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unit 2 topic 8 - Coggle Diagram
unit 2 topic 8
The features of information and advice
Accurate
the description of the product and of its terms and conditions must
be correct. It must describe accurately how the product works, what it costs, the
rights it confers and the obligations it imposes on the customer.
Transparent
it must be clear and must not try to hide anything from the
customer
for example, someone who buys a long term savings product needs to know if there are any penalties for early withdrawal of their money
Sufficient but not too complex
the amount of information should be enough
so that a customer has a clear idea of what a product will do for them.
Factors that influence financial choices
The original want or aspiration
the stronger the desire to fulfil a want or
aspiration, the greater the desire for the financial product
For example, someone whose main aspiration is to buy their own home has a strong desire for a mortgage.
Feasibility of access to a financial product to fulfil the want or aspiration
someone who needs a mortgage must be able to afford to repay it, and this depends on their personal financial circumstances,
The economic situation must be such that it is
relatively easy to get a mortgage.
Personality
the customer’s personality influences the way they make their
choice.
Some people are impulsive and buy the first product that is suggested
to them
whereas others are more cautious and do a lot of research before
committing themselves.