By Robert Adungo

More than one in five (23%) people are worried about purchasing a financial product that is not suitable for them, according to new research by independent financial research company Defaqto.

With many products differing significantly from others thanks to the diverse characteristics each one has, nearly half (49%) of consumers do not necessarily understand the particular features of the products they own.

For the majority (69%), price is a very important factor when purchasing financial products. However, there is a potential risk of them ending up with a product that is cheap, but fails to meet their particular requirements if this becomes the overriding factor.

With this in mind, the firm is urging people to use its newly launched 2012 Star Ratings, which are designed to help consumers base their financial decisions on features and benefits rather than cost alone.

Covering more than 40 different product types within credit cards, current accounts, general insurance, pensions, investments, life protection and mortgages, the Star Ratings provide an independent assessment, with a score of one to five being awarded.

"Finding a financial product that is right for you can be complicated and often confusing," notes David Cartwright, Defaqto's head of insight, who warns that people are likely to discover one is insufficient only when it's too late.

"Whether someone is insuring their home or car, or buying a protection product to safeguard their dependants' financial security, it is essential that they match the features and benefits they require with those provided by the products they choose."

Earlier this year we also warned consumers not to focus solely on the interest rate charged on loans when borrowing, as there are other important factors too.