High-earners should consider premier private bank accounts, says expert

High-earning individuals should consider opening a premier private bank account since they may benefit from the additional services they offer, says Moneyfacts.

Although such accounts charge higher fees than high street accounts, Samantha Owens, head of personal finance at Moneyfacts, says they may nevertheless be a worthwhile option for people who earn a lot of money because they can receive extra benefits such as advice on investments.

“If you’re in the higher income bracket then you’re not really going to be worried about getting a current account paying 8.5 per cent up to the first thousand pounds,” says Ms Owens.

Premier private bank accounts appear to be increasingly popular, with HSBC and Schroders both reporting recent increases in private banking pre-tax profits.

Tailored services which come with the accounts include a concierge service and a discount on investment advice.

Ms Owens warned that people on an average salary are unlikely to benefit as much from the service, particularly when taking into account the higher fees.

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“There are lots of good offers” on the market for bank accounts, say experts

Due to the effects of the credit crunch meaning banks are having difficulty finding funds, “there are lots of good offers” on the market for bank accounts for UK consumers, one expert has said.

Fool.co.uk said there are differences to be found between bank accounts but to spot them consumers will have to keep their eyes peeled.

David Kuo, head of personal finance at fool.co.uk, said: “There are no ‘one size fits all’ when it comes to current accounts. So thanks to the plethora of choices, consumers can find one account that most suits their lifestyle.”

He added, as an example, if you regularly go overdrawn then a current account that provides an overdraft buffer will probably be best.

Meanwhile, a survey by Mintel has previously found that British people are more likely to get divorced than to change their bank accounts.

Up to one in two respondents were rated as being either ‘dissatisfied or extremely dissatisfied’ with their bank’s service, according to the survey.

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Fall in house price tempts buyers

One in ten people who intend to buy a house have brought their plans forward due to the recent price falls in the market, according to new research.

A survey by personal finance information providers Fool.co.uk has shown that 11 per cent of potential home buyers have accelerated their plans.

Out of those respondents, 38 per cent expect to move this year and one in three believe they will change their property in 2009.

David Kuo, Head of Personal Finance at Fool.co.uk, said: “The long-overdue correction in the property market will allow many people who have been waiting to move house to finally realize their dream.”

However he added that many buyers often approach the financial thinking behind purchasing a home in the wrong order.

“Quite often people will ask how much they can borrow when they want to buy a property. But that is altogether the wrong question. Instead, they should ask themselves how much they can afford to repay,” he said.

Fool.co.uk revealed that over a third of Brits spent New Year in their homes to save money.

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‘Danger thresholds’ show borrowers most at risk

An industry expert has highlighted the fact that many people falling outside “defined thresholds” could be adversely affected by credit crunch.

Fool.co.uk urges mortgage borrowers to recognise the risks they could face from the wider impact of global credit problems by taking guidance from the Bank of England’s Financial Stability report.

It states that those with repayments of over 55 per cent of their total household income are most at risk, standing outside the defined thresholds.

David Kuo, head of personal finance at Fool.co.uk, advised: “Consumers should draw up a Statement of Affairs immediately to get a useful snapshot of their finances. The snapshot will tell, at a glance, whether you fall into one of the ‘at risk’ categories.

“Failing to draw up a Statement of Affairs in the current difficult financial climate is tantamount to driving a car without shock absorbers.”

The Financial Stability report speaks of a “tightening” in the money markets, pointing to the need for more focus on liquidity management and better stress testing among other things.

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