The true cost of an investment company's 'free gift' offer

There is no shortage of investment companies willing to look after your money and they offer free gives as an insentive to choose them. Here's why we're not a fan of that...

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Capital at risk

There is no shortage of investment companies willing to look after your money and reviewing all financial affairs is always good sense.

However what is worrying is the growing use of incentives by these companies to get you to choose them and transfer your money for them to look after. We have seen everything from cash-back offers, a heap of air miles and even cases of wine!

Everyone loves something for free but when it comes to money and investments, we believe that these offers are really irresponsible. The decisions you make with your money have long-reaching effect and the wrong decision today could lead to problems in the future.

Here are a few of things to think about when you’re looking to switch your investment company.

What’s the true cost of that ‘free’ gift?

The phrase “there is no such thing as a free lunch” is absolutely spot on here. Any gift you receive is paid from the fees you will pay.

Not only that, but it could end up costing you a lot more if the new providers fees are higher than what you’re currently paying – is that case of wine really worth thousands of pounds in fees over the life of your investment?

Is it the right thing for your financial goals?

Whilst cost is a really important point when considering these offers, it is absolutely essential that you consider whether it is the right thing to do for your personal situation. You could easily end up transferring your money into a product that’s not suitable for you.

Most of these firms make their money by investing yours, but they won’t tell you whether transferring your hard-earned money is the right thing to do for your financial circumstances. The risk involved in this decision still lies with the customer.

It’s not always easy to say if transferring is the right thing for your investments in the long run, but it is definitely easier to say that making those decisions based on the free gifts on offer isn’t sensible.

Unfortunately, there are too many examples in financial services where poor decisions, often as a result of unscrupulous investments promoting false hope, have led people to lose money or even their life savings. Not only can they ruin your finances but by their nature, these circumstances are incredibly emotional.

We offer free transfer reviews, which means we will tell you whether or not it’s in your best interest to transfer your investments to us. And if it isn’t, we’ll tell you honestly.

Financial advice doesn’t have to be expensive and having someone else look over your situation could give you piece of mind when it comes to your money. No gimmicks. No bribes. Just financial advice.

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Capital at risk

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