Barclays, Lloyds, HSBC, NatWest – they’re all ‘havin’ a laff’ and you’re paying

Why do high street banks want to run your current account for you? Because they make lots of money doing it? Not really. Handling our current accounts means a lot of work for not too much profit. The real reason is the opportunity to do what the banks call ‘cross-selling’ – using their contacts with us to sell us all kinds of other stuff like savings accounts, insurance, mortgages, pensions and (usually very dodgy) investments. But if you need any of these services, you’re crazy to get them from your high street bank. For savings, you’ll get much better rates from the former building societies. With insurance, not only are you paying for the insurers’ profits but you’re also giving a chunk of your money in commission to your bank. So save money and buy insurance direct from insurers. You’ll generally get much better mortgage deals by avoiding high street banks and only a madman or fool would save for a pension with the likes of Barclays, Lloyds, RBS or HSBC.

As for investments – either your bank will have cobbled together some dreadful scheme like ‘guaranteed bonds’ which are only guaranteed to make money for the bank. Or else, like Barclays did so successfully, it will take some appallingly managed, risky funds produced by crooks at somewhere like Aviva and then sell these to customers as being ‘safe’ and ‘low risk’. I was in a Barclays branch once when I overheard two of its salesmen laughing and joking about what they were going to say to a pensioner who had just lost half his life savings by investing  in Aviva through Barclays.

So, use your high street bank to run your current account for you. That’s ok. But in 99% of cases, if you buy any other service from Barclays, Lloyds, HSBC, RBS or NatWest, then you’re either a fool or mad and your bank will be having a laugh at your expense.