Financial Planners and advisers sometimes believe themselves to be part of an entirely honourable profession. The facts suggest otherwise but are a few bad apples ruining the whole bunch?

The lessons from the British Steel Pension Scheme debacle will reverberate for a long time but I wonder if the recent criticism of the regulators is just another knee-jerk response to a financial mess which could well be repeated.

Well, who can believe that we’re already two weeks into 2019, and if the new year is going to continue at this pace, we’ll be at Christmas again, we’ll be wondering where the year went and why didn’t we get done all the things that we hoped to achieve.

A recent meeting with a client really brought it home to me the impact that we, as Financial Planners, can have on our clients.

A recent experience with a prospective client really brought home to me how confusing adviser charges must be for Joe Public. With so many companies offering so many different services and with such varying charges, how are clients really able to compare charges and what they’re going to get for those charges?

2018 was a fairly quiet year for pensions legislative changes, no big surprises with regards to the annual or lifetime allowance but there was still plenty of things going in the pensions world. We saw significant consultations and changes in the defined benefit transfer arena, high profile court cases in the SIPP arena as well as the ongoing issues with the women’s state pension age. But what will 2019 hold for us?

Defined Benefit transfers

There doesn’t appear to be any slowdown in requirement for defined benefit transfers, although there have been several advisers pull out of the market. Continued high cash equivalent transfer value and the fear that they will drop any minute appears to still be fuelling demand. The FCA are keeping a very close eye on the advice being given, providing an update in December on the supervision work they have been undertaking.

2019 will hopefully see further investigations made by the FCA produce better outcomes than the most recently published results.

Pensions Dashboard

After a rather slow start, the end of 2018 saw the publication of a consultation paper and feasibility study into a central non-commercial dashboard. The proposals in the consultation lead on from various discussions including the work and pensions select committee. It is proposed that the single financial guidance body will oversee the work and delivery of the dashboard and host it. The proposals are very detailed and will require a lot of input and work from both Government and external third parties.

Even with the £5m promised in the Autumn budget to help facilitate the production of the Dashboard it is still going to be very challenging to get all pension information in one place. We wait with baited breath to see if it can be achieved within the proposed timescales. I can see there being issues with getting the correct data onto the site in a useful format. That said if it can be done it will should make a significant difference to all those with small pension pots dotted around different providers.

Auto Enrolment increases

April 2019 is going to see the second increase in minimum contribution rates for auto enrolment pension schemes. Employer minimum contributions will be increasing from 2% to 3% but more importantly employee minimum rates will be increasing from 3% to 5%. What the impact will be on opt out rates is still up for debate, but it seems to me that it is unlikely that we will suddenly see a large exit from these schemes. At the same time as this will be happening we will be seeing an increase in the personal allowance which should mitigate the impact that many low earners will see. It is only likely to scare people into opting out if they see a significant drop in their take hope pay and even then, inertia often stops the majority doing anything about it.

More to come

I fear that the issues with pension tax relief will rear its head again in the near future, it is just something that can’t be left alone however many times it is reviewed and deemed too complex to change. With everything else going on in 2019 I hope that this isn’t added to the list of issues we must deal with.

Claire Trott, head of pensions strategy, Technical Connection Ltd

As 2018 comes to a close and we look back over 2018 and the progress that has been made in the Financial Planning industry, now is a good time to think about what change we want to see in 2019.

As you might have guessed from previous blogs I think we have some excellent people in our profession. These people are passionate about getting the best outcomes for their clients, but also find time to encourage others along. There are no monopolies on good ideas and more than enough potential clients to go around. Passionate people attract each other and form collaborations.

For 2019 I’ve started incorporating a little of the Paraplanner Powwow essence in our team meetings. At the Powwows, people who work on their own or in a small team can learn from others. It’s a sharing environment that not only wants to share good practice, but also get things fixed! A key characteristic is that when we meet up it is a ‘safe space’ where all contribute – not just the wizened owls.

I was bothered more than most by the banking crisis of 2007-8 and the following great recession. I’d started work in the industry in the Great Recession of 73/74, and was part of the early Financial Planning and fee-only communities in America, reacting to the institutionalisation and product sales orientation of the bulk of the profession.