Half regret financial purchases

MORE than half of Britain's consumers regret buying a particular financial product or service, according to new research.

Worringly, poor advice was one of the top reasons given by people to explain why they made mistakes when taking out financial products such as mortgages, pensions and investments.

But the figure is a savage indictment of the financial services industry as a whole, which has been dogged by a series of mis-selling scandals over the past few years.

Those aged between 35 and 44 years were the most dissatisfied with their financial decisions, with 44% saying they were misled by providers or advisers or blaming poor advice for making a mistake.

Paul Davies of market research analysts Mintel, which carried out the research, believes the widespread dissatisfaction revealed is due in part to the number of people who have been victims of pensions and endowment mis-selling.

'In many ways such a high response rate is perhaps not too surprising, given the spate of high-profile mis-selling scandals that have dogged the financial services industry in recent years.

'These have all severely tarnished the industry‘s image and left millions of customers dissatisfied with the perfomance of their products,' he said.

Despite many people admitting to having regrets about products or services bought at some point in the past, more than 70% were confident they now held the right products for their needs.

But it‘s not all good news. Around 9% of people said they thought they held the wrong products or services for their needs, while nearly 20% did not know whether or not they were suitable.

And, as Davies points out, about 13m consumers in the UK either don't know whether their financial requirements are being met or are unsure that they are adequate.

This will alarm politicians, who are anxious to ensure that people make enough provision for their old age.

But the high number of people who don't know whether their savings are going to be enough is a reflection of how difficult it is to understand products.

Mintel found that nearly three-quarters of people said they did not know how complex financial products such as pensions and investments worked. Worryingly, 75% said they had gained any knowledge they had of financial matters through trial and error.

The report highlights the need for a greater level of financial education in the UK. This is backed up by consumers, with 94% of people supporting children being taught basic financial skills at school. Top of the academic list would be lessons on how to avoid debt, followed by managing household accounts and the best ways of saving.