31st May 2011
IFA Post of the week
Yesterday’s news, tomorrow’s U turn?
Posted by: John Bull
Date: May 28, 2011 03:06PM
Yes I agree, it's going to be an unmitigated disaster. The most worrying observation I've made on the subject, is that not a single one of my clients is even remotely aware of the cost of charging them directly is going to amount too.
If I sell I a £70 monthly life policy the commission comes to something like £1400. On a £200 monthly pension contribution, £960. But I don't sell everyday -to my loss.
After 10 years in the industry, never once has a client contacted me and requested a pension. How the FSA believes the prospect of paying for arranging one, is going to encourage the publics uptake of such products, simply boggles the mind?
My expectation is it will become like many professions -polarised. Where your advice is sought in one of two circumstances:
a. Like cosmetic surgery, wealthy fee-paying, serviced by a small group of specialists.
b. Like A&E, poor desperate souls, serviced by a larger group fighting over the scraps just trying to treat them and street them. A thankless task!
Eventually, most IFA's in the 'b. sector' will realise their clients are earning more than they are! - and with the recession and everything else the shadow of constant rule making by regulation has created - they'll simply give up and move on. The struggle will just become too much.
But if your smart like me, you won't stick about long enough to smell the coffee and get out well before the avalanche with a nice cosy bank job, like me. If the public doesn't have a pension when they retire, that'll be 'Their Problem'. They should phoned when they had the chance : )
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