Three ‘zombie’ financial products to beware of

WITH Halloween approaching, you might want to watch out for any ‘zombie’ financial products you may have lurking, which could be giving you low returns for your cash or are charging you high fees.

Danny Cox, a chartered financial planner at Hargreaves Lansdown, says: “It’s a timely reminder of how important it is to keep an eye on products you held for some time. What once seemed like a perfectly healthy choice might have turned nasty while your back was turned.”

Here are Danny’s tips for the types of products to watch out for:

Child trust funds – These accounts specifically for children were succeeded by Junior ISAs, launched in 2011. In some cases, child trust funds have lower interest rates, are more expensive and have less choice than Junior ISA options.

Old personal pensions – Older pensions (particularly pre2000) can charge more for less, compared with modern versions. You do still need to check whether you are entitled to benefits that were offered within some of these older pensions – such as guaranteed annuity rates.

Instant access cash accounts – Around 80% of people haven’t moved their instant access cash account for three years, leaving their hard-earned savings to lose value once inflation is taken into account. For those unlikely to rate-hop for the best buys, fixedrate accounts can offer improved rates, and the stock market could be considered for some of your longer-term cash.