HSBC Premier Account

Se99paj

wmb194 said:

Se99paj said:

WillPS said:

Se99paj said:

WillPS said:

Read "personal financial advisor" as point of contact for account issues who will try to sell you more HSBC products and services.

Bear in mind that moving £50k in to eligible savings and investment products will likely have a way higher opportunity cost than whatever you'd save or gain from HSBC Premier.

Can you expand a bit more on your last point? As far as I can tell there aren't going to be any additional costs than what I have today.

You'll almost certainly be giving up on more favourable rates elsewhere by meeting that £50k with HSBC requirement. It's a mistake to think this is 'free', in reality there is an opportunity cost of whatever the difference between what  HSBC would charge (fees on investments) and/or pay you (in interest) and what you would get if you didn't limit yourself to HSBC.

As a very crude "easy numbers" example, if you were to save £50k in their 2 year term fixed rate account at 3.75%, you would earn £1875 in interest per year. The MSE top pick currently is Close Brothers at 4.35%, and if you saved all £50k there instead you would earn £2175 in interest per year. The difference is £300, which is a pretty expensive travel insurance policy!

I appreciate the situation with investments is different but I'd be quite surprised to find HSBC genuinely offer the most cost effective solution here either.

Thanks for explaining, in my case the significant majority is already in a HSBC S&S ISA, so moving to the Premier account won't increase my fees. I probably should review the fees I'm paying though and compare with other providers.
The rest is currently in a Marcus ISA that gets 2.5% which is the same as HSBC.

I appreciate you don't get anything for free, but I won't be paying more than I do now if I move to Premier.

Virgin Money's offering 4.25% on a one year Isa and 3% on instant access so you can calculate the opportunity cost between these and 2.5%.

https://moneyfacts.co.uk/isa/fixed-rate-isas/?quick-links-first=false

Thanks for this, I'm not in the market for a fixed term ISA and I wouldn't be surprised if many other banks follow Virgin with the same interest rate very soon.

Also for the amount in my cash ISA 0.5% is probably the equivalent as the free travel insurance.

What I can't quantify is the financial benefit the financial advice would give me, I'm hoping that would be significantly more than £100

wmb194

Se99paj said:

wmb194 said:

Se99paj said:

WillPS said:

Se99paj said:

WillPS said:

Read "personal financial advisor" as point of contact for account issues who will try to sell you more HSBC products and services.

Bear in mind that moving £50k in to eligible savings and investment products will likely have a way higher opportunity cost than whatever you'd save or gain from HSBC Premier.

Can you expand a bit more on your last point? As far as I can tell there aren't going to be any additional costs than what I have today.

You'll almost certainly be giving up on more favourable rates elsewhere by meeting that £50k with HSBC requirement. It's a mistake to think this is 'free', in reality there is an opportunity cost of whatever the difference between what  HSBC would charge (fees on investments) and/or pay you (in interest) and what you would get if you didn't limit yourself to HSBC.

As a very crude "easy numbers" example, if you were to save £50k in their 2 year term fixed rate account at 3.75%, you would earn £1875 in interest per year. The MSE top pick currently is Close Brothers at 4.35%, and if you saved all £50k there instead you would earn £2175 in interest per year. The difference is £300, which is a pretty expensive travel insurance policy!

I appreciate the situation with investments is different but I'd be quite surprised to find HSBC genuinely offer the most cost effective solution here either.

Thanks for explaining, in my case the significant majority is already in a HSBC S&S ISA, so moving to the Premier account won't increase my fees. I probably should review the fees I'm paying though and compare with other providers.
The rest is currently in a Marcus ISA that gets 2.5% which is the same as HSBC.

I appreciate you don't get anything for free, but I won't be paying more than I do now if I move to Premier.

Virgin Money's offering 4.25% on a one year Isa and 3% on instant access so you can calculate the opportunity cost between these and 2.5%.

https://moneyfacts.co.uk/isa/fixed-rate-isas/?quick-links-first=false

Thanks for this, I'm not in the market for a fixed term ISA and I wouldn't be surprised if many other banks follow Virgin with the same interest rate very soon.

Also for the amount in my cash ISA 0.5% is probably the equivalent as the free travel insurance.

What I can't quantify is the financial benefit the financial advice would give me, I'm hoping that would be significantly more than £100

Perhaps, but I'd be surprised if HSBC does...  YMMV but financial advice from a bank is typically worthless as it'll be restricted to its own products and they're usually poor.

Miles86

AFAIK the advisors are qualified IFAs. This page seems to have some details on what's on offer:

https://www.hsbc.co.uk/investments/advice/financial-advice/

"We’ll recommend investment and insurance products, hand-picked from selected providers, including HSBC."

So sounds like a Multi Tied set up. Also:

"You can receive our financial advice if:

you have £100,000 or more in savings and investments

you have an HSBC current account and you're registered for online banking

you're at least 18 years old

you're a UK resident

you aren't a US national, citizen or resident (eg a US passport or green card holder)"

WillPS

How can you be "independent" if your livelihood is entirely paid for by one major player?

Perksy5

Premier accounts don't give financial advice.
Premier managers/relationship managers aren't qualified, if they are, it's not their day to day role. E.g someone could be qualified and work in that role, but cannot give advice. The role itself is not regulated.

What you're probably thinking of are FAs or wealth managers (banks), the employed versions of an IFA.

Have a look at HSBC Jade, that'll be more the advice aspect you're hoping for (likely not qualifying for) though new clients are not being accepted at this time. Better off going for an IFA or another provider if you qualify if you want actual advice.

Se99paj

For anyone that is interested I've just had another look through the Financial Advice Process and there is an additional cost that I didn't spot.

Essentially there are 3 steps to the financial advice process:

1. An initial call to ask a few questions about my current financial situation
2. A planning review where they will understand the investment risk that I'm comfortable with and the total cost in the financial advice - There are no fees at this point.
3. If I'm happy to proceed, and pay the fees discussed in step 2 they will then provide me with a bespoke plan.

Without knowing what these costs would be its difficult to compare with any other Financial Adviser - The financial advice was going to be the main benefit but as its an additional cost I'm going to give this a miss.

Miles86

IanManc said:

Miles86 said:

AFAIK the advisors are qualified IFAs. This page seems to have some details on what's on offer:

https://www.hsbc.co.uk/investments/advice/financial-advice/

"We’ll recommend investment and insurance products, hand-picked from selected providers, including HSBC."

So sounds like a Multi Tied set up. Also:

"You can receive our financial advice if:

you have £100,000 or more in savings and investments

you have an HSBC current account and you're registered for online banking

you're at least 18 years old

you're a UK resident

you aren't a US national, citizen or resident (eg a US passport or green card holder)"

There is nothing on that page to which you provided a link which suggests that the advisors are IFAs, and seeing they only recommend products from "hand-picked providers" and themselves it is clear that the advisors are tied salesmen.

I'm going by a friend of mines experience when he applied for said job a few months back.

The FCA doesn't allow for "recommend" without being a qualified advisor. Multi tied advisors are a regulatory status approved by the regulator.

[Deleted User]

Se99paj said:

I'm in a fortunate position that I could apply for a HSBC Premier Account, if I move some money around I should be able to reach the £50k required.

The travel insurance would be quite useful, I know it doesn't cost much to buy separately but I'd be getting it for free with the account.
I'm particularly interested in the Financial Advice service that they can offer - But would be interested to know if anyone has any experience with this, do they provide quite detailed advice such as reviewing funds that I'm invested in and reviewing my current pensions, or is very basic advice that anyone could Google.

The added benefit is the credit card that can be used for Avios points, but I'll probably use my Amex for this, the HSBC one would just be useful if someone doesn't accept Amex

I've found Jade to be better than Premier but it was taken off sale late last year.
Definitely good as 'core' bank whilst keeping options open elsewhere. 

Miles86

IanManc said:

Miles86 said:

IanManc said:

Miles86 said:

AFAIK the advisors are qualified IFAs. This page seems to have some details on what's on offer:

https://www.hsbc.co.uk/investments/advice/financial-advice/

"We’ll recommend investment and insurance products, hand-picked from selected providers, including HSBC."

So sounds like a Multi Tied set up. Also:

"You can receive our financial advice if:

you have £100,000 or more in savings and investments

you have an HSBC current account and you're registered for online banking

you're at least 18 years old

you're a UK resident

you aren't a US national, citizen or resident (eg a US passport or green card holder)"

There is nothing on that page to which you provided a link which suggests that the advisors are IFAs, and seeing they only recommend products from "hand-picked providers" and themselves it is clear that the advisors are tied salesmen.

I'm going by a friend of mines experience when he applied for said job a few months back.

The FCA doesn't allow for "recommend" without being a qualified advisor. Multi tied advisors are a regulatory status approved by the regulator.

You said "AFAIK the advisors are qualified IFAs".

The are not IFAs. They are not independent. If they are only able to advise people to invest in the bank's own products or products "hand picked from selected providers" then they are bank employees who are tied salesmen.

Yes sorry, they're qualified to the same standard as an IFA, but are *tied advisors*.

Marchitiello

I have had the HSBC Premier Account and  Premier World Elite Credit card for some year (will downgrade to the free version few weeks before my annual fee is due in some months time).

if you have a way to qualify on Income or do figure out a way that the money tied up with them are earning you enough money, than the Travel Insurance is quite good. I made a couple of stress fee claims over the years and can highly recommend it (managed by Aviva, Amex Platinum is managed by AXA for reference). However as others have said if there are significantly earning opportunity lost by moving that much saving to HSBC, than I would look at a standalone Travel Insurance and/or one that comes with a more regular package account like Nationwide’s.

with regards to non Amex Avios earning cards, especially if you are looking at HSBC free version (so no LoungeKey included), the current Barclaycard offering is much better.

HSBC points can be exchanged at 2:1 ratio to Avios (2 points per 1 Avios) although usually, once a year, they run a 25% bonus promotion. With the free card earning 1 point per £ spent, it means you are earning 0.5 Avios per pound or in the best of case with the promotion just over 0.6 Avios per £. 

The free Avios Barclaycard will earn you 1 Avios per £1 spent and would not need you to qualify for their Premier account (although requirement have been relaxed and actually it opens up even more avenues to earn further Avios). In addition you can also earn an upgrade voucher (not of great use for me but it is still something additional) if you hit the spending target.