Your very own personal banker. Is it worth it?

Jacqui Canham weighs up the perks and the costs of having a premium account
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The Independent Online

Do you feel your liquid wealth merits a better service than "hole in the wall" retail banking, but is not enough to buy an exclusive private banking package? If so, you are just the kind of customer most banks are desperate to get their hands on; you are a member of the "mass affluent"!

Do you feel your liquid wealth merits a better service than "hole in the wall" retail banking, but is not enough to buy an exclusive private banking package? If so, you are just the kind of customer most banks are desperate to get their hands on; you are a member of the "mass affluent"!

According to research group Datamonitor, mass-affluent individuals - those with £30,000 to £200,000 in onshore liquid assets - make up nearly 11 per cent of the UK adult population. This figure has risen over the past 10 years and is expected to rise by a further 6 per cent yearly, thanks, in part, to robust economic growth, increased average earnings and soaring house prices over recent years.

High-street banks have been quick to pick up on this growing trend and most of them now offer a relatively new breed of premium banking package, usually known as a "Premier" account. You pay a fee, usually monthly, and in return you receive a personalised banking service and a stunning array of perks and benefits. But is that fee worth it?

Once upon a time you had limited choice. You could either deposit your hard-earned dosh in a current or savings account; or, for a more personalised service, which included on-tap investment or tax advice from experts, access to investment products, a relationship manager, will-writing services, a shoulder to cry on - the list is endless - you would have to fork out for a private banking service. And that meant, and still means, big money.

Most institutions try to justify their hefty entry criteria for private banking by claiming they cannot produce profits on more modest amounts. True, you do generally get what you pay for in life, and most private banking packages provide you with complete portfolio and asset management, while assisting you with a host of personal financial requirements. But, not everybody is looking for this level of nurture.

"Premium banking packages suit a wide range of people who are looking for something that fills the space between retail and private banking," says Simon Shaylor, head of mass affluent at Lloyds TSB.

"At one end of the scale, you might get the high-income, high-spend city slicker types who have lots of money but are credit hungry and time poor. At the other end are the active older customers living off their assets and looking for convenient and competitive ways to utilise them." Premier banking services differ from run-of-the-mill retail banking services in several ways. There is usually a minimum entry level, which can range between £50,000 and £100,000, lower than most private bank levels.

Some banks, such as Lloyds TSB and NatWest, allow a minimum requirement based on a joint account between two people. Others will lower the deposit level if you already have savings with them. HSBC, for instance, allows entry if you have £30,000 or more of savings in one of its accounts.

Then there is the fee, which is about £15 per month. This gives access to the usual range of interest-linked current or savings accounts, but you are offered a bonanza of benefits. At RBOS you get discounts on tax and will-writing services, exclusive mortgage deals, and money off hotels, holidays, concerts, books and computers.

HSBC provides travel insurance cover for you, your partner and all dependent children for £87 per year. You can get help buying tickets for any number of events, and arrange for gifts to be bought for you while you are travelling. Plus there is no annual fee on your credit card. Lloyds TSB offers AA breakdown cover, mobile phone insurance, credit card protection, 7.5 per cent savings on package holidays, discount on electrical goods, and 25 per cent off selected cars.

These perks are all very well but do you really need them? "If you're going to buy into one of these packages, make sure that it is tailored to your personal requirements," says Joanna O'Brien, senior researcher for personal finance at Moneyfacts. "If you need a personal manager to help organise your lifestyle or you want better overdraft facilities and discounts at restaurants, and your premium account offers you this, fine. If you don't, forget it."

For most people, however, it is not the perks they pay for but their access to a relationship manager. "We recognise that people who earn more than £100,000 per annum, or with substantial personal assets, have specific banking and financial requirements that are different to the mass market," says Tiku Patel, managing director of Barclays Premier Banking. "Our Premier Banking service provides clients with a dedicated manager who can offer products, services and guidance."

For most banks, the theory goes that you will be linked up with a personal manager whom you can call at any time of day for advice relating to your account, or to discuss any problems you may have.

At Barclays your Premier Manager promises to tackle all aspects of your day-to-day finances, and take an active interest in your future financial needs. At Lloyds TSB, customers can ask for assistance on anything from their own account and sorting out paperwork, to dealing with foreign payments and arranging an international mortgage.

'It saves me so much time'

Louise Hunt is a human resources consultant. She is 40 and lives in Essex.

Louise has held a Lloyds TSB Premier Account for just over a year. Previously, she had a Classic current account with the bank, but on realising she had healthy liquid assets and a busy lifestyle, the bank suggested that a more worthwhile solution for her would be the Premier Account with a minimum entry level of £50,000.

Louise pays £15 per month and has found having her own personal account manager worth the fee.

"It's great having someone you can ring at any time for advice or with instructions - someone who knows you," she says. "I'm significantly saving on my time, which is a precious commodity." Louise travels a lot so also benefits from discounted travel services and free AA cover.

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