Show me the money

Britons not researching their investments because it’s ‘time consuming’ and ‘complicated’

A new survey conducted by the Financial Services Compensation Scheme (FSCS) and the Financial Conduct Authority (FCA) reveals that 44% of UK adults who hold investments of between £100 and £50,000 wish they had spent more time researching their investment before making a decision[1]. However, this task is commonly neglected due to its perceived complexity – it ranked much lower than other tasks like choosing a holiday, buying a house and checking social media.

The findings also highlighted the risk of investing in ‘opportunities’ with limited time frames. Scammers often use this tactic as a way to pressure victims into an ill-advised decision, so consumers should assess all investment opportunities carefully by visiting the FCA Warning List to check if the investment firm is unauthorised.

Another alarming discovery was that 22% of respondents said they hadn’t checked or didn’t know if their investment was protected by Financial Services Compensation Scheme (FSCS). This means that investors could be making investments without any chance of compensation if something were to happen to their provider.

Additional findings from the study include:

• 11% of Britons who have made a financial investment said they do it because their friends are investing, with 26% finding it ‘fun’
• 14% chose investments because they were promoted by a celebrity or influencer on social media
• Those aged 18-24 who have made a financial investment were more likely to invest while watching TV/Netflix (13%), at the pub (11%) or coming back from a night out (7%) compared to those over 25

The FSCS cannot provide protection against being scammed. Investors need to take time in doing research and be vigilant when it comes to fraudsters, as they will always find new ways to target people.

Perform relevant checks before investing

• Familiarise yourself with the warning signs of a scam. These include, but are not limited to, unexpected or unsolicited contact, pressure to make a decision within a set time window and unrealistic returns
• Check the FCA Warning List to determine if the firm you’re dealing with is authorised by the FCA
• Verify the person you’re dealing with is who they say they are through the FCA Register
• Confirm that your investment is eligible for FSCS protection using the new Investment Protection Checker

Want to make the most of your money, and not get scammed?

Ultimately, the best way to make the most of your money is to seek professional financial advice from an FCA Registered adviser. We’ll build a personalised investment plan for you. You’ll stay firmly in control of your investments, with support and guidance from our highly experienced investment experts.

Source data:

[1] FSCS and the FCA commissioned research from OnePoll to gain insight into attitudes towards investments and what people are looking for. Between 10–23 December 2021, OnePoll surveyed 2,000 UK adults, 740 of whom had at least one investment. The findings highlighted in the release are based upon this research.