Small IFAs who treat the introduction of stakeholder pensions as an opportunity have a good future, ...
Small IFAs who treat the introduction of stakeholder pensions as an opportunity have a good future, according to Paul Beard, managing director of the Alexander Beard Group.
Beard, whose IFA company has clients from the music, entertainment and sports industries, said employer ignorance about stakeholder offers an opportunity for proactive intermediaries to capture new markets.
Beard cited the example of a client who called him after three years to say he was now working with a company that did not offer a pension scheme.
The client wanted to reinstate his personal pension and Beard later found out there were 27 other employees in the same department who had not been spoken to by the company about pensions.
Beard said: "That kind of scenario offers an ideal opportunity to get an introduction to the company from the employee and offer to talk to their staff about the ramifications of stakeholder.
"If you have a group of 25 employees and you give a good stakeholder presentation and the employer appoints you as its stakeholder administrator, you have a core group to which you can help with financial planning."
Beard said employers were likely to leave any stakeholder considerations to the 11th hour and if the company had an existing IFA, they would be exposed for not alerting the employer to their obligations under stakeholder.
Beard also insisted that the potential for IFAs to secure contracts with large employers was also excellent.
He said that, contrary to the belief that the large life offices would secure contracts with large employers by going direct to them, intermediaries had the advantage of their independence.
He said: "If you approach a large company with the same level of knowledge as the life offices and stress you are independent, it is unlikely the company will turn you away."
Beard also addressed the impact of e-commerce on the IFA industry, insisting it was the future of the industry and not a threat to advisory services.
Beard said people were using the internet as a research tool rather than an execution service when it comes to financial products. He added: "If you look at research from the US, which is years ahead of us, it shows that the numbers seeking advice are actually rising.
"More people are using the internet to research products but this means you will have a more informed client sitting in front of you because they still want the reassurance that they are making the right choice."
Beard added that intermediaries who were still wary about using e-mails to exchange information would have to be circumspect about the kind of detail they send and receive.
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