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  • FIRST POST
    • pip895
    • By pip895 29th Nov 17, 9:07 AM
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    pip895
    Lloyds should be ashamed!
    • #1
    • 29th Nov 17, 9:07 AM
    Lloyds should be ashamed! 29th Nov 17 at 9:07 AM
    An elderly (83years) friend of the family asked me to sit in on a meeting with a potential financial advisor who had been recommended by a friend of hers. The advisor turned out to be from St James's Place, but all credit to him it soon became clear that he wouldn't get any business, as locking money away for years was the last thing this lady needed. He was very good and spent quite a long time sorting through her various investments (made for her by her late husband) and suggesting the ones that could potentially be cashed in and those that might have tax implications if she did.

    Her requirement was to raise funds for her daughter who was in financial trouble and after the FA left I started sorting through a file entitled "Lloyds Confusion". I found a series of accounts in there with small amounts in all earning negligible interest. One account however looked to be the solution to her issue. She had 30k sitting in an account earning 0.55%.

    We contacted Lloyds but it turns out this is a fixed term deposit which she took on after a previous one matured and there is no way we can get at this cash (the huge majority of her cash reserves) for another year not even if we forgo the interest. I am furious at the Lloyds sales person who thought it was a good idea to tie up this vulnerable old ladies cash reserves in such a way - all for 0.55%

    What are your thoughts is it worth trying to shame Lloyds into releasing the cash or should I just help her with selling out of some of her holdings in her S&S Isa?
Page 1
    • elsien
    • By elsien 29th Nov 17, 9:18 AM
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    elsien
    • #2
    • 29th Nov 17, 9:18 AM
    • #2
    • 29th Nov 17, 9:18 AM
    Elderly and vulnerable aren't necessarily the same thing. If your friend had no obvious reason to consider she might need the money in the next 12 months she may well have considered this the better option for herself.
    My grandmother used these type of bonds regularly until well into her eighties because she considered them safe and wouldn't touch any other type of account no matter what anyone said to her, refused to even have a current account.
    What evidence do you have that your friend was missold? And more to the point, what does she want to do about it?
    All shall be well, and all shall be well, and all manner of things shall be well.

    Pedant alert - it's could have, not could of.
    • PeacefulWaters
    • By PeacefulWaters 29th Nov 17, 9:31 AM
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    PeacefulWaters
    • #3
    • 29th Nov 17, 9:31 AM
    • #3
    • 29th Nov 17, 9:31 AM
    Tying money up for a year or two in return for a higher rate of return seems like a fair trade off. Even at age 83.

    While there's shame in the crap rates Lloyds savings accounts offer, there's no inappropriate selling going on here.
    • SevenOfNine
    • By SevenOfNine 29th Nov 17, 10:09 AM
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    SevenOfNine
    • #4
    • 29th Nov 17, 10:09 AM
    • #4
    • 29th Nov 17, 10:09 AM
    She had 30k sitting in an account earning 0.55%.

    We contacted Lloyds but it turns out this is a fixed term deposit which she took on after a previous one matured and there is no way we can get at this cash (the huge majority of her cash reserves) for another year not even if we forgo the interest. I am furious at the Lloyds sales person who thought it was a good idea to tie up this vulnerable old ladies cash reserves in such a way - all for 0.55%
    Originally posted by pip895
    Why do you assume this locking up of funds for a piddling interest rate was the result of advice from a Lloyds sales person? At 83 my mother was perfectly capable of making her own decisions about money - she's 90 now & still thinks that.

    If this elderly lady plans to help out her financially struggling daughter, with what appears to be a large sum of money she's trying to gather up, she may need to be mindful of deprivation of assets given her age.

    Just a small thought, 0.55% is better than nothing, which is what she's going to get when she's given it away!
    Seen it all, done it all, can't remember most of it.
    • Glen Clark
    • By Glen Clark 29th Nov 17, 10:38 AM
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    Glen Clark
    • #5
    • 29th Nov 17, 10:38 AM
    • #5
    • 29th Nov 17, 10:38 AM
    While there's shame in the crap rates Lloyds savings accounts offer,
    Originally posted by PeacefulWaters
    0.55% was more than double the bank rate. To be fair, you need to compare it with average rates, rather than the best buy internet rates advertised on here. And then factor in the cost of the personal service.
    “It is difficult to get a man to understand something, when his salary depends on his not understanding it.” --Upton Sinclair
    • badger09
    • By badger09 29th Nov 17, 11:11 AM
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    badger09
    • #6
    • 29th Nov 17, 11:11 AM
    • #6
    • 29th Nov 17, 11:11 AM
    I agree with previous posters who say elderly does not necessarily mean vulnerable, and from what you've posted, there is nothing to suggest Lloyds persuaded her to do anything.

    After her husband died 5 years ago, I started helping my then 75 year old sister to manage her finances, bills etc. While she initially agreed to follow most of my advice, netting her several £00s a year interest, when the time comes for her to renew maturing accounts, she often chooses to roll over into the best available from the existing provider, even though that is usually far from the best option. Basically, because the additional effort is not worth it for her.

    Its a bit frustrating, but it is her money and her decision.
    I'm a supporter of dunstonh
    • pip895
    • By pip895 29th Nov 17, 12:06 PM
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    pip895
    • #7
    • 29th Nov 17, 12:06 PM
    • #7
    • 29th Nov 17, 12:06 PM
    What concerns me is that it represents a very high proportion of her available cash. Even putting aside the gift she wants to make to her daughter it could leave her short if she needs to replace the boiler for example.

    If there was a provision to extract the cash by forgoing some or all the interest it would seem more reasonable.

    I will go ahead and extract the money from her ISA - at least it seems a not too bad point to sell equities and de risking her portfolio may not be a bad thing.

    You are probably right - I am projecting my horror at a rate of 0.55% on to her. She said she was sure she wouldn't have signed up for something with such a poor interest rate, but that was probably after I mentioned how poor I thought it was
    Last edited by pip895; 29-11-2017 at 12:28 PM.
    • dunstonh
    • By dunstonh 29th Nov 17, 12:07 PM
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    dunstonh
    • #8
    • 29th Nov 17, 12:07 PM
    • #8
    • 29th Nov 17, 12:07 PM
    I am furious at the Lloyds sales person who thought it was a good idea to tie up this vulnerable old ladies cash reserves in such a way - all for 0.55%
    Lloyds do not have regulated salespeople any more and havent for many years. So, it is unlikely that this product was put in place under an advice process. It is more likely it was just a bank clerk taking an instruction from the individual. Or it may even have been a rollover from another fixed term deposit with no staff members involved.

    If you are going to allege a wrongdoing, then you need to be clear on how it was set up. Most of the bank stuff nowadays are non-advised transactions acting on client wishes. You may get info supplied about rates available on different accounts but the staff member gets no incentive whether the money goes in an instant access account, fixed term deposit or something else or even somewhere else.

    Just because someone is 83, does not make them vulnerable and there are plenty of people that age taking out fixed term deposits. The bank staff member wont know if that person has £1 at a different bank or £1 million or what S&S ISAs etc they hold. They are not giving advice. So, they do not need to know.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • IanManc
    • By IanManc 29th Nov 17, 12:17 PM
    • 366 Posts
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    IanManc
    • #9
    • 29th Nov 17, 12:17 PM
    • #9
    • 29th Nov 17, 12:17 PM
    I am furious at the Lloyds sales person who thought it was a good idea to tie up this vulnerable old ladies cash reserves in such a way - all for 0.55%
    Originally posted by pip895
    You have no evidence that anyone thought it was a good idea other than the 83 year old lady. It was her decision to make, even though you think it was a mad one. As for your fury, well that is your own issue to address. Her decision and her finances do not affect you.
    • bowlhead99
    • By bowlhead99 29th Nov 17, 12:21 PM
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    bowlhead99
    What concerns me is that it represents a very high proportion of her available cash. Even putting aside the gift she wants to make to her daughter it could leave her short if she needs to replace the boiler for example.
    Originally posted by pip895
    If she didn't want to lock her money away in a long term account because she wanted liquid cash reserves to buy a new boiler she could have kept a couple of thousand pounds in another cash account. You don't need thirty grand 'just in case' a boiler goes pop. In any case, you say she has other liquid assets in the form of S&S ISAs.

    If there was a provision to extract the cash by forgoing some or all the interest it would seem more reasonable.
    Such accounts do exist but when considering opening an account from all the thousands of savings and deposit products at Lloyds and elsewhere, the customer can take whatever decisions they would like to get them the best rate and least hassle and most flexibility. Everything is a trade off.

    I will go ahead and extract the money from her ISA - at least it seems a not too bad point to sell equities and de risking her portfolio may not be a bad thing.
    It seems a bit bizarre to be on the one hand, outraged at Lloyds and wanting them to be 'shamed' because 'locking money away for years was the last thing this lady needed' ; and yet she is sitting there with tens of thousands in stocks and shares investments which are by their nature, long term investment products.

    There are a great many people in their 80s who have long term investments and long term savings (with lockins, long notice periods etc) - as they plan to be around for a long time and don't expect to need £30k of cash within the next year. So, "what products do you have that I could put my maturing deposit into, I don't need it in the short term" could quite reasonably be answered by the Lloyds clerk as "take a look at this fixed term deposit and let us know if you would like it".

    You can't "shame" someone into releasing cash contrary to the conditions you agreed, when they have done nothing "shameful" If she was 20 years older and losing her marbles, you could perhaps try it on.
    • pip895
    • By pip895 29th Nov 17, 12:43 PM
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    pip895
    OK I stand corrected - I guess they were just being a bank.

    I reserve the right to be fed up with them for closing the only two local branches round here that you could park anywhere near though.
    • bigadaj
    • By bigadaj 29th Nov 17, 1:46 PM
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    bigadaj
    I've got some sympathy for the OP and the individual, under what circumstances is a 0.55% fixed and no access account of benefit to anyone?


    Inflation running at 2.5-3%, Ok it has been above the base rate but is far worse than many easy access accounts.


    I have little sympathy for most people who hang onto the traditional undeserved respect for banks but in this scenario how can such an account be of any benefit?
    • dunstonh
    • By dunstonh 29th Nov 17, 2:17 PM
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    dunstonh
    I have little sympathy for most people who hang onto the traditional undeserved respect for banks but in this scenario how can such an account be of any benefit?
    They offered their terms. No arm twisting or threatening the family. You take it or you leave it. If you go into something which has quite clear terms (and with savings accounts, you really only have two things to worry about. Rate and accessibility), then you do have to take responsibility for that.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • EachPenny
    • By EachPenny 29th Nov 17, 4:57 PM
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    EachPenny
    I've got some sympathy for the OP and the individual, under what circumstances is a 0.55% fixed and no access account of benefit to anyone?
    Originally posted by bigadaj
    Same here.

    I was in a bank branch the other day and overheard someone being "advised" to open a specific account. Of course it wasn't proper financial advice, but how is the typical bank customer meant to know that? I wanted to tell them to check MSE and get one of the far better deals available.... even one that this particular bank offer... but then you can't really butt-in and tell strangers that kind of thing in a bank branch, can you?

    I fully appreciate that banks are businesses and at the end of the day are there to make money. I also understand many provide unattractive products because some customers want a full-range of services using only one provider.

    But what does nark me a bit is when you see products offered which give the impression they are something special, but in reality are terrible deals. For example, products which require you to lock away your savings for a set length of time, which most people would expect to offer a preferential rate of interest. Or accounts which have words like 'special', 'bonus', or 'loyalty' in the name but then offer less than the best.

    But then 0.55% is positively generous compared to Lloyds 'Easy Saver' - currently 0.05% variable for 12 months from account opening at which point it becomes a 'Standard Saver'. How many people would read that and think 'Easy Saver' is some kind of 12-month bonus account? Because, as you might have guessed, the 'Standard Saver' rate is currently also 0.05%.
    Last edited by EachPenny; 29-11-2017 at 4:59 PM. Reason: Typo
    "In the future, everyone will be rich for 15 minutes"
    • PeacefulWaters
    • By PeacefulWaters 29th Nov 17, 7:07 PM
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    PeacefulWaters
    Of course it wasn't proper financial advice, but how is the typical bank customer meant to know that?
    The bank is expected to disclose that it isn't giving advice at the start.

    "Informed choice" are the magic words.
    • bigadaj
    • By bigadaj 29th Nov 17, 7:13 PM
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    bigadaj
    They offered their terms. No arm twisting or threatening the family. You take it or you leave it. If you go into something which has quite clear terms (and with savings accounts, you really only have two things to worry about. Rate and accessibility), then you do have to take responsibility for that.
    Originally posted by dunstonh
    I don't see how that is fair terms in any logical sense.

    Another case of teh financial industry hiding behind contracts rather than sense and logic?
    • PeacefulWaters
    • By PeacefulWaters 29th Nov 17, 7:39 PM
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    PeacefulWaters
    I don't see how that is fair terms in any logical sense.

    Another case of teh financial industry hiding behind contracts rather than sense and logic?
    Originally posted by bigadaj
    A conversation along the lines of "You get 0.05% for easy access of 0.55% if you tie the money up for a year" seems perfectly fair and reasonable.

    Potential customers always have the option of going elsewhere if they can be bothered.
    • colsten
    • By colsten 30th Nov 17, 9:08 AM
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    colsten
    This is another case of someone not taking responsibility for their own actions, and trying to blame someone else for bad decisions.

    If the lady had shopped around and decided to put her money into a fixed term account paying 0.55%, that was the decision she made.

    If the lady did not shop around and simply took what may, or may not, have been mentioned by a Lloyds employee, that was again her own decision.

    If she is now becoming vulnerable, perhaps it is now time for her to appoint someone she trusts to look after her financial affairs?
    • Malthusian
    • By Malthusian 30th Nov 17, 9:31 AM
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    Malthusian
    If the OP's elderly friend had gone to Currys to buy a hoover, should the checkout staff be ashamed for selling her a hoover instead of telling her that she could get the same hoover for £30 cheaper online?

    Overcharging is not a crime.
    • bowlhead99
    • By bowlhead99 30th Nov 17, 10:15 AM
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    bowlhead99
    If the OP's elderly friend had gone to Currys to buy a hoover, should the checkout staff be ashamed for selling her a hoover instead of telling her that she could get the same hoover for £30 cheaper online?
    Originally posted by Malthusian
    Well if the same Hoover was for sale at Amazon, Ao.com, Argos or John Lewis etc at a cheaper price, she could have used the Price Promise pricematch to get it for less, even a week after she had bought it from Currys (https://www.currys.co.uk/gbuk/price-promise-1023-theme.html)

    However, when she tried to buy the Hoover the shop assistant should have pointed out the Dyson equivalent as reassuringly more expensive
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