Watchdog says better 'safe' than sorry

CASHPOINTS

Financial firms must spell out what they mean when they describe investments as "safe" or risk having to compensate savers who become dissatisfied, says the Investment Ombudsman in his annual report. He awarded pounds 262,000 to more than 150 who complained successfully. The highest award made by the ombudsman was for pounds 67,000. The word "safe" was a common source of complaints because it meant different things to different investors and guarantees about returns could rarely be substantiated. A free guide to complaining about investments is available from the Investment Ombudsman on 0171 796 3065.

Cash remains the most popular way to pay for goods and services, according to a survey for Girobank. The vast majority of people prefer to pay in cash for small purchases costing around pounds 10 and most believe that sticking to cash helps them stay in control of their finances. Most also believe offering to pay in cash will get them a better deal. But while four in five people predict their use of cash will not change substantially over the next five years use of debit cards continues to increase, with 36 per cent of people now using them.

Diabetics are being offered higher pensions by Stalwart Assurance in Surrey. Diabetics on the point of retiring and looking to convert a pension fund into an annual pension (called an annuity) are being offered higher-than-normal annuity rates by this specialist pensions company to reflect their lower life expectancy. Stalwart claims the net effect of these higher rates, which are also available to smokers, asthmatics, those with high blood pressure and the overweight, is a pension 5 per cent higher than the best available. To take advantage of Stalwart's deal, however, you have to have a pension plan with what is called an open market option, which enables you to shop around among annuity providers for the highest rates. Call 01306 876581.