Jargon kills consumer confidence as investment industry shoots itself in the foot

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According to the latest research from consumer investment site BoringMoney.co.uk, only 14% of consumers feel confident in opening an investment account (scoring themselves a 9 or 10 out of 10 for confidence).

This figure compares to 41% who feel very confident in opening a savings account, and 52% who feel very confident in choosing a mobile phone provider.

Surprisingly, confidence is not much higher amongst people who already invest.

  • Just 22% of investors feel confident about opening an investment account.
  • When it came to fees, only 34% of consumers who hold stocks & shares ISAs, investment accounts and/or share trading accounts felt very confident they know what charges they are paying.
  • A worrying 22% of investors scored themselves 0-5 out of 10 when it came to confidence their investments are the right ones for them.
  • 10% of assets on all DIY investment platforms and robos are in cash compared to 7% this time last year – suggesting a lack of confidence in the market.

Holly Mackay, CEO of Boring Money commented: “When it comes to investing, confidence remains rock bottom, driven by short-term nerves about market uncertainty but also longer-term issues created by a lack of understanding. The industry’s failure to provide clarity on both what the objectives and characteristics of investments are, and what the costs involved are, means it is shooting itself in the foot.”

Boring Money asked consumers what change would make them most likely to consider investing. Against a range of options including guaranteed returns, the single biggest response was to get rid of jargon.

Mackay continues, “Our whole business is about helping consumers to make confident choices. That’s why we continually update our Boring Money Best Buys tables, where we combine our own experience of provider offerings with thousands of customer reviews and deliver it up in plain English. By blending our knowledge of the market with the votes of real-life users of these services, we can offer investors a truly independent, easy-to-follow guide to who is best for their needs.”

Boring Money’s Best Buys are calculated on a range of criteria including (in decreasing weight): cost of services; Boring Money reader reviews; Boring Money’s internal UX testing team; ‘future stability’, based on a provider’s size and longevity in the market; call centre opening times and speed of answering.