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The number one product sold by the retail banks is fear. And fear cripples investors.

The big financial institutions may market a plethora of products but they are amateurs at this. Their genius is selling fear: the fear of loss, poverty, value, underperformance or ruin. And they have conditioned the majority of investors to fear finance and therefore adopt investment strategies that benefit only the banks. We meet with investors across the UK and many of them have significant amounts of cash in ISAs or bank accounts which are paying interest rates that are well below the rate of inflation – losing value in real terms.

Here are three examples from recent meetings:

• A 47 year old widow with over £250k in a deposit account receiving less than £50 per month in interest

• A married couple with £100k in a cash ISA earning £1,200 per annum in interest

• An elderly lady with assets of more than £700k and income of only her state pension

The relevant interest rates for the first two clients were 0.22% and 1.2% per annum. The bank will be making a net 5% on the money they are holding on deposit and so in these cases they are receiving between 400% and 2272% more than the people whose money it actually is.

The only reason that people like these clients don´t move their money is fear. On nearly every occasion that a client goes into their bank to make a transfer to another financial services provider the banks will do their very best to terrify the account holder into inactivity. Recently this has included telling a client that she wasn´t allowed to move her money to another FCA approved scheme (not theirs) because she wasn´t a sophisticated investor. And conveniently ignoring the fact that she qualified for the investment through two other criteria.

Increasingly we see ourselves as being one of the few places that you can go to be told all the facts about investments. In most case “cautious” or “balanced” investors only need to fully understand the answers to these questions:

1. How much do I need to invest?
2. What yield will I receive?
3. What is the earliest I can access my money?
4. What is the longest I may have to wait for my money?
5. Can I lose my capital?
6. Can I lose my interest?

If an investor is comfortable with the answers they receive to these six questions then they should proceed with the investment regardless of the fear mongering of their bankers.

Because if the answers to those six questions are in line with client requirement then, as Franklin D Roosevelt famously said, “We have nothing to fear but fear itself”.

And 2272% or more to gain.

If you´d like to meet with one of our investment gurus and talk about anything financial then get in touch. We´re committed to building long term relationships and helping our clients achieve short term successes