) or by bank transfer (longest of all methods as it takes about 3 days to reach your account). With either option you will receive a confirmation email when your funds reach the account and are ready to be used. To transfer money out, you will need to have your bank account confirmed with Zopa. To do that, you simply need to transfer £1 by bank transfer once for them to be able to verify the account belongs to you. At this stage, you cannot transfer the money in your Zopa account to anybody else but yourself. Overall impression: very good.

Lending in Zopa Markets: With Zopa you have two major lending options - Markets
or Listings. If you allocate your money to the Markets section, most of the work matching your lending offer with a borrower request will be done behind the scenes for you. You merely see your money moving between the stages of being offered (currently available), processing (matched to a borrower, loan verification in progress), lent out and late payments (hopefully very few in the latter category). To determine your rate of return you can either give Zopa your desired rate of return and the longest amount of time you’re willing to tie up your capital or you can fine tune your offer by indicating an exact rate of return per market segment. These segments are determined by the borrowers credit rating and the duration of the loan and range from A* for 12 months to C for 60 months. Zopa is helping you to offer realistic rates by quoting you a range of rates that other lenders are offering.

My experience with the Markets section is thoroughly positive. I’ve got all my lending offers at the higher end of the market range and yet I find that my available money is usually processing within a time span of about 2 days. I’ve only had one slight hiccup so far that was explained to me and hence resolved by the Customer Service team within 2 days (my Zopa account contained a little less than the shown £ 10 due to the Zopa fees being earmarked but not deducted every month). Overall impression: good

Lending on Zopa Listings: Zopa Listings are essentially an eBay-like reverse auction system where borrowers advertise their borrowing needs together with an explanation of their finances and lenders can quote how much they’d be willing to lend to this one borrower and at which rate. All quotes get aggregated throughout the duration of the listing. When the borrower’s desired loan amount has been reached (i.e. funding is at 100%), lenders can continue to quote and hence will start outbidding each other with lower rates. Eventually only the minimum number of lenders with the lowest rates will be kept in the listing and hence will be able to lend their money to the borrower. The advantage of the Listings is that you might be able to get a higher rate than you’ve quoted in the Markets section by bidding at the last minute - similarly to how you can get a bargain at eBay through sniping (or old-fashioned pressing of refresh and bidding on the last second).

I’ve only (actively) participated in one Listing so far which ended at 4.20am in the morning. I waited to submit my quote until half past midnight and went to bed hoping lots of people would have already done the same. By the time I submitted my quote, I was about 50 offers (out of 130) away from being excluded so I felt pretty safe and happy as I had a good impression of the borrower. Unfortunately I was out-bid just 15 minutes before the end of the Listing… In any case, the entire process was certainly exciting and I’m intending to look out for other Listings as soon as I fund my Zopa account with more money (waiting for the paycheck, anyone?). Overall impression: excellent

Total verdict: For me, Zopa turned out to be everything I expected and wanted it to be. Obviously I can’t really comment on the bad loan rate at this stage, but then I don’t think it is a major part of evaluating Zopa itself. Every lender can adjust the risk he or she is willing to take by only offering money in certain (high-quality) markets or reducing the term of the loan they’re happy to accept. I believe that people might be less likely to default on their loans when they know that they owe their money to individual people, not big face-less institutions - if you had the choice, whom would you pay back first? Your neighbour or the bank? I might be wrong, but this is what I would like to believe and Zopa’s low bad-loan quota might prove just that.

If you’re intrigued by the concept and would like to explore alternative ways of making money / earning a return on investments, I urge you to give this a go. Sign up here to get £30 when you start lending (minimum amount applies) and become part of the Zopa Community. Trust me, it’s fun!

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I’m running rather late with my end of the month review for April and I’m pretty sure I know why - the stats for this month have been rather disappointing. I’m nowhere near the targeted 0.5% asset increase this time as yet another major purchase has led to an asset decline of 1.30% which in turn reduces my net worth figure by 0.83%.

However, the “major purchase” is now sitting in my study in the form of a digital piano - the Yamaha P140S and I’m still convinced that (a) it was worth it and (b) I got a good price for it as it was reduced by more than £100 from its RRP and hence cheaper than any other quote I could find (including Internet shops…). I will probably have to use some of my savings in order to pay off the credit card I used for the purchase, but I’m hoping to reduce that to a minimum and instead fund it out of my regular salary by simply cutting back on other excess.

A few other things contributed to my negative net worth result this month: most notably a trip “up North” to Harrogate for my friend’s wedding which set me back about £300 in total (2 return tickets plus hotel). It was obviously more than worth it and I wouldn’t have wanted to miss it regardless of the expenses attached.

The only good thing to report is that my miscellaneous income is still rising, mainly due to a steady increase in interest income. My expectation for this year has been raised from £250 in January to about £600. Barclays have finally managed to open my cash ISA for this tax year. Luckily it’s only taken them about a month (*sarcasm*). But when I enquired about the progress of my application I was told (without having to ask) that interest would be credited to my account from the day the application was made - despite the cheque only being cashed 4 weeks later! This effectively means that I will have earned double interest on the initial amount I deposited…

That’s all from me for this month. I’m hoping to have a much better net worth result for May, even though I’m not 100% confident I’ll be able to achieve this as I won’t have much opportunity to increase my savings as a result of having to put all my income towards April’s purchases… Keep your fingers crossed!

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