Around 90 bank and building society variable rate savings accounts now pay at least 5.75 per cent interest.

That’s the same as the Bank of England’s base lending rate, so it might sound like a cause for celebration.

However, with around 900 accounts on the market, that’s only 10 per cent matching or beating base – and a depressing 800-plus lagging behind.

And many of the leading 90 aren’t as generous as they might seem.

Rachel Thrussell, head of savings at search engine Moneyfacts.co.uk, points out: “The rate is only part of the picture when it comes to a competitive savings account. Too many of the high paying accounts come with restrictions and conditions.”

According to Moneyfacts, more than three-quarters of the accounts paying base rate or above apply restrictions, conditions or introductory bonuses.

Many are open to old or new members or customers only, or the interest rate falls dramatically when the short-term bonus expires.

Others allow a limited number of free withdrawals, charge an interest penalty or limit the amount you can take.

Others still have age restrictions or insist the money is used for a specific purpose.

In other words, the vast majority are not worth having.

Interest-only mortgages could turn out be a ticking timebomb for many people.

So says financial comparison site Moneynet.co.uk, and I’d have to agree.

They make up almost a third of all new mortgages and, with interest rates and house prices continuing to climb, it’s hard not to conclude that many people are choosing them because they are – initially at least – considerably cheaper than repayment loans.

This is very worrying.

Not only are interest-only mortgages actually much more expensive in the long run, there is also the far from insignificant issue of the repayment vehicle.

Most lenders no longer insist on seeing proof that borrowers have organised an investment to repay the capital debt before granting an interest-only loan.

Because of this, it’s highly likely many won’t bother to set one up.

After all, if they had the spare cash to pay into an investment plan as well as a mortgage every month, why would they want this kind of home loan?

Anyone with an ounce of sense would just put the money straight into a repayment mortgage.

Repayment loans are much cheaper over the long term, and there’s no need to worry about investment returns and whether there will be enough cash at the end to clear the debt.

Interest-only loans are costly and risky, and should definitely be stamped ‘handle with care’.

The average first-time buyer is spending almost 20 per cent of their income on mortgage interest.

That’s the highest percentage for 16 years, according to the Council of Mortgage Lenders.

And, yes, I said mortgage interest.

The CML’s figures don’t include the capital component of the loan.

The typical first-timer is now borrowing a record 3.37 times their annual salary.

This time last year, they were spending 16.5 per cent of their income on mortgage interest. Now it’s over 19 per cent.

Obviously, since these are averages, many will be paying less than this.

But by the same token, many will be shelling out far more – and that is truly worrying.

Get into difficulties keeping up with the payments, as more and more people are, and you may be surprised just how little state help you’ll get.

If you bank with one of the ‘big four’, it’s high time you switched.

Barclays, HSBC, Lloyds TSB and NatWest may be the current account providers of choice for the majority of us, but their customer service is rotten and their interest rates are even worse.

In a survey by Which?, the big four each scored just two out of five for customer satisfaction and all have current accounts which pay a pathetic 0.1 per cent credit interest.

There’s no need to put up with this.

Among the accounts awarded ‘best buy’ status by Which?, Alliance & Leicester’s Premier Direct pays 6.5 per cent and got three stars for satisfaction, while the Halifax/Bank of Scotland High Interest Account paying 6.17 per cent got a similar satisfaction rating.

Nationwide’s FlexAccount, meanwhile, pays 4.24 per cent and achieved a four-star rating.

Switching banks isn’t difficult either – more than seven out of ten Which? members who’ve already voted with their feet say it was easy.

It’s not just the young who seem to lack a sense of financial responsibility (see previous post).

The UK’s OAPs owe £57 billion – yes, £57 billion – on mortgages and credit cards.

Research from Scottish Widows reveals that around one in five retired homeowners are still paying a mortgage.

They have an average debt of £38,000, with one in eight owing more than £50,000.

And almost one in three have had an outstanding balance on their credit cards for the past three months. Here, the average debt is £5,900.

Lord knows how some of them are managing the repayments.

With a full basic state pension of just £87.30 a week for a single person and £139.60 for a couple, it hardly bears thinking about.

I know it’s easier said than done, but if you want to avoid this kind of misery in retirement, there are just two steps you need to take:

1) Pay off your debts as fast as you can. Then…

2) Start saving as much as you can for retirement.

It’s that simple.

What is it about the drive to get on the property ladder that stops people thinking sensibly?

Interest rates are soaring and the stock market is crashing around our ears, signalling the possibility of an economic downturn, yet a third of under 35s say they would happily take out the largest mortgage they could get their hands on.

According to insurer LV= (formerly the far more sensibly named Liverpool Victoria), 15 per cent of this age group would be prepared to borrow more than four times their annual salary.

This craziness has taken strongest hold in London and the South-East, where 7 per cent say they would borrow six or more times their salary.

Nigel Snell, LV=’s communications director, says: “What concerns us is just how many younger buyers are prepared to stretch themselves well beyond traditional lending limits.”

Quite.

Borrowing at this level leaves you so much more vulnerable to all manner of disasters.

There’s falling property prices, rising interest rates, job loss, ill health or serious accident… Need I go on?

Contrary to popular opinion, the state pension is not a universal right.

To qualify, you need to have paid National Insurance contributions for a set number of years.

That’s why whenever I write about pensions, I advise readers to get a forecast of their state entitlement from the Pension Service.

This will tell them if they need to fill in any contribution gaps – and show just how little the state will be paying them.

The Government is keen to focus people’s minds on sorting out workplace or personal provision to keep them above the breadline, and the shock of reading a forecast tends to do just that.

So I was surprised to learn from an IFA contact this week that the Pension Service has stopped providing forecasts.

Apparently, it’s down to a computer systems update and its forecasting service won’t be operational again until autumn 2008 – yes, that’s 2008.

Thanks guys!

In the meantime, if you want to find out more about your state pension entitlement, you could always try ringing their helpline on 0845 300 0168.

More than 125,000 people are three months or more behind with their mortgage payments.

And, as recent interest rate rises start to hit home, many more are likely to find themselves in this situation.

The majority are three to six months behind, but some haven’t made a payment for a year or more, and lenders are taking an increasingly hard line, according to the Council of Mortgage Lenders.

They repossessed around 14,000 properties in the first six months of the year – nearly a fifth more than in the first half of 2006.

These people haven’t just lost their homes – their credit score and chances of future financial stability have been wrecked, as the lenders pursue them for their outstanding cash.

So if you get into difficulties, don’t ever assume repossession is an easy way out.

It’s far better to negotiate with your lender – well before things get to that stage.

Several mortgage lenders have announced they are cutting or scrapping their exit fees for new borrowers.

But this isn’t necessarily a cause for celebration.

Until recently, all lenders applied an exit fee when borrowers cleared their loan.

A decade ago, £50 was typical, but they can now be as much as £295, and this is mostly profit.

The Financial Services Authority told lenders to justify these increases, leading several – including Halifax/Bank of Scotland, Royal Bank of Scotland Group, C&G, Standard Life and Northern Rock – to ditch the fees.

Portman, West Bromwich and Coventry merely reduced theirs.

But don’t assume lenders are giving up on this chunk of profit.

Abbey, Bristol & West and Giraffe have simply renamed these fees – and others will surely follow their lead.

New titles include administration, account, core term and lending fees.

Meanwhile, other lenders are boosting their set up, arrangement or reservation fees, sometimes by several hundred pounds, to make up the lost income.

So, unless you want a nasty shock, check all the fees involved before you sign up for a new home loan.

First the good news: bank customers reclaimed £1 billion worth of excessive penalty charges in the first half of this year.

Now the bad news: if you’re thinking of following their example, prepare for a wait.

The Financial Services Authority says banks can hold off on making any further refund decisions until a test case on these charges ordered by the Office of Fair Trading is decided – and that won’t be before next year.

Even more good news: there’s a very strong chance this case will go against the banks, so it should be worth the wait.

In the meantime, there’s no harm getting your claim in so it’s dealt with as soon as a decision is made.

For help with wording it, visit websites set up by the Consumer Action Group or Which?

And once you’ve done that, how about resolving to stay in the black so you don’t incur any more charges?