Karen Barrett comments on today’s announcement from the Treasury on guaranteed guidance:
“The debate around what the government will be providing to consumers from April next year with regards to guidance is shining a light on the UK’s financial services dictionary, and more precisely, the meanings of the words guidance and advice. Today the Chancellor has confirmed that from April next year those approaching retirement will have the right to free and impartial guidance, provided by independent organisations that are not product providers. While this move acknowledges the importance of the at-retirement decisions consumers will be faced with, it is critical for everyone to be clear on the difference between guidance and advice.
“Guidance is a welcome starting point and a step in the right direction but it doesn’t cover a recommended action based on consumers’ individual circumstances. This can only be achieved through advice. The FCA is now consulting on the different standards that guidance providers need to meet, and sign posting for further information, including advice, is one of the aspects being looked at. As always, we are calling on the FCA to ensure the consumer guidance journey has a strong sign post to advice. The path to seeking a regulated professional adviser needs to be made straightforward and easy to understand and, as part of this, the scope and limitations of guidance, and the value of advice, must be made very clear to consumers.
“The need for advice at-retirement is very apparent. Our latest research found only 38% of people said they were ‘confident’ about their retirement plans and one in four (25%) said they were ‘anxious’. It has been proven time and time again that whole of market advice, tailored to individual circumstances, is the best way to get the right outcome. Our ‘Value of Advice’ research shows the average pension pot for consumers who have been advised on their retirement planning is nearly double that of those who haven’t sought advice.
“We have been putting consumers in touch with regulated professional advisers for more than twenty years and welcome the opportunity to work with The Pensions Advisory Service and the Money Advice Service to help provide access to whole of market regulated advice.
“Anyone looking for help with their retirement choices or other financial decisions can search for an independent or whole of market, regulated adviser at unbiased.co.uk. We list over 25,000 professional advisers on our site and hold details of 8,000 advisory businesses specialising in retirement. In addition, over 3,000 of these advisers specifically state they advise clients with pension pots of £50,000 or less. Using our ‘Find an adviser’ checklist is a great first step in identifying the ‘right’ financial adviser who can help with, what is potentially, some of the most important decisions a person can make.
“For a free and confidential search for a whole of market financial adviser, visit www.unbiased.co.uk.”
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