Whether we like it or not, our financial behaviours play an essential part in helping us grow up and grow old in today’s society. Yet, despite this, research shows eight in 10 Brits are confused by financial jargon.
Considering these findings, retail broker Eurotrader conducted a study* to reveal the most searched terms and questions related to personal finance, to discover where many of us may need to brush up on our financial knowledge.
Financial Terms – Top 10 Increases in Search Interest
|1||Stamp duty||551500||1432000||160%||A tax that you pay when buying a property in England or Northern Ireland|
|2||Exchange of contracts||13500||24000||78%||When the two legal firms representing the buyer and seller exchange signed contracts. The buyer pays a deposit.|
|3||Credit score||2481000||4360000||76%||A number between 300–850 that illustrates a consumer’s creditworthiness|
|4||Limited liability||19100||33100||73%||Limited liability is a legal structure for a company where a corporate loss won’t surpass the amount invested in a partnership|
|5||Quarterly statements||60||100||67%||A quarterly filing compiled by public companies to state their performance.|
|6||Corporation tax||164800||267400||62%||A tax on the profits of a corporation|
|7||Annual percentage rate (APR)||1940||3010||55%||The annual rate of interest charged to borrowers and paid to investors|
|8||Buildings insurance||91100||134000||47%||Covers the cost of repairing structural damage to a property|
|9||Conveyancing||172700||252000||46%||The legal transfer of property from one owner to another|
|10||After tax||6780||9600||42%||The net income after the subtraction of federal, state, and withholding taxes|
The housing market is the hottest personal finance topic following the UK Government’s announcement of a ‘stamp duty holiday’ during the global pandemic. This is reflected in the most searched financial terms, with ‘stamp duty’ coming in first position.
Searches increased by a whopping 160 percent in 2021. According to Eurotrader’s findings, there were 1,432,000 searches for the term ‘stamp duty’ in 2021 compared to 551,500 in 2020.
Despite the stamp duty holiday now being over, the number of searches still shows heightened interest in the term. This is perhaps a knock-on effect of the pandemic.
Over lockdown, many households managed to accumulate savings with limited spending and some job protection. It seems a lot of this additional income has been allocated to the housing market, as many decided to move house.
The number of people choosing to move out of London reached a 4-year high and Cornwall overtook the capital this year as the most searched for location. Reports also suggest surging demand for houses will last well into 2022 as buyers continue to look for more space, after experiencing isolation during lockdown.
This trend is also reflected by the second and third most searched for financial terms. ‘Exchange of contracts’ – in second place – saw a 78 percent increase since 2020. The number of searches increased from 13,500 in 2020 to 24,000.
The third most searched for financial term ‘credit score’ increased by 76 percent. It makes sense there is still a lot of confusion surrounding this term, as research shows 49 percent of UK adults have never accessed their credit report, despite it being key to whether they can borrow from lenders.
Completing the top five is ‘Limited liability’ which increased by 73 percent and ‘Quarterly statements’ (67 percent increase).
Eurotrader also looked at the most asked questions associated with financial terms. The most popular questions were focused on housing purchases and setting up businesses.
The number one most asked question is ‘What is corporation tax?’, which has 80,500 searches in comparison to 21,700 in 2020. This is a 271 percent increase. This is one of the administrative tasks small business owners must know about if they decide to become a limited company.
The Federation for Small Businesses estimated the average SME owner spends 70 hours per month on tasks like tax returns and reliefs, which could explain why the question is so popular.
In second place is ‘What is cost of sales’, which increased by 150 percent, again, an important answer to know for those setting up their own businesses.
In 3rd and 4th places are ‘What is exchange of contracts’? which increased by 139 percent and ‘What is stamp duty’, which saw searches rise by 124 percent. This is unsurprising, as both topics – associated with housing- feature heavily in the most searched for terms overall too.
Finance Questions – Top 10 Increases in Online Search Interest
|Rank||Most popular financial questions||Percentage increase|
|1st||What is corporation tax?||271%|
|2nd||What is a cost of sales?||150%|
|3rd||What is exchange of contracts?||139%|
|4th||What is stamp duty?||124%|
|5th||What is limited liability?||110%|
Commenting on the study Nick Whitehead, Head of Product from Eurotrader said:
“It’s understandable many of us feel inundated by the mass of financial jargon we read and hear. Our research suggests there is a need for increased financially focused resources and education to help consumers across the country get a better grasp of financial terms.
“From receiving weekly pocket money as a child to saving for a mortgage or planning for a pension, it’s important we all have our personal finances in order. The more organised we are in the present, the better prepared we are for the future”.
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