Pensions 

Call for better advice on 'plethora' of confusing products

 

Advisers must step up to ensure products are fully explained to clients and avoid incidental mis-selling, a consumer champion has warned.

Wanda Goldwag joined the regulator's Financial Services Consumer Panel as its chairwoman in March of this year, following the departure of Sue Lewis after five and a half years in the role.

The panel, created to advise the Financial Conduct Authority on the interests and concerns of consumers in its policy development, campaigns for change across the industry including advocating clearer pension fund costs.

Speaking with FTAdviser Ms Goldwag said the "plethora" of confusing products in the financial services industry has posed one of the biggest threats to consumers in recent years, with the market witnessing a "great deal" of mis-selling.

She said: "There’s also been products that are far too complex, and not well explained, including not well explained by advisers.

"If you take pensions for example, I’m very happy that we’ve got much more in the way of pension freedoms.

"But one of the things we now need to make sure is that people who have pensions freedom have very good advice about what to do with that money."

Ms Goldwag added: "What we need is to make sure when products change, or we change systems, that we take into account what sort of customers are now taking those products and what sort of advice they really need."

The consumer chairwoman said she was "quite concerned" about the number of previous occasions that have seen a company’s needs put before those of the consumer when developing products.

Ms Goldwag also expressed concern that consumers lack a "real sense" of how long they might live and what financial support is needed as a result.  

Her concerns echoed those of former chairwoman Sue Lewis, who earlier this year warned there was "so much more" to be done by the industry to help consumers with defined benefit pensions make good decisions.

Ms Goldwag is also chairwoman of the Office of Legal Complaints, adviser to Smedvig Venture Capital and a lay member of the Queen's Council appointments panel.

 

rachel.addison@ft.com