The solution to the pension advice 'fear factor'

Take for instance a quick Google news search on ‘Pension Wise’ and you will bring up the following headlines:

- Only one in five will use Pension Wise.
- Pension Wise ignores housing wealth.
- Government spends £37,000 on Pensions Wise branding.
- Man almost lost £88k pension pot to phone scam.

Now, while I fully agree that pension scammers’ tactics, and the damage they can cause, should be highlighted we could be moving down a road where every retiree immediately assumes that pensions advice is a potentially dangerous conversation to have. Undoubtedly, caution needs to be exercised on the part of the individual but if they are using the right Pensions Wise website and speaking to the appropriate people then there is no reason to fear a conversation about their pension and their later life options.

Clearly, this will not stop the cold-calling or the attempts at fraudulent activity – and there needs to be real resources put behind closing down fake sites and stopping the scammers – but let’s not deliver a fear factor to those who could actually benefit from such an initial conversation. Because while there is a chance that individuals could be talked out of their pension pots, if the right processes are in place and, rather importantly, the providers are on their toes when it comes to such potential activity then we should be able to head this fraud off at the pass.

Somewhat counter-intuitively it may well be a good thing that there appears to be a lot of negativity around Pension Wise and pensions advice, because it might actually make retirees take the threat seriously and therefore make sure they go through the correct channels to secure their Guidance and (hopefully) move on to full advice.

This is where advisers need to ensure they position themselves effectively whilst at the same time reassuring potential clients they are bona fide advisers, with the necessary permissions and qualifications to be able to carry out such activities. To do this, we as an industry – and individual firms – need to be pointing retirees in the right direction when it comes to highlighting our credibility. Therefore, make sure the client can see your FCA authorisation on the register, make sure they are aware of the qualifications you hold, provide them with historical details of the clients you have helped and the recommendations that have come from those clients.

This is all about providing people with the confidence to place their trust in you and to move through the customer journey with you. In that sense, we shouldn’t be afraid to place clients back with Pension Wise if they have not yet had their initial meeting/conversation – by doing this you actually show there is access to ‘free information’ available to them and following this you will be available to take them on the next stage of their journey should they wish to do so. It will soon become clear to them following Guidance that they have options but they might not have an idea about which one is best for them and how they go about accessing and executing them.

As you can see this is very far away from the hard-sell that potential scammers would be using, instead it’s a softly-softly approach which is a hand-holding exercise. Indeed, we are suggesting with our ‘Guidance +’ option, which is part of the Academy’s offering, that advisers don’t charge for any initial post-Guidance meeting. This will cement their position and again will help development trust, plus by the end of that first session, it will offer the client some specific recommendations that can then be followed up, and charged for.

In a sense, later life advisers have to use the negativity that surrounds some aspects of Pension Wise and overall pension advice to their advantage. They can do this by positioning themselves as the credible, regulated, authorised, client-supporting alternative; a business which is there to help and support not defraud. It’s really time to get on the front foot with this approach and to ensure that we do not lose more potential clients to fear, especially when they are part of a generation that perhaps needs advice like never before.