I would welcome Martin Wheatley’s thoughts on just exactly how he feels the RDR has been of benefit to the industry and consumers for the cost borne?
He cited transparency and professionalism at the Treasury select committee meeting. I am sorry to say that under the old model, clients had full cost disclosure in every illustration. This was evenly split into commission, that is, advice costs, and product costs, that is, plan charges.
You really could not get any more transparent than that. In terms of qualifications, I have yet to put the knowledge to good use in real life as I have not yet come across a client earning £600,000, divorced with a business which has been sold for which he got £1.3m.
As for the efficient frontier hypothesis - I just use this every day of life with clients when dealing with their Isa and other £50,000 investment plus some life cover or PHI.
As the qualifications were so important and were brought in, we can now all put letters after our names (if that floats your boat) but clients are no better off. On the whole, they are worse off as our costs have to be recouped and we need to make a profit.
The FCA has got to the stage where it has crippled the industry and the results are so catastrophic for end users it beggars belief, but they need to be there to fine us when we forget to cross a ‘t’ or dot an ‘i’.
Martyn Young
Financial adviser
Martyn Young
Belfast
