Consumers find choosing where to buy a house and how to invest their money the most difficult decisions, new research has found.
A study commissioned by Barclays Plan & Invest, in partnership with researchers at UCL, revealed that financial concerns present the biggest challenges for consumers.
Purchasing a property was cited as the most difficult choice by 32 per cent of respondents, followed by how to invest (25 per cent) and how to spend your savings (25 per cent). The only non-financial decision to make the top five was choosing a partner, with nearly one quarter struggling to make up their minds when picking their other half.
The survey found that nearly one third of men struggle to decide how to invest their money, compared to just 21 per cent of women. The majority of women (43 per cent) said that they base their decisions on gut instinct.
The research suggested women make better investment decisions than men.
The average women’s investment portfolio on the Barclays Smart Investor platform beat that of their male counterparts over a three-year period.
The annual return on investments for men was, on average, a marginal 0.14 per cent above the performance of the FTSE 100, while for women it was 1.94 per cent higher.
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“It comes as no surprise that financial, and particularly investment, decisions rank so highly as some of life’s tougher choices,” said Robert Smith, head of behavioural finance at Barclays Wealth Management and Investments.
“It’s easy to be overwhelmed by the sheer number of investments on offer or be put off by the amount of jargon – particularly if you’re new to investing.
“When deciding where to invest, some may instinctively choose to invest in the market closest to them or may be swayed by what is trending in the news.
“However, creating a diversified portfolio, focused on an individual’s personal goals and attitudes, is the most advisable strategy when investing.
“But for those who don’t have the confidence to make their own investment decisions, it’s worth considering a digital advice service, such as Barclays Plan & Invest, where you can get experts to create a personalised investment plan and make all of the difficult investment decisions on your behalf.”
“Our research has revealed that we are consistently bombarded with choice, often creating a sense of decision fatigue,” said Dr Bastien Blain, research associate at UCL.
“This cognitive fatigue makes us more impulsive and therefore prone to choosing small, immediate rewards over larger, delayed ones.
“This may well explain why financial decisions are consistently ranked the hardest, as they require the most attention.”