You can save
money on financial products with internet comparison sites. But when you visit
thebestdealforeveryfinancialproduct.com how do you know it is comparing the
whole market and doing it fairly?
Five traps
to be aware of.
1. The sponsored link. Many sites let firms buy their way to the top of the list. Normally
these products are shown separately and the full list is given below the entries
that pay for their position. But the sponsored links can fill a whole screen. So
it is always worth scrolling down to make sure you are finding the real best
buys.
2. The missing firms. Not every product provider is listed. Some choose not to be. Others do
not provide the information regularly enough or in the right format. And some
are just missed out. Some of the absent products might be the best deal. So try
two or three comparison sites and compare them.
3. Paid for adverts. The advertisements are normally separate and clear to see. But beware.
The claims made in the ads may not be as clear or objective as the deals in the
best buy tables. Always cross-compare.
4. Click-through payments. Every time you click on a link to a financial firm or product the
website will get a payment. And if the click leads to a sale the website will
get more. The amounts of these payments are kept secret. So you can never be
sure if the way a product is shown or the prominence it is given depends on a
good click-through rate. But the temptation must be there.
5. Deals and offers. Finally, the product providers study the way the best buy tables are
compiled and try to find ways of getting into the top five by tweaking their
product. That is why savings accounts offer a ‘bonus’ rate for six or twelve
months. That can propel them to the top only to plummet down towards the bottom
when the bonus runs out. If you buy one make a note in your diary and switch in
good time. Insurers will pare their premium to the bone by cutting back on the
service or the extras or imposing a very high excess. You may not realise this
trick until you make a claim.
You can
avoid these tricks by going to the non-commercial comparison site at
www.fsa.gov.uk/tables. But it
is a bit dull and not always easy to use.