Of 180 advisers in Which? survey only 28 gave full correct answers on Isa transfers, with HSBC and Yorkshire doing worst
How do you transfer your old cash Isa to a new provider? According to one RBS employee, the answer is: “Just withdraw all your funds, close the account down and transfer it to somebody else.” If you were to take these steps your savings would lose their tax-free status, which could leave you substantially out of pocket. Instead, your new provider should manage the transfer for you.
The RBS employee’s inaccurate advice is just one example of the misinformation being bandied around by banks and building societies about Isas, according to research from Which? to be published on 22 March. Its researchers called 180 advisers at 15 different providers to test their knowledge of the cash Isa transfer rules; only 16 gave fully correct answers to all of its questions.
Some of the biggest clangers came when the advisers were asked how much you can put into a cash Isa each year. The limit is currently £5,640, which will rise to £5,760 on 6 April 2013. “There’s no limit,” said one Yorkshire bank employee, while an HSBC member of staff said: “We cannot provide that information.”
“Without reliable advice, customers could be put off from moving their money or, worse still, lose out as a result of misleading information,” said Which? executive director Richard Lloyd.
“We want to see better training for frontline staff as part of the big change that’s needed in banking, so that banks put customers first.”
Of the 15 providers Which? tested, each was given a percentage score based on how many of their advisers answered all the questions correctly. The consumer body made 12 calls to each provider.
National Savings & Investments’ advisers gave the most correct answers, with an overall score of 72%. Santander and the Cooperative were not far behind.
At the bottom of the table were HSBC, scoring just 33% for accurate advice, Yorkshire bank, scoring 35%, and RBS with 44%. Even customer-friendly First Direct did poorly, scoring only 49%.
So where did they go wrong?
Only 28 of the 180 advisers gave a full, correct explanation of the rules on how much you can transfer. You can hold only one “active” cash Isa account each tax year, but you can move as much money as you want from Isa subscriptions from previous years.
Several advisers, including the one from RBS – but also advisers from Lloyds TSB, Natwest and Yorkshire bank – wrongly suggested that the Which? callers should withdraw money from their cash Isa to transfer it.
In more than a third of calls, advisers were not aware that you could transfer from a cash Isa to a stocks and shares Isa. However, this has been possible since 2008.
Responding to the findings, RBS said it had just completed staff retraining and communications to make sure its staff have “the most up-to date information”. HSBC/First Direct said its performance was “not acceptable” and that it was now improving staff training. Yorkshire bank said it would take action “should any gaps in training be identified”.
For those savers who do have money to transfer from previous Isa subscriptions, the options of where to move your money have shrunk dramatically this year. According to moneyfacts.co.uk, just three of the top 10 variable cash Isas accept transfers in, compared with five this time last year and nine in February 2011.
“Savers with the largest pots are being turned away, leaving them with the same provider as last year, in an account that could be paying peanuts because the bonus has expired, or with a new account that is not a best buy,” said Sylvia Waycot, editor at moneyfacts.co.uk.
The top accounts that accept transfers in are currently from the Cheshire building society and Santander, both paying 2.5%. In both cases the rate includes a 2% bonus that expires next year.
The next best rate is from the Harpenden building society at 2.25%.
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Reporters fail to distinguish themselves by skipping guns and focusing on the fiscal cliff – but president fares little better
One of the first rules of being a journalist (we’ve just now looked them up) is: you don’t have to ask the questions the person talking wants to answer. You can ask anything. And the White House press corps proved it on Wednesday.
After announcing a new panel on gun control to be headed by vice-president Joe Biden, the president, weariness writ on his face, the pain of Newtown still heavy in his voice, offered to take questions.
The first question was about … the fiscal cliff. So was the second one. So was the third one.
The press exercised its freedom. It was not an impressive display.
Given an opportunity to speak for a nation aching to hear that something real is being done about guns, the White House corps reverted to its Beltway worst, bypassing a needed conversation to stroke a personal fixation.
Perhaps worse, the president took them up on it, delivering long-winded, rambling, repetitive answers that were alarmingly reminiscent of a stump speech.
The fiscal cliff is important. It was appropriate for the president to take a question about it. And he did get one good punch in, accusing Republicans of being so caught up in defeating him personally that they had lost sight of the public good. That line should play well in the evening newscasts.
But to watch the exchange play out at the top of what most everyone else hoped would be a conversation on gun control was discouraging. The implication was that perhaps it is impossible after all for the USA to discuss the matter. You know what we can talk about? Congressional gridlock.
The gun control questions did eventually come. Then, at the end, ABC News’ Jake Tapper nailed it, pointing out that the president hasn’t done much on guns in the last four years and asking, “Where have you been?”
Obama showed his frustration. He said he was dealing with the worst economic crisis since the great depression, two wars and a bunch of other stuff. “I haven’t been on vacation,” he said.
The news conference mercifully ended there. Where the conversation goes remains to be seen.
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From the gulf between rich and poor, to welfare reform, old arguments are failing to find answers for a world in flux
Politics has never been so fascinating. It drips from the ceiling. It oozes up through the floor. It reeks across the internet. Reading politics, being informed about it, participating in it, should be the compulsory national service of the 21st-century state. Yet never can the toolkit of political debate have been so empty and the task of understanding the world so titanic.
America has just undergone a monumental exercise in democracy. But