In response to the survey that showed people would only spend £253 on advice for their pensions, this is really no surprise or anything new.
Most advisers, or at least the decent ones, really do not pay much attention to these findings – as they have clients who are happy to pay for advice and have done so long-term and have paid considerably more than the paltry £253 quoted.
You really need to put this in context. There are more than 12m people over pension age – that is a bit over 20 per cent of the population. Your figures indicate that one in five –20 per cent – are willing to pay for advice.
Let us assume that just half of these are willing to pay proper fees, thereby discounting those who would only wish to pay a pittance. Therefore you arrive at 10 per cent of 12m. That is 1.2m people.
According to Apfa there are about 24,000 advisers in the UK. So there are around 50 clients each who are willing to pay proper fees for each adviser. If the government is concerned, it should have formulated the rules in such a way as to put financial advice on the same footing as pertains to lawyers or accountants.
Please do not forget that first and foremost these ‘freedoms’ were designed to swell the Treasury coffers. A clever political ploy makes it seem as if it is for the benefit of the participants. When these people have then to rely exclusively on the state pension, what strain will there be on the exchequer then? Will there be another review by the regulator? Most advisers are unwilling at any price to sign off those who wish to ‘trash the cash’ – the regulatory risk is incalculable – so those only wishing to pay peanuts will not even get the monkeys.
Harry Katz
Consultant,
HA7 Consulting,
Stanmore, Middlesex
