Publication of the Pensions Bill this week is designed to be another step by the government towards giving consumers what they want in terms of financial protection at retirement.
Looking at the current retirement system and where legislation may be heading has, however, raised concerns about the IFA's continuing role in the management of pensions. At the same time as financial advisers are being ostracised from a key aspect of the sales process, it has also been noted THE IFA VOICE IS MISSING from the pensions debate.
This is a little surprising, given the financial intermediary is best placed to assess what both the consumers and product provider would like to see in terms of suitable and sensible pension provision.
It also does not quite tally with the idea most advisers are interested in helping their clients, when few intermediary firms now speak out on consumer needs relating to personal finance.
This is particularly surprising given the IFA has to spend most of his time dealing with consumers who do not understand why they need to take up pension provision aside from State benefit, and where they might find the ‘spare’ money to cover premiums.
At a time as the government is looking to “simplify” pensions, the IFA does exactly that every time they advise a client of the reasons for taking out provision as well as pointing out why one option is better than another. IFAs know what it is the consumer really wants, and how they want to receive that retirement benefit. Yet few intermediaries have honed their skills as pension experts and all the lobbying is bring left to consumer groups and provider-backed trade bodies.
Financial intermediaries additionally understand the best and worst aspects of pension products, their tax treatment and where providers could make money for themselves. But again IFAs rarely speak out when they are in the perfect position to help the government design products suitable for both providers and consumers.
It seems such a crying shame IFAs do not speak out and use the specialist knowledge they have about pensions. Even at this late stage, the independent intermediary could offer useful contributions.
After all, what do IFAs have to lose? The financial adviser’s reputation has been knocked from pillar to post over the last four years, so speaking out in the interests of clients only help rather than harms the IFA’s position.
There are MPs out there who are interested in listening, if only the IFA sector would speak up, so use your vote now before financial advisers are ostracised further.
If you have any comments you would like to add to this or any other issue, either email the editor of IFAonline, Julie Henderson – [email protected] - or log on and add your comments to the IFAonline discussion board.IFAonline
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