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UK consumers increasingly cautious about taking investment risks


UK consumers have become increasingly cautious in making investment decisions, with just 13 per cent always willing to take risks in order to get the best return on their money, according to peer to business property lender Credit Peers.

Two in five (40 per cent) said they were never willing to take a risk on their money, no matter what the returns might be.
In spite of this cautiousness, consumers are also dissatisfied with the returns from their day to day savings, with almost two thirds (65 per cent) citing poor rates of return as their biggest frustration with banks or building societies.
Consumers’ expectations of return for their savings remains high despite prevailing economic conditions, with nearly half (44 per cent) expecting a rate of return on their investments to be between 5-10 per cent. Almost three quarters (73 per cent) agreed that rate of return was very important, ranking higher than any other investment consideration when choosing how to invest.
Consumers are also demanding a high level of flexibility from their savings providers, with four in five (84 per cent) expecting the option to access funds at short notice. Other big frustrations with traditional savings include high service fees (26 per cent) and strict penalty charges (25 per cent). As a result of these challenges, over half of savers (58 per cent) trust their bank less than they did five years ago.
Torsten Hartmann, CEO of Credit Peers, says: “What we have found is that the turbulent political environment means that people are shying away from taking financial ‘risks’, but at the same time, historically low interest rates are severely hindering their ability to save effectively through traditional means. With an aging population, rising house prices and cost of living compared to salary increases, this is a recipe for disaster. I believe people could be making their money work much harder for them if they were more open to alternative investment options which can offer a better rate of return.”
Brexit is one possible explanation for this caution, as over a third (34 per cent) are more worried about their financial future as a result of the referendum. And 16 per cent have delayed or cancelled planned investments following the UK’s decision to leave the European Union.
Credit Peers is one of the latest businesses to launch in the exciting alternative finance market and is one of the first peer-to-business (P2B) property lending platforms in the UK. Current lending opportunities include an office building in Newcastle under Lyme and a commercial site forming part of a larger re-development on Stratford High Street, London.

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