Many consumers will be surprised to learn the results of recent survey published today. Although I’m sure the vast majority of financial planners in the UK will not be surprised by these findings. 

It shows that UK Banks and Building Societies are providing “shockingly poor advice” to customers regarding cash ISAs. The findings follow an undercover investigation by Which?Money, the consumer rights organisation.

Which?Money found a massive 97% of Bank & Building Society advisers failed to answer four simple questions about ISA transfer rules correctly. Of the 104 calls made to 13 different providers, Which?Money reported that only 3 calls resulted in the correct answers.

They go on to name and shame the four worst organisations. Calls to HSBC resulted in the lowest proportion of correct answers – 32%. Next was Royal Bank of Scotland with just 35% of correct answers. There was nothing between The Co-operative Bank and First Direct who both only provided correct answers only 38% of the time.

This evidence that the banking sector is not providing a decent service. Advisers should be knowledgeable and give accurate advice and information. This was not demonstrated in the Which?Money survey.

When we couple this with the fact that we are in a high inflation, low interest rate environment alarm bells start ringing. The return on cash deposits are low.  The purchasing power of cash deposits is being eroded by inflation. In fact inflation of 5% pa will reduce the purchasing power of cash deposits by one half in less than 14 years. 

Are banks and building societies serving their customers or serving themselves?

Speak to an independent financial adviser to get an unbiased view. At Proposito Financial Planning we sit on the same side of the table as our clients. We protect them from poor advice, mis-information and clever  advertising. We help them to develop a healthy cynicism and to question everything. We educate them and encourage them to develop an understanding their financial situation and beyond. We provide them with the discipline that helps them make smart decisions about their money. To have a chat with Proposito about the impact that long term cash holdings might have on your financial future please do give us a call. 

You can read the full Which?Money report HERE.