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Why we’ve chosen to guide not advise transactional pension clients

Joss Harwood, director, Eldon Financial Planning, tells ABR why the firm is choosing to ‘guide not advise’ transactional clients in the wake of the new pension rules and how the firm is part of the IFP push to protect consumers from scammers


ABR: How will the financial advice market cope with the increase in people looking for information on pensions but not necessarily financial planning?

JH: There has been a great deal of interest in the new rule changes and as such, a growing number of people in need of advice.

The goal posts change greatly within financial advice and it is difficult for consumers to keep up with incoming rules and understand how they will impact them. We have already seen and will continue to see a rise in the number of people looking for information but who do not necessarily understand the financial planning process. Financial planning is not everyone’s cup of tea but we are very generous with our time and will always seek to guide those consumers who do not wish to go down this route. As an accredited firm, we have pledged to steer consumers in the right direction such as Citizen’s Advice where they can receive free advice. We hope our ‘guide not advise’ approach will help individuals avoid falling into traps.

Also, we are part of the Institute of Financial Planning’s accredited firms register and are in support of its push to protect consumers against scam artists who will undoubtedly seek to take advantage of confused consumers.

ABR: Would you accept requests for transactional business?

JH: We have received enquiries from individuals but the difficulty we face as financial planners is that we look at the whole picture and the pension is just one part of the jigsaw. We would be reluctant to handle one part of someone’s wealth, without taking into account everything else going on as it might give us a distorted view. Agreeing to carry out transactional work would pose too much of a risk going forward. Therefore, we would expect any prospective clients to adopt the whole financial planning process so we can ensure the best possible outcome and make sure we’ve advised them as best we can.

ABR: How are you preparing your business for the pension rules changes?

JH: Financial advice is a market that constantly evolves and changes and there is always lots of talk about new proposals. We keep our ear to the ground and get all the information we possibly can. As financial planners we have to be very careful we keep completely up to date and fully understand any changes so we know exactly what to recommend to our clients.

In addition, we have used our formal review system to address the changes with our existing clients and go through any questions they might have. We have been careful to identify and contact those clients who are approaching retirement now and will be most affected by the changes. For those clients, we have brought forward their review so they can take advantage of the opportunities available.

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