The FCA is clearly inching its way towards breaking down the boundary between advice and guidance with the aim of giving more ’targeted support’, as it calls it, to millions of pension savers.

Its announcements this week have been widely covered and point towards a new approach to pensions guidance.

This could bring benefits but also, as some commentators have pointed out, risks too.

You can read about the plans on Financial Planning Today but in essence the regulator wants to give firms the ability to provide more ‘guidance’ support to pension savers, mostly to stop them making mistakes with their money.

We know that since the Pension Freedoms were introduced in 2015 that many thousands have withdrawn their pension in cash and shifted it into a bank account. Some have also invested in all sorts of unsuitable investments or been horribly ripped off by pension scammers.

This does not mean the Pension Freedoms were necessarily wrong but they have been a green light to all sorts of changes, not all of them good.

Giving ‘targeted support’ to millions, as the FCA puts it, will restore some balance and might just help a few people avoid blunders like leaving all their money in cash or just leaving it in poorly performing funds.

The principles behind the changes are sensible and if they help some people manage their pensions better and avoid running out of money in retirement will be a step forward.

Having looked through the proposals in detail, I do not think that holistic, highly qualified Financial Planners have anything to worry about. If anything the proposed changes, not yet confirmed, might bring more enquiries from potential clients who have received some guidance and now appreciate the value of more comprehensive advice.

One concern which has been raised is whether the introduction of more guidance or 'nudging' will mean some sales-hungry firms turning the guidance into sales pitches. That will be a risk and the FCA will need to ensure that its laudable aims are not subverted. This will be a tricky balancing act to manage.

Some pension savers will no doubt be encouraged, or perhaps ‘inspired’ is a better word, to make changes to their pensions. This should give them a better deal but will some turn round and say their provider prompted them to make a change which was ultimately to their detriment?

Perhaps, but the prize of millions more people getting some support - rather than none at all - is worth taking some risks.

• The latest issue of our Financial Planning Today magazine can be viewed here: https://bit.ly/2ZdVXWz. 

Kevin O’Donnell is editor of Financial Planning Today and a journalist with 40 years of experience in finance, business and mainstream news. This topical comment on the Financial Planning news appears most weeks, usually on Fridays but occasionally other days.  Email: This email address is being protected from spambots. You need JavaScript enabled to view it. Follow @FPT_Kevin >Top Tip: Follow Financial Planning Today on Twitter / X @_FPToday for breaking news and key updates