Three ‘zom­bie’ fi­nan­cial prod­ucts to be­ware of

Western Mail - - PERSONAL FINANCE -

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.

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